| The Supervisor of Banks, Mr. Yoav Lehman, today published a directive of the Proper Conduct of Banking Business regarding "Transferring Activity and Closing a Customer's Account," and sent to the banks the final version of the principles acceptable to the Supervisor relating to the package deal on bank fees for the basic services involved in managing households' current accounts. |
| The directive on Transferring Activity and Closing a Customer's Account simplifies the technical procedures entailed in moving from bank to bank, and minimizes the inconvenience caused to the customer by these procedures. This directive constitutes another step in the activity of the Banking Supervision Department to increase competition in the banking system. |
| The directive obliges a bank to pass to a customer who wishes to examine the possibility or profitability of transferring his activity to another bank and closing his existing account detailed and exhaustive information in writing on all his assets in and liabilities to the bank, as well as any other information required to reach and implement a decision to close his account (direct debits, standing orders, credits, etc.). The directive applies to activity in the bank account and to debit cards issued by the bank for that account. |
| The directive also determines a system that enables the bank to which the customer moves to carry out on his behalf all the steps needed to transfer his activity. Thus the customer can avoid the inconvenience currently incurred in the process of moving his account. The banks have been asked to prepare themselves to implement the directive with effect from 1 December 2005, although some of the changes may require some additional time to complete the computerized adjustments necessary. |
| The Banking Supervision Department has also finalized the formulation of the principles regarding the package deal relating to bank fees wwhich was previously accepted by the Knesset Economic Committee, after solving various problems that prevented its implementation in its original format. Implementing this package deal is expected to considerably lower the cost of the basic services in current accounts of most private customers. |
| In the agreed package-deal format, the fixed bank charge (NIS 10 per month) currently levied in addition to the fee charged on every transaction, and the charge per entry on the statement, will be abolished. Customers may choose from the following options: |
| 1. |
Payment of a fee of NIS 1.21 per basic transaction in the account (e.g., drawing a check or signing a direct debit), with a minimum monthly charge per account of NIS 10 (so that a customer performing up to eight transactions in a month will pay only NIS 10). |
| 2. |
A basket of basic activities agreed with the Knesset Economic Committee for a monthly payment of NIS 18, with each additional transaction in excess of those in the basket being charged at NIS 1.21. |
| 3. |
Other combinations that banks may offer their customers. |
| Furthermore, as part of the steps taken to ease the move from bank to bank, it was decided to reduce significantly the various fees that would be likely to raise difficulties, in the opinion of the Supervisor of Banks, in transferring an account to another bank. It was decided that banks would not charge a customer wishing to transfer his account to another bank more than NIS 40, even if the fees due for the steps necessary to implement the move would amount to more than that sum. Banks may, however, charge extra to cover sums they may have to pay to third parties, such as brokers abroad or the stock exchange. |
| The banks have notified the Supervisor of Banks of their agreement to the above "package deal," and have advised that they can implement it from 1 December 2005, and have been asked to give formal acknowledgement of their agreement to the final version of the package sent to them. The implementation of the package deal currently depends, therefore, on the agreement to it of the various parties involved-the Knesset Economic Committee, the Director-General of the Anti-Trust Authority and the banks. |