The US has recognized that the Palestinian Authority has met the requirements set by Israel for extending indemnification needed to allow Israeli banks to continue transactions with Palestinian banks. The US hopes that this recognition will push the Israeli government to extend the corresponding banking agreement with the Palestinians for at least another year. Failure to approve the waiver risks an economic crisis in the West Bank and the collapse of the Palestinian Authority. The agreement is set to expire on October 31, and there are concerns that Finance Minister Bezalel Smotrich won't agree to extend it further.