West Bank and Gaza: Selected Issues

September 16, 2022

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West Bank and Gaza: Selected Issues, (USA: International Monetary Fund, 2022) accessed September 19, 2024

Summary

For more than a decade, commercial banks in West Bank and Gaza (WBG) have struggled to manage buildups of excess physical Israeli shekel cash. Banks elsewhere typically manage the amount and currency composition of physical cash they hold in their vaults through transactions with other commercial banks and central banks. However, citing money laundering and terrorism financing (ML/TF) concerns, the two Israeli banks that currently offer correspondent services to banks operating in WBG no longer offer them cash services. The Bank of Israel (BoI) has imposed limits on the amount of shekel coins and notes it accepts back from Palestinian banks. This has long hindered liquidity management and been a drag on the profitability of Palestinian banks, but periodic large increases in excess cash in recent years have created additional risks and raised the costs to the Palestinian banking system.

Subject: Crime, Financial institutions, Financial markets, Financial services, International organization, Monetary policy

Keywords: Anti-money laundering and combating the financing of terrorism (AML/CFT), Cash in West Bank, Cash shipment, Commercial banks, Correspondent banking, Excess cash, Financial inclusion, Global, Middle East, North Africa, Palestinian banking system, Shekel cash

Publication Details

Pages:

12
Volume:

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DOI:

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Issue:

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Series:

Country Report No. 2022/299
Stock No:

1WBGEA2022003
ISBN:

9798400220166
ISSN:

1934-7685

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