Outrage Over Bank Leumi EU-Prompted ‘Boycott’ of Yesha Businesses

Heads of local authorities and regional councils in Yehudah and Shomron demanded explanations from Bank Leumi Monday after reports claimed that the bank had essentially banned residents and businesses of the region from a financing program it is offering residents of “Israel proper.” Binyamin Regional Council head Yisrael Gantz said that “the apparent decision of Bank Leumi to bow to the demands of BDS groups and ban hundreds of thousands of residents of Yehudah and Shomron from doing business with it is shocking and unprecedented. We will not continue to work with an organization that boycotts us. I expect a full explanation from the bank and confirmation that they are not boycotting residents of Yehudah and Shomron.”

The sharp reaction came after Yisrael Hayom reported Monday that Bank Leumi had indeed banned residents and businesses from a financing program offered jointly with the European Investment Fund. The fund is aimed at businesses seeking to invest in new technologies, and the EIF is providing a credit framework that will enable Bank Leumi to offer low-cost loans to Israelis that fit the program’s criteria. Among those criteria is a geographical one; the EIF’s agreement with Bank Leumi bans money covered under the program from being used for businesses or individuals in Yehudah and Shomron, areas of Yerushalayim liberated in the Six Day War, and the Golan Heights.

The report said that the EIF had offered the deal to other Israeli banks before making a deal with Leumi, but that the other banks had turned down the EIF, mainly because of the ban. With good reason, said Gantz: Discriminating against residents of Yehudah and Shomron is a violation of Israeli law, and could cost the bank huge amounts in penalties and fines.

In response to the report, Bank Leumi said that “the European guarantees are part of a larger program called Horizon 2020, which was established to promote technology development in Europe. Israel is a part of this program. The eligibility factors were provided by them, and they are very strict. So far, hundreds of companies have received loans worth hundreds of millions of dollars under the program. When joining the program, the bank decided that if there was an eligible candidate in Yehudah and Shomron that did not qualify because of that condition, we would provide them with a loan under the same conditions that they would have gotten as part of the program. So far no companies have sought those loans,” the Bank said in its statement.

Gantz said he was doubtful that that was the case. If the bank did not make clear its position – with actions – it would lose its business from local authorities in Yehudah and Shomron. “I have instructed our financial officers to immediately investigate moving their business away from Bank Leumi, and I recommend that local authorities do so as well,” he added.