Press "Enter" to skip to content

Lebanon deposits money safe: central bank

Lebanese central bank governor Riad Salameh has defended his record, rejecting criticism from the prime minister that he was to blame for a financial crisis and assuring savers there was no need for a haircut on their deposits.

Salameh has come under fire from critics including Hezbollah in recent days amid a rapid decline in the pound currency that has fuelled new protests and threatens broader unrest.

In a near hour-long televised address, Salameh deflected the blame back towards successive Lebanese governments for the unprecedented financial meltdown.

“Yes, the central bank financed the state but it is not the one that spent the money. There are those who spent the money,” Salameh, in office since 1993, said. He said he was being targeted in a “systematic campaign”.

Lebanon, one of the world’s most heavily indebted states, defaulted on its foreign currency loans last month. The financial crisis which came to a head last October has led inflation and unemployment to soar. Savers have been frozen out of their US dollar deposits amid a hard currency liquidity crunch.

In an attack on Salameh’s performance last Friday, Prime Minister Hassan Diab cast him as responsible for the currency’s crash, mounting losses in the banking sector and for lack of transparency and co-ordination.

The Lebanese pound has lost more than half its value since October, falling away from the pegged rate of 1507.5 pounds on a parallel market. Its descent picked up steam over the past week, hitting over 4000 pounds to the US dollar.

Salameh said depositor money was safe.

“There is absolutely no need for a haircut and a haircut should not be adopted,” Salameh said. “We confirm to the Lebanese that their deposits are there and are in the banking sector and are being used.”

Originally published as Lebanon deposits money safe: central bank

Be First to Comment

Leave a Reply

Your email address will not be published. Required fields are marked *