US Treasury chief concerned with Palestinian banks being cut off from Israeli correspondents

US Treasury Secretary Janet Yellen said Thursday she is "particularly concerned by Israel's threats" to take action that would lead to Palestinian banks being cut off from their Israeli correspondent banks.

"These banking channels are critical for processing transactions that enable almost $8 billion a year in imports from Israel, including electricity, water, fuel, and food, as well as facilitating almost $2 billion a year in exports on which Palestinian livelihoods depend," Yellen said at a news conference ahead of a G7 Finance Ministers and Central Bank Governors Meetings in Italy.

"Israel's withholding of revenues that it collects on behalf of the Palestinian Authority also threatens economic stability in the West Bank. We and our partners need to do everything possible to increase humanitarian assistance to Palestinians in Gaza, to curtail violence in the West Bank, and to stabilize the West Bank's economy," she added.

Yellen noted that the US administration has issued public guidance and conducted outreach to humanitarian groups to make sure that American sanctions do not stand in the way of legitimate humanitarian assistance to Palestinians in Gaza.

"And my team and I have also engaged directly with the Israeli government to urge action that would bolster the Palestinian economy and, I believe, Israel's own security," she said.