Lebanese depositor holds up bank to access own savings
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The Lebanese economic crisis and the banks' actions are driving the people to barge into banks and demand their savings that have been locked up for years now.
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Byblos Bank, Ghaziyeh, Lebanon, September 16, 2022
A Lebanese man armed with a gun that turned out to be a toy raided on Friday a bank and held hostages in a bid to free his savings frozen by the banking system, marking the third incident of the sort this week.
The Lebanese Security Forces later arrested the man after he retrieved a portion of his funds from Byblos Bank's branch in the southern city of Ghazieh.
The escalation against the banking sector comes after Lebanese banks decided to lock most of the depositors' savings as the country undergoes one of the world's worst financial crises in recent history, rendering the overwhelming majority of the population unable to pay for basic goods.
The World Bank warned that Lebanon was enduring an economic depression that might rank among the top 10 worst economic crises in the world since the mid-nineteenth century, in the absence of any solution on the horizon that would get it out of a reluctance reality exacerbated by political paralysis.
The small Mediterranean country defaulted on its debt in 2020; the Lebanese currency has lost around 90% of its value on the black market, and the UN now considers four in five Lebanese to be living under the poverty line.
Capital control laws were never formalized by Beirut, but the country's judicial system has been too lenient on banks, not ruling on depositors' attempts to access savings via litigation against banks. This has led depositors to try accessing their savings in various ways.
Just two days ago, Lebanese woman Sali Hafiz was able to retrieve around $13,000 of her blocked deposits after briefly holding up a branch of BLOM bank in Beirut.
Hafiz stated that she needed her savings withdrawn in order to treat her cancer-stricken sister.
Read next: Health care crisis in Lebanon
On a similar event on the same day, Lebanese man Rami Charafeddine barged into MED bank in Aley and retrieved nearly 30,000$ of his deposit before turning himself into the security forces that escorted him to the local police station.
As public frustration with bank policies increases, more citizens are hailing such actions as heroic and rightful on social media, which was clearly seen in the case of Bassam Al-Sheikh Hussein, a Lebanese man that took a bank hostage in order to retrieve a small part of his savings to pay for his father's surgery.
To add to the mounting financial pressure on citizens, the Lebanese central bank (BDL) completely halted on Monday its fuel purchases subsidies, leading to a hike in gasoline prices, the head of the gas station owners' union, George Brax.
Beirut started in the late summer of 2021 enacting a subsidies phase out, suspending gasoline subsidies under the pretext that the central bank's funds no longer sufficed to keep fuel prices low.
Monday saw the price of 95-octane gasoline and 98-octane gasoline increasing by 20,000 Lebanese pounds to 638,000 and 653,000 Lebanese pounds per can (20 liters), respectively. The price of diesel, on the other hand, barely decreased, falling by 1,000 LBP and reaching 790,000 LBP per can.
Ahead of the Lebanese financial and economic crisis in 2019, a can of gasoline was around 25,000 Lebanese pounds.
The financial crisis spanning two years so far has paralyzed the country and plunged more than 70% of its population into poverty.
