Sources inform ''Globes'' that Prime Minister Benjamin Netanyahu has decided in favor of the Ministry of Finance and will keep the Capital Markets, Insurance and Savings Division within the ministry. Netanyahu promised the leading candidate for the Supervisor of Capital Markets, Insurance and Savings, Anat Levin, that he would not remove the department from the ministry without the explicit consent of Minister of Finance Yuval Steinitz.
Netanyahu's commitment means that the Capital Markets, Insurance and Savings Division will stay at the Ministry of Finance in its present form, since Steinitz opposed removing the division from the ministry. Steinitz believes that the present structure is best for regulating the capital market.
Levin also opposes removing the division or infringing on the supervisor's authority in any way.
Netanyahu's decision may affect relations with the Bank of Israel. Governor Stanley Fischer and deputy governor Zvi Eckstein have long demanded that the Capital Markets, Insurance and Savings Division should be transferred to the authority of the Bank of Israel. Netanyahu's decision raises the question if Fischer knew of the intention and was notified of it beforehand, and whether it will affect Fischer's staying on for a second term, since transferring the division was one of his conditions (albeit the last in a list) to do so.
The Bank of Israel declined to respond to the questions.
The OECD report on the Israeli economy also recommended taking the Capital Markets, Insurance and Savings Division out of the Ministry of Finance and turning it into a more independent agency.
Published by Globes [online], Israel business news - www.globes-online.com - on November 26, 2009
© Copyright of Globes Publisher Itonut (1983) Ltd. 2009