بنك إنترا | Bank Intra | Banque Intra

In Octobre 1966, people rushed to withdraw their deposits from Intra Bank On October 14th, Intra announced it is freezing withdrawals. The Immunity There are many stories about Intra’s bankruptcy and conspiracy theories. Concretely, Intra was the biggest bank in Lebanon during the 1960’s, holding up 15% of the country’s deposits. of Palestinian descent, Its owner, Youssef Baidas, had good relations with investors in Lebanon and the region, especially Arab leaders who had deposited their profits from the oil industry in Intra. The bank was also present in Europe, North and South America, and Africa. Baidas was investing the bank’s money all over the world. He was making long term investments, while the money in his bank was made up of short term deposits. In 1966, the FED decided to increase its interest rates, which forced Europe to do the same. Deposits got withdrawn from Lebanon, especially from Intra, with people looking to profit from the higher interest rates. Furthermore, the conflict between Saudi Arabia and Egypt over Yemen had negative repercussions on Arab deposits in Lebanon. The withdrawal of deposits in Lebanon causes liquidity problems for Intra, who asks the Central Bank for help The Central Bank refused to help before Intra provided information about its balance sheet. Other Lebanese banks then started withdrawing their deposits from Intra. The information is leaked to the public somehow that Intra had liquidity problems. People then rushed to also withdraw their deposits. And since a bank can’t give back all its deposits at once, Intra froze withdrawals and closed its doors who had lost faith in the bank. to the Lebanese people who wanted to withdraw their deposits Fearing a bank run due to a loss in confidence in the banking sector, the government intervened. The government named a provisional administrative committee, and injected liquidity to help small depositors. In January 1967, the Parliament voted in the Intra Law: A bank can’t declare bankruptcy. It can only say that it is freezing payments. The goal is to preserve the bank’s reputation and confidence in the banking sector. A court can then quickly intervene and name a committee to run the bank’s affairs. This law also created bodies to protect the banking sector, such as the Bank Control Commission, which is independent of the Central Bank and whose members are named by the government. The Commission’s first president was Selim el Hoss. These bodies got hold of ten banks in one year, including Banque el Alhi and Crédit Hypothécaire who had close links to Intra. Despite all the measures taken by the bodies and the authorities, the lack of trust in the Lebanese banking sector persisted and the simplest rumor had depositors rushing to withdraw their money again. A small anecdote: On March 2nd, 1967, a rumor caused a bank run at British Bank In response, the bank decided to open all day and allow depositors to withdraw their money. In the afternoon, when people realized there was nothing to worry about, they all redeposited the money they had withdrawn that morning. And this until the end of the evening. At the end of the day it’s all a matter of trust. If you would like to know more about today’s subject, or if you have any question, you can refer to the sources cited with the video or you can send me a message on Facebook YouTube, or Instagram

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