Lebanon crisis brings mixed legacy for central bank governor

BEIRUT (AP) — Touted as the guardian of Lebanon’s monetary stability, he steered the tiny country's finances for nearly three decades, through post-war recovery and bouts of unrest.

Now, Lebanon’s central bank governor is being called a “thief” by some anti-government protesters who see him as a member of a corrupt ruling elite whose mismanagement has driven the country to the edge of bankruptcy.

The changing fortunes of Riad Salameh, a 69-year-old former investment banker, mirror the rise and fall of Lebanon’s post-war banking sector, which he personally oversaw.

Last year, as economic conditions worsened and Lebanon was engulfed in mass protests, banks began imposing limits on cash withdrawals and limits on transfers abroad that continue to deprive depositors of access to their savings. In recent weeks, the Lebanese pound — pegged to the dollar for more than two decades under Salameh — lost 60% of its value against the dollar on the black market.

Protesters rioted, hurling firebombs and smashing ATM machines. Metal barriers rose up around the banks.

“They are like thieves, hiding behind their fortifications,” said Ahmad Rustom, 46, a self-employed carpenter standing outside a local bank in Beirut recently. “The fact that they are fortifying means they don’t intend to give people their money back.”

At the center of this tumult is Salameh, one of the world’s longest-serving governors. Prime Minister Hassan Diab's government has singled him out, blaming the bank's “opaque policies" for the downward currency spiral over the past weeks.

Naim Kassem, the deputy leader of the militant Hezbollah group which supports Diab's government, said the crash “is the result of accumulated mistakes at the central bank.” The Iran-backed group and its...