Bank of Israel Negotiating with Bank of Jordan for Latter to Open West Bank Branches

The Bank of Israel, the country’s State Bank, was reported today to be on the verge of concluding negotiations with the Arab Bank of Jordan for the latter to open branches on the West Bank. However, Meir Het, supervisor of banks at the Bank of Israel, denied that an agreement already has been reached. He said the negotiations with the Jordanian bank, one of the largest Arab banks, have been going on for some time but there were still a few obstacles to overcome. Het expressed hope that the negotiations would be completed within “weeks.”

One of the reported obstacles was the Arab Bank’s demand to be permitted to open a branch in East Jerusalem, which the Bank of Israel has refused. But the problem is being overcome, one source said today. Representatives of the Arab Bank were said to have agreed in principle to accept the Bank of Israel’s supervision of its branches in the administered territories. But one representative observed that “it is not a normal situation to have banks operating, whose center is in an enemy country.” He said that this was the source of some of the problems that have to be solved.

Negotiations are also reportedly being conducted with a local bank in Gaza which wants to resume operations that were suspended during the Six-Day War.