New York City has taken another step away from its longstanding financial relationship with Israel, as Comptroller Mark Levine declined to restore a nearly 50-year investment tradition involving Israel Bonds.
City Comptroller Mark Levine is facing questions over his decision not to restore purchases of Israel Bonds, reportedly reversing a campaign pledge as the organization's CEO challenged his financial justification, saying his office only learned of the decision through news reports.
The controversy has critics asking if the Mamdani administration's anti-Israel sentiment influenced Levine's reversal and whether political considerations are affecting a financial decision that could mean New York City is passing up a reliable investment opportunity.
BOND YIELDS ARE HOVERING NEAR MULTI-YEAR HIGHS: WHAT IT MEANS FOR YOUR WALLET
Israel Bonds President and CEO Dani Naveh challenged Levine's financial rationale in an interview with FOX Business, pointing to competitive interest rates, Israel's record of repayment and continued investments by other American governments, including New York State.
"We learned of the comptroller's decision when it was reported," Naveh said. "The city's former comptroller had already broken with a 50-year tradition of investing in Israel Bonds, a tradition his predecessors kept even during times when Israel's economy was vulnerable. We had hoped his successor would reverse that decision because, until recently he had pledged many times to restore New York City’s investment in Israel Bonds."
City investments began in 1974. Former Comptroller Brad Lander stopped renewing purchases when holdings matured in 2023. Israel Bonds were first issued in 1951.
The decision concerns New York City, not New York State. Published reporting identifies a discretionary pool under Levine's control from which previous purchases were made. Declining new purchases does not reduce existing pension benefits. However, questions remain about whether treasury funds, pension assets or both are affected, and whether pension trustees or union representatives were consulted. FOX Business included those questions in its inquiry to Levine's office.
Levine cited financial considerations and technical obstacles in departing from his campaign pledge.
"I always said this would be based on financial considerations only, not politics," Levine told The New York Times. He subsequently said purchases remained under evaluation, citing a New York City rule change on the short-term investment desk.
The reversal puts Levine's campaign commitments under renewed scrutiny, particularly over what financial or regulatory circumstances changed between his repeated pledges to restore the investments and his decision not to move forward.
Levine's explanation has raised additional questions about how his office evaluates investment opportunities, particularly amid reports that the city holds other bonds offering lower yields than Israel Bonds.
FOX Business reached out by phone and email to Levine's office seeking the financial analysis supporting his reversal, clarification on the investment restrictions and whether alternative investments offered stronger returns. His office did not respond by publication time.
US ECONOMY ADDED 29,000 JOBS IN SEPTEMBER, A SLOWER PACE THAN EXPECTED
"Investing in Israel Bonds is, first and foremost, a decision made in investors' own financial interest," Naveh said. "At currently published rates, three-year Jubilee Bonds offer an annual interest rate of 5.52 percent, five-year bonds 6.02 percent, and ten-year bonds 6.44 percent."
He said, "What makes Israel Bonds compelling is their record of reliability," he continued. "In 75 years, through wars, economic crises, and periods when its economy was far weaker than it is today, the State of Israel has never missed a single payment of principal or interest on its bonds. For retirees who count on their pensions, that kind of reliability matters."
Asked whether financial conditions justified the reversal, Naveh said the opposite.
"If anything, Israel's financial picture has gotten stronger," he said. "The Israeli Ministry of Finance and the Bank of Israel project four percent growth in 2026, and the OECD forecasts 5.6 percent growth for 2027."
"Unemployment is about 3 percent, inflation is around 1.6 percent, and Israel's debt-to-GDP ratio is about 68 percent, roughly 40 points below the advanced-economy average," he said.
"These are not political statements or expressions of sympathy for Israel," he said. "They are financial decisions made by sophisticated investors with billions of dollars at stake."
Asked whether Levine's office had reached out about financial concerns, Naveh responded: "Our door is always open. We're confident the numbers will speak for themselves."
"Israel remains investment grade with all three major credit rating agencies. S&P and Fitch continue to give Israel a solid A rating, and Moody's keeps its Baa1 rating," he said. "Furthermore, S&P and Moody's have raised Israel's outlook from negative to stable, while Fitch stayed the same."
SIGN UP FOR ANTISEMITISM EXPOSED NEWSLETTER
Those assessments concern Israel's sovereign creditworthiness; Israel Bonds products themselves are not rated.
"The cost of insuring Israel's debt against default has fallen to around 59 basis points, near its prewar level," Naveh said.
Mark Goldfeder, CEO of the National Jewish Advocacy Center, challenged Levine's explanation and told FOX Business,"So I'm holding him to it, and I have the math, and he’s wrong."
Goldfeder said Levine could change his predecessor's restriction and that financial suitability should determine the outcome.
"If it was a bad investment, he should sell it. I'm not arguing that," he said. "And so the smart thing to do and the responsible thing to do is to correct it."
Naveh said more than 44 American local, state and municipal governments had invested nearly $4 billion in Israel Bonds since Oct. 7, 2023.
"They're led by Democrats and Republicans alike, and they invested knowing they would earn strong, stable returns. Among them is the State of New York," he said.
ISRAEL'S ECONOMY FIGHTS TO RECOVER AS ISRAEL-HAMAS WAR RAGES ON
The decision also raises questions about the role of politics in public investment decisions, particularly as economic relationships with Israel face increasing scrutiny amid concerns over rising antisemitism.
With that broader climate in mind, Naveh addressed whether Levine's decision could further fuel antisemitism, telling FOX Business, "At a time of rising antisemitism, we must be especially careful that our words are not used to give credibility to misleading narratives about Israel."
"I respect Comptroller Levine, and I believe that constructive dialogue based on economic facts is the best way forward," he added.
CLICK HERE TO GET FOX BUSINESS ON THE GO
"The Comptroller had it right when he called Israel Bonds a long-term, safe and secure investment," Naveh said. "Global financial markets recognize Israel's strength, and among these investors is the State of New York. If Israel Bonds are a sound investment for New York State, why not for New York City? Let the numbers guide this decision."
https://www.foxbusiness.com/fox-news-world/nyc-comptroller-faces-questions-over-israel-bonds-reversal-ceo-challenges-financial-rationale
