Dear Governor, a veteran contractor, 35 years in the field, who has behind him the execution and initiation of about 600 construction and infrastructure projects in Israel, is writing to you from the heart. Yes, Mr. Governor, to build I certainly know, but what to do that every project needs funding - and here I have already lost my arms and legs in search of logic;
Following the jump in the Bank of Israel interest rate in just one year, bank profits have multiplied by an average of threefold. 3X sir. And you, who gave it to them "as a gift", must intervene. Things are simple.
Six months ago, the bank would have earned NIS 3 million annually, about 10%. Today, as already mentioned, his profits have increased at least 3-fold. Just mentioning that exactly a year ago the prime interest rate was 1.85% and today it is 6.25%.
As a result, the average mortgage has risen over the past year by a repayment of about NIS 2,000 a month per family, and hundreds of thousands of shekels in total financing. Does that make sense to you, Mr. Governor?
Shalom Shitrit, one of the owners of Shteit (Photo: Shalom Sam Yitzhakov)
Bank customers – that is, on the one hand, we own the construction companies, and on the other hand, mortgage takers – are the big losers who pay much more.
Every month a little more and a little more,
mortgage borrowers have difficulty paying the monthly repayment of the mortgage, and companies increase their financing expenses from month to month. The banks, which encouraged the financing processes, benefited at the time when taking out the financing and benefit many times more today. And that makes sense to you, Mr. Governor?
Just to clarify, two years ago all the banks together earned about 2-3 billion. Now they earn 20 billion. So basically the banks are the only beneficiaries.
Bank of Israel Governor Amir Yaron (photo: image processing, Flash 90; none)
All this, while the entrepreneurs lose, the citizens lose the most and the country will lose big time. The loss to the state as a result of the damage to the real estate industry, and thus in the collection of taxes from real estate, is expected to reach tens of billions of shekels. It would be a disaster for a country like ours.
Dear Governor, your job is to set limits on the banks. The interest rate increase that wanted to represent a recession would actually produce a collapse.
And finally, a word to MKs - this entire budget is one big bluff built on false representations. Without the real estate tax revenues that already reached NIS 40 billion last year, you have nothing to finance and nothing from the headlines you provided.
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