Former JPMorgan official, BoI chief slams Netanyahu for ignoring int’l warnings on economic danger of overhaul

Jacob Frenkel, a former chairman of JPMorgan Chase International and the former chief of the Bank of Israel, slams Prime Minister Benjamin Netanyahu’s government’s far-reaching plans for overhauling the judicial system.

“I’m very surprised” by what Netanyahu is doing, he tells Channel 12 news.

“When JPMorgan makes a recommendation — take it very seriously,” Frenkel says, referring to a company internal memo released Friday, which warned of the growing risk of investing in Israel.

JPMorgan manages over $3.5 trillion worldwide.

Many have compared Israel’s situation to Poland, and Frenkel says this underlines that “the situation could deteriorate.”

In the case of Poland, “its credit rating dropped; citizens were harmed; prices went up; its capacity to borrow money on the international markets was reduced,” he says. “Countries that have weakened their judicial oversight are the countries where the citizens have suffered.”

“The prime minister I worked with was careful, cautious, did not take chances… It’s very dangerous to say I’m ignoring the professional reports of the relevant bodies because I think differently,” Frenkel warns.

“I want to avert the fire… We’re issuing warnings… This prime minister has led Israel to astounding achievements. So there is a great deal to lose,” he says.

He says Netanyahu reportedly deploying his Strategic Affairs Minister Ron Dermer to speak to the relevant financial institutions is inappropriate. “It shows contempt for these organizations… They’re issuing warnings.”

The emergency is not here yet, but “there is a danger of losing everything that has been achieved,” he says. If it happens, “it will happen much faster than you’d think.”

For the public, “this is not the time for panic. This is the time to demand that the [warning] opinions be heeded. This is not how you carry out a reform,” Frenkel says.

“Netanyahu and I carried out a reform of Israel’s foreign currency market. It was done gradually, with fieldwork, transparency, and a process. Not deep, fast, now! What is this?” he adds.