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Eighteen years after the publication of the Bejsky Report following the bank share manipulation scandal, the commission's key recommendation is about to be implemented. The Bachar Commission on reform in the financial market and banking sector, headed by Finance Ministry Director-General Yossi Bachar, has already drafted a recommendation to split the provident and mutual funds, and underwriting operations, from the banks.

The recommendation means the banks will no longer own or manage provident funds, mutual funds, or underwriting companies. The banks currently hold 97 percent of Israel's provident funds, 86 percent of the mutuals sector, and they dominate the field of underwriting.

Commission members agree on the need for this complete separation, so it is clear the commission's recommendations will be grounded in this premise. The separation from the banks will cover ownership, and not just management of the funds. This is the only point on which the commission is in agreement. The details of how the separation is to be made are still in dispute.

Commission members do not agree on whether the separation of the provident and mutual funds and underwriting operations will be directed at the entire banking sector or only at the two major players - Bank Hapoalim and Bank Leumi. These two banks alone hold 65 percent of the mutual fund sector and 70 percent of the provident fund sector. They also dominate underwriting for the stock exchange.

Differentiation between the two major banks and the rest of the sector is designed to address what is considered one of Israel's most serious financial problems: Two banks dominate the financial markets and essentially the entire economy.

The separation of funds from banks is designed to address the substantial conflicts of interests the banks face in providing credit, issuing companies and investing the public's money in financial markets.

Another disputed issue is the insurance companies. Will they be allowed to buy the provident and mutual funds that the banks put on the block, will there be a sweeping rule for all insurance companies or will there be demarcation between the two largest players in the sector - Migdal and Clal - and the rest, and will insurance companies be allowed to merge with banks?

The commission will also attempt to upgrade the financial market by granting permits and removing obstacles to allow the launch of new financial instruments that do not exist in Israel to date.

The commission is far from making decisions on all these points, despite an obligation to issue its recommendations by June 30. The commission is expected to meet several times during the month, in efforts to reach agreement and draft final recommendations.

In addition to Bachar himself, the commission includes the treasury Supervisor of Capital Markets Eyal Ben Chelouche; Israel Securities Authority chair Moshe Terry; Antitrust Commissioner Dror Strum; and Justice Ministry financial sector expert Davida Lahman Messer.