The headquarters of the Association of Banks in Lebanon. (Credit: NNA)
BEIRUT — AM Bank announced in a press release that it is suspending its membership in the Association of Banks in Lebanon, and called for other banks to follow suit.
Here’s what we know:
• AM Bank stated in the press release that ABL “has been taking decisions that greatly diverge from the interests of its members, thus harming the banking sector and depositors alike.”
• The release goes on to list some of the decisions by ABL that AM Bank considers inappropriate over the past two years, such as the closure of banks for two weeks in October 2019, a well as the recent letter sent to the International Monetary Fund by the company Decision Boundaries, the content of which were not discussed and was not seen by most ABL members.
• The release also mentions that AM bank was not made aware of the appointment of the company Decision Boundaries as an advisor to ABL.
• Recent tension within the ranks of the association arose after Reuters broke out the news on June 21 that ABL sent a letter to the International Monetary Fund, calling the preliminary agreement signed by the Lebanese government in April “unlawful.”
• Some banks, among them bank Audi and AM Bank, distanced themselves from the content of the letter.
• The Financial Times, in an article published on June 22, identified the person behind the letter to the IMF, as Carlos Abadi, Managing Director of Decision Boundaries, and advisor to ABL. In the same article, Marwan Kheireddine, chair of AM Bank, said his bank was not made aware of the letter before it was sent.
• Carlos Abadi was permanently barred from the securities business in the US by the Financial Industry Regulatory Authority in April 2017, and in 1995 was charged by the Supreme Court of the State of New York with unauthorized receipt of money relating to a former employer, and with erroneously filing state income tax. All counts were later dismissed, except the count relating to tax returns. He was ordered to pay a fine of $200,000.