Lebanon’s top banker linked to offshores with $100 million in assets

Lebanon’s top banker linked to offshores with $100 million in assets
Lebanon's Central Bank Governor Riad Salameh. (REUTERS File Photo)
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Updated 14 August 2020

Lebanon’s top banker linked to offshores with $100 million in assets

Lebanon’s top banker linked to offshores with $100 million in assets
  • No question of criminality raised as scrutiny increases on country’s elite amid financial meltdown and Beirut explosion

DUBAI: Offshore companies linked to Lebanon’s central bank governor own assets worth nearly $100 million, a media group has said in a report, as his role in Lebanon’s economic turmoil comes under intense scrutiny.

The companies tied to Riad Salameh invested in real estate in the UK, Germany and Belgium over the past decade according to a report by a collective of European news outlets called the Organized Crime and Corruption Reporting Project (OCCRP), a nonprofit media organization, and its Lebanese partner, Daraj.com.

The report by the Sarajevo-based OCCRP does not allege any wrongdoing by Salameh, and Reuters has not reviewed any of the documents on which the report is based.

Responding to the report, Salemeh told Reuters he had declared during a TV interview in April his net worth prior to becoming a governor in 1993 and it was $23 million.

“I have shown the supporting documents as a proof. This to eliminate doubts on the origin of my net worth and that it was prior to holding office,” he said.

He said he had previously stated that he asked professionals and trustees to manage his net worth. “The origin of my net worth is clear, this is the important matter,” he said.

Salameh, previously seen as a guarantor of financial stability in the country, has become a focus of anger for street protesters since Lebanon’s financial system collapsed earlier this year under the weight of one of the world’s biggest public debt burdens.

The report into his personal wealth comes at a sensitive time for the country, as Lebanon grapples with the aftermath of an enormous chemical explosion that devastated the capital Beirut, fueling public anger with the country’s leadership.

The OCCRP report also comes after central bank accounts seen by Reuters last month revealed that Lebanon’s central bank governor inflated the institution’s assets by over $6 billion in 2018, showing the extent of financial engineering used to help prop up the Lebanese economy.

The governor told Reuters last month that the central bank accounting was in line with policies approved by the board.

A Lebanese judge last month ordered a protective freeze on some assets held by the governor after ruling in favor of a complaint that he had allegedly undermined the financial standing of the state.

By the end of 2018, Salameh’s assets were worth more than $94 million, the report said, citing balance sheets of Luxembourg companies controlled by the governor.

Salameh said his declaration on his net worth demonstrated he was not trying to escape public scrutiny and was the proof he has “nothing to hide.” 


WEEKLY ENERGY RECAP: Despite long-term challenges, oil prices remain in healthy range

WEEKLY ENERGY RECAP: Despite long-term challenges, oil prices remain in healthy range
Updated 24 January 2021

WEEKLY ENERGY RECAP: Despite long-term challenges, oil prices remain in healthy range

WEEKLY ENERGY RECAP: Despite long-term challenges, oil prices remain in healthy range

Oil prices have been stable since early January, with Brent crude price hovering around $55. Brent crude closed the week slightly higher at $55.41 per barrel,
while West Texas Intermediate (WTI) closed slightly lower at $52.27 per barrel.

Oil price movement since early January in a narrow range above $50 is healthy, despite pessimism over an increase in oil demand, while expectations of US President Joe Biden taking steps to revive energy demand growth are
still doubtful. The US Energy Information Administration (EIA) reported a hike in US refining utilization to its highest since March 2020, at 82.5 percent. The EIA reported a surprise weekly surge in US commercial crude stocks by 4.4
million barrels. Oil prices remained steady despite the bearish messages sent from the International Energy Agency (IEA), which believes it will take more time for oil demand to recover fully as renewed lockdowns in several countries weighed on oil demand recovery.

The IEA’s January Oil Market Report came as the most pessimistic monthly report among other market bulletins from the Organization of the Petroleum Exporting Countries (OPEC) and EIA. It forecast oil demand will bounce back to 96.6 million bpd this year, an increase of 5.5 million bpd over 2020 levels.

Though the IEA has lowered its forecast for global oil demand in 2021 due to lockdowns and vaccination challenges, it still expects a sharp rebound in oil consumption in the second half of 2021,
and the continuation of global inventory depletion.

The IEA reported global oil stocks fell by 2.58 million bpd in the fourth quarter of 2020 after preliminary data showed hefty drawdowns toward the end of the year. The IEA reported OECD industry stocks fell for a fourth consecutive month at 166.7
million barrels above the last five-year average. It forecast that global refinery throughput is expected to rebound by 4.5 million bpd in 2021, after a 7.3 million bpd drop in 2020.

The IEA monthly report has led to some short term concern about weakness in the physical crude spot market, and the IEA has acknowledged OPEC’s firm role in stabilizing the market.

Controversially, the IEA believes that a big chunk of shale oil production is profitable at current prices, and hence insinuated that shale oil might threaten OPEC market share.

It also believes that US shale oil producers have quickly responded to oil price gains, winning market share over OPEC producers. However, even if US shale oil drillers added more oil rigs for almost three months in a row, the number of operating rigs is still less than half that of a year ago, at 289 rigs.

The latest figures from the Commodity Futures Trading Commission show that crude futures “long positions” on the New York Mercantile Exchange are at 668,078 contracts, down by 18,414 contracts from the previous week (at 1,000 barrels for each contract).