Israeli Competition Authority Probes WhatsApp Chats on Bank Association CEO Replacement
The Israeli Competition Authority has raised concerns after a WhatsApp conversation among senior banking officials about replacing Eitan Madmon, CEO of the Israeli Banks Association, was inadvertently exposed. The exchange was revealed when Ron Lavkovitz, chairman of Bank Hapoalim, accidentally shared a screenshot of the chat on his WhatsApp status. The authority noted that the direct, informal communications between top banking executives could violate competition laws, especially in a market already deemed non-competitive. Just two months ago, the authority classified banks as a concentrated group in the household and business services market.
The WhatsApp messages, published by Calcalist, show Avi Zeldman, chairman of Mizrahi Tefahot Bank, suggesting a closed meeting of bank chairs and CEOs without the association’s staff or Madmon to discuss a plan for leadership change. Uri Alon, chairman of Bank Leumi and president of the Banks Association, responded that he intended to complete discussions with all banks before moving forward. The correspondence indicates that some bank leaders are actively considering a leadership change behind formal association frameworks.
The Banks Association responded that it received the authority’s inquiry and will fully cooperate, emphasizing its ongoing compliance with competition laws. Established 67 years ago, the association represents the banking sector to regulators and government bodies. Madmon, a former CEO of the newspaper Globes, has led the association since 2019 amid intense public and political criticism of banks. Critics blame the association’s leadership for failing to improve the banking sector’s image, citing the recent 3 billion shekel windfall profits tax imposed by Finance Minister Bezalel Smotrich and the voluntary relief measures banks adopted under pressure.
Supporters argue Madmon’s tenure coincided with exceptional challenges, including record bank profits and unprecedented public scrutiny, making it difficult to attribute the sector’s reputation issues solely to the association. Madmon succeeded Moshe Perel after a prolonged selection process. In 2020, Bank Leumi temporarily left the association to engage regulators independently but rejoined about a year ago. The CEO role is highly compensated, with Madmon’s predecessor earning around 100,000 shekels monthly, though Madmon’s salary was somewhat reduced.
Summary: The Israeli Competition Authority is investigating WhatsApp messages among senior bank officials discussing the possible replacement of the Banks Association CEO, raising concerns about informal coordination in a non-competitive market. The Banks Association pledges full cooperation as the inquiry unfolds amid ongoing sector criticism and leadership debates.
