Israeli banks will have to pay additional taxes amounting to $700 million over the next two years. The financial cost of the Gaza war on Israel exceeds $40 billion in the period 2023-2024.
With inflation declining and economic growth slowing, the Central Bank of Israel reduced the key interest rate to 4.5% last January. Israeli banks also agreed to establish a fund worth 100 million shekels to support loans provided to reserve soldiers and small business owners. The Tel Aviv index of the five largest banks fell 1.2% in afternoon trading yesterday, Monday, while the broader market stabilized.