He attached the letter to his resume for the forthcoming general meeting of the Bank, which will be held on September 10, at which he seeks to be appointed an external director of the Bank’s Board of Directors.
Stern, who served as an external director at Leumi for 6 years until 2018, is running for the position opposite Salinger, who was in charge of insurance and the capital market from 2013-2018.
Stern also wrote in his letter that the bank lacks a core of control, faces dynamic market conditions, faces significant regulatory reforms, competes with new players from Israel and abroad, manages long-term projects and functions in a local and global economic storm whose future is unclear. “This is the moment experience and expertise are required. Professional in the team that is supposed to outline the bank’s policy, “he wrote.
He noted in a critical tone that the chairman of the board, the bank’s CEO and the bank’s legal adviser – all serve in their first year in office and that “none of the board members have education and professional experience in business law, with an emphasis on banking law, corporate law, corporate governance, liability Corporate compliance management andreputation. Against this background, it is of particular importance to choose from among the candidates for the position of director those who combine banking knowledge, proven experience as a foreigner in a large body and a deep familiarity with Bank Leumi, “Stern wrote.
Salinger, was considered a supervisor of dominance, activism and one of the most influential regulators the insurance industry and the capital market knew. Throughout her tenure as insurance supervisor, there have been frictions between her and the insurance companies. During her tenure, insurance company executives said of her that she was “cold and arrogant.” Now, when it comes to running for the position of foreign minister, it actually needs their support as the institutional bodies that are shareholders in the bank.
Salinger currently serves as an external director at Strauss Group and Arco Holdings, whose main activity is through its subsidiary GPM, which operates approximately 1,400 convenience stores and gas stations in the United States.
Bank Leumi ended the first quarter of 2020 with a loss of NIS 232 million, compared with a profit of NIS 1.09 billion in the corresponding quarter in 2019. The loss was caused as a result of the corona crisis and was reflected in a sharp increase in expenses for credit losses, as well as losses from securities due to the collapse in the markets in the first quarter.
In the first quarter, Leumi made a provision for credit losses in the amount of NIS 860 million.
Most of the provisions, NIS 756 million, are a group provision as a preliminary step to the possibility that many borrowers will have difficulty meeting payments following the crisis. The rest is an individual provision, in the case of specific borrowers who already appear to be in difficulty.
The report for Leumi’s second quarter is expected to be published in the coming weeks. Apparently, in the entire banking system as well as in Leumi, provisions are seen under the credit loss item similar to the first quarter or more.