Bank Leumi examines future of portfolio management business

Bank could establish its own portfolio management business to replace the portfolio investment division.

By SHARON WROBEL
April 18, 2006 21:59
1 minute read.
bank leumi 298 88 aj

bank leumi 298 88 aj. (photo credit: Ariel Jerozolimski [file])

 
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Bank Leumi is reconsidering the continuation of its portfolio management business following the sale of Psagot Ofek to York Capital Management at the end of last year. Currently, Bank Leumi is in the process of examining three options, a bank representative told The Jerusalem Post. Among them was the possibility of the bank establishing its own portfolio management business to replace the portfolio investment division, which is being sold off to York Capital Management. As part of the sale, however, Leumi has acquired an option to buy half of Psagot Ofek's portfolio management business. Making use of the option would be another way for Bank Leumi to continue its portfolio management services, although the bank said it had not yet decided whether it would make use of the option. The third possibility under consideration, according to the bank, is the complete withdrawal from the investment management business. In accordance with the Bachar reforms, which obligate banks to sell their mutual and provident funds interests, Bank Leumi last November sold the business operations of its Psagot Ofek unit to New York-based York Capital Management for NIS 1.35 billion. York Capital was the first foreign investment company to buy an Israeli asset management company after the Knesset passed the Bachar law in July 2005.

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