Nine banks, including Ivory Coast’s largest, have shut down their operations one after another this week, further squeezing the country’s strongman, who is refusing to leave office nearly three months after being declared the loser of the presidential election.
Together, the financial institutions halting operations this week hold the vast majority of civil servant bank accounts in the West African country. The move is expected to prevent almost all government employees from receiving their salaries. Panicked people gathered in lines desperately seeking to take out their savings in fear of a cash shortage.
The international community had said it would use financial -sanctions to dislodge sitting Ivory Coast president Laurent Gbagbo, who is refusing to step down even though results issued by his country’s election commission and certified by the UN showed he had lost the Nov. 28 ballot by nearly 9 percentage points. Among the sanctions slapped on Gbagbo’s regime was the revocation of his signature on state accounts at the regional central bank that prints the currency used in Ivory Coast.
Once that happened late last month, the Gbagbo government was no longer able to make deposits into the private banks where government salaries are cashed.
Private banks began shutting down earlier in the week, starting with Britain’s Standard Chartered, France’s BNP-Paribas, Nigeria’s Access Bank and US bank Citibank. They were joined Thursday by France’s Societe Generale, the country’s largest financial institution, which announced it was shuttering all 47 branches of its local subsidiary serving 230,000 clients.
“The bank is no longer in a position to ensure high quality, secure operating conditions for its clients,” Societe Generale said in a statement. “We are no longer able to ensure the short term supply of currency/cash to our branches.”
Over the course of the day Thursday, four smaller Ivorian banks also shut their doors, citing technical difficulties.
“A kind of psychosis has set in,” insurance broker Jean-Claude Eddie said. “People are flocking to the few banks that are still open, and all this demand cannot be met. It’s the beginning of a crisis.”
Diplomats and analysts have been wagering that once civil servants stop receiving their pay, they will defect en masse away from Gbagbo. He is still backed by the army, which has brutally cracked down on supporters of opposition leader Alassane Ouattara, who has been unable to assume office even though he is internationally recognized as the winner of the vote.
Every month since the contested election, observers have been closely watching to see if state employees are paid — but so far Gbagbo appears to have made payroll.
He was initially able to because the governor of the central bank is an ally and refused to seal off Gbagbo’s access to the accounts.
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