Palestine Monetary Authority

PALESTINE MONETARY AUTHORITY

Instructions No. (50) of 2019

Regarding the Rescheduling of Facilities and Financing Granted in the Southern Governorates

Based on the provisions of Law Decree No. (9) of 2010 concerning Banks, particularly Article (40) thereof,

and in accordance with the powers delegated to us,

and in pursuit of the public interest,

we have issued the following Instructions:

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Article (1)

Scope of Application

The provisions of these Instructions shall apply to all banks licensed by the Palestine Monetary Authority to conduct banking business in Palestine.

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Article (2)

Objective

These Instructions aim to achieve the following:

1. Amend the rescheduling conditions for facilities and financing set forth in Instructions No. (2008/1) issued on 20/01/2008, as well as amend the maximum limit for consumer credit repayment set forth in Instructions No. (02) of 2015 issued on 15/02/2015, where this amendment shall be limited exclusively to the rescheduling of facilities and financing granted to public sector employees in the Southern Governorates only.

2. Amend the post-rescheduling acceptance of real estate collateral as specified in Instructions No. (2008/1), and this amendment shall apply to all facilities and financing granted in the Southern Governorates.

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Article (3)

Rescheduling of Facilities and Financing Granted to Public Sector Employees in the Southern Governorates

1. Based on the down payment conditions set forth in paragraphs (1), (2), and (3) of Item (Seventh) of Instructions No. (2008/1), banks may reschedule facilities and financing granted to public sector employees in the Southern Governorates with mutual consent without requiring a down payment, whether during the first, second, or third rescheduling.

2. All other rescheduling conditions stipulated in Instructions No. (2008/1) shall remain in effect without any amendment.

3. Banks may refrain from classifying loans to public sector employees in the Southern Governorates, provided that these debts are rescheduled in proportion to the employee's current income.

4. Based on the provisions of paragraph (1-b) of Article (5) of Instructions No. (2) of 2015 concerning credit granting criteria and controls, banks may determine the appropriate rescheduling period in proportion to the employee's income, provided that the borrower commits to repaying installments according to the rescheduling terms.

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Article (4)

Calculation of Real Estate Collateral After Rescheduling

Based on the provisions of paragraph (2-d) of Item (Third) of Instructions No. (2008/1), banks are permitted to continue accepting real estate mortgages in the event of a change after rescheduling, in accordance with the acceptance ratios specified in Instructions (2008/1), provided that they are not accepted after five years have elapsed since the change. This applies exclusively to all facilities and financing granted in the Southern Governorates, and this exception shall be temporary until the end of the current year, 2019.

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Article (5)

Repeal

All provisions conflicting with the terms of these Instructions are hereby repealed.

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Article (6)

Implementation and Enforcement

1. All competent authorities shall implement the provisions of these Instructions within their respective jurisdictions, and their provisions shall apply as of the date of issuance.

2. These Instructions shall remain in effect until the Palestine Monetary Authority issues instructions to repeal or amend them.

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Issued in Ramallah on Thursday, dated 21/02/2019

Supervision and Inspection Department
Palestine Monetary Authority

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