Lebanese banks in tatters after protests

January 16, 2020


BEIRUT: A branch of Societe Generale bank that was vandalised.—AFP
BEIRUT: A branch of Societe Generale bank that was vandalised.—AFP

BEIRUT: Public anger against cash-strapped banks boiled over in crisis-hit Lebanon where demonstrators armed with metal rods, fire extinguishers and rocks attacked branches in protest at controls that have trapped the savings of ordinary depositors.

The Red Cross said on Wednesday that at least 37 people were injured in an overnight showdown during which protesters smashed windows of banks and scuffled with security forces in the capital’s Hamra commercial district.

Police said 59 people were detained, making it one of the largest wave of arrests since Lebanon’s anti-government protest movement began on Oct 17 demanding a complete government overhaul.

As the movement nears the start of its fourth month, banks have become a prime target of demonstrators who charge them with driving the country towards its worst economic crisis since the 1975-1990 civil war.

On Wednesday morning in Hamra, a banking hub, almost every bra­n­ch was left with smashed display windows, dest­ro­yed ATMs and graffiti-daubed walls, after what the Association of Banks condemned as a “savage” onslaught.

Banks have since September arbitrarily capped the amount of dollars customers can withdraw or transfer abroad, in a country where the greenback and the Lebanese pound are used interchangeably.

Although no formal policy is in place, most lenders have limited withdrawals to around $1,000 a month, while others have imposed tighter curbs.

The local currency has lost over a third of its value against the dollar on the parallel market, plunging to almost 2,500 against the US dollar over the past week. The official rate was pegged at 1,507 Lebanese pounds to the greenback in 1997.

Demonstrators accuse banks of holding their deposits hostage while allowing politicians, senior civil servants and bank owners to transfer funds abroad.

Banks have as a result transformed into arenas of conflict, where shouting and tears abound, as depositors haggle tellers to release their money.

Compounding the situation, debt-burdened Lebanon has been without a government since Saad Hariri resigned as prime minister on Oct 29 under pressure from the anti-government protests.

Published in Dawn, January 16th, 2020