The Lebanese Central Bank’s balance sheet conveys some $863.34 million expansion in its foreign assets portfolio during the second half of September 2021 to $18.79 billion, up from $17.93 billion a fortnight earlier. The Central Bank attributed the increase in foreign assets to the transfer of the proceeds of Special Drawing Rights for Lebanon from the IMF. When factoring out BDL’s portfolio of Lebanese Eurobonds amounting to $5.03 billion as per the disclosure made by the Central Bank, the latter’s foreign currency reserves would settle at $13.76 billion by end of September. Contrastly, the value of gold reserves at BDL decreased by 3.91% ($649.07 million) in the second half of September to $15.96 billion as gold prices tumbled following the Federal Reserve’s announcement that it will be reducing its monthly bond purchases.

 On an annual basis, BDL’s foreign assets came in 27.52% ($7.14 billion) lower than the $25.93 billion reading reported as at end of September 2020. Moreover, the value of gold reserves dropped by 8.06% ($1.40 billion) when benchmarked to the $17.36 billion figure recorded in the same period last year. It is worth noting that BDL’s total reserves (foreign currency and gold) cover some 177 months of debt service and constitute around 30.28% and 34.29% of Lebanon’s gross and net public debt on a respective basis.

In a related note, BDL’s balance sheet expanded by $282.80 million during the second half of September to $159.35 billion on the back of the 4.82% ($0.86 billion) rise in the value of foreign assets to $18.79 billion coupled with the 0.18% increase in the value of securities portfolio to $40.87 billion which both outweighed the 3.91% contraction in the value of gold reserves to $15.96 billion, bearing in mind that loans to the local financial sector and other assets (representing capitalized open market operations and seigniorage) remained almost stable at $13.86 billion and $69.58 billion respectively.

The share of BDL’s foreign assets of the latter’s total assets increased to 11.79% by end of September 2021, compared to 11.27% in mid-September, while the share of gold reserves dropped to 10.02% from 10.44% two weeks earlier. The share of other assets, on the other hand, bucked its upward trend, dropping to 43.67% of BDL’s total balance sheet.