YEREVAN, October 21. / ARKA /. Karnit Flug was appointed Sunday as the first woman to head Israel’s central bank, RBC reported citing Reuters. Flug, 58, was deputy to previous governor Stanley Fischer and has been acting chief of the Bank of Israel since her predecessor stepped down in June after eight years in the job.

Accepting the post, Flug, said in a brief statement the central bank and Israel's economy faced significant challenges.

Flug's appointment followed a meeting between Prime Minister Benjamin Netanyahu and Finance Minister Yair Lapid, who had been unable since Fischer resigned to fill the post.

Fischer recommended Flug to succeed him but Netanyahu, officials said, preferred candidates with a stronger international standing.

Netanyahu and Lapid initially chose Jacob Frenkel, central bank governor in the 1990s and chairman of JPMorgan Chase International, to succeed Fischer but he pulled out following reports he had been arrested on suspicion of shoplifting at Hong Kong's airport in 2006.

Frenkel denied any wrongdoing and authorities in Hong Kong decided not to pursue the case.
A second candidate, Bank Hapoalim Chief Economist Leo Leiderman, also dropped his bid two days after his nomination, citing personal reasons.

Flug completed her doctorate at New York's Columbia University and worked at the International Monetary Fund as an economist and later as a senior research economist at the Inter-American Development Bank. She was appointed director of the research department at the Bank of Israel in 2001. -0-