A lawsuit raised by oil trader IMMS for the withdrawal of a $1 billion deposit held at Lebanon's BankMed has been settled without "any transfer of funds outside Lebanon" the two said in a joint statement on Wednesday.
The lawsuit was filed last November amid growing concerns by depositors in Lebanese banks hit by a financial crisis that drained them of hard currency and prompted them to impose strict controls limiting withdrawals and transfers.
IMMS, which trades European, Middle Eastern and Asian oil products, said in the lawsuit filed in the US state of New York that it had instructed BankMed to return a $1 billion deposit on Nov. 8 but the bank refused.
BankMed later said it was a blocked deposit with about two years left until maturity.
In the joint statement BankMed and IMMS said that on April 9 they had "reached a settlement amicably resolving their disputes and dismissing all legal proceedings between them".
"No deposit blocked with BankMed was broken or withdrawn and such deposit will remain blocked until its maturity, in accordance with its original terms," the statement said.
Lebanon said last month it could no longer pay its hefty foreign debt obligations while also preserving dollars for critical imports and would enter into negotiations with creditors.
A draft economic rescue plan that surfaced last week has drawn heavy criticism, in particular its proposal to take "a transitory exceptional contribution from large depositors" to help cover huge losses to the financial system.
