Israel carried out a series of airstrikes on the southern suburbs of Beirut, south Lebanon and the Bekaa valley early on Monday morning, striking buildings belonging to the Hezbollah-run banking institution Al-Qard Al-Hassan.

At least 10 airstrikes were carried out in the southern suburbs of the capital, with an entire building collapsing and a jet of fire streaming into the air in the Chiyah neighbourhood. A building close to Lebanon’s only commercial airport was also struck, video footage showing a smoke plume billowing while a nearby plane sat on the runway.

“They struck empty buildings in residential neighbourhoods, and destroyed those surrounding neighbourhoods. These weren’t military centres or weapons caches,” said Ma’an Khalil, the mayor of Ghobeiry municipality in the southern suburbs of Beirut.

The US envoy Amos Hochstein arrived in Beirut hours after the strikes, where he met Lebanon’s parliamentary speaker, Nabih Berri, and the country’s caretaker prime minister, Najib Mikati, to discuss ways towards a ceasefire.

Before the bombings, Israel issued several warnings via X , pinpointing buildings belonging to Al-Qard Al-Hassan in the southern suburbs of Beirut and across Lebanon and warning people to move at least 500 metres away from these buildings. Streets from the affected areas were soon choked with traffic as people fled in anticipation of the strikes.

Al-Qard Al-Hassan has branches across Lebanon, with 15 in greater Beirut alone.

The strikes were part of what Israel said were efforts to dismantle Hezbollah’s financial system. The Israeli military said on Sunday night that Al-Qard Al-Hasssan financed Hezbollah and the group “uses this money to finance its terrorist activities”, including buying and storing arms.

The announcement that Israel would start targeting the bank, a part of Hezbollah’s civilian institutions, signified an expansion of the scope of Israel’s targets from just the group’s military wing. The institution had sanctions placed on it by the US in 2017 during the Trump administration for giving Hezbollah access to the international financial system, according to the US treasury.

Al-Qard Al-Hassan was founded in the early 1980s as a charitable institution, part of Hezbollah’s robust social services network.

The banking institution became more popular after Lebanon’s 2019 financial crisis, when commercial banks froze almost all accounts and almost entirely stopped issuing loans. Hundreds of thousands of Lebanese people, primarily Shia Muslims, bank with Al-Qard Al-Hassan, many of them giving the bank familial assets such as gold in exchange for loans.

According to Lina Khatib, the director of the Soas Middle East Institute, though Al-Qard Al-Hassan is not the main way in which Hezbollah manages the finances of its social network, the potential loss of the institution would be a “significant blow”.

“If this gold is destroyed, Hezbollah’s constituents expect that it will be able to compensate them for their loss. For the time being, the level of trust that Hezbollah’s constituency has in the group remains high despite its huge losses,” Khatib said.

Shortly after the strikes, Hezbollah announced that it had launched rockets at a groups of Israeli soldiers in Al-Malakiyah and Markaba, south Lebanon. Intense fighting between Israeli soldiers and Hezbollah fighters stretched on from Sunday into Monday morning, as Israel continued to conduct cross-border incursions into south Lebanon.

Israel has said it is trying to degrade and destroy Hezbollah’s infrastructure and capabilities along the border. Its progress is unclear, as the border areas have been virtually depopulated and media access is limited.

On Monday afternoon, Hochstein said implementation of the UN security council resolution 1701 was the path towards a ceasefire in Lebanon and rejected calls to amend the UN agreement.

Resolution 1701 ended the 2006 Israel-Hezbollah war and has since been the framework that governs security dynamics on the Lebanese-Israeli border. Under the terms of the agreement, Hezbollah and other armed militias must not be present past the Litani River, about 18 miles (30km) north of the border. The resolution also dictated that Israeli forces withdraw from Lebanon.

“The non-implementation of resolution 1701 is the reason for the intensification and continuation of this conflict,” Hochstein said after meeting Berri, who negotiates on behalf of Hezbollah. It was the US envoy’s first visit to Lebanon since Israel launched Operation Northern Arrows on 23 September.

The implementation of resolution 1701 has been viewed as key to stopping the fighting, which started on 8 October last year after Hezbollah launched missiles “in solidarity” with Hamas’s attack on Israel a day earlier. More than 2,400 people have been killed and more than 11,530 wounded in Lebanon since then.

Over the last month, Lebanese officials have stated their willingness to adhere to the resolution, without mentioning Hezbollah’s presence south of the Litani River by name.

Hezbollah previously rejected being pushed back from the de facto border, but unprecedented losses for the group have reportedly softened its stance as it seeks a ceasefire with Israel. Almost all of its senior military leadership and its former secretary general, Hassan Nasrallah, have been killed by Israeli attacks in the past three months.

According to the Axios news website, Israel gave its conditions for a ceasefire to Washington last week in a document that included amendments to resolution 1701. The document requested that Israel be allowed to conduct “active enforcement” to ensure that Hezbollah does not rebuild its military capacity in border areas of south Lebanon. It also demanded that Israel’s air force have freedom of operation in Lebanese airspace.

Hochstein said on Monday that he would not “engage in talks on amending resolution 1701, but rather the possibility of its implementation”. Lebanese officials are likely to reject the new demands, which would be seen as encroaching on the country’s sovereignty.