JERUSALEM, April 11 (Reuters) - Israeli Prime Minister Benjamin Netanyahu wants Jacob Frenkel to return as central bank chief when Karnit Flug’s term ends later this year, TheMarker financial news website said on Wednesday without citing sources.
Netanyahu’s office declined to comment on the report, while Frenkel was not immediately available.
Frenkel, who was Bank of Israel governor in the 1990s and led a charge to reduce inflation, had been Netanyahu’s first choice to return as central bank chief in 2013 when Stanley Fischer stepped down after eight years on the job. Fischer later became vice chairman of the U.S. Federal Reserve.
Frenkel was forced to withdraw his candidacy due to what at the time he called an “unfortunate toxic and poisonous environment created by the media”.
Israeli media said Frenkel, currently chairman of JPMorgan Chase International, had been briefly detained at Hong Kong airport in 2006 on suspicion of shoplifting.
Frenkel said the incident was a misunderstanding.
The Hong Kong Department of Justice said they had decided not to proceed with the case and charges were dropped.
Fischer’s deputy Flug became Bank of Israel governor. Her first five-year term ends in October and Finance Minister Moshe Kahlon, who also has some say in choosing the next governor, said last month that a search for a new governor would begin after the Passover holiday that ended on Saturday.
Flug has clashed with Kahlon numerous times since he became finance minister three years ago, mainly on fiscal policy and his affinity for lowering taxes.
On Tuesday, Flug said she was undecided on whether to stand for a second term although she played down Kahlon’s importance.
“There are still seven months until my first term ends,” Flug said. “I haven’t yet thought about it and I have not spoken with the prime minister on that possibility.” (Reporting by Steven Scheer Editing by Hugh Lawson)