Bank Hapoalim Announces Third Quarter 2019 Financial Results
TEL AVIV, Israel, Nov. 20, 2019 (GLOBE NEWSWIRE) — Bank Hapoalim (TASE: POLI) (ADR: BKHYY), today announced its financial results for the third quarter ended September 30, 2019.
Key financial highlights:Net profit – totaled NIS 736 million, compared with a net profit of NIS 950 million in the corresponding quarter of 2018, a decline of approximately 22.5%.Return on equity (ROE) – totaled 7.6%, compared with 10.7% in the corresponding quarter of 2018.Net profit in the third quarter of 2019 was impacted by negative CPI of 0.7% (NIS 76 million) and the Bank’s decision to accelerate the sale of its banking activity in Turkey.The Bank recorded a loss of impairment of approximately NIS 63 million with regards to its investment in Bank Pozitif (Turkey). Excluding this effect, net profit in the third quarter totaled approximately NIS 798 million (ROE of 8.3%).Dividend payment – NIS 1 billion paid in dividend with respect of capital surplus generated as a result of the sale of 65% of Isracard Ltd.Common Equity Tier 1 capital ratio – stood at 11.87% as at September 30, 2019, surpassing both regulatory and internal capital targets.Net credit to the public – totaled NIS 291.0 billion, compared with NIS 282.5 billion at the end of 2018, an increase of 3.0%.
Housing loans, totaled NIS 87.3 billion, compared with NIS 81.5 billion at the end of 2018, an increase of 7.2%.
Commercial credit, totaled NIS 40.0 billion, compared with NIS 37.5 billion at the end of 2018, an increase of 6.7%.Recent mentions:Mr. Dov Kotler took office as CEO of the Bank on October 1, 2019 replacing Mr. Ari Pinto.On September 24, 2019 the Board of Directors declared the distribution of dividend in the amount of NIS 1 billion, with respect of the capital surplus generated by the sale of 65% of Isracard. The dividend was paid in October 2019.The following Board Members took office: Mr. David Avner, Dr. David Zvilichovsky, and Mr. Noam Hanegbi.On October 6, 2019 the Board of Directors resolved to appoint to the Board of Management of the Bank: Ms. Dalit Raviv, as Head of Retail Banking; Mr. Amit Oberkovitch, as Head of Human Resources, and Mr. Ram Gev, as Head of Finance (CFO).Key developments in the financial statements for the third quarter of 2019:Total income from regular financing activity, totaled NIS 2,387 million in the third quarter of 2019, compared with NIS 2,356 million in the same period last year, an increase of 1.3%.
Negative CPI of 0.7% in the third quarter of 2019, resulted in an expense of NIS 76 million, compared with an income of NIS 19 million in the same period last year. Excluding the CPI effect in the reported quarter, total income from regular financing activity, would have increased by 5.4% compared with the corresponding quarter last year.Fees and other income in Israel, totaled NIS 826 million in the third quarter of 2019, compared with NIS 835 million in the same period last year, a decline of 1.1%.Net provision for credit losses, recorded an income of NIS 40 million in the third quarter of 2019, representing 0.05% of the average credit to the public, compared with an expenses of NIS 118 million in the same period last year, representing 0.17% of the average credit to the public.Gross provision for credit losses, stood at 0.36% in the third quarter of 2019, compared with 0.59% in the same period last year.Operating and other expenses, totaled NIS 1,970 million in the third quarter of 2019, compared with NIS 1,984 million in same period last year, a decline of 0.7%. The decline was partially due to a decline in salary expenses associated with the Bank’s ongoing efficiency measures.Key developments in balance sheet items for the third quarter of 2019:Consolidated balance sheet, as at September 30, 2019, totaled NIS 453.3 billion, compared with NIS 460.9 billion at the end of 2018, a decline of 1.6%.Net credit to the public, totaled NIS 291.0 billion, compared with NIS 282.5 billion at the end of 2018, an increase of 3.0%.
Consumer credit in Israel, totaled NIS 42.3 billion, compared with NIS 44.1 billion at the end of 2018, a decline of 4.0%.
Housing loans in Israel, totaled NIS 87.3 billion, compared with NIS 81.5 billion at the end of 2018, an increase of 7.2%.
Credit to small business in Israel, totaled NIS 31.1 billion, compared with NIS 32.6 billion at the end of 2018, a decline of 4.4%.
Credit to the commercial segment in Israel, totaled NIS 40.0 billion, compared with NIS 37.5 billion at the end of 2018, an increase of 6.7%.
