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Tuesday, May 16, 2006

Israel Discount Bank severing ties with the PA

Israel Discount Bank announced today that it is joining Bank HaPoalim in severing ties with the 'Palestinian Authority.' Under the terms of the 'interim accords' under the Oslo framework of the mid-90's, Discount and HaPoalim are the only Israeli banks that are allowed to do business with the Palestinian Authority. HaPoalim announced six weeks ago that it was severing ties.

Discount officials said that implementation of the decision would take three to six months. They are worried that they could run afoul of anti-terrorism laws if they continue dealing with the Hamas-led government. "No suitable framework was found which would enable Bank Discount to provide banking services to the Palestinian banks without it being exposed to the significant risks involved in such activities," the bank said.

According to the Jerusalem Post,
the decision will make it much more difficult for Palestinians, both the government and private business people, to continue their substantial financial dealings with Israeli businesses. The Palestinian Authority buys key supplies, such as fuel, electricity and water, from Israel, and numerous businesses buy goods from Israeli suppliers. The Palestinian government also pays its tens of thousands of employees in shekels, the Israeli currency.


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