Fischer wanted to succeed Oded Eran as Hapoalim chairman

Stanley Fischer  / Photo: Eyal Izhar, Globes

Market sources believe that because of Stanley Fischer's interest, Reuven Krupik was fast-tracked into the chairman's job by his fellow board members.

Stanley Fischer has been interested in becoming Bank Hapoalim (TASE: POLI) chairman for several months, sources inform "Globes." The former Bank of Israel Governor and Deputy Chairman of the US Federal Reserve made it known that he was interested in the position, when it became clear that the late chairman Oded Eran had become too ill to continue in the job, and before he died in June. Eran was replaced by Reuven Krupik, a member of the board of directors.

For the time being Fischer, who is also a former vice chairman of Citigroup, will likely have to make do with a place on Hapoalim's board of directors, although this is becoming a controversial matter.

Last week it was announced by the committee for appointing directors to banks without a controlling core that Fischer was one of three candidates for two available places on Bank Hapoalim's board of directors, who would be voted on at the shareholders annual general meeting. The committee, headed by Emeritus Judge Moshe Gal and including two other permanent members Prof. Momi Dahan and Orit Koren also selected three candidates for two positions as external directors.

But controversy followed when it became clear that the Hapoalim representative on the committee David Avner had given Fischer a low mark, despite his huge international experience, and had recommended another candidate - probably Nurit Krauss, who has major international experience in risk management - to whom he had given a higher mark. Avner resigned because the committee ignored his recommendation amid charges that the committee had 'changed the rules of the game' and acted 'behind his back.'

The committee meeting last week also ousted Dalia Lev after just one terms on Hapoalim's board without recommending her as a candidate to be voted on at the shareholders annual general meeting.

Sources inform "Globes" that Lev's ouster and Fischer's candidacy may be connected. Lev had strongly promoted Krupik's candidacy as chairman of Bank Hapoalim even though she knew that Fischer was interested in the job. Market sources believe that because of Fischer's interest, Krupik was fast-tracked into the chairman's job, and approved by the Bank of Israel, despite the fact that some people knew about Fischer's desire.

Krupik's term as chairman is valid until the start of 2022, the end of his term on the board, with the authority to name a chairman resting only with Hapoalim's board. Before that date Krupik can only be replaced if he is ousted - an exceptional event that last took place when Dan Dankner was chairman of Bank Hapoalim. The ousting was carried out by Fischer as Governor of the Bank of Israel who pressed the then controlling shareholder Shari Arison to replace him for 'corporate governance' reasons.

The Bank of Israel said, "During the period when the late Hapoalim chairman Oded Eran died, the Bank of Israel was informed including by Prof. Fischer and sources in Bank Hapoalim, that it was the desire of Stanley Fischer to bid for a place on Bank Hapoalim's board of directors. The Bank of Israel and its head and the Supervisor of Banks or anybody else did not encourage or not encourage or welcome the initiative."

The Bank of Israel added that the committee to recommend directors is "is independent and impartial" and as the chairman of the committee Emeritus Judge Moshe Gal said had not contact with the Bank of Israel in the process of choosing candidates for the Bank Hapoalim board.

Fischer's reresentatives declined to respond to the recent reports.

Bank Hapoalim said, "The decision of the committee for appointing directors decides on the identity of the candidates for the board. Bank Hapoalim is not party to this process of appointments. The final candidates for the board will be chosen by the annual general meeting of the shareholders and the bank welcomes any choice of a director who can contribute to the activities of the board and continue the bank's success. The bank is not party of the opinions expressed and heard by parties on this matter."

Published by Globes, Israel business news - en.globes.co.il - on August 30, 2020 © Copyright of Globes Publisher Itonut (1983) Ltd. 2020

Stanley Fischer  / Photo: Eyal Izhar, Globes
Stanley Fischer / Photo: Eyal Izhar, Globes
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