Israel May Extend Bank Indemnification After Palestinian Authorities Meet Key Requirements
The Palestinian authorities have fulfilled Israel’s requirements for indemnification, allowing Israeli banks to continue transactions with Palestinian banks, according to a source familiar with the matter. Technical experts argue that this development should warrant an extension of the current indemnification agreement, which is set to expire on October 31, for at least another year. Without an extension, the West Bank could face a severe economic crisis.
US Deputy Treasury Secretary Wally Adeyemo, who recently warned Israel of the security risks tied to allowing banking relationships to lapse, spoke with Palestinian Authority Prime Minister Mohammad Mustafa on Monday. They discussed security and economic issues, including the authority’s progress on improving its anti-money-laundering and countering-the-financing-of-terrorism regime.
Adeyemo acknowledged the Palestinian Authority’s efforts to meet international standards and implement key milestones in assessing risks and ensuring compliance. The progress made could help pave the way for an extension of the indemnification, which is critical for maintaining economic stability in the West Bank.
