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      Appointment Process of BOI Chief Was a 'Disaster', Admits Lapid

      "I don't mind apologizing to Karnit Flug" for the lengthy appointment process, says Finance Minister.
      By Elad Benari
      First Publish: 10/21/2013, 3:13 AM

      Finance Minister Yair Lapid
      Finance Minister Yair Lapid
      Flash 90

      Hours after officially appointing Dr. Karnit Flug as the new Governor of the Bank of Israel, Finance Minister Yair Lapid (Yesh Atid) admitted on Sunday evening that the appointment process had been “a disaster”.

      Speaking to Channel 10 News, Lapid said that he and Prime Minister Binyamin Netanyahu held many meetings on the issue of the Bank of Israel Governor but were unable to reach an agreement.

      "We were not able to reach common ground and then Flug’s name came up,” he said, adding, “I supported her from the beginning and I was glad she was appointed. I would not mind apologizing to her, but if someone is given this role, it is both a compliment and an apology.”

      “I have no doubt that the Prime Minister and Karnit Flug will be able to work together," added Lapid, referring to past differences between Netanyahu and the new Governor, which had led Netanyahu to initially reject her candidacy.

      "She seemed pretty happy today, when she heard of the appointment," he added.

      Flug, who served as the deputy to former Bank of Israel chief Professor Stanley Fischer, was appointed after a lengthy process which saw Israel go for more than 100 days without a governor.

      The position was originally offered to Professor Jacob Frenkel, who previously served two terms as the Governor of the Bank of Israel between 1991 and 2000. Frenkel, however, withdrew his candidacy because of allegations that he shoplifted an item in Hong Kong several years ago.

      Netanyahu and Lapid then offered the position to Professor Leo Leiderman but he, too, withdrew his candidacy for the position.

      Netanyahu and Lapid were criticized for not having offered the position to Flug right away. Netanyahu reportedly rejected her outright, since she did not agree with him on certain issues.