Interest on current account credit balances: class action certified against Mizrahi Tefahot and three other banks

The details on this page are based on Mizrahi Tefahot Bank's immediate report of September 23, 2026, on a Calcalist article published on ynet and on an article on Bizportal. We did not have the full text of the decision.

It is important to know from the outset: this is a decision that certifies the conduct of the claim as a class action. The court did not decide whether the banks must pay, and the claim has not yet been heard on the merits. According to ynet, the banks are expected to appeal the certification of the class action.

Background: class action over interest on current account credit balances against Mizrahi Tefahot and three banks

The motion was filed in June 2023 against Bank Leumi, Mizrahi Tefahot Bank, Discount Bank and First International Bank. According to the applicants, the banks did not pay interest on credit balances in current accounts, and did not disclose to customers that interest could be obtained by placing the funds in a deposit. The applicants are represented by attorneys Yitzhak Aviram and Shahar Ben Meir.

According to Bizportal, the applicants estimated the damage in the years 2022 to 2025 at NIS 3.6 to 5.1 billion. According to ynet, the economic opinion attached to the motion estimated the damage up to the date it was filed at NIS 3.62 to 5.06 billion, and the alleged damage is currently estimated at more than NIS 15 billion for all the banks together. These are estimates of one party, not a liability that has been determined.

The parties' arguments

According to Bizportal, the applicants alleged breach of the duty of good faith and the fiduciary duty, unjust enrichment, misrepresentation and unreasonable refusal under the Banking Law. The banks argued that there is no legal source obliging them to pay credit interest or to transfer balances to a deposit automatically, and that the agreements with the customers addressed the matter explicitly. According to ynet, the banks argued that the account opening contracts provide that paying interest on the current account is at their discretion.

According to ynet, the Banking Supervision Department filed a position in the proceeding. It opposed obliging the banks to pay interest on the current account and the automatic diversion of funds to a deposit without the customer's consent, and supported proactive notices to customers.

What the Central-Lod District Court held

According to the bank's immediate report, on September 22, 2026 the Central District Court granted the motion, on the cause of action of unjust enrichment. According to ynet, Judge Shmuel Bornstein rejected the causes of action of breach of the duty of good faith, breach of the fiduciary duty and misrepresentation. The remedy certified for adjudication is monetary compensation for the past period only.

According to ynet, the court held that the enrichment of the banks, which used the customers' funds as a source of financing and derived profits from them, is prima facie an unlawful gain. It was further held, according to the same report, that even if there is no contractual duty to pay interest, the contract does not rule out the cause of action of unjust enrichment. The regulator's position carries weight, but does not negate the right of action regarding enrichment that has already occurred.

According to the immediate report, the class includes anyone who held an account at one of the respondent banks with a credit balance of more than NIS 3,000 on at least one business day, or more than NIS 1,000 on at least three business days, between April 2022 and May 20, 2025. The court noted that the class definition and the period may change later, for example by narrowing it to customers with higher balances or by shortening the period.

According to ynet, the period ends on May 20, 2025 because on that date Amendment 39 to the Banking (Customer Service) Law was passed. As described in the article, the amendment entitles a customer with a credit balance of more than NIS 15,000 continuously for a quarter to a proactive notice and to investment alternatives. Because the legislature regulated the matter going forward, the court rejected remedies for the future, such as the automatic diversion of funds to deposits.

What it means for Mizrahi Tefahot customers

Mizrahi Tefahot customers who held credit balances in a current account between April 2022 and May 20, 2025 may be included in the class definition, as it is currently worded. The definition may change, and it has not been decided whether compensation is due and in what amount.

More class actions against the bank are collected on the page Class actions and in the rulings database.

Sources

• Mizrahi Tefahot Bank immediate report to the stock exchange on the approval of the motion, September 23, 2026 (PDF, in English)
• "Approved: class action worth billions against four banks over profits from current account funds", Calcalist on ynet
• "Class action worth billions over non-payment of credit interest in current accounts approved", Bizportal, September 23, 2026

Frequently asked questions about court rulings against Mizrahi Tefahot Bank

How to cite

Class action against Leumi, Mizrahi Tefahot, Discount and First International (case number not stated in the sources), Central District Court (Lod), 22.09.2026. Source: Net HaMishpat (Israeli courts database), case Class action against Leumi, Mizrahi Tefahot, Discount and First International (case number not stated in the sources).