Will Pay Limits for Israeli Bankers Spark Mass Exodus?

Israel’s parliament has effectively capped salaries for bankers at $655,000, raising fears that the best minds in the money business will flee the sector for industries with no such limits.

The new Knesset law was designed to soothe public anger over income inequality but has sparked fears of a mass exodus at a time when jittery world financial markets call for experienced hands, Bloomberg reports.

“I hope the law won’t prompt the early retirement of key people at the banks all at once,” Bank of Israel Governor Karnit Flug said at a news conference in Jerusalem on Sunday, the news agency reported. “It’s preferable that such processes be gradual.”

The law, passed March 28, practically limits bankers’ individual salaries to 2.5 million shekels. That’s a healthy 20 times the average Israeli wage, but is less than a third of what CEO’s at the two biggest banks raked in last year.

It may already be having an impact. The head of Hapoalim, Israel’s largest bank, last week said he will quit to seek new business challenges.


Your Comments

The Forward welcomes reader comments in order to promote thoughtful discussion on issues of importance to the Jewish community. All readers can browse the comments, and all Forward subscribers can add to the conversation. In the interest of maintaining a civil forum, The Forward requires that all commenters be appropriately respectful toward our writers, other commenters and the subjects of the articles. Vigorous debate and reasoned critique are welcome; name-calling and personal invective are not and will be deleted. Egregious commenters or repeat offenders will be banned from commenting. While we generally do not seek to edit or actively moderate comments, our spam filter prevents most links and certain key words from being posted and the Forward reserves the right to remove comments for any reason.

Recommend this article

Will Pay Limits for Israeli Bankers Spark Mass Exodus?

Thank you!

This article has been sent!