A request by Lebanon’s Central Bank Governor for extra powers to standardize banking controls has sparked fears among depositors concerning the measures Riad Salameh plans to impose.
Last week, Salameh sent a letter to caretaker Finance Minister Ali Hassan Khalil asking for the extra powers.
The letter sparked rumors on the possibility of imposing new measures on depositors, although the Governor denies such plans.
Lebanese economist and former finance minister Georges Corm told Asharq Al-Awsat on Thursday that no extra powers would be granted to the Central Bank.
“The problem is that depositors no longer trust the Central Bank or the monetary system that has been in place for the past 30 years,” he said.
Corm explained that 80 percent of bank reserves were deposited at the Central Bank. “This is unhealthy,” he said.
Since October, banks have been imposing strict measures on capitals and withdrawals.
They have blocked nearly all transfers abroad and curbed dollar withdrawals - including limits of $200 a week.
Economic Expert Mohamad Zbib warned from any attempt by Salameh to legalize the tight measures already imposed on bank accounts.
Such measures are illegal because they did not come in the form of a circular, which is usually written and requires an amendment of the Code of Currency and Credit.
“Those measures are already unfair to employees and medium and small depositors, and therefore, we should get rid of them instead of legalizing them,” Zbib told Asharq Al-Awsat.
For his part, lawyer Jad Tohmeh said that Khalil was not authorized to grant Salameh extra powers.
“Requesting those powers requires legal measures taken by the Parliament,” he added.
