The controversy continues to swirl around the board of directors of Bank Leumi (TASE: LUMI).
Despite a warning by Minister of Finance Yuval Steinitz, the appointments committee of the bank recommended today to add current CEO Galia Maor as a director. In nominating Maor, the committee relied on a legal opinion rendered by Adv. Yuval Levy, who also is an external legal advisor at Bank Leumi subsidiary Leumi Card.
The significance of the committee's decision is that it means Maor will almost certainly be named chairwoman of the board, replacing current chairman Eitan Raff, unless a court petition, or the Bank of Israe halts it.
The appointments committee did not authorize the candidacy of Prime Minister Benjamin Netanyahu's nominees Ori Yogev, former chairman of Bezeq The Israeli Telecommunication Co. Ltd. (TASE: BEZQ) and of Africa-Israel Investments Ltd. (TASE:AFIL; Pink Sheets:AFIVY.PK) Israel (Izzy) Tapuchi, and former Israel Securities Authority chairman Moshe Tery. Yogev is the prime minister's chief adviser on economic affairs.
Today the bank's board met to determine the agenda for the general meeting in March in which the new directors will be voted on. The board nominated four current directors, and new candidate Maor. Another candidate will be former Governor of the Bank of Israel Prof. David Klein, backed by Leumi's largest individual shareholder, Shlomo Eliahu.
Since only five directors can be chosen, one of the nominees will not be picked.
If Maor is elected, she will resign as CEO, probably after the bank publishes its financials in March.
Maor's candidacy has led to controversy following a call for a two year cooling off period as set by law for executives before joining the board. Both the Ministry of Finance and Ministry of Justice have said that they consider Maor to be within that period, so that she cannot run for the position. Backers of Maor have said that she is considered to have "special talents" which exempt her from the cooling off period.
Published by Globes [online], Israel business news - www.globes-online.com - on January 31, 2010
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