Professor Leo Leiderman has withdrawn his candidacy to become the next governor of the Bank of Israel.

The chief economist at Israel’s Bank Hapoalim withdrew from the position on Friday, despite being appointed by Israeli Prime Minister Benjamin Netanyahu and Finance Minister Yair Lapid as the next governor just two days earlier.

Prof Leiderman is said to have discussed his pending position with his family and decided to stay in the private sector.

A spokesperson said Mr Netanyahu and Mr Lapid “express their regret at the decision”.

It is still not known who will replace outgoing governor Stanley Fischer.

Jacob Frenkel, 70, the chair of JP Morgan Chase, was expected to take up the position but withdrew his candidacy following allegations that he shoplifted at Hong Kong airport in 2006.