Regulatory Alerts2026-04-14
Added · Updated
Banking (Licensing) Law, 5741-1981
The Banking (Licensing) Law, 5741-1981, establishes the framework for licensing banking corporations, detailing requirements for minimum capital, the process for license issuance and revocation by the Governor of the Bank of Israel, and the considerations involved. It specifies the permitted fields of activity for banks, authorizing "small banks" to engage in additional occupations with the Supervisor's prior written approval under certain conditions. Furthermore, the law prohibits "banks with a wide scope of activity," defined as those with asset values exceeding 10 percent of the total asset value of all banks in Israel, from engaging in payment card issuance operations or acquiring payment card transactions, and from controlling corporations involved in these activities. The law also outlines the types of corporations a bank may control or be a principal shareholder in, including foreign corporations and auxiliary corporations, often requiring the Supervisor's approval.