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There was strong agitation among savers and spread to bank lobbies, following information about the establishment of new caps for cash withdrawals in Lebanese pounds, with a maximum limit of two million pounds per month, or around $ 250, depending on the average price in parallel markets, while open exchange can be done electronically using credit cards and the specified limit. In turn, the caps on checking accounts for deposits.
Adding to the confounding factors that surprised depositors in pounds and dollars was the fact that the full salaries of more than 300,000 public sector employees were domiciled in banks and transferred in cash from the “central” at the end of each month.
The same is true of the private sector, where workers in most of its sectors already suffer deductions amounting to 50 percent of their wages that are transferred to their institutions. In both sectors, all remittances were withdrawn to satisfy the necessary needs on the one hand, and to anticipate the continuous deterioration of the value of the national currency and its purchasing power in parallel.
The administrations of some banks were not immune from fueling anxiety after the Central Bank formally informed them of the adoption of new rules to feed them with liquidity in pounds. They quickly proceeded, according to information kept by “Asharq Al-Awsat”, to circulate emergency verbal measures for their branches preparing promptly to establish new caps for withdrawals in lira with limits not exceeding two million. Monthly, regardless of the amount available in the checking account, provided that the same measure is applied to the disbursement of salaries, and inform clients by bank card of the withdrawals or disbursements they need.
These events demanded that the Governor of the Central Bank, Riad Salameh, was quick to deny the fixing of the roofs according to the news circulating. But he also emphasized that “the mechanism adopted by the (Banque du Liban) is to establish ceilings for banks to withdraw money from their current account at the Banque du Liban.”
When these maximum limits are exceeded, the required amounts are calculated from the frozen accounts of the banks. Therefore, there is no limit to the amounts that can be withdrawn from the (Banque du Liban).
Then the source of funding for this liquidity will be different, which means that withdrawals are made from the checking account up to a certain limit, and what exceeds that limit in terms of certificates of deposit or deposits ”.
A banker who spoke to Asharq Al-Awsat noted an explicit discrepancy in the statement of the ruling. “The refusal to establish maximum limits for withdrawals is complemented by the establishment of maximum limits for banks, which forces them to apply them to their clients.
Current LBP bank accounts are insufficient to meet the daily demand for LBP or dollar deposits; Where the depositor can withdraw at the price of 3900 pounds of their savings in dollars, which has been classified under the name (LOLAR), due to the impossibility of withdrawing it in the currency in which it was issued, and the adoption of monetization of withdrawals exclusively in pounds at the rate of the platform in the (Central).
In this case; The normal behavior of banks is to either adopt the withdrawal restriction or charge clients what they will incur in terms of additional costs to provide liquidity.
The banking source considered that “any technical measure to control liquidity will be sterile and will have limited and transitory effects, unless it is based on re-correcting all internal clues.
Although the new mechanism may not lengthen wages as much as its implications for savings withdrawals, and although banks have previously restricted withdrawals in lira relatively, the mere production of new pressures on the fundamentally deteriorating monetary path will generate negative and negative repercussions. undesirable for the crisis and the currently anticipated live wave of obscene price increases. Then the governor also hinted about the imminent depletion of foreign exchange reserves that can be used to support the financing of basic and strategic products and the food basket approved by the Ministry of Economy.
