When gunmen burst into Gaza's Palestine Bank on Monday and demanded a quarter of a million dollars the branch manager had to give in -- he couldn't say no to the police.

The incident in Gaza City took place when police run by the Islamist Hamas movement went to impose a court order unfreezing the assets of a health charity at the heart of a bitter factional dispute.

When the Friends of the Patient Society, which operates a small hospital in the impoverished territory, was taken over by Hamas earlier this year, the Palestinian Authority in the West Bank blocked the assets.

A Gaza court run by Hamas then ordered the assets unfrozen and police were dispatched on Monday to enforce it, putting them in the odd position of barging into a bank and asking it to hand over the dough.

"Police carried out a court order today in favour of the Friends of the Patient Society," police spokesman Ayman al-Batniji said.

"In the beginning there were some problems, but then the branch manager cooperated and implemented the order," he added.

An official at the Palestine Bank confirmed the police had taken around one million shekels ($270,000, 200,000 euros) "by force" and said the lender had suspended operations in protest.

Hamas and the secular Fatah movement of Palestinian president Mahmud Abbas have been split into geographically-separated hostile camps since Hamas' bloody takeover of Gaza in June 2007.

Since then, the factional tensions have seeped into nearly all public institutions, giving rise to rival ministries, agencies and organisations in the two territories.

Nearly all Gaza banks are still governed by the Palestine Monetary Authority in the West Bank and boycott Gaza's Hamas-run government.

They facilitate the payment of salaries to Palestinian Authority civil servants, who also boycott Hamas.