Disclosure by banks
available to clients
It is mandatory to show lending and deposit rates computations
The Central Bank’s Basic Circular No. 134, which requires banks to apply measures to ensure transparent and fair dealings with their customers, has been completely implemented, said executives from Bank of Beirut and Credit Libanais.
The Central Bank, which issued the circular in February this year, had set September 30 as deadline for banks and financial institutions to comply with the provisions of the circular.
Georges Awad, Head of Retail and Branches Division at Bank of Beirut, said they have fully applied all the central bank’s requirements including the creation of the Consumer Protection Unit and setting up complaint boxes in their branches.
The circular says: ”Banks and financial institutions operating in Lebanon shall establish a Unit in charge of implementing the policy relating to ‘The Principles of Banking and Financial Operations with Customers’. This Unit shall be affiliated to the General Manager.” It also requires banks to “allocate a specific space in their head office and all branches, and on their websites, to receive customers’ claims.”
Fadi Sader, Assistant General Manager at Credit Libanais, said the bank has implemented all measures and set the needed infrastructure. Credit Libanais has appointed a manager to run this new undertaking and it has established the unit required by the central bank’s circular 134, Sader said.
The Central Bank’s new regulations require, among other things, that banks give key information to their customers such as showing them the computational method used to calculate the actual cost of each product or service provided by the bank. The banks are also required to disclose the computational methods for lending or deposit interest rate of each product or service.
Awad said that that Bank of Beirut hasn’t encountered any hurdles in applying these regulations as it had already begun implementing transparency measures as early as 2013. The administrative work load could have increased by 15% to 20% but the bank has already applied 80% of these requirements, he said.
Sader said the procedures don’t require any significant paperwork. “We have been visited by central bank officials a year ago and they saw that we were already applying transparency measures, so implementing this circular was easy for us,” he said.
Reported by Shikrallah Nakhoul
Date Posted: Oct 16, 2015