Net Profit totaled NIS 674 million
Return on Equity of 8.4%
Cash Dividend Payout of NIS 135 million
TEL AVIV, Israel, May 19, 2016 (GLOBE NEWSWIRE) -- Bank Hapoalim (TASE:POLI) (ADR:BKHYY), Israel's leading financial group, today announced financial results for the first quarter ended March 31, 2016.
First Quarter 2016 Financial Highlights:
- Net profit totaled NIS 674 million compared with a profit of NIS 808 million in the same quarter last year. The decline in profit stemmed mainly from the decrease in the corporate tax rate which led to a one-time increase in the tax expense in the amount of NIS 114 million, as well as a decrease in profit from sale of bonds and shares and a decrease in income from capital market activity.
- Return on equity reached 8.4% in the first quarter of 2016, compared with 10.7% in the same quarter last year.
- Tier 1 Capital Ratio stood at 9.74% on March 31, 2016, compared with 9.63% at December 31, 2015.
- Total Capital Adequacy Ratio stood at 13.94% on March 31, 2016, compared with 14.36% at December 31, 2015.
- Quarterly Dividend - The Bank's Board of Directors approved a cash dividend distribution, at a rate of approximately 20% of net profit, in the amount of NIS 135 million from its first quarter 2016 earnings.
Main developments in the financial statements for the first quarter of 2016:
Profit from regular financing activity totaled NIS 2,024 million in the first quarter of 2016, compared with NIS 1,836 million in the same quarter last year.
Net Provision for credit losses in the first quarter of 2016 totaled NIS 46 million (0.06%), compared with NIS 60 million (0.09%) in the same quarter last year.
The rate of the gross provision for credit losses (before recoveries) stood at NIS 304 million (0.43%) in the first quarter of 2016, compared with NIS 340 million (0.50%) in the same quarter last year.
Fees and other income totaled NIS 1,336 million in the first quarter of 2016 compared with NIS 1,383 million in the same quarter last year.
Operating and other expenses totaled NIS 2,202 million in the first quarter of 2016 compared with NIS 2,188 million in the same quarter last year.
Cost-Income ratio stood at 62.1% at the end of the first quarter of 2016 compared with 61.2% at the end of 2015.
Provision for taxes - the decrease in the corporate tax rate led to a one-time increase in the tax expense in the amount of NIS 114 million.
Dividend declared - The Bank's Board of Directors declared a dividend with respect to the first quarter 2016 profits, of approximately NIS 135 million, which amounts to about 10.116 agorot per share. The record date is May 31, 2016 and the date of payment is June 8, 2016.
Contribution to the community - The Bank's employees are involved in a varied and extensive range of community-oriented activities that take the form of social involvement, monetary donations, and large-scale volunteer activities. Bank Hapoalim’s community-oriented activity during the first three months of 2016 was expressed in a financial value of approximately NIS 15 million.
Developments in Balance Sheet Items:
The consolidated balance sheet as at March 31, 2016 totaled NIS 434.9 billion, compared with NIS 431.6 billion at the end of 2015, an increase of 0.8%.
Net Credit to the public totaled NIS 279.9 billion, compared with NIS 278.5 billion at the end of 2015, an increase of 0.5% mainly from retail, small business and commercial segments.
Consumer credit in Israel totaled NIS 39.6 billion compared with NIS 39.0 billion at the end of 2015, an increase of 1.6%.
Mortgages in Israel totaled NIS 67.0 billion compared with NIS 66.8 billion at the end of 2015, an increase of 0.3%.
Credit to Small Businesses in Israel totaled NIS 26.2 billion compared with NIS 25.5 billion at the end of 2015, an increase of 2.5%.
Credit to the Commercial segment in Israel totaled NIS 31.4 billion compared with NIS 30.8 billion at the end of 2015, an increase of 1.9%.
Credit to the Corporate segment in Israel totaled NIS 78.9 billion compared with NIS 79.2 billion at the end of 2015, a decrease of 0.4%.
Deposits from the public totaled NIS 321.6 billion compared with NIS 321.7 billion at the end of 2015.
