BEIRUT — Bank Audi responded Wednesday to the a decision by the UK’s High Court of Justice, Queen's Bench Division, ordering the bank to pay around $1.1 million to claimant Vatche Manoukian by March 4, saying that the execution of the order would result in “unequal treatment among depositors.”
Here’s what we know:
• The Bank Audi statement said it “is plain that the Order or any other similar decision would not have been issued if capital control laws or regulations were enacted in Lebanon.”
• The statement continued that the “execution of the Order will result in unequal treatment among depositors with wealthy depositors who happen to be resident in the United Kingdom being able to be paid 100% of their funds out of the pockets of the remaining depositors who do not have the right or ability to bring proceedings overseas,” adding that “this will significantly reduce the money available to the other depositors.”
• Bank Audi concluded that, more than two years into Lebanon’s financial crisis, further delays on the part of the state in passing a capital control law and an economic reform plan will cause more harm and create further unequal treatment of depositors.
• The British High Court of Justice ruled in favor of a Lebanese-British businessman, who filed a complaint targeting Bank Audi and Société Générale de Banque au Liban for refusing in 2019 to transfer funds from Lebanon abroad.
• The vast majority of bank account holders in Lebanon have been subject to commercial banks' informal capital controls on their deposits since late 2019, when the depth of the country's financial crisis became apparent.
• Bank Audi said in its statement that it “will consider its options regarding whether or not to appeal the Order and the related court judgment upon issuance of the judgment,” adding, “In the meantime, Bank Audi sal intends to abide by the Order prior to expiration of the stated deadline.”