With hysteria running wild about paying anyone associated with the financial services industry a bonus, news that Israel’s best run and profitable bank, Mizrahi Tefahot, is looking to pay bonuses is big news. With countries looking to implement US Prez. Obama’s call for salary limits and no bonuses, Mizrahi Tefahot is bucking the trend. For good measure. Why shouldn’t employees who contribute to a successful and profitable business be rewarded for their hard work?

According to Globes: “Mizrahi Tefahot Bank is the only bank considering paying employee bonuses for 2008. Its return on equity in January-September was 12.1%, the highest in the banking system. Its profit was down just 4.3%, compared with the corresponding period of 2007, and compared with an 82% drop in the aggregate profits of the other banks. A knowledgeable source said that, given Mizrahi Tefahot Bank’s strong results, “it cannot be ruled out that its board will approve the payment of employee bonuses.”

It seems crazy to me that a bank in such a terrible climate has been run so well, and will not pay out bonuses. If quality management will not be compensated for their good work, why should they stay in their position? Who wants to be CEO if you aren’t going to make any money.

The board of Mizrahi Tefahot should approve the bonuses at once.

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