The right of banks and depositors to bear responsibilities!

The Secretary-General of the Association of Banks in Lebanon, Fadi Khalaf, considered in the opening of the association’s monthly report entitled “The State’s Responsibility, Even After a Time,” that “in the context of the financial crisis that Lebanon is witnessing, the role of the state and its financial institutions in deepening this crisis is highlighted through a series of measures and actions that are inconsistent with… The basic principles of international law, including the United Nations Principles of the International Responsibility of Countries, for acts inconsistent with governance trends in financial management. These principles define the framework within which countries must work, to ensure financial and economic order and stability, and confirm that countries bear full responsibility for any failure to regulate and monitor the financial system effectively.”

Khalaf said: “Therefore, demanding that the state be held accountable is not only a right for those affected by this crisis, but it is also a duty related to ensuring justice and restoring confidence in the financial system. Those affected must demand that the state pay its dues, even after a while, and at the same time, insist on carrying out radical reforms that prevent the recurrence of such crises. The state’s demand is a right and a duty, so that the right is not lost and the duty is implemented.

Right: The right of banks and depositors to bear responsibilities.

• The responsibility of those who squandered the funds of banks and depositors on expenses and projects around which there were many question marks.
• Who supports merchants with other people’s money,
• Who pays money and distributes benefits from the sweat of others’ brows,
• Whoever smuggled across the border the savings of depositors,
• Whoever wiped out two generations, hiding behind future generations in the hope of future benefits,
• Whoever proves a currency will show its true price over time.

Duty: The duty to restructure the state in conjunction with the banks.

• Integrity is no longer tied to one person, but rather a rule that applies to everyone.
• In order not to forget the “Alvarez” report in the drawers to protect this and that,
• So that the public employee does not come out of prison and return to his position,
• In order not to distribute the wealth of depositors again to borrowers,
• In order not to force the investor to pump money only to have it lost again,
• So that an honest judge can rule justly, away from those with double standards.

Holding the state accountable so that everyone knows that the crisis is systemic, and that the state is primarily responsible for wasting deposits in numbers:

• The losses of the Bank of Lebanon until the year 2020 amounted to 51 billion dollars, and they are the responsibility of the state, according to Article 113 of the Monetary and Credit Law.
• The state debt owed to the Bank of Lebanon is $16.5 billion.
• The Bank of Lebanon has spent about 23 billion dollars on supporting smuggling, merchants, and the lira since the beginning of the crisis from mandatory investments in banks.
• The state is the one that refrained from issuing laws that prevent the enrichment of borrowers at the expense of depositors by $31 billion.

These numbers refute doubt with certainty that the state, along with its institutions, is responsible for dissipating more than $121 billion out of $124 billion that was deposited in banks on the eve of October 17, 2019.”

Khalaf added: “It is true that no one expects the state to be able to magically compensate for its atrocities, nor to sell its property and capabilities to pay its dues to banks and depositors, but the citizen hopes at least to shed light on solutions, which begin with the state acknowledging its responsibility for the systemic crisis it caused, in order to… We are looking for possible plans. The state’s blaming of the consequences of its crimes on the banks and depositors, in order to evade responsibility and adopt a scorched earth policy to obscure the facts, will destroy the entire banking sector, and thus eliminate any hope of recovering deposits.”