"We have a wonderful people, and we need to keep it that way. Before the economy, before the capital market, before profitability, before everything, the most important thing is that we should know that we really have a wonderful place," Eyal Ben-Simon, CEO of insurance and financial group The Phoenix Holdings said in conversation with "Globes" capital markets reporter Netanel Ariel at the 32nd "Globes" Israel Business Conference.
Before we talk about The Phoenix, you see the situation of the State of Israel after two years of war. There are large deficits, but although growth was weak in the second quarter, we did see strong growth in the third quarter. Do you believe that the expected post-war boom will come?
"First of all, even before the economy, it’s Important that the State of Israel should define the right set of values for itself. Much more important than the Israeli economy, over and above whether growth will be 4.5% or 5%, is that the State of Israel should define its priorities and what’s right for it. Security, for example, is one of the main things we have to be concerned about, because otherwise people won’t want to live here, and certainly won’t want to invest here.
"Another important matter in the set of values of the State of Israel is that we should be prepared to take responsibility. Not just businesspeople, but policymakers as well should be prepared to take responsibility. They should understand that equality is not equality between banks and financial institutions; equality is that we all bear the same burden and also receive the same rights.
"We must understand that the State of Israel needs a long-term plan. It’s not just a matter of understanding what the set of values really is and what values come first, but what values we want to put on the map or vision of the State of Israel. In the end we need a strategic plan that states where we want to go."
"Many countries would like to have a debt:GDP ratio like Israel’s"
Commenting on the State of Israel’s economic strength, particularly after the past few years, Ben-Simon said, "Had you said two or three years back that after we undergo a legal revolution and such deep division and such a terrible war and such a terrible massacre, that after all that the debt:GDP ratio would be 70%, many people would have raised an eyebrow. Many countries would agree to sign up for such a debt:GDP ratio.
"In the end, Israel’s numbers are very strong. Looking ahead, it very much depends on how we manage our order of priorities, that is, where we put the money - on growth, on education, on security, and not just job security, security at the personal level, because it’s unacceptable that people are murdered here in the streets. That’s something that as citizens we must not agree to. So we have to put the State of Israel’s investments in the right places."
On international comparisons Ben-Simon said, "A big investor from the US said to me: ‘Look, in the US we have more brains than in Israel, but when you look at capability and talent as a proportion of the population Israel is a global marvel.’ If we are sensible enough to retain all these talents here and bring in further capabilities, the growth, prosperity and welfare potential of Israel is enormous.
"Along with this, our planning has to take into account the weaker sections of Israel’s population. The fact that businesses make money is splendid, and we’re happy for them. This is the engine that has sustained a great deal of what has happened here in Israel in the past two years, but wise policy also takes this and devolves it downwards to the sections of the population that need help, whether it’s the elderly, or families in distress, or people with special needs, and in the end this has to be the substance of the basis in tradition, religion, or the national mandate that we all grew up on, a country that is meant to improve the situation of all its citizens."
"When you create competition, the growth potential is immense"
For years, insurance company stocks were sleepy. In the past eighteen months, the share price of The Phoenix has soared 300%, making it the third largest company on the Tel Aviv Stock Exchange, with a market cap of NIS 35 billion. Your previous owners, the US-based investment funds Centerbridge Partners and Gallatin Point, missed out on most of the rise, but President Trump’s son-in-law Jared Kushner scored a hit and made a handsome gain. Do you think that more foreign investors will come in?
"First of all, what Centerbridge Partners and Gallatin Point spotted was that The Phoenix was bringing about change in Israel. The Phoenix has just now surpassed the 80,000 mark in the number of new accounts at its investment bank - it has gone from 10,000 to 80,000 in three years. The Phoenix is actually one of the main generators of competition in the financial world, and we did that in a consumer environment the same as for all the institutions in retail credit.
"Foreign investors too realized that The Phoenix is one of the main generators of competition in the financial market, and as soon as you generate competition, your growth potential is immense.
"Incidentally, if we look at the numbers for a moment, the aggregate value of the financial market in Israel, including the banks and the financial institutions and the unlisted firms, is over NIS 400 billion. The Phoenix has reached a market cap of NIS 35 billion, and, assuming that the stock market continues to rise, we’ll go even higher. But in the end The Phoenix represents 7.5% of this market, and the potential of a company that creates genuine competition to grow and go far is immense. How fast? That depends on us."
You continue to expand , and you recently acquired the insurance agency of Itzik Oz.
"I think that despite all the tut-tutting from the policymakers, the regulators, and others, the financial product distributors and the insurance agencies are among the main generators of competition in the financial world.
"In the end, the market in which there are the most transfers between providers is the pensions, provident finds, and advance training funds market."
The question is, is that good?
"That’s an excellent question, but it means that there’s competition. The competition is very strong. It’s true that the financial intermediaries have a great deal of power, but, if we draw a comparison with other markets, in Israel we have much to learn in the financial sector from the US.
"Looking ahead in financial consumerism, I very much hope that we get to a situation in which there are six to seven main players in the financial world in Israel, and I think that it will happen as soon as the influence of the regulators diminishes, because in my view, certainly when you look at the banking reform that is taking shape, and see that what is holding it up is the regulators and not the businesses, you realize that there’s an opportunity here to create much greater competition.
"In the end, the people who will gain from this are everyone sitting here, the financial consumers, whose wealth, we are happy to say, is steadily growing, and they want to consume services exactly like the financial consumer in the US, the UK and Switzerland. There’s no reason for this not to come to Israel, and The Phoenix is the main engine leading the process."
A year ago, you published a strategic plan with a profit forecast of NIS 2 billion for 2027. The forecast for average return on equity was 16-18%, and in fact it can be said that you are already there. What’s the next plan?
"In a few days’ time we’ll release our third quarter financials and we’ll also provide the updated goals. The truth is that since we published the forecast of a NIS 2 billion profit on September 9, 2024, before Israel switched to attack mode, we have revised the forecast several times, once in March with IFRS, and again when we acquired Itzik Oz, and in a couple of days we’ll update the goals map again."
Full disclosure: The Israel Business Conference is being held in cooperation with Bank Hapoalim and Phoenix Group and sponsored by Bezeq, El Al, Tnuva, Electra, Armis, Haifa Group, Hamilton Lane Israel, Doral, Shikun & Binui, BlackRock, Bazan, Pagaya, KPMG, Nespresso, Egged, Zeekr, ICL, and the Israel Medical Association, and with the participation of Israel Ports. Co., Mekorot, Ashdod Port, and the Israel Innovation Authority.
Published by Globes, Israel business news - en.globes.co.il - on November 24, 2025.
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