Bank of Independence for Palestinian Investment and Development — It Didn’t Last Long

Mercy for the martyrs, healing for the wounded, and freedom for the prisoners… in the squares of freedom in Palestine and in Lebanon… and in the solidarity squares for Palestine… wherever they are found… the dawn is coming with the light of freedom… The flame of freedom and independence for the Palestinian people has not been extinguished across generations of old and young for centuries, despite the sacrifices and the pains…!

Before we proceed with writing the lines of our post under the above title, we note that today is the anniversary of the Balfour Promise (2-11-1917)… in which the British Foreign Secretary (Arthur Balfour) pledged in his letter, quoted below, to Lord Rothschild, one of the leaders of the Zionist movement, to establish a national home for the Jews in Palestine: "Dear Lord Rothschild: The government of His Majesty views with favour the establishment in Palestine of a national home for the Jewish people, and will use its best endeavours to facilitate the achievement of this object, it being clearly understood that nothing shall be done which may prejudice the civil and religious rights of existing non-Jewish communities in Palestine, or the rights and political status enjoyed by Jews in any other country." I should be grateful if you would bring this declaration to the attention of the Zionist Federation."... Sincerely: Arthur Balfour

The Palestinian people throughout the world still carry the flame and banner of freedom and the right of return brightly burning… and it grows in intensity and depth with the succession of generations… despite the genocidal war and destruction that were and are being waged against the Palestinian people in the Gaza Strip and the West Bank and Jerusalem… and inside the Green Line and in all the countries of the region where Palestinian refugees or Palestinian communities reside… where some Western countries stood with the Zionist movement in a manner that Balfour’s promise officially announced this support… in the seizure of Palestinian lands, the erasure of their rights, and their expulsion from their homeland… in 1948 when the United Nations established Israel… And it is still before our eyes and on the ears of the world… this entity is participating in and being assisted after more than 107 years since the accursed Balfour Promise… and, unfortunately, no Arab lord among those with influence in the West was able to obtain the sympathy of Western politicians… led by the United States of America, which participates openly in this genocide…and in denying the existence of Palestinians… who are being slaughtered where there was doubt about the numbers of martyrs, wounded, and prisoners that the Palestinian government media offices in Gaza were publishing and documenting to the United Nations, which attested to the truth and accuracy of those figures… no Arab lord or Arab personality, despite close relations with Western countries, was able to obtain a Western pledge or sympathy… to stop the massacres being committed against the Palestinian people to exterminate this people and deport them… once again out of their homeland..!

●      BANK OF INDEPENDENCE FOR PALESTINIAN INVESTMENT AND DEVELOPMENT… DID NOT LAST LONG…!

●      Not enough time passed for the Bank of Independence for Palestinian Investment and Development to carry out its activities fully. From its establishment date on 10 February, 2021, pursuant to (Decree-Law No. (5) of 2021), until its liquidation, when President Mahmoud Abbas issued Decree-Law No. 14 of 2024, dated 29-9-2024, repealing Decree-Law No. 5 of 2021 concerning the Bank of Independence for Investment and Development, in this regard the proverb keeps coming to mind: "You have only been in the palace since yesterday afternoon!"

●      Lawyer Ali Abu Hableh indicated in his article regarding the liquidation of the bank, when he questioned the repercussions and responsibilities for liquidating the bank according to the prevailing laws…. In the bank liquidation decision (Decision No. 14 for 2024), in Article 3 of its five articles, it was stated that the Ministry of Finance, in cooperation with the Palestine Monetary Authority, and the relevant authorities, according to the liquidation decision, must take the necessary measures to settle the bank’s financial position, and that the Ministry of Finance shall inventory what the bank is owed and what it owes, including the bank’s assets, and the bank’s holdings, and the revenues the bank realized as a result of carrying out its activities, and the bank’s financial allocations from the general budget, grants, donations and loans obtained by the bank… etc., and as stated in Article 4 thereof, the financial and accounting regulations of the Bank of Independence for Investment and Development No. 3 of 2023 are to be repealed!

●      The Bank of Independence for Investment and Development was a Palestinian government bank, and the main objective of its establishment was to promote investment and development toward economic and social progress, broaden the productive base of the national economy, and create effective mechanisms to manage project accounts, government funds, and any other projects or funds that the Council of Ministers decides to create and assigns the bank to manage, in addition to contributing to improving the digitization and collection of government revenues, among other things.

●      The bank was to be managed and supervised by a Board of Directors consisting of eleven members all appointed by decision of the Palestinian Council of Ministers, with seven of those members, including the chairman of the board, representing the public sector, and four representing independent members for a term of three years renewable only once, and the board elects from among its members a vice chairman of the board with relevant expertise.

