At the end of 2022, Palo Alto Networks founder Nir Zuk celebrated the award of a license for a new digital bank from the Bank of Israel, Esh Bank, in which he is a shareholder. The bank, set up by three young techies with no financial background, recruited former Israel Securities Authority chairperson Shmuel Hauser and former CEO of Bank Massad and Bank Otsar HaHayal Kobi Malkin, and set out with a promise of revolutionizing the banking market in Israel and beyond.
The bank said it would accomplish this through technological development that would replace all existing banking information systems, making the bank much leaner and more automated, with the lowest commissions on the market. Under the original plan, the bank was to have employed not more than 150 people at its launch, scheduled for 2025. The opening of the bank to the public is liable to be delayed, however, if the war drags on into next year. The company believes that as long as people’s attention is on the war, it will not be the best time to launch a new consumer brand. The bank has three years in which to launch commercially from the date it was given a license in December 2022.
Ambitious goal
Since the award of the license, the bank has gone under the radar, and it management has been silent. The last update to its website was in August 2023, marking the appointment of former deputy governor of the Bank of Israel Nadine Baudot Trajtenberg, Prof. Shmuel Hauser, Dr. Kira Radinsky, Prof. Dan Galai, and Ester Levanon to its board of directors.
Banking industry sources say that Esh has set itself an ambitious goal: development of all of its data systems from scratch, including the heavy core systems and the credit underwriting systems, which it is still working on. Another goal is a launch with three products at once: deposits and current accounts; payments; and credit cards. The launch will therefore only take place when all three products are sufficiently ready.
Sources inform "Globes" that, since the new bank was announced two years ago, about 100 employees have been recruited to two companies: Bank Esh and Esh OS (operating systems). Both are owned by the same shareholders: Nir Zuk, Clal Insurance, and the founders Yuval Aloni and Alex Liverant.
Most of the employees are in Esh OS, the technological company behind the venture, indicating the bank’s intention of employing as few people as possible, with most of the banking activity being automated. The plan is for Esh OS to sell the systems it develops to third parties.
Published by Globes, Israel business news - en.globes.co.il - on September 11, 2024.
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