News
Jacob Frenkel issues sudden withdrawal of candidacy to head Bank of Israel
Jacob Frenkel, who had been approved by both Prime Minister Benjamin Netanyahu and Finance Minister Yair Lapid, yesterday announced that he is withdrawing his candidacy as the next Governor of the Bank of Israel.
Frenkel previously served a term as Governor between 1991-2000 and had agreed to succeed Stanley Fischer, who retired following an extremely successful tenure. Frenkel is credited with bringing Israeli inflation down to levels of other Western economies and liberalising financial markets during his initial period as Governor. He is currently Chairman of JP Morgan International and previously served as Chairman of Merril Lynch International, Vice-Chairman of AIG insurance, and Director of Research at the International Monetary Fund.
However, Frenkel’s candidacy was subject to approval by the Turkel Committee, which is tasked with vetting candidacies for top public service posts. His candidacy had already caused controversy after the State Comptroller ordered Frenkel to return expenses during his first tenure as Governor. Haaretz then revealed that Frenkel had omitted to tell the committee that he had been detained at Hong Kong airport in 2006 over suspicions of shoplifting. Frenkel has claimed that the incident was a misunderstanding, but his failure to disclose it led Attorney-General Yeuda Weinstein to open an investigation.
Last night, in an interview on Channel Two, Frenkel announced that he had “a long conversation with the Prime Minister and the Finance Minister… notifying them that I have withdrawn my candidacy.” Frenkel alleged that the media coverage of the Hong Kong incident was a smear campaign against him, commenting “In an unreasonable and intolerable way, they put a man on the stake without all the facts, simply based on speculation.”
Finance Minister Lapid lamented Frenkel’s decision, saying he “could have been exactly what we needed.” Maariv names interim-Governor Karmit Flug and former-director general at the Finance Ministry Avi Ben Bassat as possible candidates to fill the role.