Bank disruptions are increasing in Lebanon as depositors demand their own money

Bank disruptions are increasing in Lebanon as depositors demand their own money

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By Taymour Al-Azhari and Laila Bassam

BEIRUT (Reuters) – Depositors suspended five Lebanese banks seeking their funds frozen in the banking system on Friday, in an escalating series of stumbles this week, out of frustration over an internal financial meltdown with no end in sight.

Seven banks have been suspended since Wednesday in Lebanon, as commercial banks have cut off most depositors of their savings since an economic crisis gripped three years ago, leaving many residents unable to pay for basics.

The bank told Reuters that a gunman named Abed Sobra entered the BLOM Bank in the new Tariq neighborhood of the capital on Friday morning, demanding his deposit.

He told Reuters he later handed his gun over to security forces but remained locked up in the bank after sunset, and negotiated with bank officials to withdraw his $300,000 cash savings.

Local media reported that Supra eventually left the bank without funds as part of a settlement negotiated by an influential sheikh. He was not arrested.

Throughout the day, he was cheered by a large crowd gathered outside, including Bassam Sheikh Hussein, who was arrested in August to get his own deposits from his bank, which had dropped charges against him.

“We will continue to see this happen as long as people have money inside. What do you want them to do? They have no other solution,” Hussain said.

Banks are ‘worthy of my shoes’

The Union of Depositors, an advocacy group set up to help customers access their money, described Friday’s disruption wave as a “depositors’ uprising” and a “natural and justified reaction” to banks’ restrictions.

Next week, the Lebanese Banks Association announced a three-day closure over security concerns and urged the government to pass laws to deal with the crisis.

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The authorities were slow to pass reforms that would give access to $3 billion from the International Monetary Fund, and on Friday failed to pass the 2022 budget.

Without the capital controls law, banks have imposed unilateral limits on what most depositors can redeem each week in US dollars or Lebanese pounds, which have lost more than 95% of their value since 2019.

The other four disruptions ended Friday in partial payments of a total of $60,000 in cash given to the attackers, most of whom were captured while one was in hiding.

Jawad Selim entered the LGB Bank branch in the Ramlet al-Baida area of ​​Beirut on Friday morning.

His brother told local media that by nightfall, he had agreed with the bank to leave with $15,000 and a $35,000 check he could use for a haircut.

Security forces detained him, but it was not immediately clear what charges he would bring.

In a separate context, the Lebanese, Mohamed Al-Moussawi, received $20,000 in cash from his account at the Lebanese-French Bank after threatening employees with a fake gun.

“This banking system is deceiving us and it deserves my shoes,” he told Reuters he would hide. The BLF confirmed the accident.

In the fifth incident on Friday afternoon, an ex-army element took $25,000 in cash from his account at a Mediterranean Bank branch outside Beirut after shooting inside the branch and threatening to commit suicide if he didn’t get the full amount, an industry. A source told Reuters.

The source said that the man handed the money to his mother and the security forces arrested him after that.

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