Netanyahu and Lapid Can't Agree on BOI Governor

PM and Finance Minister meet, don't agree on next Bank of Israel Governor. Official announcement expected by Sunday.

Elad Benari ,

Netanyahu and Lapid
Netanyahu and Lapid
Flash 90

Israel has been without a governor for the Bank of Israel for 108 days, but will have to wait a few more days before a candidate is announced.

Prime Minister Binyamin Netanyahu and Finance Minister Yair Lapid met for two hours on Wednesday evening but were still undecided on the identity of the next governor.

A joint statement published after the meeting said that the two discussed “several issues.” The statement added that Netanyahu and Lapid “agreed to announce the identity of the new Bank of Israel Governor by Sunday.”

Professor Stanley Fischer stepped down from his position as Bank of Israel Governor at the end of June and, since then, Netanyahu and Lapid have had a host of problems naming a replacement.

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.

Some reports suggested that Leiderman’s decision to withdraw his candidacy was made after the Turkel Committee, a panel headed by retired Supreme Court Judge Yaakov Turkel and whose task is to approve nominations for public positions, received letters and complaints suggesting that Leiderman had behaved inappropriately when he worked at the German Deutsche Bank.

Leiderman, however, told Israeli news website The Post that he was convinced that the Turkel committee would have approved his appointment but that this procedure would have lasted more than two months and he was not willing to go through “the nightmare”, as he put it, that Frenkel had gone through.

The three finalists for the position are now Prof. Mario Blecher, Prof. Zvi Eckstein and Victor Medina.

Eckstein, 64, holds an economics degree from the Hebrew University in Jerusalem. He previously served as Deputy Governor of the Bank of Israel and now serves as head of the Economics Department at the Interdisciplinary Center in Herzliya. Medina, 74, has an MA in Economics from the Hebrew University. He formerly held a senior position in the Bank of Israel, was Director-General of the Ministry of Finance in the late 1980s and CEO of the Mizrahi Bank. In 2005 he was a candidate for Governor of the Bank of Israel, but ultimately lost to Stanley Fischer.

According to reports, Lapid and Netanyahu are in disagreement between Eckstein and Medina. Netanyahu has expressed his support for Medina, but Lapid is backing Eckstein.