Regulatory Alerts2016-01-01
Circular No. 64: Government Payment Authorizations
The Palestine Monetary Authority issued Circular No. 64 (2016) to regulate the investment and settlement mechanisms for government payment authorizations. The directive mandates that banks obtain prior written approval for investment ceilings, adhere to maximum discount rates of 8% for Shekel-denominated instruments and LIBOR plus 3% for US Dollar-denominated ones, and utilize specific SWIFT message formats and real-time settlement systems for transactions. Additionally, banks must disclose these investments in monthly reports, report monthly volumes and trust account balances to the Authority, and maintain strict confidentiality regarding designated trust accounts without dual regulatory approval.
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