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The union of insurance companies announced this week that it too objects to the recommendations of the Hodak committee on bond market reform.

The union includes Migdal, Clal Insurance, Harel, Menora-Mivtachim, Phoenix, Eliahu, Ayalon, the ILD Insurance group and Direct Insurance. It is led by Yonel Cohen, CEO of Migdal.

Why does it matter? Because the committee, charged with forming regulations to govern bond issuers, led by attorney David Hodak, happens to include one Anat Levin. Levin is the manager of Migdal's investment division.

The insurance firms are in good company: The IDB group, the Association of Banks in Israel, the Association of Publicly Traded Companies and the Israeli Forum of Chief Financial Officers have already come out against the committee's preliminary recommendations.

But while the others settled for stewing, the insurance companies took their complaints straight to Yadin Antebi, the Finance Ministry's commissioner of capital markets, insurance and savings.

The insurance companies' main complaint about the Hodak committee - officially known as the Committee to Determine Parameters for Consideration by Institutional Investors Providing Credit through Non-Governmental Debenture Purchases - is that the parameters for extending loans (i.e., buying bonds) are too strict. The rules would wind up essentially transferring investment management from the institutionals to the treasury. Plus, they object to the fact that the treasury is already pushing to have the recommendations implemented, even though the committee has issued only a draft circular.

Also, like everyone else, the insurers don't like how the recommendations would let institutionals recall debt immediately following any change in control - for instance following acquisition, sale, merger and the like - that they had not previously approved. Also, the insurers object to the demand that debt-issuing companies be prohibited from collateralizing assets to anyone else but the institutionals after the bond issue.

Migdal denied that two of its top officials were at loggerheads and released the following response: "The head of the insurance company union, Yonel Cohen, as well as the head of Migdal's investment department, Anat Levin, agree that pushing through the Hodak committee's preliminary recommendations - which were supposed to be open to public feedback from the affected parties - is moving too quickly. It would be preferable if this hadn't been done before the Hodak committee formulated its final recommendations."