Palestine Monetary Authority

PALESTINE MONETARY AUTHORITY

Instructions No. (50) of 2019

On the Scheduling of Facilities and Financing Granted in the Southern Governorates

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

2. Amend the acceptance of real estate collateral after restructuring 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)

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

1. Based on the down payment conditions stipulated in paragraphs (1), (2), and (3) of Item (Seventh) of Instructions No. (2008/1), banks may schedule 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 scheduling.

2. All other scheduling 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 as non-performing, provided that these debts are scheduled in a manner commensurate with the employee's current income.

4. Pursuant to the provisions of paragraph (1-b) of Article (5) of Instructions No. (2) of 2015 concerning the determinants and controls of granting credit, banks may determine the appropriate scheduling period commensurate with the employee's income, provided that the borrower commits to repaying installments according to the scheduling conditions.

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Article (4)

Calculation of Real Estate Collateral After Scheduling

Pursuant to the provisions of paragraph (d-2) of Item (Third) of Instructions No. (2008/1), banks are permitted to continue accepting real estate mortgages in case of restructuring after scheduling, in accordance with the acceptance ratios specified in Instructions (2008/1), provided that they are not accepted after five years have elapsed since the restructuring. 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 provisions of these Instructions are hereby repealed.

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Article (6)

Implementation and Entry into Force

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

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

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

Supervision and Evaluation Department
Palestine Monetary Authority

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Note:
Ramallah & Al-Bireh Governorate - Palestine P.O. Box 452 info@pma.ps | Fax: +970 2 2415310 | Tel: +970 2 2415251 Gaza - Palestine P.O. Box 4026 Fax: +970 8 2844487 | Tel: +970 8 2825713 www.pma.ps