Union Bank of Israel
Corporate brand
UnclaimedA former Israeli commercial bank that operated nationally under the Hebrew name Bank Igud until its complete absorption into Bank Mizrahi-Tefahot in 2022.
Last updated August 26, 2026
Overview
Union Bank of Israel, commonly known by its Hebrew name Bank Igud, was an Israeli commercial bank headquartered in Tel Aviv. It was established in 1951 by the Economic Company for Israel of New York and the Palestine Association of London, continuing banking activities associated with the Palestine Association, which had operated in the Land of Israel since 1922. The bank developed as a relatively small participant in Israel's banking system, maintaining a nationwide branch network that ultimately comprised about thirty branches. The institution's ownership changed several times during its history. In 1954, Bank Leumi acquired most of the shares of the Palestine Association, leaving Bank Igud jointly owned by Bank Leumi and the Economic Company for Israel. Bank Leumi later purchased the remaining shares in 1961 and thereby obtained full ownership. A proposed merger with Feuchtwanger Bank in 1958 did not proceed after negotiations failed. Bank Igud served retail, commercial and business customers, with a particular emphasis in later years on commercial banking and affluent clients. In 2014, it was described as holding approximately 3% of Israel's banking-system market. Although modest in overall scale, the bank had a much stronger position in diamond financing and related banking services. Its relationship with the diamond industry developed partly because diamond trading was conducted in the same Tel Aviv building where the bank's offices were located when the Diamond Exchange was established. The bank was reported to hold approximately 22% of the Israeli diamond-sector banking market, substantially above its share of the broader banking system. Bank Mizrahi-Tefahot agreed to acquire Bank Igud, and the transaction was completed in September 2020. From 1 October 2020, the bank no longer operated as an independently traded public company and became a subsidiary of Mizrahi-Tefahot. The acquiring bank appointed four directors and replaced Zeev Aviel as chairman with Moshe Levi. During the integration process, the bank's diamond-sector credit portfolio was sold to Peninsula. Customer migration proceeded in 2022: all remaining Bank Igud customers were transferred to Mizrahi-Tefahot by 15 November, and the legal merger was completed on 31 December 2022. Bank Igud consequently ceased to exist as a separate banking entity.
History
Union Bank of Israel, better known in Hebrew as Bank Igud, traced its institutional origins to the Palestine Association, whose banking activities in the Land of Israel began in 1922. The modern bank was founded in 1951 by the Economic Company for Israel of New York and the Palestine Association of London. Its creation provided a continuing corporate vehicle for the association's banking operations during the early years of the State of Israel. The bank's ownership structure evolved during the 1950s and 1960s. In April 1954, Bank Leumi acquired most of the shares of the Palestine Association. Bank Igud consequently became jointly owned by Bank Leumi and the Economic Company for Israel. In March 1958, the bank considered a merger with Feuchtwanger Bank, but the negotiations failed and the proposed transaction was abandoned. Bank Leumi subsequently bought the remaining shares in 1961, becoming the bank's sole owner. Over the following decades, Bank Igud operated as a smaller Israeli banking institution with branches across the country. Its activities covered ordinary banking services as well as commercial and business finance. By the period described in available reference material, its strategy emphasized commercial customers and people with relatively high incomes. In 2014, the bank was estimated to account for about 3% of Israel's overall banking market, placing it among the smaller nationally operating banks. One of its most distinctive areas was diamond-sector banking. The relationship developed alongside the Israeli diamond trade: when the Diamond Exchange was established, diamond trading also took place in the Tel Aviv building that housed the bank's offices. This physical and commercial proximity helped establish Bank Igud as an important lender and financial-services provider to the sector. Its estimated share of the Israeli diamond-banking market was approximately 22%, far higher than its general banking-market share. This specialization gave the bank a recognizable niche even though its overall branch and balance-sheet presence was modest compared with Israel's largest banks. Bank Mizrahi-Tefahot acquired all the shares of Bank Igud in September 2020. The transaction ended Bank Igud's status as an independently traded public company from 1 October 2020 and placed it within the Mizrahi-Tefahot group as a subsidiary. The acquiring institution reshaped the bank's governance by appointing four directors and replacing chairman Zeev Aviel with Moshe Levi. Integration also involved the disposition of Bank Igud's diamond-sector credit portfolio to Peninsula. The final phase was the transfer of customers and legal consolidation. By 15 November 2022, all Bank Igud customers had been moved to Mizrahi-Tefahot. The merger process was completed on 31 December 2022, when the Bank Igud name and entity ceased to exist separately. Its history therefore combines a long-standing Israeli banking franchise, a specialized role in diamond finance, and eventual absorption into a larger domestic banking group.
