RAMALLAH, Feb 25: Israeli troops raided this central West Bank town on Wednesday and forced their way into four of its banks and the headquarters of a local rights organization, Palestinian security sources and witnesses said.

Israeli security sources said it was an "operation against the funding and financing of terrorism". The raid aimed to "confiscate funding for terrorism as part of the State of Israel's continuing fight against terrorism and its infrastructure and corresponding to the global war on terror financing", the sources said.

Clashes broke out between soldiers and stone-throwing youths. The army used rubber bullets and teargas to disperse the youths and also beat some of them with the butts of their assault rifles.

The head of Ramallah hospital, Hosni al Aatari, said 16 people were wounded, one of them moderately in his chest, requiring an operation. He said two of the wounded were women, including one foreign national.

The Israeli sources said "funds are being confiscated ... various bank accounts are being examined on suspicion that they have received money from the Hezbollah, Hamas and Islamic Jihad".

The funds could have been "used by terrorist operatives and organizations in the (Palestinian) territories to promote terrorism and carry out attacks against Israel", they added.

The Arab Bank in downtown Ramallah and another branch in El Bireh neighbourhood, the International Palestinian Bank and the Cairo-Amman bank were taken over by troops as soldiers proceeded to cover surveillance cameras with pieces of cloth, Palestinian security sources said.

Troops also barged into the offices of the Union of Palestinian Medical Relief Committees (UPMRC), headed by rights activist Mustafa Barghuti, and searched the accountant's office, employees said.

The army spokesman said "a number of riots erupted with people hurling stones, rocks and molotov cocktails. Forces used non-lethal means to break them up, including rubber bullets".

Palestinian security sources said Mohammed Abu Ghosh, a computer engineer at the Arab Bank and Rateb Aataya, holding the same job at the Cairo-Amman Bank, were arrested overnight. Witnesses at the Cairo-Amman bank said troops were accompanied by Aataya, whom they were holding by force, when they broke into the room. -AFP