Bank of Israel officials to take 5% pay cut

The Bank of Israel has been under public scrutiny for paying excessive wages and benefits, compared to other state workers.

By SHARON WROBEL
March 17, 2009 09:04
1 minute read.
bank of israel 88 298

bank of israel 88 298. (photo credit: Ariel Jerozolimski)

Bank of Israel Governor Stanley Fischer and 12 of his senior managers have agreed to a 5 percent salary cut for a year, the central bank announced Sunday. The pay cut was recommended by Fischer and director-general Hezi Kalo. The central bank's managers earn an average monthly base salary of NIS 45,000 to NIS 55,000, while Fischer earns a base salary of NIS 37,382, according to the public-sector wage report for 2007 published by the Finance Ministry. The central bank's economists earn an average monthly base salary of NIS 34,000 to NIS 40,000, according to the report. The Bank of Israel has been under public scrutiny for paying excessive wages and benefits, compared to other state workers, including bonuses and pensions. The central bank has, in recent months, drawn criticism for its intention to allocate "outstanding performance" bonuses in a period when the private sector is undergoing efficiency measures, slashing jobs and cutting salaries. The bonuses for 2008 are part of a salary agreement between management, employees and the government. Management has been discussing the possibility of postponing or canceling the bonuses for 2008. Banks and corporations have cut salaries in recent months in response to the worsening economic climate. At Israel Discount Bank, CEO Giora Ofer and chairman Shlomo Zohar have taken a one-year, 10% wage cut, and last month it was decided to cut board members' salaries by 7.5% in 2009. At Bank Hapoalim, chairman Dan Dankner and chief executive Zvi Ziv announced a voluntary 10% pay cut. Bank Leumi employees in January agreed to have their planned annual salary increase of 5% cut to 2.5% for this year. Union representatives accepted the modification of a 2005 contract in which Leumi had agreed to boost paychecks by 5% a year for five years.


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