NYC Comptroller Reverses Decision to Buy Israeli Bonds

New York City Comptroller Mark Levin, who had pledged to resume investments in Israeli government bonds, has reversed his decision, stating that the move is "not suitable at this time." Levin, a Jewish Democrat and long-time supporter of Israel, announced the change ten months after taking office, citing "technical difficulties" and economic considerations. He explained that his investment team concluded the deal was not currently viable, despite his personal ties to Israel, including speaking Hebrew and having family there.

Levin initially campaigned on a platform of reintroducing Israeli bonds into the city's pension funds and defended the idea after assuming office. However, he now states that a full financial picture was not available when he made those promises. He had hoped Israel's credit rating would improve or bond yields would rise, and also aimed to counter calls for divestment from Israel. The decision comes as credit rating agencies have downgraded Israel's rating since the start of the recent wars, with Fitch issuing a negative outlook due to rising public debt and security risks.

The amount in question is relatively small within the city's vast pension system, which manages approximately $326 billion across five funds for over 750,000 employees. Levin directly oversees about $1.3 billion, and the city has held Israeli bonds for nearly five decades. While this decision pertains to new bond purchases, the city's pension funds still hold over $285 million in investments in Israeli companies.

This reversal contrasts with the stance of Levin's predecessor, Brad Lander, who in 2023 chose not to purchase new Israeli bonds upon maturity, citing an investment policy against foreign government debt. Lander faced accusations from former Mayor Eric Adams that his decision served the boycott, divestment, and sanctions (BDS) movement, which Lander denied. Levin, conversely, had called Israeli bonds a "sound investment" during his election campaign.

The political context also plays a role, as current Mayor Zohran Mamdani publicly opposed resuming purchases, noting the city does not buy bonds from other foreign governments. Additionally, pro-Palestinian activists protested in April demanding Levin refrain from the investment. Despite these pressures, Levin maintains his decision is not ideological. Meanwhile, the New York State Common Retirement Fund, a separate entity, holds approximately $333 million in Israeli government bonds and has no plans to change its investment policy, according to State Comptroller Thomas DiNapoli.