Barrack says ban of dealings with Al-Qard al-Hasan a 'valued' step

U.S. envoy Tom Barrack has described the Lebanese Central Bank’s decision to bar banks and brokerages from dealing with the Hezbollah-affiliated Al-Qard Al-Hasan financial institution as a “step in the right direct by the Lebanese government.”

“Transparency and alignment of all financial intermediaries in Lebanon under the supervision of the Central Bank is a valued and necessary accomplishment,” Barrack said in a post on the X platform.

In a circular dated Monday, the Central Bank prohibited all licensed financial institutions in Lebanon from dealing directly or indirectly with unlicensed entities and listed Hezbollah's Al-Qard Al-Hassan as an example. The bank had issued similar circulars in the past but this is the first time that it mentions Al-Qard Al-Hassan by name.

The U.S. Department of the Treasury imposed sanctions on Al-Qard Al-Hasan in 2007, saying Hezbollah used it as a cover to manage "financial activities and gain access to the international financial system."

Al-Qard Al-Hassan, founded in 1983, describes itself as a charitable organization that provides loans to people according to Islamic principles that forbid interest. Israel struck some of its branches during its war with Hezbollah last year.

Operating as a not-for-profit organization under a licence granted by the Lebanese government, it has more than 30 branches, mostly in predominantly Shiite Muslim areas of Beirut, southern Lebanon and the Bekaa Valley.

A Lebanese official said the central bank move had been in the works for months, and reflected U.S. pressure on Lebanon to take action against Hezbollah's financial wing.

Nassib Ghobril, chief economist at Byblos Bank, said Lebanese banks were already careful to avoid dealing with Al-Qard Al-Hasan because it is under U.S. sanctions.