●      The first Board of Directors, upon the bank’s establishment, was formed with the Palestinian Prime Minister at that time, Dr. Mohammed Shtayyeh, as Chairman of the Board, and as of 20 October 2022, the Palestinian Minister of Social Development at that time, Ahmad Majdalani, became Vice Chairman of the Board after he was elected during the board’s third meeting; Mahdi Hamdan held the position of General Manager of the bank, and the board at that time included the Minister of Labor at that time, Nasri Abu Jaish, the Minister of Agriculture at that time, Riyad Attari, the Minister of National Economy at that time, Khaled Al-Assili, the Minister of Higher Education and Scientific Research at that time, Mahmoud Abu Mouis, and the President of the Federation of Palestinian Chambers of Commerce, Industry and Agriculture at that time, Omar Hashim, and it was noted that the Board of Directors of the Bank of Independence for Investment and Development at that time lacked any female representation!...

●      I attempted to find the names of the current Board of Directors — at the time of writing my post on Facebook — on the bank’s website, in case there had been any changes from what was mentioned above, but I found no names except the name of the General Manager of the bank..!

●      In fact, on 29-7-2024 I wrote a post on my Facebook page and my blog in which I included a report on this bank for the year 2022… in which, after the above introduction about the bank, I set out the observations and violations that appeared in the annual report of the State Audit and Administrative Control Bureau (SAACB) for 2023, during the establishment and the stages of operation of the Bank of Independence for 2022, noting that the government Bank of Independence for Investment and Development announced on 16-1-2024 the start of its actual operations by launching a financing instrument for small and medium enterprises.

●      I briefly list some of the observations and violations contained in the aforementioned SAACB report since the bank’s inception and during its formation stages (published on my Facebook page and blog):

●      Disclosure and transparency at the bank:

1- Bank licensing: The final license for lending and financing activity was obtained for the bank from the Palestine Monetary Authority on 5-3-2023, before the Ministry of Finance paid the bank’s capital in accordance with the law..!

2- Board meetings: Only four Board meetings were held during 2022, contrary to Article (6) paragraph (1) of Decree-Law No. (5) of 2021 concerning the Bank of Independence for Investment and Development, and contrary to the instructions issued by the Palestine Monetary Authority in this regard regarding the Code of Rules and Best Practices for Bank Governance, which requires, according to the Bank of Independence law, to hold a meeting at least once each month.

3- The Board of Directors did not adopt policies and procedures to prevent conflicts of interest among its members!

4- The Board did not appoint deputies, or a deputy general manager of the bank, or advisors, or experts, to assist in managing the bank’s affairs, contrary to the bank governance principles issued by the Palestine Monetary Authority!

5- The bank’s capital was not paid in compliance with the laws and regulations of the Palestine Monetary Authority pending completion of the audit process, despite being one of the most important licensing conditions and requirements!

6-    Lease of the bank's headquarters: The process of leasing the bank's headquarters was carried out based on a recommendation from the Secretariat of the Council of Ministers to the Central Rental Committee, and not based on technical studies of the bank's needs and price offers, as is customary with the Committee in similar leasing operations.. where approval of the leasing operation was issued by the Council of Ministers, based on a recommendation from the Secretariat of the Council of Ministers, to the Central Rental Committee !

7-    The cost of using the building is higher than the approved rent! (with reference to the agreement concluded with the leasing company)!

8-    Charging the costs of the bank's internal finishing, (the lessee), divided into four instalments pursuant to the agreement signed by the Ministry of Finance, where there is no appropriation for this bank by the Council of Ministers, nor by the Central Rental Committee, and not deducting them from the annual rent as is customary in similar investment operations!

9-    The budget and the need for experts: The actual need was not taken into account when preparing the general budget of the bank, resulting in a large gap between the budget and budget execution!

10-          In 2021 the Bank of Independence for Development and Investment did not provide a list of its annual need for local and foreign experts, and the positions it requires!

11-          General supplies: The general supplies were not recorded on the supplies and assets register, and an Excel register was relied upon to record the supplies..!

-        Were the above-mentioned violations one of the reasons for the liquidation..?

●      How much we wished, as citizens, observers and specialists, that establishing such a government bank would be a new nucleus and energy to revive the national economy in all its sectors, in compliance with laws and legislation, observing justice, transparency, and the principles of governance, and away from any violations... but we were astonished by the existence of some violations according to the report of the State Audit and Administrative Control Bureau (SAACB), and we had hoped that what could be corrected would be corrected.. and that violators would be held accountable according to the rules and governing legislation.., and that the principles of governance would be reinforced, yet the decision issued to liquidate the bank, whose motives and causes for such a step we did not know, struck our hopes that we had pinned on the existence of a government development and investment bank in the country, with disappointment...! However, we hope that the State Audit and Administrative Control Bureau (SAACB), being one of the supervisory audit bodies that oversees this government bank, will inform us of the reasons for this liquidation.. and the extent to which the bank's Board of Directors and its management are questioned for their shortcomings, and the extent of responsibility that the related parties may bear that could have caused the collapse of this national edifice!