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Lebanon's Banks Threaten to Sue the State

Lebanon's Banks Threaten to Sue the State

Saturday, 26 March, 2022 - 10:45
A view of Lebanon's Central Bank building in Beirut, Lebanon April 23, 2020. REUTERS/Mohamed Azakir/File Photo

A senior Lebanese official in the financial sector warned that the country was in a severe monetary crisis as a result of explicit duplicity in the state to dealing with the governance of the central bank and the banking system.

The danger looms at a time when the talks with the International Monetary Fund are reaching a critical point.

A financing agreement could be concluded based on the government’s presentation of a recovery plan and the adoption of laws by the parliament, especially the Capital Control Law.

On the one hand, the Lebanese government insists on the Governor of the Banque du Liban Riad Salameh covering the financial needs in dollars to ensure the flow of oil imports and to meet the necessary expenses of Electricite du Liban.

The government invited Salameh to personally participate in next week’s cabinet meeting.

On the other hand, Salameh is summoned as part of an ongoing judicial confrontation. The governor is called for questioning next Thursday for the crime of “illegal enrichment and money laundering.”

For her part, Raya Hassan, chairman of the board of Bankmed, revealed that Lebanon’s banking sector is seriously considering suing the state for measures it is taking against local banks.

“The measures taken against the banking sector today are tantamount to eliminating the sector, and they are judicial capital control,” said Hassan in a televised interview.

“What is the fault of the banks if the money of depositors is spent by the state? Why is innocence presumed for all MPs and ministers who spent the money?” she questioned.

“To those attacking the banks, did they not notice the $50 billion that was wasted on electricity,” added Hassan.

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