Lebanon banks to close as violent raids by depositors multiply

There were at least five bank hold-ups on Friday alone as customers struggled to withdraw money amid the financial crisis

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Banks in Lebanon have said they will close for three days next week, after depositors stormed several branches on Friday, holding employees hostage and forcibly demanding to withdraw their savings.

It started with a man armed with a toy gun holding up a bank in south Lebanon and refusing to release hostages until he was given access to his trapped savings.

A few hours later another man ― aided by a group of associates ― stormed a bank in a working class Beirut neighbourhood. Then news of a third bank hold-up broke out. And a fourth.

Armed woman breaks into bank in Lebanon

Armed woman breaks into bank in Lebanon

At least five such raids were carried out by depositors across Lebanon, the latest in a series of hold-ups conducted by people who have taken the law into their own hands in a desperate bid to recoup their trapped savings from the country's commercial banks.

Financial institutions across the country have imposed withdrawal limits, amid a financial crisis.

Friday's raids came only a day after a lobby group called on depositors to take matters into their own hands to retrieve their frozen savings.

The 'Depositor's Outcry' ― a hardline depositors advocacy group ― assisted in at least one raid earlier this week. Members of the group held up a Blom Bank branch in Beirut alongside a woman, Sally Hafez, as she demanded access to savings to pay for her sister’s cancer treatment. She successfully withdrew $13,000 by force.

The Association of Banks in Lebanon (ABL) announced a three-day strike set to begin next week in protest against the depositors' actions.

The industry body, which represents the vast majority of the country's banks, denounced the incidents and called on the government to pass laws to address the economic crisis as quickly as possible.

A representative of the ABL told The National that, together with the banks, it was holding talks with the Interior Ministry, aimed at persuading the government to take steps towards protecting bank employees from potential violence.

"Other than that each bank is taking its own decision regarding how it will protect itself," said ABL representative Jessy Trad.

As the bank heists continued to gain traction throughout the day, caretaker Interior Minister Bassam Mawlawi called for an emergency meeting with security forces to discuss measures that could be taken, the state's National News Agency reported.

On Friday morning, the man with the toy gun was arrested after storming a branch of Byblos Bank in the southern city of Ghazieh to demand his savings, making out with $20,000.

In a video circulated on social media, Muhammad Reda Korkmaz proudly leaned out of a car window as he was driven into police custody.

"I got it!" he proclaimed to onlookers.

In the Tariq Al Jdideh neighbourhood of Beirut, Abed Soubra and his associates entered a Blom Bank branch and demanded at least $120,000 of his savings.

A third man armed with a pellet gun also stormed a branch of LGB Bank in Beirut's posh Ramlet Al Baida area of Beirut requesting to withdraw his $50,000 in savings.

A fourth reportedly tried to forcibly withdraw his savings from Fransabank in Baaqrif.

Outside the Blom Bank in Tariq Al Jdideh, people gathered in support of Abed Soubra as he demanded his savings of $125,000.

Supporters of Mr Soubra clambered on top of an ATM, passing him coffee and snacks through the bank's second-storey window.

From his perch on the ATM a proudly self-professed accomplice, Fadi Zajour, turned to the crowd gathered outside.

“He says they offered to give him $40,000 at the rate of 12,000," he shouted down.

The crowd laughed in derision.

The Lebanese currency’s value has plummeted in value by more than 95 per cent since 2019. The bank's offer would have been less than half of what Mr Soubra's savings are worth.

"Abed don't you dare leave the bank until you get all your money," an onlooker called out.

In 2019, commercial banks informally imposed their own capital controls following the collapse of the nation’s financial system and the onset of a severe economic crisis that has left two-thirds of Lebanon's population destitute. People overnight found themselves locked out of their bank accounts and unable to access the majority of their own savings.

The national currency’s plunge was accompanied by soaring inflation, making life expensive and difficult for many. Capital is scarce for the cash-strapped state, but as political leaders continue to quibble over enacting the necessary reforms required for an international bailout, the central bank’s remaining dollar reserves continue to dwindle.

Legal attempts by depositors to withdraw their savings from their accounts have so far been thwarted. Banks have closed branches in protest against judicial orders to release money into the hands of customers, while the judiciary itself is often incapacitated and barely operational.

Fouad Debs, a lawyer and the co-head of the Lebanese Depositors Union, told The National the hold-ups were a natural reaction to "the political and financial elite that have abducted the judiciary and security forces to work for their own protection, rather than the people's."

The Depositors Union is another group that advocates for the release of deposits and frequently provides legal aid for depositors who resort to desperate measures.

"People are desperate after three years, and we're seeing the manifestation of that," Mr Debs said.

Sabri Sallem, who had gathered to watch the events in Tariq Jdideh unfold, told The National Mr Soubra was a well-known merchant in the district who had fallen on hard times after Lebanon's financial crash three years ago.

"He's in debt. He is not a terrorist," he said. "People want their money back."

An elderly man next to him, Issam Mahdi, said he was worried about his niece ― a bank manager and one of the staff taken hostage.

“She's just an employee. She can't do anything," he told The National. "But at the same time I understand and I empathise with them. My own money is trapped in the bank."

"I wish I could do something like this but because of my reputation — I'm a retired officer — I can't.”

The Depositor's Outcry group have vowed to orchestrate more bank hold-ups with anyone seeking to unlock their frozen savings from the the nation’s commercial banks.

"Sally Hafez was just the start of the revolution," said Ibrahim Abdullah, a member of the group, at a press conference on Thursday.

"It won't end until we get all our money."

Updated: September 16, 2022, 8:04 PM