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Lebanon’s banks to reopen after wave of holdups

A closed Credit Libanais branch in Sidon, southern Lebanon, REUTERS/Aziz Taher
People walk past a closed Credit Libanais branch in Sidon, southern Lebanon, on September 19

Lebanon’s banks will reopen on Monday, the country’s banking association said, after five days of closures that followed a wave of holdups by savers seeking access to their frozen funds.

The association said in a statement on Sunday that the decision to reopen “was taken after consideration of the current difficult security conditions and the need to maintain the safety of customers and employees alike, in the absence of adequate protection by the state”.

It added that each bank would determine its own channels for banking operations.

On Friday a top Lebanese banker criticised politicians for failing to enact a capital control law, saying this was the way to avoid bank raids by savers demanding funds from frozen accounts and to stop banks’ “discretionary practices”.

The holdups reflect savers’ desperation three years after Lebanon’s financial system collapsed due to decades of state corruption and waste, and unsustainable financial policies.

The government has not agreed a financial recovery plan or enacted reforms deemed vital to get Lebanon out of the crisis. While the government says it is committed to reforms, the International Monetary Fund says progress remains very slow.