Bank Official Resigns

Raphael Recanati resigned Monday as managing director of the Israel Discount Bank, which the Recanati family has owned for 50 years. Resigning with him were his sons, Ehud and Leon Recanati, both directors the bank, and Eli Cohen, one of its top executives.

Their resignations came less than 24 hours after the Cabinet decided Sunday to give Bank of Israel Governor Cabinet decided Sunday to give Bank of Israel Governor Michael Bruno a free hand to remove Recanati, who had refused to step down voluntarily.

His resignation and those of the chief officers of Israel’s three other largest banks were recommended in the report released in May by a commission of inquiry headed by Supreme Court Justice Chaim Beisky. The commission, set up to investigate the 1983 bank shares scandal, held the heads of the major banks culpable for the collapse of bank stocks which touched off a financial panic. According to the commission, the banks grossly inflated the value of their shares to mislead investors. It recommended that their chief officers be forced to resign. The heads of the other banks complied. Recanati was the only hold-out.

The Discourt Bank Board of Directors announced Monday that would be replaced by Yosef Ciechanover, former Director General of the Foreign Ministry and more recently head of the Israel Discount Bank’s operations in the U.S. Ciechanover said he would make no public comment for the time being.

Recanati too refused comment as he left his Tel Aviv office Monday.

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