Bank of Israel spokesman: Some bank may have liquidity problem

Bank of Israel announced the decision to raise the banks' ten monetary quotas, beginning at the 4.8% interest rate level, from NIS 100 million per quota to NIS 1 billion.

Bank of Israel noted that "the move is designed to ease intra-bank trade, and other steps will be taken as needed to increase liquidity in the banking system."

"In general," the central bank's spokesman told TheMarker, "when there is a temporary liquidity problem, we take a temporary solution, like the one offered today."

He further maintained, "The fact that one or another bank encountered liquidity problems is unrelated to Trade Bank." Nonetheless, he told us, "the problems at Trade Bank affect the entire banking system ¿ not just due to customer withdrawals, but also, for example, through problems created by the fact that deposits at Trade Bank served as collateral for loans."

Despite his insinuations, the spokesman refused to say if a bank or banks other than Trade Bank have encountered liquidity problems. "It is possible one or another bank has encountered liquidity problems. There are problems in the system itself, and not just at a specific bank," he said.