Bank Hapoalim Settles Israeli Derivative Lawsuit

According to news reports here (Jerusalem Post) and here (Globes Online), Israel's largest bank, Bank Hapoalim Ltd., has reached an agreement in principle to settle a derivative class action lawsuit filed against the bank for the bonuses paid to executives in 2005.

The litigation was filed after Zvi Ziv, the bank's president and CEO and Shlomo Nehama, the bank's chairman were paid NIS (New Israeli Sheqel) 33 million and NIS 23 million, respectively, in total compensation in 2005. According to the Post article, the payment to Ziv was "the highest executive compensation package ever for an executive in Israel."

Each of the officers has agreed to return NIS 13 million to the bank, or just over $3 million at today's exchange rates, but according to the Globes article:

They will not make an actual repayment; the amounts will be deducted from the amounts to which they will be eligible in 2006-08.

The settlement agreement is subject to approval both by the Court and the Israel Securities Authority.

Bank Hapoalim is dual listed on the Tel Aviv and London Stock Exchanges.

Readers may recall that Bruce Carton over at Securities Litigation Watch has been on a quest to track down international securities litigation.

Daily Trivia: The plural of sheqel (also spelled shekel) is sheqalim (or shekalim). The New Israeli Sheqel was introduced in on September 4, 1985 and is divided into 100 agorot (plural of agora).