Israel central bank simplifies process for new banks in bid to spur sector

Israel's banking regulator published a new policy on Sunday that makes it easier and faster to set up a new bank, part of a reform to spur competition in the banking sector and lower borrowing costs. Israel has not awarded new banking licences for decades. The top two banks, Hapoalim and Leumi, control 56 percent of Israel's credit supply. Under the reform, they must divest their credit card companies by 2020 while new, smaller banks with lighter regulations are encouraged.
The new policy enables a party wishing to establish a bank to obtain a limited license within six months and allows it to manage limited deposit and credit provision activities. Until now, the regulator's policies provided only for the establishment of regular sized commercial banks.