Regulatory Alerts2013-01-01
Liquidity Instructions No. 4 of 2013
The Palestine Monetary Authority issued Instructions No. 4 of 2013 to amend the minimum cash liquidity ratios for banks and branches operating in Palestine. The directive establishes baseline liquidity requirements of 3% per currency and 6% total for banks, and 2% per currency and 4% total for branches, excluding the US dollar. It further mandates a phased increase in the US dollar liquidity ratio, raising bank requirements from 3% to 6% and branch requirements from 2% to 4% effective May 1 and November 1, 2013, respectively, requiring all institutions to implement compliance measures by the specified deadlines.
Palestine Monetary Authority
Palestine Monetary Authority
Instructions No. (4/2013)
To all banks operating in Palestine Date: Wednesday, March 13, 2013
Subject: Liquidity Instructions
Based on the provisions of Banking Law No. (9) of 2010, and pursuant to Instructions No. (5/2008) dated 29/12/2008, Paragraph (2/c) stipulating the following is amended:
The minimum cash liquidity ratio:
- For the Bank: 3% per currency and 6% total currencies.
- For the Branch: 2% per currency and 4% total currencies.
To read as follows:
1. The minimum cash liquidity ratio:
| Level | Currency | Total Currencies including US Dollar |
|---|---|---|
| Bank | For each currency other than US Dollar | 3% |
| Branch | For each currency other than US Dollar | 4% |
2. The minimum cash liquidity ratio in US Dollars is amended as follows:
| Date | At Bank Level | At Branch Level |
|---|---|---|
| Effective from 2013/05/01 | Increased from 3% to 4.5% | Increased from 2% to 3% |
| Effective from 2013/11/01 | Increased from 4.5% to 6% | Increased from 3% to 4% |
This amendment takes effect from 2013/05/01, and all banks are required to take necessary measures to ensure compliance with these instructions according to the specified dates above.
Supervision and Audit Department Palestine Monetary Authority
Ramallah - Al Bireh P.O.Box 452 - Tel.: 02-2409920 - Fax: 02-2409922 Gaza - P.O. Box 4026 - Tel.: 08-2825713 - Fax: 08-2844487 E-mail: info@pma.ps www.pma.ps
Ramallah - Al Bireh - P.O. Box: 452 - Tel.: 02-2409920 - Fax: 02-2409922 Gaza - P.O. Box: 4026 - Tel.: 08-2825713 - Fax: 08-2844487