Circular - Banks - Outputs of the First Meeting - 2025

PALESTINE MONETARY AUTHORITY (2025/ 21) Circular No. (2025/30) Date: 05/07/2025 Ramallah & Al-Bireh Governorate - Palestine P.O. Box 452 info@pma.ps | Fax: +970 2 2415310 | Tel: +970 2 2415251 | Postal code: P6160675

Circular No. (2025/30) Date: 17/07/2025

To: All Banks and Financial Institutions Subject: Outputs of the First Meeting - 2025

Reference is made to Circular No. (2025/30) dated 17/07/2025 regarding the outputs of the first meeting held in 2025 concerning the banking sector's engagement with Environmental, Social, and Governance (ESG) principles, climate change disclosures, and net zero commitments.

The Palestine Monetary Authority (PMA) hereby communicates the following decisions and requirements:

1. Implementation of ESG Frameworks Banks are required to integrate Environmental, Social, and Governance (ESG) criteria into their operational strategies and risk management frameworks. This includes establishing internal policies that address climate-related risks and opportunities, ensuring alignment with international best practices and local regulatory expectations.

2. Climate Change Disclosure Reports (CCDRs) All banks must prepare and submit Climate Change Disclosure Reports (CCDRs) in accordance with the guidelines issued by the PMA. These reports should cover the bank's exposure to climate-related risks, its carbon footprint, and its contribution to sustainable finance initiatives. The first submission deadline is specified in the accompanying guidelines.

3. Net Zero Commitments (NDCs) Banks are encouraged to set and publish Net Zero Commitments (NDCs) aligned with global climate goals. These commitments should outline the bank's strategy to reduce its financed emissions and support the transition to a low-carbon economy. The PMA will provide further guidance on the methodology for calculating and reporting these commitments.

4. Establishment of ESG Committees Each bank must establish a dedicated ESG Committee responsible for overseeing the implementation of ESG strategies, monitoring progress, and ensuring compliance with regulatory requirements. The committee should include senior management representatives and have the authority to make decisions regarding ESG-related investments and risk management.

5. Submission of Strategic Plans Banks are required to submit their updated strategic plans, incorporating the above ESG and climate-related initiatives, to the PMA for review. The submission should demonstrate how the bank intends to achieve its ESG goals and contribute to the sustainable development of the Palestinian economy.

For any inquiries or clarifications regarding this circular, please contact the PMA at GF-CCR@pma.ps.

Palestine Monetary Authority Ramallah & Al-Bireh Governorate - Palestine P.O. Box 452 info@pma.ps | Fax: +970 2 2415310 | Tel: +970 2 2415251 | Postal code: P6160675