Shareholders' Equity totaled NIS 33.3 billion as at March 30, 2016, compared with NIS 33.0 billion at the end of 2015, an increase of 0.9%.
Leverage ratio- defined as the ratio of the capital measurement (Tier 1 capital) to the exposure measurement (total of balance sheet exposures, exposures to derivatives and securities financing transactions, and off-balance sheet items), stood at 7.1% at the end of the first quarter of 2016 compared to the 6% minimum required by the Supervisor of Banks.
Liquidity coverage ratio – defined as the ratio between the supply of "high-quality liquid assets” to the net expected outgoing cash flow in a stress scenario, stood at 105% at the end of the first quarter of 2016 compared to the target of 80% for the end of 2016.
Actuarial liabilities – Following legislation of the Financial Corporations Officer Remuneration law, actuarial liabilities increased by NIS 167 million in the first quarter of 2016. The increase was allocated to equity.
Conference Call Information
Bank Hapoalim will host a conference call as well as a slide presentation webcast on Thursday May 19th, 2016 to review the First Quarter 2016 financial results at 9:00 a.m. U.S. Eastern Time / 2:00 p.m. UK Time / 4:00 p.m. Israel Time.
To access the call, please dial: 1-888-281-1167 in the U.S. and 1-866-485-2399 in Canada or (972) 3-9180685 for international participants. No password is required. The presentation slides, earnings release and the First Quarter 2016 financial statements are available at the Bank's website, www.bankhapoalim.com, under Investor Relations, Financial Information.
A replay of the conference call will be available beginning at approximately 11:00 a.m. U.S. Eastern Time / 4:00 p.m. UK Time / 6:00 p.m. Israel Time on Thursday May 19th, 2016 through 11:00 a.m. U.S. Eastern Time / 4:00 p.m. UK Time / 6:00 p.m. Israel Time on Thursday May 26th, 2016 by telephone at (972) 3-9255918 (international).
The webcast replay will also be available by audio playback on the Bank Hapoalim website at www.bankhapoalim.com, under Investor Relations, Financial Information.
About Bank Hapoalim
Bank Hapoalim is Israel's leading financial group. In Israel, the Bank Hapoalim Group has about 245 retail branches, seven regional business centers, a network of 22 business branches and specialized industry relationship managers for major corporate customers.
The Bank Hapoalim Group includes Isracard Ltd, Israel's leading credit card company as well as financial companies involved in investment banking, trust services and portfolio management.
Internationally, Bank Hapoalim operates through branches, subsidiaries and representative offices, in North America, Latin America, Europe, the Far East, and Turkey. In these markets, the Bank is engaged in trade, corporate finance, private banking and retail banking.
Bank Hapoalim is listed on the Tel Aviv Stock Exchange. In addition, a Level-1 ADR is traded "over-the-counter" in New York.
For more information about Bank Hapoalim, please visit us online at www.bankhapoalim.com.
