Palestine Monetary Authority

PALESTINE MONETARY AUTHORITY

Instructions No. (9) of 2021

Regarding the Extension of the Application of Instructions No. (27) of 2020

Based on the provisions of Decision-Law No. (9) of 2010 regarding Banks, and in accordance with the powers delegated to us, and in the public interest, we have issued the following Instructions:

Article (1)

Scope of Application

The provisions of these Instructions shall apply to all banks licensed by the Palestine Monetary Authority under the Ministry of Banking Affairs in Palestine.

Article (2)

Procedures and Measures

In light of the continued negative effects resulting from the repercussions of the coronavirus crisis on economic sectors, and aiming to assist affected borrowers under difficult economic conditions, enable them to meet their financial obligations, preserve employment, and develop the production cycle, the following has been decided:

1. Allowing the application of Instructions No. (27) of 2020 regarding mitigating the effects of the financial crisis and the coronavirus crisis (COVID-19) on installments expected to mature until 2021/12/31.

2. Credit obligations maturing for affected customers (individuals and companies) as a result of the current economic conditions shall be addressed through restructuring or rescheduling of facilities/financing, with the aim of supporting operational challenges and short-term liquidity financing in accordance with the conditions stipulated in the aforementioned Instructions.

3. Obtaining prior approval from the Palestine Monetary Authority when processing credit in accordance with Instructions No. (27) of 2020 for customers representing a credit concentration of related companies and facilities/financing granted outside Palestine.

4. The bank must manage customer credit obligation processing operations in a transparent manner that achieves the objectives of the aforementioned Instructions and enables customers to meet their obligations, ensuring that risks are identified and measured correctly and accurately. There must be continued identification and classification of cases where borrowers, particularly in sectors most affected by the current crisis and individual customers, may face long-term financial difficulties (e.g., fundamental disruption and/or decline in repayment sources) in accordance with prevailing Instructions, in order to provide accurate information regarding the quality of the bank's portfolio and to ensure adequate provisioning for it.

Article (3)

Cancellation of Conflicts

Any provision conflicting with these Instructions is hereby repealed.

Article (4)

Implementation and Enforcement

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

Issued in Ramallah on Sunday, 2021/05/09

Dr. Firas Malham
Governor

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