FM unveils Bank Leumi share distribution plan to public
Immediately after the privatization of Israel Discount Bank, the government plans to accelerate the sale of Bank Leumi.
And in a move that won't be lost on political commentators, Finance Minister Benjamin Netanyahu Tuesday presented his plan for the Leumi deal, which would involve the distribution of shares to the general public.
The state is slated to hand out almost 32 percent of the country's second-largest bank, which is worth NIS 5.5 billion on the exchange. The Finance Ministry hopes the plan will be set to go by the end of the year.
Accountant General Yaron Zelekha estimated that the plan constitutes a NIS 4 billion perk for citizens, or an average of NIS 1,000 for everyone over 18.
Nonetheless, senior government figures have sharply criticized the treasury's plan. They say it is unclear whether the plan constitutes a perk due to its high NIS 100 million cost. They are also concerned that the experimental move could leave room for fraud and deception.
The government sources say the precedent-setting step involves high risks and costs, and shareholders from public and the bank itself will pay the price of any mistakes.
The three-staged program involves the distribution of shares to all registered voters directly to their individual bank accounts.
Tuesday's presentation included several substantial amendments to previous versions including receipt of the shares into existing bank accounts, rather than dedicated accounts opened at the Postal Bank.
The public will pay for the shares, at an 85 percent discount, at the time of their sale and not when they are distributed, as had been planned. Every citizen is expected to pay NIS 200 for the shares, or NIS 400 per family. If the bank's share price on the Tel Aviv Stock Exchange rises, the value of the perk will rise. If the price drops, the perk will shrink.