Financial crisis takes a toll on depositors as account numbers decline

In the context of tracking the effects of the financial crisis on depositors, new data has emerged, indicating a significant decline in the total number of deposit accounts.

The figures show a decrease from 2.81 million accounts in December 2019 to 1.41 million in December 2022, representing a staggering 50 percent decline. The most substantial reduction occurred among small depositors, many of whom faced severe restrictions, with some experiencing withdrawal limits as high as 85 percent.

This article was originally published in and translated from Lebanese newspaper Nidaa al-Watan.   

In terms of value, the most significant decline was observed in accounts held by large depositors (one million dollars and above). At the end of 2019, these accounts amounted to approximately $61 billion, but by the end of last December, they had dropped to $34 billion, representing a staggering $27 billion decrease.

Within this substantial amount, it is possible to trace funds that were illicitly transferred abroad, including loan repayments, real estate purchases, and other assets acquired through bank checks or local withdrawals, sometimes using highly restrictive measures.

However, on Tuesday, the French judiciary issued a ruling imposing a freeze on the assets of Lebanon's central bank governor, Riad Salameh, as well as his funds and properties. This ruling carries significant weight in the final consolidation of the charges against the governor, his brother Raja, and others, including Marianne Howayek and Anna Kozakova.

According to legal sources closely following the case, the trial proceedings will commence next year.

Regarding the forensic audit, the Financial Public Prosecutor, Judge Ali Ibrahim, made a remarkable statement on Tuesday expressing his surprise at relying on a foreign company. He argued that the Court of Audit could have audited the Central Bank of Lebanon's accounts, sarcastically questioning, "why wasn't the matter presented internally, or is the nearby church incapable?"

This statement aligns with leaked information, potentially originating from Salameh, claiming that "there is nothing of importance in the forensic audit report, and it holds no legal value, rendering its publication useless."

This assertion was also reiterated by Finance Minister Youssef Khalil, who stated in a press release that "the report is a draft and not finalized." Khalil further noted that he awaits the final report to submit to the Cabinet, the authority responsible for its content. He mentioned to MPs who asked him for the report that he would not send it to them, as they requested, emphasizing the need to respect specific protocols.

This statement sparked the anger of several MPs considering filing a lawsuit against Khalil, accusing him of complicity and covering up information that could incriminate him, in addition to the condemnation of the central bank governor.