OREANDA-NEWS. Bank Hapoalim, 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.