Relations between unions and management at the major banks have started to unravel in the past few months, At Bank Hapoalim, headed by Yadin Antebi, a complicated and highly-charged labor dispute is taking place, while at Discount Bank CEO Avi Levi sent a dramatic letter to the heads of the bank’s workers committees announcing freezing of bonuses and a halt to the early retirement with extra severance pay program. At First International Bank, headed by Eli Cohen, there is no labor dispute, but the authorized signatories and managers’ committee has started to agitate for larger bonuses, and there too relations are strained.
All this comes after the banks reported another record year for profits last month. The five major banks (Leumi, Hapoalim, Mizrahi Tefahot, Discount, and First International) posted an aggregate profit of NIS 32 billion for 2025, 9% higher than for the previous year. Including their overseas activity, these banks employ 32,900 people between them. This represents a 1% decline within a year, mainly because of a 4% cut in the workforce at Bank Leumi, headed by Hanan Friedman.
The battle over the efficiency ratio
What troubles the workers committees is that the managements of the banks are on an ever more determined efficiency drive, in which they are closing branches and shedding employees through voluntary retirement programs. Their aim is to improve the efficiency ratio (the bank’s operating expenses divided by its revenue). The lower the ratio, the higher the quality of the bank’s management is considered to be. The ratio is positively impacted by reductions in the workforce, but the sharp rise in the banks’ interest income thanks to higher interest rates has helped to improve it dramatically.
Gil Bar-Tal, chairperson of the Public Service Workers Union, told “Globes”; “There’s discontent and agitation in the banking system. It happened all at once, in almost all the banks. Objectively speaking the banks are very profitable, but what bothers them is the efficiency ratio, that’s what they compete over. Interest rates are not rising as they were, so the banks, which sell money, are less flush.”
Today, Bar-Tal says, the banks are taking steps to lower the efficiency ratio as much as possible. “The cost cutting is in the employees. So they give a lower bonus, and fire employees, and all this comes at the expense of service to the customer and at the expense of the workers.”
Bank Leumi has for years managed to set a high standard for the efficiency ratio. In 2025, its ratio was below 30%, which is considered good even by international standards. None of the other four major banks even comes close to it.
At Discount Bank, the letter that the CEO sent to the national workers committee and the chairperson of the managers committee made clear that significant streamlining measures were in the offing. Besides freezing workers’ bonuses and halting the early retirement program, Levi clearly indicated that the workforce would be cut.
He mentioned the advent of companies such as Revolut, the legislation to promote small banks, and artificial intelligence and the need for automation. “Processes that in the past depended on large manpower are become more automated and efficient,” he wrote. The trend, he said, “will increase the redundancy of jobs at the bank” and will require “brave decisions.”
The bank said in response: “We are working to expand and accelerate the streamlining program and we intend to introduce significant measures by the end of the year. We are maintaining a dialogue with the workers committee with the aim of reaching understandings.”
“The banks were always hampered and reported poor efficiency ratios because of the strong workers committees. Today, however, we are seeing the power moving more towards the employers, to the managements,” a senior capital markets player familiar with the workings of the banking system told “Globes”. “The CEOs want to fight to preserve the profit and return on equity cushion.”
At Bank Hapoalim, a complicated labor dispute has been going on for over a year. On the last day of 2024, CEO Yadin Antebi announced a streamlining plan designed to reduce the bank’s workforce by 770 jobs, which would lead to an annual saving of NIS 300 million. The plan, giving employees who wished to retire enhanced severance terms, cost the bank NIS 600 million.
At First International Bank, the managers and authorized signatories committee began to inflame the territory when they called on the CEO to avoid harming the conditions of the bank’s managers and staff. The committee also demanded compensation for the cutting of vacation days because of Operation Rising Lion, and an improved bonus. There is no labor dispute at the bank, but there is certainly friction.
“Fainting from the workload”
According to the workers committees, the banks’ managements are harming almost every aspect of employment. “There is a degree of unrest in labor relations because the managements are continuing with an aggressive, unilateral line,” the bank workers committees say. “Now at Discount the CEO is freezing the voluntary retirement program. There are employees who have been shown the way out and who have been given weak review scores, and on the other hand they have also halted the severance program. They’re trying to have it both ways.”
Bar-Tal of the Histadrut adds that the efficiency measures at the bank also stem from a desire to improve profits. “The CEO and senior management want to show that the bank is profitable. They make service digital, which costs less, and ignore their customers. The workers suffer from pressure and are worn down. We have cases of branch workers fainting from the pressure. These days they are harming the workers and raising the workload, and the workers are angry about that.
“At the same time, the managers at the banks are fighting against the salary restrictions on senior executives and taking bonuses for themselves,” he says. “A bonus of six months’ salary for a member of senior management can amount to a million shekels, but the workers are given small bonuses. It’s all in the name of swinish capitalism. They harm the workers in order to show a better efficiency ratio. I think that this is a grave matter.”
What does Bar-Tal think will happen in the labor disputes? “In my view, at Discount they took it a step too far. Over the years, the bank has eroded the workers’ rights and has abolished tenure. Today, that’s a pressure lever that generates panic, and the workers committee will have to respond together with the Histadrut to stop it. At Bank Hapoalim, it has been stopped by collective legal action. The sides are now negotiating as a result of the balance of power between the management and the workers, and that is what will happen at Discount. At First International I cautiously estimate that relations will settle down.”
Published by Globes, Israel business news – en.globes.co.il – on April 29, 2026.
© Copyright of Globes Publisher Itonut (1983) Ltd., 2026.
