Government debt restructuring must minimise damage to depositors: Lebanon banking association – ZAWYA

Government debt restructuring must minimise damage to depositors: Lebanon banking association – ZAWYA

BEIRUT- Lebanon's debt restructuring should minimise the damage to the country's nearly 3 million depositors and tap state assets to avoid damaging the country's banks, an alternate economic rescue plan issued by the banking association said on Wednesday.. Lebanon's cash-strapped banks have sharply criticised a government rescue plan that forms the basis for negotiations with the International Monetary Fund, in part because it calls for depositor contributions and a shareholder bail-in that would wipe out their capital.. In a 46-page plan of its own on Wednesday, the association called for avoiding a default on internal debt and for setting up a so-called government debt defeasance fund, where $40 billion in public assets would be placed to settle internal debts, part of ways to relieve pressure on the banks.. The comments could hold sway with the IMF, since banks are among the largest holders of Lebanon's debt..