Credit to the corporate segment in Israel, totaled NIS 75.5 billion, compared with NIS 71.9 billion at the end of 2018, an increase of 5.0%. Corporate credit balances include NIS 3.6 billion of previously consolidated loans provided to Isracard recognized for the first time in the second quarter of 2019.Deposits from the public, totaled NIS 348.0 billion, compared with NIS 352.3 billion at the end of 2018, a decline of 1.2%.Deposits from consumers in Israel, totaled NIS 187.0 billion, compared with NIS 187.1 billion at the end of 2018.Deposits from small businesses in Israel, totaled NIS 43.8 billion, compared with NIS 42.4 billion at the end of 2018, an increase of 3.3%.Shareholders’ equity, totaled NIS 39.2 billion at the end of the third quarter of 2019, compared with NIS 37.5 billion at the end of 2018, an increase of 4.5%.Total capital ratio, stood at 15.16% as at September 30, 2019, compared with 14.39% as at December 31, 2018.Please note: This press release was prepared for convenience only. In case of any discrepancy, the Bank’s reported financial statements in Hebrew will prevail.Conference Call Information:Bank Hapoalim will host a conference call today to discuss its quarterly financial results at 5:00 p.m. (Israel); 3:00 p.m. (UK); 10:00 a.m. (ET). To access the conference call, please dial: 1-888-281-1167 toll free from the United States; 0-800-051-8913 toll free from the United Kingdom; or 972-3-9180685 internationally. No password is required.Please note: The conference call does not replace the need to peruse the immediate reports and the Financial Statements of the Bank, including all the forward-looking information included therein in accordance with Section 32A of the Israeli Securities Law, 1968.About Bank Hapoalim:Bank Hapoalim is Israel’s leading financial group. In Israel, the Bank Hapoalim operates 222 full-service retail branches, 12 regional business centers and specialized industry relationship managers for major corporate customers. The Bank Hapoalim Group includes holdings in Isracard Ltd, Israel’s leading credit card company, as well as financial companies involved in investment banking, trust services and portfolio management. Internationally, commercial banking services are provided in North America by the New York branch. Bank Hapoalim is listed on the Tel Aviv Stock Exchange (TASE: POLI) and holds a Level-1 ADR program. For more information about Bank Hapoalim, please visit us online at www.bankhapoalim.comContact:Karen Mazor, SVP
Head of Investor Relations
Bank Hapoalim
T: +972 3 5673440
E: Karen.mazor@poalim.co.il
Table 1-1: Condensed financial information and principal performance indicators over time
Table 1-1: Condensed financial information and principal performance indicators over time (continued)
Table 1-1: Condensed financial information and principal performance indicators over time (continued)
Key financial highlights:Net profit – totaled NIS 736 million, compared with a net profit of NIS 950 million in the corresponding quarter of 2018, a decline of approximately 22.5%.Return on equity (ROE) – totaled 7.6%, compared with 10.7% in the corresponding quarter of 2018.Net profit in the third quarter of 2019 was impacted by negative CPI of 0.7% (NIS 76 million) and the Bank’s decision to accelerate the sale of its banking activity in Turkey.The Bank recorded a loss of impairment of approximately NIS 63 million with regards to its investment in Bank Pozitif (Turkey). Excluding this effect, net profit in the third quarter totaled approximately NIS 798 million (ROE of 8.3%).Dividend payment – NIS 1 billion paid in dividend with respect of capital surplus generated as a result of the sale of 65% of Isracard Ltd.Common Equity Tier 1 capital ratio – stood at 11.87% as at September 30, 2019, surpassing both regulatory and internal capital targets.Net credit to the public – totaled NIS 291.0 billion, compared with NIS 282.5 billion at the end of 2018, an increase of 3.0%.
Housing loans, totaled NIS 87.3 billion, compared with NIS 81.5 billion at the end of 2018, an increase of 7.2%.
Commercial credit, totaled NIS 40.0 billion, compared with NIS 37.5 billion at the end of 2018, an increase of 6.7%.Recent mentions:Mr. Dov Kotler took office as CEO of the Bank on October 1, 2019 replacing Mr. Ari Pinto.On September 24, 2019 the Board of Directors declared the distribution of dividend in the amount of NIS 1 billion, with respect of the capital surplus generated by the sale of 65% of Isracard. The dividend was paid in October 2019.The following Board Members took office: Mr. David Avner, Dr. David Zvilichovsky, and Mr. Noam Hanegbi.On October 6, 2019 the Board of Directors resolved to appoint to the Board of Management of the Bank: Ms. Dalit Raviv, as Head of Retail Banking; Mr. Amit Oberkovitch, as Head of Human Resources, and Mr. Ram Gev, as Head of Finance (CFO).Key developments in the financial statements for the third quarter of 2019:Total income from regular financing activity, totaled NIS 2,387 million in the third quarter of 2019, compared with NIS 2,356 million in the same period last year, an increase of 1.3%.
