Is­raeli banks told to cut in­ter­na­tional op­er­a­tions

Banking Frontiers - - Regulator -

The bank­ing su­per­vi­sion de­part­ment of Bank of Is­rael has di­rected banks in the coun­try to fur­ther tighten their mon­i­tor­ing mech­a­nism of branches out­side the coun­try. The cen­tral bank had ear­lier brought in sev­eral mea­sures to con­tain in­ter­na­tional ac­tiv­ity the banks. This is a fur­ther step in the same di­rec­tion. The bank said the coun­try’s banks have sig­nif­i­cantly re­duced their over­seas ac­tiv­ity in re­cent years. As a com­ple­men­tary step to this re­duc­tion, it is de­mand­ing that the banks re­con­sider their re­main­ing over­seas busi­ness and re­strict it to a small num­ber of im­por­tant coun­tries and branches in a way that will fa­cil­i­tate an al­lo­ca­tion of re­sources that is suit­able in ex­tent and qual­ity for the sake of ap­pro­pri­ate risk man­age­ment. Banks will now have to re­de­fine the strat­egy for over­seas ac­tiv­ity and their risk ap­petite for it. The aim ap­par­ently is to re­duce ac­tiv­ity in emerg­ing mar­kets, where the risks are con­sid­ered much higher.

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