Lebanon has enlisted three international financial advisory firms to address its  banking crisis, aiming to bridge an $80 billion gap while safeguarding depositors and stabilizing the financial sector, Nidaa Al-Watan newspaper reported.

The advisory effort involves Ankura Consulting Group, representing the Association of Banks; Rothschild & Co, advising the Central Bank; and Lazard, acting on behalf of the Lebanese State. The three firms are expected to coordinate strategies for restructuring the banking sector, allocating losses, and implementing a framework for a Financial Regularization Law.

The move comes after years of economic turmoil that have left depositors, banks, and the State grappling with significant losses. While details remain limited, sources indicate that responsibilities will be distributed based on each party’s capacity to bear financial obligations, with the Central Bank taking the primary role, commercial banks secondary, and the state providing additional support.

Ankura Leads Bank Negotiations

Ankura, a U.S.-based consulting firm operating in over 115 countries, will negotiate on behalf of Lebanese banks starting next week. Its mandate includes assessing options for sector restructuring, designing a plan to restore confidence among depositors, markets, and creditors, and developing flexible, practical solutions rather than rigid financial measures.

The firm will also coordinate an international and domestic public relations campaign to clarify the banks’ position and reduce potential legal exposure. The advisory contract spans 18 to 20 months, with an estimated cost of $4 million, distributed among banks according to the size of their deposits and Central Bank holdings.

A source at the Ministry of Finance told Nidaa Al-Watan that Ankura will provide financial assessments and propose a framework for the Financial Regularization Law, detailing responsibilities for the Central Bank, banks, and the State. 

Alongside deposit recovery, discussions will include the recapitalization of commercial banks and the Central Bank. The State is responsible for recapitalizing the Central Bank, while banks are expected to recapitalize themselves to meet obligations. Depositors will generally be protected, except in cases of illegal funds or pre-crisis financial engineering that produced inflated gains. Some adjustments may be applied to reduce strain on banks and the treasury.

While Ankura’s engagement spans up to 20 months, sources say the process does not necessarily mean a prolonged delay in legislation. The advisory firms are expected to deliver practical recommendations to guide the drafting of the Financial Regularization Law.

Lebanon is also coordinating with the International Monetary Fund (IMF), although officials stress that no agreement will be signed until a clear plan is finalized and consensus is reached among all parties. The IMF is reportedly focused on ensuring government commitment to reforms and anti-corruption measures.