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As approved by the Episcopal Church Economic Justice Loan Committee (EJLC) of the Executive Council and as part of its economic justice portfolio, The Episcopal Church recently purchased a three-year certificate of deposit for $500,000 in the Bank of Palestine.
This action, approved in late January by EJLC, is in response to several resolutions affirmed by the General Convention, most recently Resolution B019 approved by General Convention in July 2012.
Presiding Bishop Katharine Jefferts Schori said, “I am delighted that The Episcopal Church has now made a positive investment in the Palestinian economy, an action which we have encouraged for some time. This is tangible evidence of our commitment to a healthy economy in the Palestinian territories as a necessary instrument to building a lasting peace.”
The investment is part of the assets which were set aside by Executive Council in November 1989 for socially-responsible fixed-income investments. At year-end 2012, the investments consisted of $3.6 million in deposits at credit unions and similar intermediaries; and $2.1 million in loans to community development intermediaries made through the Economic Justice Community Development Loan Fund.
“Interest earned from these investments is typically below market rates, though an effort is made to achieve rates above the inflation rate in order to safeguard the principal available for future loans,” explained N. Kurt Barnes, Episcopal Church treasurer. “The interest earned in this program flows to the DFMS operating budget.”
In preparation for the purchase, the Episcopal Church Finance Office worked with several organizations, including the Holy Land Christian Ecumenical Foundation, to identify business opportunities in Palestine. The EJLC concluded that an investment in the Bank of Palestine http://www.bankofpalestine.com/index.php?lang=en made the most sense. Barnes continued, “The primary mid-size to large businesses in Palestine are banking services, IT and Call Centers, hospitality and tourism. The banking sector offers liquidity; and as the leading bank in Palestine, the Bank of Palestine is a logical candidate, which in turn will get the money out to community development activities within Palestine.”
Barnes, who met with senior management of the Bank of Palestine, noted that the bank:
• Has well-developed corporate-governance and risk-management structures based on best practices generally seen in North America;
• Makes nearly 20% of its $720 million loan portfolio available to micro and small businesses (SMEs) employing over 10,000 Palestinians;
• Has a green loans program, which encourages water wells, wastewater management and alternative energy sources in order to reduce reliance on often unstable Israeli-sourced energy; and
• Contributes 5%t of its net profit each year to Corporate Social Responsibility initiatives.
Bishop Stacy Sauls, Episcopal Church Chief Operating Officer, commented, “One of the ways we seek to serve at the churchwide level is to make it easy for the Church at the local level, dioceses and congregations, to act on our common convictions. Several dioceses have already approached us about helping them take similar action. Co-investing with us pools resources for good and allows smaller units of the Church to take advantage of the work done on their behalf and access services and opportunities that might not otherwise be available to them. That’s what the churchwide level exists to do.”
Lindsey Parker, of the Diocese of Massachusetts and chair of the EJLC, noted, “We are pleased to receive the Bank’s assurance that the deposit will be directed to SMEs; the Bank's Green Loans Program; or the soon-to-be introduced SME loans for women.”
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