Bank Hapoalim has agreed to extend its correspondence agreements with Palestinian banks until August 15 on special request by the Bank of Israel, in order to win time to formulate a mechanism through which the correspondence could be maintained without infringement of antiterrorism and anti-money laundering laws. "Palestinian trade with Israel accounts for more than 80 percent of its total trade and as a result of canceling correspondence agreements with Israeli banks, the entire Palestinian economy would become frozen. A modern economy cannot work without banks," said the Israel/Palestine Center for Research and Information, which helped to initiate the request in the first place. Palestinian banks depend on Israeli banks for check clearances, letters of credit, and other commerce-related services. Last month Bank Hapoalim set an ultimatum to stop all clearance of Palestinian checks beginning July 5, while Israel Discount Bank set the deadline for August 15. Bank Hapoalim and Bank Discount were the two main banks to keep financial transactions with the Palestinian Authority since the Paris Accords, which determined the two banks as the correspondence banks to Palestinian banks. Following the swearing in of the Hamas government and the new Israeli anti-terrorism law, which prohibits business with organizations that are classified as terrorist organizations, Bank Hapoalim and Bank Discount had decided to cease any operations to obey by this law.