Discount chairman Shlomo Zohar asked to step down

The move is puzzling since the owners are apparently pleased with the bank's performance.

Israel Discount Bank (TASE: DSCT) chairman Shlomo Zohar has been asked to leave by year end, by the bank's controlling shareholder, the Bronfman-Schron group, the bank said in a notice to the Tel Aviv Stock Exchange (TASE) this morning.

Sources inform "Globes" that the leading candidate to replace Zohar was former Ministry of Finance director general Yossi Bachar. Bachar is currently an advisor to several organizations.

The Bronfman-Schron group acquired the controlling core in Discount Bank from the state in February 2006. The Bronfman family owns 60% of the controlling core (15.6% of the bank's shares) and Ruben Schron owns the other 40%. Zohar is an associate of Matthew Bronfman, and has served as chairman since the acquisition. Sources believe that he will step down at the end of the year.

In the notice to the TASE, Discount Bank said, "The board of directors states that the chairman was asked verbally by controlling shareholder, the Bronfman-Schron group, to leave his position at the bank by the end of this year. The contract between the chairman and the bank was for five years, beginning on February 6, 2006, and ending on February 5, 2011."

The decision to replace Zohar is not because of Discount Bank's performance. Sources close to the Bronfman-Schron group say that it is quite pleased with the bank's performance, its management, and especially with the performance of president and CEO Giora Ofer.

A spokesman of the Bronfman-Schron group declined to comment on the report.

Zohar said in response, "My contract ends at the end of 2010. Beyond that, I have nothing to say."

Prof. Amir Barnea told “IDF Radio" (Galei Zahal) this morning, "I have no idea why the decision was taken to oust Zohar. I am surprised. I hope that the other directors knew about the move," He compared Zohar's ouster to the ousting of Bank Hapoalim (TASE: POLI) chairman Dan Dankner.

Discount Bank's share fell 2.1% at the opening today to NIS 7.11.

Published by Globes [online], Israel business news - www.globes-online.com - on November 1, 2009

© Copyright of Globes Publisher Itonut (1983) Ltd. 2009

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