Bank Leumi CEO Rakefet Russak-Aminoach has announced she will step down from her position, after having served seven years in the post. Russak-Aminoach’s decision follows a recent statements by the CEOs of both Israel Discount Bank and Bank Hapoalim that they too have chosen to resign. All three of these leading bank executives couched their choice to leave as a function of the fact they had accomplished what they set out to achieve.
While the past few years have indeed been very successful for all the major Israeli banks, the consensus attributes the main reason these executives chose to exit at this point in time to a law passed in 2015; a law which limited the compensation bank and insurance company officers could receive to NIS 2.5 million. The logic behind the law was that since the officers in those two sectors (i.e., banks and insurance companies) operate with public money, their compensation should be measured/restrained within certain bounds. This legislation was very popular. Despite warnings the new law would push the best bankers would leave to work for foreign banks, that has not been the case. In contrast, there is no such restriction on commensurate compensation for those working in the high-tech sector. Given that there seems to be no end to the opportunities available in high-tech, the leaders of the banks appear to be looking in that direction to mandate the precedent for them to be permitted to receive much higher compensation.