Norway fund’s ethics body reviews Israeli bank stakes over West Bank settler loans

OSLO, Norway — The ethics watchdog for Norway’s $1.9 trillion wealth fund is scrutinizing Israeli banks’ practice of underwriting Israeli settlers’ housebuilding commitments in the West Bank, in a review that could prompt up to $500 million in divestments.

The Council on Ethics, a public body set up by Norway’s Finance Ministry, has, however, decided not to object to the Fund’s investments in accommodation platforms such as Airbnb that offer rentals in the Jewish settlements.

The body checks that firms in the portfolio of the world’s largest wealth fund meet ethical guidelines set by Norway’s parliament.

In an interview with Reuters on May 22, Council head Svein Richard Brandtzaeg said it was examining how Israeli banks offer guarantees that protect Israeli settlers’ money if the company building their home in the West Bank should fold.

Other practices are also being looked at “but this is what we can see so far,” he said. “That is what is well documented.” He declined to say how long the review would take.

Brandtzaeg did not name the banks but, at the end of 2024, the fund owned about 5 billion crowns ($500 million) in shares in the five largest Israeli lenders, up 62% in 12 months, according to the latest data.

The banks – Hapoalim, Bank Leumi, Israel Discount Bank, Mizrahi Tefahot Bank and First International Bank of Israel – did not answer requests for comment.

Since 2020, they have been included in a list of companies with ties to settlements in the Palestinian territories compiled by a UN mission assessing the implications for Palestinian rights.