The Tripoli-based Central Bank of Libya (CBL), headed by Saddek Elkaber, sacked the General Manager of the Libyan Foreign Bank (LFB), Mohamed Ben Yousef, and all his board of directors on Monday. The CBL also referred them for investigation.
The LFB is a wholly-owned subsidiary of the CBL. The LFB used to be known as the Libyan Arab Foreign Bank and reports issued capital of US$ 8.7 bn and paid-up capital of US$ 3 bn.
While the CBL has made official statement on the matter, social and conventional media put the sacking down to a reported loss by the LFB put in the hundreds of millions of dollars
Indeed, the much publicised yet officially unconfirmed move was only confirmed on Wednesday when the LFB itself issued a statement.
In this statement, the LFB condemned the Tripoli-CBL action and announced that it would refuse to abide by it. It claimed that the action was unjust and illegal. The statement assured that the General Manager, the board and all the executive would continue in their work as usual.
The statement welcomed the support from its loyal staff who condemned the move and their letters to the Attorney General, Audit Bureau and House of Representatives.
The LFB statement said it was surprised by and condemned the decision in view of the fact that all its transactions are subject to continuous oversight by the Audit Bureau, and in view of being in a strong financial position and being one of the few Libyan institutions to make a profit.
With regards to the alleged losses that the LFB made and which led to the sacking of its General Manager and its board, the LFB said that these were estimated and not actual losses and that in the meantime it has recouped some profits since those estimates.
It is worth bearing in mind that there are other unsubstantiated allegations of either fraud or mismanagement by the LFB that have been reported by Libyan social and conventional media.
The incident does, however, highlight yet again the disputed legality and legitimacy and weakness of the Libyan state and its institutions post the 2011 revolution.