Leumi Bank Chairman Warns Populism Against Banks Harms Israeli Economy
Uri Alon, chairman of Bank Leumi, opened the Calcalist National Economic Conference by highlighting the resilience and strength of the Israeli economy despite ongoing challenges, including the longest war in the country's history. He noted that the Tel Aviv 125 index rose sharply during the conflict, outperforming leading global indices, signaling confidence in Israel's economic stability and growth potential. Alon emphasized that although economic activity initially declined at the war's outbreak, it recovered faster than expected, with inflation stabilizing around 2%, aided by a strong shekel and limited global energy price impact.
Alon praised Bank of Israel Governor Amir Yaron for prudent monetary policy, including interest rate cuts early in the war and maintaining stability amid uncertainty. The current interest rate stands at 3.5%, with expectations of further reductions, which will ease burdens on households and businesses. He also highlighted the critical role of Bank of Israel and banking regulators in maintaining professionalism and public trust during turbulent times.
Looking ahead, Alon outlined plans for unprecedented infrastructure investments exceeding half a trillion shekels over the next decade in transportation, real estate, renewable energy, and data centers, which will drive economic recovery and create thousands of jobs. He underscored the central role of the high-tech sector, which raised $7.6 billion in capital in the first half of 2026, a 50% increase from the previous year, and contributes significantly to tax revenues and business growth.
Alon stressed that while high-tech is the engine of growth, the banking system is the foundation enabling all economic activity, especially during crises. Throughout the war, banks operated fully, providing credit responsibly and supporting households, businesses, and vulnerable populations through extensive aid programs. Bank Leumi initiated social projects for diverse communities, including summer camps for youth from conflict zones and housing for elderly citizens without protected spaces.
He warned against populist rhetoric targeting banks, which threatens financial stability and the broader economy. Alon called for balanced, responsible, and long-term economic policies to preserve the banking system's resilience, which is vital for sustained growth and competition. He concluded by affirming Israel's economic flexibility and the opportunity to accelerate growth through strong engines like infrastructure investment, technological leadership, and the ongoing AI revolution.
