At the start of its operations in April 1964, the main task of the Banque du Liban (BDL) was to assume the role of "the Bank of Syria and Lebanon", as an entity with the exclusive right to issue the national currency. Two years later, as the result of a banking boom, there were 96 commercial banks operating in Lebanon. But the banking business boom came to a halt in 1966, with a crisis-triggering failure of the leading commercial bank of the country, the Intra Bank. In response, the authorities enacted new laws and amended the Code of Money and Credit (CMC).
Three new entities were established in 1967:
1- The Banking Control Commission (BCC).
2- The Higher Banking Council (HBC).
3- The National Deposit Guarantee Institution (NDGI).
Between 1964 and 1967, banking supervision was performed by a BDL department, the "Department of Control". Following the heavy-impact failure of Intra Bank in 1966, an independent body with broader supervisory authority, the Banking Control Commission (BCC), was established in May 1967 by Law No. 28/67 to replace the BDL Control Department. The BCC is composed of four members and a chairman, who are appointed by the Council of Ministers for a five-year period. Proposed by the Association of Banks in Lebanon, one member of the Commission represents the private sector. A second member represents the National Deposit Guarantee Institution (NDGI) whose board of directors is controlled by private banks.
The BCC performs its supervisory functions as an independent body, with a separate budget. But, in order to be financed by the Central Bank, the Higher Banking Council (HBC) must ratify this budget. A member of the Banking Control Commission cannot be removed from office, except for physical incapacitation. The provisions of Law 28/67 and those of Articles 149 and 150 of the Code of Money and Credit define the duties of the Commission.
The BCC verifies and evaluates financial statements submitted by banks and financial institutions, and monitors the implementation by these institutions of the provisions of the Code of Money and Credit and of the Central Bank′s regulations. If necessary, the BCC can impose corrective and reform measures on individual banking institutions.