Return on Equity of 9.6%
Net Profit Totaled NIS 653 Million
Core Tier 1 Capital Rose to 9.3%
Bank to Payout a Cash Dividend of 15% of Net Profit
TEL AVIV, Israel, Nov. 27, 2013 (GLOBE NEWSWIRE) -- Bank Hapoalim (TASE:POLI) (ADR:BKHYY), Israel's leading financial group, today announced financial results for the third quarter ended September 30, 2013.
Third Quarter 2013 Financial Highlights:
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Return on equity reached 9.6%, on an annualized basis, compared with 9.9% in the second quarter of 2013.
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Net profit totaled NIS 653 million compared with a profit of NIS 655 million in the second quarter of 2013.
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Profit from regular financing activity totaled NIS 1,922 million, compared with NIS 1,864 million in the second quarter of 2013.
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Operating and other expenses totaled NIS 2,133 million similar to the second quarter of 2013.
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Shareholders' Equity totaled NIS 28,391 million as at September 30, 2013, up from NIS 26,755 million at the end of 2012.
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Core Tier 1 Capital ratio continued its trend of improvement and rose to 9.3% compared with 8.9% at the end of 2012.
- Quarterly Dividend - The Bank's Board of Directors approved the continuation of the quarterly cash dividend distribution, at a rate of approximately 15% of net profit, from its third quarter 2013 earnings in the amount of NIS 92 million. In 2013, the Bank has approved dividends to be paid to common shareholders totaling NIS 276 million.
Main developments in the financial statements for the third quarter of 2013:
Profit from regular financing activity totaled NIS 1,922 million in the third quarter of 2013, up from a profit of NIS 1,864 million in the sequential second quarter of 2013. The financial margin from regular activity increased to 2.20% in the third quarter of 2013, compared with 2.16% in the sequential second quarter of 2013.
Provision for credit losses in the third quarter of 2013 totaled NIS 375 million, compared with NIS 301 million in the sequential second quarter of 2013. The rate of provision as a percentage of credit to the public reached 0.59% at the end of the third quarter compared with 0.48% in the previous quarter. The increase reflects a cautious approach towards the current state of the Israeli economy.
Fees and other income totaled NIS 1,278 million in the third quarter of 2013 compared with NIS 1,282 million in the sequential second quarter of 2013, mainly influenced by the implementation of the recommendations of Bank of Israel's Committee on Competitiveness.
Operating and other expenses totaled NIS 2,133 million in the third quarter of 2013 similar to the second quarter of 2013. The decline in salary and other expenses was primarily related to operational efficiencies and cost management which has become a key focus in the Bank's strategy.
Dividend declared - The Bank's Board of Directors approved the continuation of the quarterly cash dividend distribution and declared a dividend with respect to the third quarter 2013 profits, of approximately NIS 92 million, which amounts to 7 agorot per share. The record date is December 5, 2013 and the date of payment is December 18, 2013. This in addition to the dividend paid with respect to the first half 2013 profits in the amount of NIS 184 million.
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 nine months of 2013 was expressed in a financial value of approximately NIS 34.5 million.
Developments in Balance Sheet Items:
The consolidated balance sheet as at September 30, 2013 totaled NIS 374.2 billion, compared with NIS 376.4 billion at the end of 2012, a decrease of 0.6%.
Net Credit to the public totaled NIS 249.3 billion, compared with NIS 249.2 billion at the end of 2012, an increase of 0.1% mainly as a result of an increase in retail, small business, and commercial credit, partially offset by a decrease in corporate credit.
Deposits from the public totaled NIS 269.6 billion compared with NIS 271.4 billion at the end of 2012, a decrease of 0.7%, mainly a result of a change in customers' investment preferences.
Shareholders' Equity totaled NIS 28,391 million as at September 30, 2013, compared with NIS 26,755 million at the end of 2012, an increase of 6.1%, mainly stemming from retained earnings during the first nine months of the year.
Core Tier 1 Capital Ratio stood at 9.3% at the end of the third quarter of 2013, compared to 8.9% at the end of 2012.
Total Capital Adequacy Ratio stood at 15.7% at the end of the third quarter of 2013 similar to the end of 2012.
