Emirates Leaks

Emirates Leaks reveals: UAE banks are devoting their activities to support Israel’s economy and transactions

Reliable sources revealed fundamental changes in UAE banks’ work to devote their activities to supporting Israel’s economy and transactions.

The agreements declaring normalization between the UAE and Israel quickly extended to large and vital sectors, including the financial and banking sector.

Less than a week after the declaration of normalization, Emirates NBD’s largest Emirati banks rushed to sign a memorandum of understanding with the largest Israeli bank, Bank Leumi. 

This bank was established before the occupation was declared, in 1902 by members of the Zionist movement to prepare for settlement and develop industrial, urban, agricultural and infrastructure projects to serve the new occupiers.

The Vice-Chairman of Abu Dhabi Islamic Bank, Khamis Buharon, boasted that these agreements would support banking services for individuals and companies in their banking needs when travelling or opening a business in the two countries.

Hapoalim Bank

Another preceded this agreement with the second-largest bank in Israel, the Bank of Hapoalim, founded in 1921 by the Zionist Organization of the Histadrut (General Union of Workers in “the Land of Israel”).

This agreement is the first of its kind between the two sides and is part of the start of financial and economic relations between the two parties to the alliance.

On the financial front, too, the Tel Aviv Stock Exchange announced last October that it had launched talks with the Abu Dhabi Stock Exchange, to discuss possible cooperation.

The Dubai Diamond Exchange announced the signing of a memorandum of understanding with its Israeli counterpart to promote bilateral trade opportunities and innovation in the diamond industry.

According to stock exchange data, the total value of rough and polished diamonds traded in Dubai over the past year exceeded 84 billion dirhams ($23 billion).

Extensive financial cooperation

Although financial cooperation is a fundamental pillar in building alliances, it is known that banks are keen not to expand or conclude quick agreements without extensive studies or in-depth assessments.

However, the speed in signing these agreements, which took less than four days following the normalization agreement, raises questions about the Emirati’s motives scrambling towards Israeli banks.

These agreements cannot be considered absurd, or merely a facilitation of commercial and investment transactions, as reported in the media; It is clear that many financial and political dimensions are driving in the shadows.

Insufficient liquidity

The bank’s conditions and financial liquidity are insufficient to face the scenario of withdrawing a percentage of depositors of their money or a bank panic wave scenario.

Thus, the Bank of Israel will benefit from the expected influx of Emirati funds to offset the liquidity drain resulting from its hidden losses.

The expected UAE cash flows are not limited to direct investment by Emirati banks in their Israeli counterparts through loans, deposits and other regular financial instruments.

Indeed, it is likely that Emirati companies will funnel the funds of their future investments in the various economic sectors to the occupation through the Israeli banks with signed cooperation agreements.

Of course, this will mean liquidity and profits on the financial operations of these banks.

Modest investment size

Bank Leumi seems weaker than its predecessor and more in need of liquidity, as its capital adequacy ratio is low.

It is the value that expresses the size of the bank’s investments compared to its capital, which is 14.36.

In other words, the bank’s investments are 14 times greater than its capital, meaning that the bank is exposed to losing much more than its worth if the economic conditions continue to deteriorate.

Especially after losing the stock markets, as the bank is expected to record losses ranging between 200-300 million shekels for the current year.

Corruption and bribes

According to FinCEN documents, this assumption is also reinforced by the involvement of official companies owned by the occupation in corruption and bribery, estimated at $769 million.

Some Israeli banks, such as Bank Hapoalim, were involved in tax evasion, corruption cases and bribery related to FIFA, which cost them nearly $904.3 million.

This is how the features of the massive financial and economic returns that the occupation will reap through the flow of Emirati funds and investments resulting from the normalization agreements become clear.

Israel’s economy appears as a black hole capable of absorbing more money and investments, compensating for its losses and out of its crises.

The worst thing is that this intersects with the occupation’s objectives and its colonial vision, strengthening its control over our country, and establishing itself as a strong and potential economic partner in the region, this time with Arab funding.

It would not be surprising to witness direct settlement financing operations supervised by Emirati banks, as their Israeli counterparts, Bank Hapoalim and Bank Leumi, have previously supervised the settlement operations by contributing to financing and building settlements and enabling Israeli local councils to expand settlements.

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