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Debt is the “oxygen” of the commercial banks … and it is one of the tools of the “war” it is waging against the “Lebanese state”. After bank owners and large depositors amassed their personal fortunes on interest paid by the “state” in exchange for what it borrowed, they began to use the debt to direct depositors’ ire at the public sector. Instead of banks admitting to depositors that they are not paying their fees because they mismanaged the trust, and today they are bankrupt institutions, their owners and management hide behind the excuse that the state caused the crisis in the banks .
Months ago, the “Association of Banks” issued a statement of “apology” from the depositors, lamenting that “many justified the feeling that they are claiming a right to a bank due to the inability of the state to pay their debts.” The banks also apologize because they lent to the State to support the implementation of structural reforms in the public sector to enhance the capacities of the private sector and raise the standard of living of citizens through employment and growth opportunities ”. The words repeated on all occasions and by all members of the network of interests associated with the “Banking Party”, no more than one lie. And its disclosure came through one of the current members of the association, specifically its general secretary, Makram Sader. In an online meeting with the “Lebanese Board of Executives” in association with the “Lebanese Diaspora Appeal”, issued two days before the August 4 explosion, he announced that the banks “had loaned the state $ 25,000. million (the sum of what the banks loaned in US dollars and Lebanese pounds) of the deposits they had. It amounts to $ 150 billion and is therefore a small fraction of their total potential. Regarding the remaining funds , was distributed between the Lebanese economy and deposits in the Central Bank.The question that should be asked of an issuer – in what it represents – is that if bank loans constitute a “small percentage”, how are the funds squandered until banks become unable to repay the money they owe? And why do banks ask the state to repay them with real estate valued at $ 40 billion? And why do banks deliberately confuse what they lent to the state c What did they deposit in the Banque du Liban, despite the total independence that the latter enjoys, legally, and which the “banking party” fiercely defends?
The second “recognition” that Sader made is that “increasing the amount of Lebanese pound that is injected into the market can create price inflation and therefore lead to a decrease in the purchasing power of citizens.” It is the “game” that Governor Riad Salameh plays when he entices depositors to withdraw their dollars from banks, in pounds, at an exchange rate of 3,900 pounds to one dollar, thus easing the burden on banks and imposing a discount. on deposits, as money loses its value after the dollar reaches. The black market is about 8,000 pounds. The matter got to the point where the Banque du Liban created “additional cash on the market in the first seven months of 2020 worth 11,001 billion pounds, at a monthly rate of 1571 billion pounds” (“Al- Akhbar ”, capital supplement: 10/08/2020).
When banks claim that they have contributed to the development of the Lebanese economy, they do not mention an example, regardless of their concerted attempts to persuade people to apply for loans for cosmetic operations, a vacation trip or the purchase of property. Its permanent policy has been to allocate public money through loans to the state. Since 2011, he has been increasingly pleased to invest nearly 71.62% (according to the Bloom Invest newsletter, issued on August 4), of people’s money in the BDL, not because the latter is risk-safe, but because it offered the banks very high interest rates.
Debt was not a banking capacity
Almost $ 2 billion in long-term debt.
– $ 32.6 billion Eurobonds, of which “foreign” creditors (including those who may be Lebanese expatriates or a foreigner buying the bonds for the benefit of a Lebanese party), $ 14 billion, Lebanese commercial banks $ 11.5 billion and the Bank of Lebanon carry $ 5.3 billion.
When the Hassan Diab government announced its intention to stop paying Eurobonds, commercial banks quickly sold their bond holdings. There are no exact figures on the value of what it removed, but according to bank estimates, it ranges from $ 3 to $ 4 billion. Banks that have long viewed lending to the state as a “duty” that they cannot “evade” rushed to sell bonds, that is, to get rid of the debt burden, so as not to be affected by default. . This means that from the beginning it was never obliged to contract Eurobonds, but did so in anticipation of the benefits paid by the public treasury. Indeed, on the opposite side of the public interest, the banks threw “the state” into the jaws of foreign creditors when they raised their share of the 2020 bonds to 76.7%, creating legal problems for the government. been and pay dearly for your non-payment.
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Source: News
