The Bank of Israel’s response to Bank Leumi’s announcement regarding the sale of Leumi Card.
Such formal and orderly examinations are in addition to the series of meetings that the Banking Supervision Department has held with representatives of the purchasers and of other groups that expressed interest in purchasing the company. As part of those meetings, the groups presented their interest in Leumi Card, and obtained clarifications from the Banking Supervision Department regarding present and future regulatory requirements, which are critical in creating the regulatory certainty they required in order to decide on the transaction.
Following the series of meetings held by the Banking Supervision Department, and the initial examination of the structure of the agreement with the group to which the bank chose to sell Leumi Card, the Banking Supervision Department formulated an initial assessment that, under the new ownership, Leumi Card will be able to contribute to advancing competition in the payments market and to increased competition in retail credit, and that the know-how and experience that the purchasers bring will help advance the payments field in Israel.
The fact that Bank Leumi worked to diligently advance the sale a long time before the final date permitted by the law (January 2020 to January 2021) will enable Leumi Card to begin establishing itself as an independent company, which will contribute to the realization of the purpose of the legislation—increased competition in the financial system. In parallel, Bank Hapoalim is advancing the sale of Isracard.
Supervisor of Banks Dr. Hedva Ber said, “The Bank of Israel acted diligently in order to advance the increase in banking competition together with the Ministry of Finance and other partners. The regulatory adjustments created by the Banking Supervision Department and the on-going guidance it provides to all relevant parties have led many serious and experienced entities to express interest in purchasing the companies. The reported sale is an expression of confidence in the Israeli economy, in the reform to increase banking competition, and in Leumi Card itself, by a significant international entity. I again emphasize that the Banking Supervision Department will continue to back the credit card companies in order to ensure that they become established and that the develop as independent, strong and innovative companies, and so that the broad public will benefit from the results of the reform.”