TEL AVIV — Prime Minister Benjamin Netanyahu and President Barack Obama set aside their differences on Wednesday and said farewell in a meeting that took place in a “light-hearted atmosphere,” a senior Israeli official said.

The official, who traveled to New York as part of the Israeli delegation to the UN, contradicted reports from a White House official that the meeting was dominated by Obama’s profound “concerns about the corrosive effect that settlement activity, that is continuing when the occupation enters its 50th year, is having on the prospects of the two state solution.”

According to the Israel official, who spoke to the Times of Israel, the hitherto acrimonious relationship between the two leaders is “mellowing.”

“There is an interesting change in the relations [between them]. It’s like an on old couple that is just getting to know each other.”

Another senior Israeli official concurred with the assessment of the two leaders as “old,” comparing them to Statler and Waldorf, the two grumpy old men from the Muppet Show.

Deputy National Security Adviser Ben Rhodes said he doubted reports that Obama would use the meeting to discuss the notion of a new peace initiative to be implemented between elections and his final day in office in the new year.

Prior to the closed-door meeting, which lasted an hour, the two joked for the cameras and Obama mused about future visits to Israel that will not be for diplomatic purposes, but rather to take his family to see the “sights and sounds of a remarkable country.”

Obama did, however, mention his concerns over Israel’s settlement activity, though he did not expound on the point.

The Israeli official contended that the settlement issue was not discussed further at the meeting.

“There’s an elephant in the room. But [they] didn’t talk about it,” the official said, adding that settlements “weren’t the essence of the meeting. They didn’t take up much time in the conversation. It was a marginal part of the meeting.”

According to the official, Netanyahu briefly reiterated his view that Israelis living in the West Bank are not an obstacle to peace, while the Palestinian demand for the right of return and the refusal to recognize a Jewish state are impediments.

On Tuesday, Obama said Israel could not continue occupying Palestinian land in his speech at the UN General Assembly.

The majority of the meeting was comprised of security and intelligence-related discussions regarding the Middle East at large, the official said.

Syria was discussed at length, as well as other issues concerning military cooperation between the U.S. and Israel. Iran was mentioned but the official did not comment further on that.

“We agree on almost everything. We coordinate on more things than people think,” the senior official said, adding that military and intelligence cooperation is “truly a two-way street.”

The meeting between the two leaders was likely the last face-to-face encounter before Obama leaves office.