A few hours after the publication of the report by the International Monetary Fund (IMF) fiercely criticizing the recommendations of the Strum committee on competition in banking, and warning of harm to the stability of Israel's banking system if they are implemented, the Ministry of Finance, unfazed, published the draft bill for implementing the committee's recommendations yesterday evening, even though the committee's final report has yet to appear. The draft bill states that the final report is due to be released today, more than a year after it was decided to form the committee.
"The committee reached the conclusion that in the current state of affairs and given the fact that previous attempts have not led to change in the retail banking sector, there is no avoiding a series of structural changes, the purpose of which is to build a non-banking threat to the banking system (among other things through separating the major banks from their credit card companies) and at the same time to create conditions conducive to greater competition within the banking system," the draft bill states.
"This measure is intended to enable competitive and sustainable players to enter the market in the near future and become a 'competitive threat' to the banking system, to create competition in banking and financial services in the retail sector. The committee also recommended a series of supplementary measures the purpose of which is to enable new players to enter the banking and financial services market, the process of entering which at present is long, difficult and uncertain," the bill further states.
Published by Globes [online], Israel business news - www.globes-online.com - on July 7, 2016
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