June 10--The investment institutes at Mizrahi Tefahot Bank's (TASE:MZTF) general shareholders meeting today approved the NIS 6.4 million annual salary cost of CEO Eldad Fresher, despite Minister of Finance Yair Lapid's objections. He intends to question the bank's directors, as he recently questioned the directors of The Phoenix Holdings Ltd. (TASE: PHOE1;PHOE5).
However, Lapid has a problem at Mizrahi Tefahot Bank, which he does not face at Phoenix. As an insurance company, Phoenix is under the supervision of the Ministry of Finance's Capital Markets, Insurance, and Savings Supervision Department; the banks are supervised by Supervisor of Banks David Zaken at the Bank of Israel. It is therefore unclear whether Lapid has the statutory authority to question the bank's offices, and he will have to ask Zaken personally to do so.
In late May, Lapid came out against the salary package of Phoenix CEO Eyal Lapidit, which could reach NIS 41 million over the next 4.5 years. Both Lapidot and Fresher's salary packages exceed the cap that the Ministry of Finance proposes. In early April, Lapid announced that he plans to cap the compensation packages of bank and financial institution executives at NIS 3.5 million a year, and that any amount beyond this would not be recognized for tax purposes. A draft bill on the matter was published a few days ago.
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