Last Wednesday a short six-page document dramatically changed the life of the former most powerful man in the Israeli economy. Following the decision of Judge Nurit Tabib-Mizrahi of the Tel Aviv Magistrate's Court to order insolvency proceedings against Nochi Dankner, the former controlling shareholder of IDB was thrown into a new reality, which he has been trying to avoid for 10 years: life as a bankruptee in Israel.

"I have actually been insolvent for ten years or more," Dankner said in court. "A decree will be issued in this matter right now, and I respect that."

What is the extent of Dankner's debt, which led to his being declared bankrupt?

The original debt was estimated at about NIS 510 million, most of which was for personal guarantees that Dankner gave for loans taken out by the private companies through which he owned IDB - Ganden and Tomahawk. Another part is for a guarantee for the debts of his cousin, businessman and former Bank Hapoalim chairman Danny Dankner.

In 2016, following the collapse of IDB, Dankner signed a debt settlement with the banks. The settlement included a commitment on Dankner's part to repay NIS 180 million by March 2024 as a fixed component of the settlement, and in addition to transferring an amount from his future income until the full repayment of all debts. Dankner has repaid about NIS 110 million to date, of which about NIS 90 million is for the principal of the debt and an additional NIS 20 million for interest accrued.

Why did the banks seek to declare Dankner bankrupt after a decade of agreements and settlements with him?

Under the terms of the debt settlement a decade ago, Dankner was supposed to repay the banks over NIS 300 million from future income. However, it is doubtful whether the banks or Dankner himself believed that it would be possible to actually produce income on such a major scale. The business activity that Dankner tried to produce income from the Hoshen foodtech venture did not take off.

The banks also realized over time that the repayments were coming mainly from the estate of Dankner's late father. From their perspective, in such a situation there was no longer a relative advantage to a debt settlement over a court-supervised process, since a trustee could also realize the estate's funds.

What happened unexpectedly in court that caused the judge to declare Dankner bankrupt?

Dankner initially opposed the banks' request to declare him bankrupt and proposed formulating a comprehensive debt settlement through negotiation. However, in a court hearing, Dankner surprised everyone by announcing that he was withdrawing his opposition to the process.

"We bow our heads and say: If this is what (the banks) want, that's what it will be," said Dankner's lawyer, Adv. Shalom Goldblatt.

What personal restrictions will now apply to Dankner, and when will they be in effect?

According to the court's decision, based on the Insolvency Law, Dankner will now be subject to a series of personal restrictions that took effect immediately. Thus, he will be prohibited from holding a passport and leaving the country without court approval, and he will not be able to hold a credit card without the approval of the trustee appointed for his assets by the insolvency commissioner at the Ministry of Justice (except for a debit card for immediate debit or a card for withdrawing cash), and his bank account will have to be in good standing and without receiving credit.

Dankner will also be prohibited from establishing or having an interest in a corporation without court approval, and he will be required to periodically report to the trustee on his current expenses for daily living and on his assets and liabilities.

Legal proceedings against Dankner will be suspended, unless Judge Tabib-Mizrahi approves their continuation. Her decision will be required soon regarding the class action lawsuit approved against Dankner for NIS 50 million, which is being conducted in the Tel Aviv District Court, for his part in the IDB share scam, for which he was convicted and served a prison sentence.

When will Dankner be able to receive a discharge from his debts?

The court usually reviews the progress of repayment within a year of the opening of proceedings. Dankner has a hearing scheduled for September 2027, during which a detailed plan for financial rehabilitation may be determined, which will include the amount of monthly repayments that Dankner will be required to make to the trustee's fund and the assets that he will have to sell. At the end of the rehabilitation period, which will last up to three years, Dankner will be able to receive a discharge from the remaining debts.

Is a new debt settlement expected with the banks?

Dankner and the banks said in court that they are interested in continuing the talks. If a new debt settlement is agreed upon, it will primarily include the sale of Beit Hashinhav an office and commercial building in Givat Shaul, Jerusalem, for which Dankner is negotiating with a potential buyer.

Published by Globes, Israel business news - en.globes.co.il - on June 28, 2026.

© Copyright of Globes Publisher Itonut (1983) Ltd., 2026.