Karnit Flug Named as New BoI Deputy Governor

Flug has worked at the Bank of Israel for 23 years, and for the last 10 years served as director of the research department.

Dr. Karnit Flug will be the next deputy governor of the Bank of Israel. She will replace Prof. Zvi Eckstein who is returning to academia in July after five years at the central bank.

Yesterday, the governor of the Bank of Israel, Stanley Fischer, announced he will propose Flug's appointment to the cabinet, which must approve it. Flug has worked at the Bank of Israel for 23 years, and for the last 10 years served as director of the research department. She has a bachelor's and a master's degree in economics from the Hebrew University of Jerusalem and a doctorate from Columbia University in New York.

Karnit Flug
Michal Fatal

In accordance with the new Bank of Israel Law, Flug will serve as a member of the central bank's monetary committee and administrative council. Both of these are expected to be appointed in the coming months.

In his first term, Fischer preferred to appoint outsiders to senior positions, and many did not carry out the job to his full satisfaction, central bank sources said yesterday. Recently, the governor changed his tactics and is now appointing central bank insiders, such as in the case of David Zaken, who was appointed the supervisor of banks.

Barry Topf also gets a promotion

In addition to Flug's nomination, Fischer announced he was appointing Barry Topf, the head of the market operations department, as his senior adviser on monetary policy and as a member of the soon-to-be-appointed monetary committee. Topf will remain in his present position for another four months.

Topf has worked at the central bank for 30 years and was previously head of the foreign currency department.

"Barry Topf has already contributed a great deal to the success of the Bank of Israel," said Fischer in announcing the appointment. "His professionalism, commitment and reputation are well-known in Israel and abroad, and their results are evident constantly. I am confident that in his new role as a member of the monetary committee and member of the administration of the Bank of Israel he will continue to make an important and significant contribution to the success of the economy and the country."

Central bank sources said they hoped that Topf and Flug would be replaced in their current postions by Bank of Israel insiders.

Fischer also praised Eckstein, the outgoing deputy governor, for his service, saying he would "like to offer my sincerest thanks to Prof. Zvi Eckstein for his great contribution to the Bank of Israel and to Israel's economy, in particular during the economic crisis, as well as his help in getting the Bank of Israel Law passed by the Knesset, the approval of the wage agreement, the formulation and implementation of the restructuring of the bank, and for his loyalty to the Bank of Israel and its objectives."