Torbey: No threat to banking secrecy
Osama Habib| The Daily Star
BEIRUT: There is no reason to lift the banking secrecy in Lebanon in general as the entire banking sector is fully compliant with anti-money laundering and terrorism funding laws, the president of the Association of Banks in Lebanon said Thursday. “There is no need to remove the banking secrecy in Lebanon. The banking secrecy will be removed on people involved in money laundering and illicit financial activities but not on those who have clean accounts, and they represent the majority,” Joseph Torbey told journalists at the headquarters of ABL.
Lebanon is one of the few countries in the world with a banking secrecy that dates back to the ’50s.
Torbey added that the Lebanese banks immediately take action on any list of names that are blacklisted by the Europeans and Americans and for this reason there is no need to remove the banking secrecy.
“The purpose of the banking secrecy in Lebanon is to protect the legitimate money in the banks and not the other way around,” he argued.
Torbey also denied claims that the anti-money laundering and terrorism financing drive is aimed at a specific sect in Lebanon.
“The actions banks are taking are not aimed at any specific sect and the majority of our clients have clear clean records. We only apply the laws on those mentioned in the lists.”
He also said that the number of people suspected of money laundering and terrorism financing that are provided by the international parties is not that big, noting that the bulk of the bank accounts are clean.
In December 2015, the U.S. House of Representatives voted unanimously to impose tough new sanctions on banks that knowingly do business with the Lebanon-based movement Hezbollah.
The bill targeting Hezbollah, which is considered a terrorist organization by Washington, passed the Senate last month.
U.S. President Barak Obama quickly signed the bill, which became effective immediately.
Asked whether the Hezbollah MPs and ministers who collect their salaries from the Finance Ministry in Lebanese pounds will be excluded from this measure, Torbey said that the lawmakers, the Central Bank and all parties in Lebanon have reached an agreement on this issue but without giving further details.
Torbey reiterated that the Lebanese banks are fully committed to the fight against money laundering and terrorism financing and emphasized that a high ranking delegation from ABL and the Central Bank will visit the United States soon to brief the U.S. Treasury and Congress about the measures adopted by the lenders to combat this phenomenon.
He praised the speaker of the House and MPs for passing four important bills on tightening the measures against money laundering, increasing the list of crimes under these bills, disclosing the cash amount transferred across the border and entry points as well as joining international agreements to fight terrorism financing.
Torbey also highlighted the achievements and performance of the Lebanese banking sector in 2015 which was quite satisfactory despite the regional turmoil.
“Despite the economic slowdown and deficit in the balance of payments, the banking sector achieved a growth in deposits of 5 percent in 2015. This means that deposits jumped by $7.3 billion, an amount sufficient to cover the financial needs of the national economy with both its public and private sectors,” he said.
Torbey added that the private equities of Lebanese banks in 2015 have reached $16.7 billion.
“These private capitals will consolidate the confidence of the local and foreign investor in the Lebanese banking sector. In addition, this capital will be long term source for banks that can be used in medium and long term operating loans and would also consolidate the financial position of the banks,” he added.
But what is more important, according to Torbey, is that loans provided by the banks have helped achieve a growth even at modest ratio of 1 percent.
“If it wasn’t for the bank lending activity, the GDP would have achieved a negative growth of minus 1.5 percent,” he added.
Torbey disclosed that Lebanese banks hold 70 percent of the total Eurobonds and 54 percent of the total government public debt in Lebanese pound in their balance sheets.