Conference Call Information
Bank Hapoalim will host a conference call as well as a slide presentation webcast today to review the third quarter 2013 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 third quarter 2013 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 1:00 p.m. U.S. Eastern Time / 6:00 p.m. UK Time / 8:00 p.m. Israel Time on Wednesday, November 27, 2013 through 1:00 p.m. Eastern Time / 6:00 p.m. UK Time / 8:00 p.m. Israel Time on Wednesday December 4, 2013 by telephone at (972) 3-9255900 (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 270 branches, eight 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 the only Israeli Bank listed on both the Tel Aviv and London 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) | ||||
| Profit and Profitability | For the three months ended | ||||
|
Sept. 30, 2013 |
June 30, 2013 |
March 31, 2013 |
Dec. 31, 2012 |
Sept. 30, 2012 |
|
| Net financing income* | 2,117 | 2,176 | 2,057 | 2,111 | 2,115 |
| Fees and other income | 1,278 | 1,282 | 1,287 | 1,314 | 1,335 |
| Total income | 3,395 | 3,458 | 3,344 | 3,425 | 3,450 |
| Provision for credit losses | 375 | 301 | 257 | 54 | 286 |
| Operating and other expenses | 2,133 | 2,135 | 2,135 | 2,354 | 2,249 |
| Net profit attributed to shareholders of the Bank | 653 | 655 | 621 | 652 | 625 |
| Balance Sheet – Principal Data | |||||
|
Sept. 30, 2013 |
June 30, 2013 |
March 31, 2013 |
Dec. 31, 2012 |
Sept. 30, 2012 |
|
| Total balance sheet | 374,216 | 378,483 | 370,317 | 376,388 | 367,365 |
| Net credit to the public | 249,341 | 247,120 | 247,782 | 249,182 | 249,904 |
| Securities | 60,998 | 61,137 | 59,461 | 52,070 | 53,076 |
| Deposits from the public | 269,632 | 274,601 | 265,297 | 271,411 | 264,490 |
| Bonds and subordinated notes | 34,819 | 35,874 | 36,222 | 35,677 | 36,051 |
| Shareholders' equity | 28,391 | 27,808 | 27,279 | 26,755 | 25,759 |
| Net total problematic credit risk** | 13,869 | 13,264 | 13,561 | 13,284 | 14,187 |
| Of which: net impaired balance sheet debts** | 6,623 | 7,030 | 6,856 | 6,701 | 6,493 |
| For the three months ended | |||||
|
Sept. 30, 2013 |
June 30, 2013 |
March 31, 2013 |
Dec. 31, 2012 |
Sept. 30, 2012 |
|
| Main Financial Ratios | |||||
| Net loan to deposit ratio | 92.5% | 90.0% | 93.4% | 91.8% | 94.5% |
| Net loan to deposit ratio including bonds and subordinated notes. | 81.9% | 79.6% | 82.2% | 81.1% | 83.2% |
| Shareholders' equity to total assets | 7.6% | 7.3% | 7.4% | 7.1% | 7.0% |
| Core Tier 1 capital to risk-adjusted assets | 9.3% | 9.2% | 9.1% | 8.9% | 8.5% |
| Total capital to risk-adjusted assets | 15.7% | 15.7% | 15.6% | 15.7% | 15.1% |
| Financing margin from regular activity(1)(2) | 2.20% | 2.16% | 2.07% | 2.06% | 2.37% |
| Cost-income ratio | 62.8% | 61.7% | 63.8% | 68.7% | 65.2% |
| Total income to assets (3) | 3.6% | 3.7% | 3.7% | 3.8% | 3.8% |
| Total cost to assets (4) | 2.3% | 2.3% | 2.3% | 2.6% | 2.5% |
| Provision for credit losses as a percentage of the average recorded balance of credit to the public(1) | 0.59% | 0.48% | 0.41% | 0.09% | 0.45% |
| Net return of profit attributed to shareholders of the Bank on equity(1) | 9.6% | 9.9% | 9.5% | 10.3% | 10.2% |
| Basic net earnings per share in NIS attributed to shareholders of the Bank | 0.50 | 0.50 | 0.47 | 0.49 | 0.47 |
| * Net financing income includes net interest income and non-interest income. | |||||
| ** Net of the individual allowance, the allowance according to the extent of arrears, and the collective allowance for problematic credit risk. | |||||
| (1) Calculated on an annualized basis. | |||||
| (2) Financing profit from regular activity (see the Board of Directors' report, in the section Profit and Profitability – Development of Financing Profit) is 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 the balance of total average assets. | |||||
| (4) Total operating and other expenses, divided by the balance of total average assets. | |||||