- 2022
Customer transfer and legal merger
[1]All Bank Igud customers are transferred to Mizrahi-Tefahot by 15 November, and the legal merger is completed on 31 December.
- 2020
Acquisition by Bank Mizrahi-Tefahot
[1]Mizrahi-Tefahot acquires all Bank Igud shares. The bank becomes a subsidiary and stops being a separately traded public company from 1 October.
- 2014
Bank maintains a small general-market share and a strong diamond niche
[1]Reference material describes Bank Igud as holding about 3% of Israel's banking market while accounting for about 22% of the country's diamond-sector banking market.
- 1961
Bank Leumi becomes sole owner
[1]Bank Leumi purchases the remaining shares and obtains full ownership of Bank Igud.
- 1958
Proposed Feuchtwanger Bank merger fails
[1]Negotiations for a merger with Feuchtwanger Bank do not succeed, so the proposed combination is not completed.
- 1954
Bank Leumi acquires most Palestine Association shares
[1]Bank Leumi's acquisition of most of the Palestine Association's shares results in joint ownership of Bank Igud by Bank Leumi and the Economic Company for Israel.
- 1951
Bank Igud is founded
[1]The Economic Company for Israel of New York and the Palestine Association of London establish Bank Igud, later known in English as Union Bank of Israel.
- 1922
Palestine Association begins banking activity
[1]The Palestine Association is described as having conducted banking operations in the Land of Israel from this year, providing the institutional background for the later Bank Igud.
Products and positioning
A smaller Israeli commercial bank with national branch coverage, a focus on business and affluent customers, and a notable specialization in diamond-sector banking.
Banking services
Retail banking
Bank Igud maintained a nationwide branch network and provided conventional banking services to individuals. The available reference material does not enumerate specific account, card or digital products, but identifies the institution as a full-service Israeli bank rather than a narrowly specialized financial intermediary.
Commercial banking
Commercial and business banking
Commercial activity was a central part of the bank's later positioning. It focused on business customers and affluent clients, offering banking and credit relationships suited to commercial activity. Specific loan, deposit and advisory products are not separately documented in the supplied sources.
Sector finance
Diamond-sector financing
Bank Igud developed a substantial specialist franchise serving Israel's diamond industry. Its estimated share of banking in the diamond sector was about 22%, well above its share of the wider banking market. During the integration with Mizrahi-Tefahot, this credit portfolio was sold to Peninsula.
Brand decisions
2022
Complete integration into Bank Mizrahi-TefahotM&ABackground
After the 2020 acquisition, Bank Igud remained to be integrated operationally and legally.
Action taken
Mizrahi-Tefahot transferred all Bank Igud customers by 15 November and completed the legal merger on 31 December.
Aftermath
Union Bank of Israel ceased to exist as a separate entity and no longer operated under the Bank Igud brand.
2020
Accept acquisition by Bank Mizrahi-TefahotM&ABackground
Bank Mizrahi-Tefahot acquired all shares of Union Bank of Israel, ending the bank's independent public-company status.
Action taken
The transaction was completed in September 2020, and Bank Igud became a subsidiary of Mizrahi-Tefahot from 1 October. The acquirer also appointed four directors and installed Moshe Levi as chairman.
Aftermath
Bank Igud's customers and operations were progressively integrated into Mizrahi-Tefahot. The legal merger was completed at the end of 2022.
2020
Transfer of diamond-sector credit portfolioStrategyBackground
The acquisition and integration required decisions about the treatment of Bank Igud's specialist diamond-finance business.
Action taken
Bank Igud's credit portfolio in the diamond sector was sold to Peninsula as part of the merger process.
Aftermath
The transaction separated the diamond-finance portfolio from the former Bank Igud franchise during its absorption into Mizrahi-Tefahot.
Recent events
- 2022
Bank Igud customer accounts transferred to Mizrahi-Tefahot[1]
M&A · Other
The integration of Bank Igud reached an operational milestone when all Bank Igud customers had been transferred to Mizrahi-Tefahot by 15 November 2022.
- 2022
Union Bank of Israel ceases to exist as a separate entity[1]
M&A · Other
The legal merger with Bank Mizrahi-Tefahot was completed on 31 December 2022, ending Bank Igud's existence as an independent bank.
- 2020
Bank Mizrahi-Tefahot completes acquisition of Bank Igud[1]
M&A · Leadership change
Bank Mizrahi-Tefahot acquired all shares of Union Bank of Israel. From 1 October 2020, Bank Igud ceased to be a separately traded public company and continued as a subsidiary of the acquiring bank.
- 2020
Mizrahi-Tefahot changes Bank Igud board leadership[1]
Leadership change · M&A
Following the acquisition, Mizrahi-Tefahot appointed four directors to the Bank Igud board and named Moshe Levi chairman in place of Zeev Aviel.
Sources1 sources
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