Dozens of Lawsuits Filed Against Banks in Lebanon

A demonstrator looks on as Lebanese policemen stand guard outside the Central Bank in Beirut last year (AFP)
A demonstrator looks on as Lebanese policemen stand guard outside the Central Bank in Beirut last year (AFP)
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Dozens of Lawsuits Filed Against Banks in Lebanon

A demonstrator looks on as Lebanese policemen stand guard outside the Central Bank in Beirut last year (AFP)
A demonstrator looks on as Lebanese policemen stand guard outside the Central Bank in Beirut last year (AFP)

Judicial sources in Lebanon revealed that dozens of lawsuits were filed by depositors against Lebanese banks on charges of withholding their money.

The sources noted that criminal courts in Lebanon, especially in the governorates of Beirut, Mount Lebanon, and the Bekaa, have seen a great influx of lawsuits. Those “have greatly confused the banking sector,” a banking source told Asharq Al-Awsat.

Depositors find that resorting to the Judiciary has become the shortest way to recover their money withheld in banks, especially since in some of these cases, the court ruling was in favor of the plaintiffs.

The first case of this kind was filed in November by Judge of Urgent Matters Ahmed Mezher against a bank in Nabatieh. The Judge ordered the release of 129 thousand euros, without delay and under penalty of a coercive fine of LBP 20 million for each day of delay.

A judicial source told Asharq Al-Awsat that Mezher issued another similar decision two weeks ago obliging another bank to “effectively and immediately” return the funds of one of the depositors amounting to 400 thousand euros under penalty of imposing a high coercive financial fine for each day of delay.

In remarks to Asharq Al-Awsat, a banking source said that the lawsuits “greatly confused the banking sector. It is no secret anymore.”

However, the source underestimated the impact of these lawsuits on the reliability and credibility of banks, and stressed that “most of the rulings that were issued against banks were appealed (challenged).”

The bank official accused some lawyers "of seducing depositors with their ability to withdraw their money according to decisions and judicial rulings within a quick time limit, which motivated them to file these cases, knowing that their money is safe despite exceptional and compelling measures banning withdrawal of all deposits as that would strike the banking sector and lead to a liquidity crisis.”



Egypt's Central Bank Leaves Key Interest Rates Unchanged

A general view of Dahab Island or Gold Island (Gezirit el-Dahab) in the middle of the Nile River in Cairo, Egypt, July 2, 2024. REUTERS/Amr Abdallah Dalsh
A general view of Dahab Island or Gold Island (Gezirit el-Dahab) in the middle of the Nile River in Cairo, Egypt, July 2, 2024. REUTERS/Amr Abdallah Dalsh
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Egypt's Central Bank Leaves Key Interest Rates Unchanged

A general view of Dahab Island or Gold Island (Gezirit el-Dahab) in the middle of the Nile River in Cairo, Egypt, July 2, 2024. REUTERS/Amr Abdallah Dalsh
A general view of Dahab Island or Gold Island (Gezirit el-Dahab) in the middle of the Nile River in Cairo, Egypt, July 2, 2024. REUTERS/Amr Abdallah Dalsh

Egypt's central bank left its overnight interest rates unchanged on Thursday, as expected, saying economic growth remained slow but that inflation has been decreasing.
The bank's Monetary Policy Committee (MPC) left the deposit rate at 27.25% and the lending rate at 28.25%.
All but one of 18 analysts in a Reuters poll had expected rates to remain unchanged, with the sole analyst forecasting a cut of 100 basis points (bps).
The decision keeps the overnight deposit rate below that of headline inflation, which was 27.5% in June. Real interest rates have been negative since January 2022. Inflation declined in June for a fourth straight month after soaring to a record 38% in September.
The MPC expects inflation to come down sharply in the first half of 2025.
"The gradual unwinding of food inflation along with the improvement of inflation expectations suggest that inflation is on a sustained downward trajectory," the MPC said.
Gross domestic product inched down to an annualized 2.2% in the first quarter from 2.3% in the final quarter of 2023, the MPC added.
"Leading indicators for Q2 2024 suggest that economic activity remains subdued. Consequently, real GDP growth is expected to slow down in FY 2023/24 compared to the previous fiscal year, before recovering in FY 2024/25," it said.
Egypt reported GDP of 3.8% in 2022/23.
The central bank raised interest rates by 600 bps on March 6 as part of an agreement with the IMF, bringing total increases since the beginning of the year to 800 bps. Egypt also sharply devalued its currency against the dollar under its IMF accord.