Regulatory Alerts2024-12-30
Banking (Licensing) Law, 5741-1981
The Israeli Knesset enacted the Banking (Licensing) Law, 5741-1981, to mandate licensing, capital requirements, and operational oversight for all banking corporations under the Governor of the Bank of Israel. The legislation establishes a Licensing Committee to evaluate applicants based on business viability, managerial fitness, and market competition, while granting the Governor authority to impose conditions or revoke licenses for breaches, insolvency, or public welfare concerns. Furthermore, it strictly defines permissible banking activities, prohibits control over non-financial entities, and restricts large and medium-sized banks from issuing payment cards or acquiring transactions to prevent market concentration.
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