|19 September, 2019

Lebanon central bank agrees to liquidation request from sanctions-hit bank

The value of the bank's assets, and its share of the national deposit guarantee body, are in principle enough to pay all deposits and commitments

A man sits on the stairs in front of the central bank in Beirut, Lebanon May 7, 2019.

A man sits on the stairs in front of the central bank in Beirut, Lebanon May 7, 2019.

REUTERS/Mohamed Azakir

BEIRUT- Lebanon's central bank said on Thursday it agreed to a request from Jammal Trust Bank, which was hit by U.S. sanctions last month, to liquidate itself.

The value of the bank's assets, and its share of the national deposit guarantee body, "are in principle enough to pay all deposits and commitments", the central bank statement said.

Washington hit Jammal Trust bank and its subsidiaries with sanctions in August, accusing it of helping to fund the Iran-backed Hezbollah movement in Lebanon. The bank rejected the U.S. allegations and pledged to appeal the decision.

Lebanon's Central Bank Governor Riad Salameh reassured again that all depositors' funds would be guaranteed at maturity, the statement said.

Jammal Trust Bank has 25 branches in Lebanon and representative offices in Nigeria, the Ivory Coast and Britain, its website says.

The bank is a relatively small lender. It had net assets of 1,600 billion Lebanese pounds ($1 billion) as at the end of 2017, according to the annual report on the latest year for which data is available.

Washington has sought to choke off Hezbollah's funding worldwide, with sanctions among a slew of steps against Tehran since U.S. President Donald Trump withdrew last year from a 2015 international nuclear deal with Iran.

(Reporting by Ellen Francis and Tom Perry in Beirut, Lisa Barrington in Dubai Editing by Shri Navaratnam)

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