Israel's Bank Hapoalim Names Attorney Oded Eran as Chairman

First International, meanwhile, taps Irit Izakson to head its board.

Bank Hapoalim's former chairman Yair Seroussi, left, and ex-CEO Zion Kenan. Sivan Peres

Bank Hapoalim moved quickly to designate a new chairman, naming attorney Oded Eran to the post just hours after Yair Seroussi announced on Tuesday he would step down after the bank was reprimanded for its handling of a sex-harassment complaint.

Eran, 61, was being rumored as Seroussi’s successor before the latter surrendered to pressure from inside and outside the bank to step down. Eran had the backing of Shari Arison, Hapoalim’s controlling shareholder, who began the search of a new chairman several weeks ago. His appointment is subject to approval from the Bank of Israel’s banks supervisor.

Eran has been a director at Hapoalim, Israel’s largest bank, since February. After 23 years as a partner at the law firm Goldfarb Seligman & Company, he has worked there on a of-counsel basis for the last six years. Eran will work together with Seroussi until officially replacing him on January 1, the bank said.

The harassment allegation that led to Seroussi’s resignation was made by an unnamed employee against the bank’s former CEO a decade ago. Seroussi failed to report to regulators, as required, the affair or the payment the bank made to the employee, which in November earned the bank a reprimand when the affair surfaced. Seroussi’s term was originally due to expire next September.

Observers say Eran’s appointment is intended as a signal to regulators that Hapoalim is determined to patch up its chronic corporate governance problems.

Meanwhile, First International Bank of Israel said on Wednesday it had named as its chairwoman Irit Izakson, who has long been affiliated with the Hapoalim group and other Arison companies. Izakson has been on Hapoalim’s board since 1999 and was previously chairwoman of its Isacard unit. She is regarded as close to Arison. Izakson will replace Roni Hizkiyahu, who last month said he was joining the Finance Ministry as accountant general.

Izakson’s appointment, which also requires Bank of Israel approval, would mark the first time an Israeli bank counts women as its top two officers.

Israeli banking has now a preponderance of women in top roles. Smadar Barber-Tsadik has been FIBI’s CEO since 2007, Bank Leumi is headed by Rakefet Russak-Aminoach and Israel Discount Bank by Lilach Asher-Topilsky. The banks supervisor is a former Leumi executive, Hedva Ber.