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Lebanon depositors smash up, burn Beirut banks

February 16, 2023 at 2:30 pm

Lebanese depositors stage a protest outside Central Bank in Beirut, Lebanon on January 25, 2023. [Hussam Shbaro – Anadolu Agency]

Several dozen Lebanese protesters attacked banks in a Beirut neighbourhood on Thursday, while blocking roads, protesting against informal restrictions on cash withdrawals in place for years and rapidly deteriorating economic conditions, Reuters reports.

At least six banks had been targeted as the Lebanese pound hit a new record low on Thursday, a spokesperson for “Depositors Outcry”, a lobby representing depositors with money stuck in the country’s banking sector, said.

A bank in the Badaro neighbourhood smouldered as fire fighters sprayed water, while riot police stood nearby with shields.

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Since 2019, Lebanese banks have imposed restrictions on withdrawals in US dollars and Lebanese pounds that were never formalised by law, leading depositors to seek access to their funds through lawsuits and, often, by force.

The Lebanese pound has lost more than 98 per cent of its value since the country’s financial sector imploded in 2019. It was changing hands at around 80,000 pounds per greenback on Thursday, dropping from 70,000 pounds just two days earlier.

The country’s Central Bank, which has struggled to manage the crisis, did not respond to a request for comment on why the pound had crashed and what it was doing to address the issue.

The office of Lebanon’s Prime Minister said work was ongoing to remedy financial conditions in the country.

Lebanon made a first step towards securing an International Monetary Fund bailout in April 2022 but, nearly a year later, has failed to carry out the reforms needed to finalise it.

READ: Cash is king in Lebanon as banks atrophy