Ernst Japhet died last night (Wednesday) in New York, at age 76, while undergoing open heart surgery. Japhet served as general manager of Bank Leumi In the period 1963-1986 and as Chairman of the Bank during 1977-1986. Japhet was forced to resign these positions in 1986, following the Boesky share pegging report.
In his time, Japhet was one of the most highly regarded bankers in the history of the State, primarily by virtue of his far-ranging international connections and his success in vastly expanding the operations of Bank Leumi.
On resigning from the bank, Japhet received severance pay amounting to millions of shekels, which causes a public furore. He later waived almost the entire amount, contenting himself with a monthly pension of tens of thousands of shekels.
When the amount of his severance pay became known to the public, Japhet went to live in New York, and was there at the time he was indicted in the share -pegging affair. His trial was separated out from the others, and he was later tried by himself, on returning to Israel. Japhet’s punishment, a nine-month prison sentence, was the harshest meted out to anyone involved in the affair. However, it was quashed by the High Court of Justice. He was also fined hundreds of thousand of shekels.