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Banks Supervisor Yoav Lehman last week told the Knesset Finance Committee the reason for the low banks profitability was over-spending. (The 2004 first quarter results published yesterday were an exception). Lehman also included inflated spending on salaries.

But not even a day passed before Israel Discount Bank made it clear to Lehman that he could talk all he liked but the bank's minting machines would continue to print. Discount announced that in two weeks when its general meeting is held, chairman Arie Mientkavich would get a golden parachute worth NIS 3.2 million.

The board of directors has already approved the gift and the hot potato has been put on the plate of the bank's shares committee. On the agenda is compensation amounting to 15 month's pay if the new owners of the bank dismiss the chairman - in addition to the 12 months' wages in severance pay to which Mientkavich is entitled under his existing contract.

In addition, the directors would like to grant Mientkavich NIS 575,000 which he waived in 1999, and return to him 10 percent of the earnings he lost in the past few years when the bank was losing money.

All these measures may be unjustified but Mientkavich isn't the only one having a golden time at Discount. A few months ago, the bank management made sure there would be similar golden parachutes waiting for them on retirement and these would also include returning salary cuts from the difficult years.

But why just management? Two days before the announcement of the golden parachute, the bank agreed to give its 5,700 workers a 5 percent pay rise and a grant of half a month's salary.

So is it surprising that everyone is happy? Is it surprising that Riki Bachar, chairman of the workers' committee, has become an enthusiastic supporter of Mientkavich's golden parachute? He is already planning how to get similar parachutes for all the other workers.

Israel's banks do not exist in an atmosphere of thriving competition, but rather in one of limited competition. As a result, they can charge us exorbitant fees and interest rates, and keep a large reserve of workers on high salaries. There is a 12-15 percent excess of manpower in Bank Hapoalim, 15-20 percent in Bank Leumi, and 20-25 percent in Israel Discount Bank. That is why the management of Discount should be the last to milk the bank.

If the bank had a serious board of directors, it would tell Mientkavich that his current salary - NIS 120,000, which costs NIS 160,000 per month - is more than high enough, that his current agreement is sufficiently generous, and that there are excellent people willing to take over the job if he feels the quid pro quo is too low.

The chairman of the bank shares committee, Naomi Stern, must stop this mistaken move. The finance minister recently told the committee he opposes the Mientkavich golden parachute, but the committee is not obliged to accept this. Nevertheless, it would be appropriate to hope common sense and public responsibility might gain the upper hand.