Identifier
Created
Classification
Origin
09TELAVIV2343
2009-10-23 14:49:00
CONFIDENTIAL
Embassy Tel Aviv
Cable title:
BOI-PMA BANKING MEETING HELD
how-toVZCZCXRO8411 PP RUEHROV DE RUEHTV #2343 2961449 ZNY CCCCC ZZH P 231449Z OCT 09 FM AMEMBASSY TEL AVIV TO RUEHC/SECSTATE WASHDC PRIORITY 3950 RHEHNSC/NSC WASHDC PRIORITY RUEATRS/DEPT OF TREASURY WASHDC PRIORITY INFO RUEHXK/ARAB ISRAELI COLLECTIVE
C O N F I D E N T I A L TEL AVIV 002343
SIPDIS
NSC FOR PREM KUMAR, TREASURY FOR DMOGER
E.O. 12958: DECL: 10/23/2019
TAGS: EAID EFIN PREL KPAL IS
SUBJECT: BOI-PMA BANKING MEETING HELD
REF: TEL AVIV 2003
Classified By: Economic Counselor David R. Burnett; reasons 1.4 b/d
C O N F I D E N T I A L TEL AVIV 002343
SIPDIS
NSC FOR PREM KUMAR, TREASURY FOR DMOGER
E.O. 12958: DECL: 10/23/2019
TAGS: EAID EFIN PREL KPAL IS
SUBJECT: BOI-PMA BANKING MEETING HELD
REF: TEL AVIV 2003
Classified By: Economic Counselor David R. Burnett; reasons 1.4 b/d
1. (C) Dudu Zaken, Assistant Supervisor of Banks at the
Bank of ISRAEL (BOI),informed EconOff that a bilateral
Israeli-Palestinian banking meeting was held on 21 October.
Surplus cash in Palestinian banks was a primary topi of
discussion. In mid-August, the BOI allowed deposit of 300
million shekels into Bank HaPoalm's account in
Israel'scentral bank. According o Zaken, soon thereafter,
the Palestinians requesed that another 400 million shekels
be deposited With the request still pending, in the October21 meeting, the Palestinians asked that the amountbe raised
to 600 million shekels. Zaken told Jiad Al-Wazir, Governor
of the Palestinian Monetary Authority (PMA),that the BOI
would need an explanation as to the increasing amount of
surplus shekels in Palestinian banks before approving this
request. Zaken does not understand why there is such a large
surplus of cash in the West Bank given current economic
indicators. He said that the GOI was willing to take action
in August due to the emergency nature of the surplus cash.
However, he emphasized that the Bank of ISRAEL is not a
commercial bank and will not accept routine regular deposits
from the Palestinians under normal circumstances.
2. (C) The plan for providing social security payments to
entitled Gazans was also discussed, though Zaken noted
continuing difficulties on the Palestinian side in moving
forward.
3. (C) Econoff plans to receive a full readout of the
meeting, along with any follow-up, early next week from
Zaken, Yacov Peled, Head of BOI's Institutional Evaluation
Unit, and Paul Landes, Legal Counsel to the ISRAEL Money
Laundering and Terror Financing Prohibition Authority (IMPA).
Zaken was optimistic that by then, the PMA might provide an
explanation behind the surplus cash.
4. (C) Comment: Embassy views the continuation of this
dialogue as encouraging, especially in light of the current
political situation. We are pleased that the GOI has moved
beyond the former sticking point of a Palestinian response to
its technical questions (see ref) to address more pressing
topics of concern.
CUNNINGHAM
SIPDIS
NSC FOR PREM KUMAR, TREASURY FOR DMOGER
E.O. 12958: DECL: 10/23/2019
TAGS: EAID EFIN PREL KPAL IS
SUBJECT: BOI-PMA BANKING MEETING HELD
REF: TEL AVIV 2003
Classified By: Economic Counselor David R. Burnett; reasons 1.4 b/d
1. (C) Dudu Zaken, Assistant Supervisor of Banks at the
Bank of ISRAEL (BOI),informed EconOff that a bilateral
Israeli-Palestinian banking meeting was held on 21 October.
Surplus cash in Palestinian banks was a primary topi of
discussion. In mid-August, the BOI allowed deposit of 300
million shekels into Bank HaPoalm's account in
Israel'scentral bank. According o Zaken, soon thereafter,
the Palestinians requesed that another 400 million shekels
be deposited With the request still pending, in the October21 meeting, the Palestinians asked that the amountbe raised
to 600 million shekels. Zaken told Jiad Al-Wazir, Governor
of the Palestinian Monetary Authority (PMA),that the BOI
would need an explanation as to the increasing amount of
surplus shekels in Palestinian banks before approving this
request. Zaken does not understand why there is such a large
surplus of cash in the West Bank given current economic
indicators. He said that the GOI was willing to take action
in August due to the emergency nature of the surplus cash.
However, he emphasized that the Bank of ISRAEL is not a
commercial bank and will not accept routine regular deposits
from the Palestinians under normal circumstances.
2. (C) The plan for providing social security payments to
entitled Gazans was also discussed, though Zaken noted
continuing difficulties on the Palestinian side in moving
forward.
3. (C) Econoff plans to receive a full readout of the
meeting, along with any follow-up, early next week from
Zaken, Yacov Peled, Head of BOI's Institutional Evaluation
Unit, and Paul Landes, Legal Counsel to the ISRAEL Money
Laundering and Terror Financing Prohibition Authority (IMPA).
Zaken was optimistic that by then, the PMA might provide an
explanation behind the surplus cash.
4. (C) Comment: Embassy views the continuation of this
dialogue as encouraging, especially in light of the current
political situation. We are pleased that the GOI has moved
beyond the former sticking point of a Palestinian response to
its technical questions (see ref) to address more pressing
topics of concern.
CUNNINGHAM