The local authorities say that the agreement solves the problems of only 67 of 155 local authorities.
Bank Otzar Hashilton Hamekomi, controlled by European group Dexia Bank (Brussels, Paris: DEXI), has signed an agreement with the Ministries of Finance and the Interior to provide NIS 450 million in financing to local authorities.
The ten-year agreement provides credit to 67 local authorities whose financial situation is solid enough to repay the credit. As collateral, the bank will receive a check, in respect of the local authorities’ equalization grants, amounting to 25-45% of the credit. The state has authorized and guaranteed the credit.
Bank Otzar Hashilton Hamekomi said that the signing of the financing agreement just before the Passover holiday would make it possible for the local authorities to pay their employees before the holiday.
At the same time, the local authorities said today that the agreement constituted only the start of a solution for their financial plight, and that without continuation, the agreement would be worth little. The local authorities assert that the agreement provides solutions for 67 out of 155 local authorities undergoing various stages of recovery plans, while the other local authorities were not covered.
Published by Globes [online] - www.globes.co.il - on April 10, 2005