Officials in the Ministry of Finance and Bank of Israel are incensed by the headlines in some of today's newspapers claiming that they have formulated a secret national emergency plan yesterday for intervening in the market. A senior Treasury official has informed "Globes" that such headlines create false panic and are an insult to the intelligence.
"Obviously if there were a collapse we would intervene and we have said this all along. But at the moment there is no such intention and there are no grandiose emergency plans as some newspapers have cited," the official in Jerusalem said, stressing that there was absolutely no intention of intervening in the market for the simple reason that there is no need to because there are no liquidity problems in Israel's financial sector.
As reported by "Globes," there was an additional meeting yesterday between working committees of the Bank of Israel and the Ministry of Finance which examined various possible scenarios and prepared contingency plans in response to various potential negative developments. The Bank of Israel was also angered by the reports in the press.
A senior figure in the Bank of Israel explained that "it is no secret that we are investigating and preparing various contingency plans. That's our job. We have to be prepared. These plans are updated on an almost daily basis. The Governor checks everything and instructs all divisional heads to examine problematic matters and possible weak points.
"A national emergency plan, or intervention in the market on a massive scale is not on the agenda, at least not for the time being," he concluded.
Published by Globes [online], Israel business news - www.globes-online.com - on October 7, 2008
© Copyright of Globes Publisher Itonut (1983) Ltd. 2008