| Principal Data of the Bank Hapoalim Group | (NIS millions) | |||||||
| For the three months ended | ||||||||
| March 31, 2016 | Dec. 31, 2015 | Sept. 30, 2015 | June 30, 2015 | March 31, 2015 | ||||
| Profit and Profitability | ||||||||
| Net financing profit** | 2,209 | 2,106 | 2,179 | 2,472 | 2,172 | |||
| Fees and other income | 1,336 | 1,352 | 1,354 | 1,344 | 1,383 | |||
| Total income | 3,545 | 3,458 | 3,533 | 3,816 | 3,555 | |||
| Provision (income) for credit losses | 46 | 147 | 55 | 213 | 60 | |||
| Operating and other expenses | 2,202 | 2,311 | 2,183 | 2,108 | 2,188 | |||
| Net profit attributed to shareholders of the Bank | 674 | 586 | 802 | 886 | 808 | |||
| March 31, 2016 | Dec 31, 2015 | Sept. 30, 2015 | June 30, 2015 | March 31, 2015 | ||||
| Balance Sheet – Principal Data | ||||||||
| Total balance sheet | 434,905 | 431,638 | 422,919 | 416,614 | 426,426 | |||
| Net credit to the public | 279,850 | 278,497 | 275,192 | 270,817 | 268,921 | |||
| Securities | 66,154 | 62,884 | 61,064 | 56,232 | 54,328 | |||
| Deposits from the public | 321,576 | 321,727 | 310,692 | 304,382 | 307,895 | |||
| Bonds and subordinated notes | 36,836 | 34,475 | 35,061 | 34,829 | 34,808 | |||
| Shareholders’ equity | 33,336 | 33,032 | 32,741 | 32,260 | 31,845 | |||
| Net total problematic credit risk | 8,725 | 9,311 | 9,898 | 10,750 | 12,349 | |||
| Of which: net impaired balance sheet debts | 4,134 | 4,265 | 4,780 | 5,268 | 5,702 | |||
| March 31, 2016 | Dec 31, 2015 | Sept. 30, 2015 | June 30, 2015 | March 31, 2015 | ||||||||||||||
| Main Financial Ratios | ||||||||||||||||||
| Net loan to deposit ratio | 87.0 | % | 86.6 | % | 88.6 | % | 89.0 | % | 87.3 | % | ||||||||
| Net loan to deposit ratio including bonds and subordinated notes | 78.1 | % | 78.2 | % | 79.6 | % | 79.8 | % | 78.5 | % | ||||||||
| Shareholders’ equity ratio to total assets | 7.67 | % | 7.65 | % | 7.74 | % | 7.74 | % | 7.47 | % | ||||||||
| Common equity Tier 1 capital ratio to risk-adjusted assets(5) | 9.74 | % | 9.63 | % | 9.50 | % | 9.42 | % | 9.43 | % | ||||||||
| Total capital ratio to risk-adjusted assets(5) | 13.94 | % | 14.36 | % | 14.22 | % | 14.16 | % | 14.19 | % | ||||||||
| Liquidity coverage ratio*(6) | 105.0 | % | 99.0 | % | 92.0 | % | 88.0 | % | - | |||||||||
| Leverage ratio*(5) | 7.1 | % | 7.1 | % | 7.2 | % | 7.2 | % | - | |||||||||
| Financing margin from regular activity(1)(2) | 2.03 | % | 2.03 | % | 2.19 | % | 2.23 | % | 1.96 | % | ||||||||
| Cost-income ratio | 62.1 | % | 66.8 | % | 61.8 | % | 55.2 | % | 61.5 | % | ||||||||
| Total income to assets(3) | 3.0 | % | 3.3 | % | 3.4 | % | 3.7 | % | 3.5 | % | ||||||||
| Total expenses to assets(4) | 1.9 | % | 2.2 | % | 2.1 | % | 2.0 | % | 2.2 | % | ||||||||
| Provision for credit losses as a percentage of the average recorded balance of credit to the public(1) | 0.1 | % | 0.2 | % | 0.1 | % | 0.3 | % | 0.1 | % | ||||||||
| Net return of profit attributed to shareholders of the Bank on equity(1) | 8.4 | % | 7.3 | % | 10.4 | % | 11.6 | % | 10.7 | % | ||||||||
| Basic net earnings per share in NIS attributed to shareholders of the Bank | 0.51 | 0.44 | 0.60 | 0.67 | 0.61 | |||||||||||||
| * Initial implementation as of April 1, 2015. | ||||||||||||||||||
| ** Net financing profit includes net interest income and non-interest financing income (expenses). | ||||||||||||||||||
| (1) Calculated on an annualized basis. | ||||||||||||||||||
| (2) Financing profit from regular activity divided by total financial assets after allowance for credit losses, net of non-interest bearing balances in respect of credit cards. (3) Total income divided by average balances of total assets. | ||||||||||||||||||
| (4) Total operating and other expenses, divided by the average balance of total assets. | ||||||||||||||||||
| (5) For additional information, see the section "Capital Adequacy and Leverage" below. | ||||||||||||||||||
| (6) For additional information, see the section "Liquidity and Financing Risk" below. | ||||||||||||||||||