Copycat bank holdups snowball in Lebanon

·3-min read

Five more Lebanese banks have been raided by depositors seeking access to their own money, in a spiralling spate of holdups this week spurred by frustration over a financial implosion with no end in sight.

Seven banks have now been held up since Wednesday in Lebanon, where commercial banks have locked most depositors out of their savings since an economic crisis took hold three years ago, leaving much of the population unable to pay for basics.

On Friday morning, an armed man identified as Abed Soubra entered BLOM bank in the capital's Tariq Jdideh neighbourhood demanding his deposit, the bank told Reuters.

He later handed his gun to security forces but remained locked in the bank past sunset, negotiating with bank officials.

Soubra said he had a refused the bank's offer to take a portion of his $US300,000 ($A450,000) in savings with a significant haircut, in the deteriorating local Lebanese currency.

"I'll stay here three, four, five days," he told Reuters by phone.

"I deposited my money in (US) dollars, I want it back in dollars."

Soubra was cheered on by a large crowd of people gathered outside - including Bassam al-Sheikh Hussein, who in August carried out a hold-up to get his own deposits from his bank, which dropped charges against him.

"We're going to keep seeing this happen as long as people have money inside," Hussein said.

"What do you want them to do? They don't have another solution."

The Depositors' Union, an advocacy group established to help clients get access to their funds, described Friday's spree of hold-ups as "the depositors' uprising" and a "natural and justified reaction" to banks' restrictions.

Lebanon's banks association has announced a three-day closure next week over security concerns and urged the government to pass laws to deal with the crisis.

Authorities have been slow to pass reforms that would grant access to $US3 billion ($A4.5 billion) from the International Monetary Fund, and on Friday failed to pass a 2022 budget.

Without a capital controls law, banks have imposed unilateral limits on the amounts most depositors can retrieve each week in US dollars or the Lebanese lira, which has lost more than 95 per cent of its value since 2019.

The four other hold-ups on Friday concluded in partial payouts with a total of $US60,000 ($A90,000) cash given to the assailants, most of whom were arrested while one went into hiding.

Jawad Slim entered a branch of LGB Bank in Beirut's Ramlet al-Bayda area on Friday morning.

By nightfall, he agreed with the bank to leave with $US15,000 ($A22,400) in US dollars and a cheque for $US35,000 ($A52,300) which he could cash in at a haircut, his brother told local media.

Security forces took him into custody. It was not immediately clear what charges would be pressed.

Separately, Lebanese citizen Mohammad al-Moussawi got $US20,000 ($A30,000) in cash from his account at the Banque Libano-Francaise bank after threatening employees with a fake gun.

"This banking system is tricking us and it's worth my shoe," he said, telling Reuters he would be going into hiding. BLF confirmed the incident took place.

In the fifth incident on Friday afternoon, a former member of the military got $US25,000 ($A37,400) in cash from his account at a BankMed branch outside of Beirut after firing shots inside the branch and threatening to commit suicide if he did not get the full amount, an industry source told Reuters.