Negative CPI of 0.7% in the third quarter of 2019, resulted in an expense of NIS 76 million, compared with an income of NIS 19 million in the same period last year. Excluding the CPI effect in the reported quarter, total income from regular financing activity, would have increased by 5.4% compared with the corresponding quarter last year.Fees and other income in Israel, totaled NIS 826 million in the third quarter of 2019, compared with NIS 835 million in the same period last year, a decline of 1.1%.Net provision for credit losses, recorded an income of NIS 40 million in the third quarter of 2019, representing 0.05% of the average credit to the public, compared with an expenses of NIS 118 million in the same period last year, representing 0.17% of the average credit to the public.Gross provision for credit losses, stood at 0.36% in the third quarter of 2019, compared with 0.59% in the same period last year.Operating and other expenses, totaled NIS 1,970 million in the third quarter of 2019, compared with NIS 1,984 million in same period last year, a decline of 0.7%. The decline was partially due to a decline in salary expenses associated with the Bank’s ongoing efficiency measures.Key developments in balance sheet items for the third quarter of 2019:Consolidated balance sheet, as at September 30, 2019, totaled NIS 453.3 billion, compared with NIS 460.9 billion at the end of 2018, a decline of 1.6%.Net credit to the public, totaled NIS 291.0 billion, compared with NIS 282.5 billion at the end of 2018, an increase of 3.0%.
Consumer credit in Israel, totaled NIS 42.3 billion, compared with NIS 44.1 billion at the end of 2018, a decline of 4.0%.
Housing loans in Israel, totaled NIS 87.3 billion, compared with NIS 81.5 billion at the end of 2018, an increase of 7.2%.
Credit to small business in Israel, totaled NIS 31.1 billion, compared with NIS 32.6 billion at the end of 2018, a decline of 4.4%.
Credit to the commercial segment in Israel, totaled NIS 40.0 billion, compared with NIS 37.5 billion at the end of 2018, an increase of 6.7%.
Credit to the corporate segment in Israel, totaled NIS 75.5 billion, compared with NIS 71.9 billion at the end of 2018, an increase of 5.0%. Corporate credit balances include NIS 3.6 billion of previously consolidated loans provided to Isracard recognized for the first time in the second quarter of 2019.Deposits from the public, totaled NIS 348.0 billion, compared with NIS 352.3 billion at the end of 2018, a decline of 1.2%.Deposits from consumers in Israel, totaled NIS 187.0 billion, compared with NIS 187.1 billion at the end of 2018.Deposits from small businesses in Israel, totaled NIS 43.8 billion, compared with NIS 42.4 billion at the end of 2018, an increase of 3.3%.Shareholders’ equity, totaled NIS 39.2 billion at the end of the third quarter of 2019, compared with NIS 37.5 billion at the end of 2018, an increase of 4.5%.Total capital ratio, stood at 15.16% as at September 30, 2019, compared with 14.39% as at December 31, 2018.Please note: This press release was prepared for convenience only. In case of any discrepancy, the Bank’s reported financial statements in Hebrew will prevail.Conference Call Information:Bank Hapoalim will host a conference call today to discuss its quarterly financial results at 5:00 p.m. (Israel); 3:00 p.m. (UK); 10:00 a.m. (ET). To access the conference call, please dial: 1-888-281-1167 toll free from the United States; 0-800-051-8913 toll free from the United Kingdom; or 972-3-9180685 internationally. No password is required.Please note: The conference call does not replace the need to peruse the immediate reports and the Financial Statements of the Bank, including all the forward-looking information included therein in accordance with Section 32A of the Israeli Securities Law, 1968.About Bank Hapoalim:Bank Hapoalim is Israel’s leading financial group. In Israel, the Bank Hapoalim operates 222 full-service retail branches, 12 regional business centers and specialized industry relationship managers for major corporate customers. The Bank Hapoalim Group includes holdings in Isracard Ltd, Israel’s leading credit card company, as well as financial companies involved in investment banking, trust services and portfolio management. Internationally, commercial banking services are provided in North America by the New York branch. Bank Hapoalim is listed on the Tel Aviv Stock Exchange (TASE: POLI) and holds a Level-1 ADR program. For more information about Bank Hapoalim, please visit us online at www.bankhapoalim.comContact:Karen Mazor, SVP
Head of Investor Relations
Bank Hapoalim
T: +972 3 5673440
E: Karen.mazor@poalim.co.il
Table 1-1: Condensed financial information and principal performance indicators over time
Table 1-1: Condensed financial information and principal performance indicators over time (continued)
Table 1-1: Condensed financial information and principal performance indicators over time (continued)