Israeli banks cutting ties with Palestinian Authority
Discount Bank and Bank Hapoalim are demanding that the government should replace them in providing correspondent bank services, amid growing fears of involvement in terror financing
Assessment
Two of Israel's largest banks are moving to sever their financial relationship with the Palestinian Authority, citing concerns over potential terror financing. The banks are pressing the government to take over the provision of correspondent banking services, a shift that could disrupt the flow of funds between Israel and the Palestinian territories. The immediate question is whether the government will step in or allow the banking separation to proceed, which would have significant economic and political consequences.