'We meant to deal with Hapoalim quietly'

BOI Governor Fischer: Knesset has no business interfering in the bank's management issues.

May 6, 2009 13:21
1 minute read.


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Bank of Israel Governor Stanley Fischer rejected on Wednesday the Knesset's plan to intervene in the Bank Hapoalim crisis, including some parliamentarians' attempts to prevent him from removing the bank's chairman Dan Dankner and MK Shelly Yacimovich's call to ratify Fischer's move to dismiss him with a Knesset vote. The Bank of Israel contacted Poalim Group chief Shari Arison several weeks ago following a report by the Banks Supervisor Roni Hizkiyahu, which severely criticized Dankner's management of the bank. Hizkiyahu ordered the report after last month's unexpected resignation of Hapoalim CEO Zvi Ziv and the quick appointment - reportedly three minutes later - of his deputy, Zion Keinan, as his replacement. The BoI requested that Arison take steps to remove Dankner, and threatened to intervene if she wouldn't. Speaking at a Knesset's Finance Committee discussion, Fischer said the bank "[really] should not have intervened in this matter now, in the middle of the biggest financial crisis in the history of the country and in light of the repercussions this would have on the Israeli economy." Nevertheless, Fischer added, "we have decided steps must be taken. Regardless, the question of regulating the banks is an issue of the regulator and the regulated body [and not the Knesset]. "We wanted to solve the Hapoalim issue quietly, as is the custom around the world. These things are usually done quietly and the manager's honor is not hurt. It's not the way it happened here. But we're still hoping to reach a compromise," Fischer said. "Our intention is to strengthen the banking system and the management of Bank Hapoalim as well. The fact that this matter became a public issue is an unfortunate outcome."

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