Bank Leumi surprised with record profits of 2.8 billion in the first quarter

Bank Leumi ended the first quarter of 2024 with a surprising profit of NIS 2.8 billion compared to NIS 981 million. The quarter saw a net one-time profit of NIS 632 million from the sale of the headquarters buildings in Tel Aviv as part of the transition of the management led by CEO Hanan Friedman to the campus in Lod.

The profit represents a return of 20.2% on the capital of NIS 57.1 billion, which is the highest profit in the system. In doing so, Leumi overtook Mizrahi Tefahot. A dividend of 1.1 billion shekels will be distributed, of which 835 million shekels will be in cash and 280 million shekels in the purchase of shares as part of a 1 billion shekel plan.

Leumi presents an efficiency ratio (operating expenses divided by operating income) of 29%, the best in the system despite a jump of about NIS 200 million in operating expenses (salary expenses) to NIS 1.8 billion.

Deposits increased by 11.8% to NIS 595.8 billion. Public credit by 2.2% to NIS 428.6 billion. Mortgage credit jumped by 8.9% to NIS 134.3 billion. Expenses for credit losses decreased from NIS 406 million to NIS 222 million.

The entire provision arises from the group provision due to the influence of the macro data. In the individual provision, an excess of income is recorded. Net interest income eroded by 4% to NIS 3.77 billion.

Hagit Argov, head of the financial division: "The results were achieved in a particularly challenging period, while adopting a conservative policy. The results testify to the bank's strength as the leading financial body in the economy and its ability to continue supporting the economy."

"The variety of advanced financial tools that distinguish us from other banks allow us to continue responsible growth in the selected strategic segments and to deal optimally with the challenges of the changing reality."

The profits of the International Bank decreased in the first quarter by 9.8% compared to the corresponding period and amounted to NIS 569 million, although they include tax revenues of NIS 49 million. The profit reflects a return on capital of 18.7% which is considered high. The bank is managed by Eli Cohen and the chairman of the board of directors is Ron Lebkowitz.

Revenues decreased by 7% to NIS 1.58 billion. Financing profits fell by 12.6% to NIS 1.16 billion due to customers switching to interest-bearing deposits. Indeed, public deposits increased by 13.4% compared to the corresponding period last year to NIS 196.6 billion.

The customer asset portfolio amounts to NIS 720 billion. Credit to the public decreased by 2.5% to NIS 116.8 billion due to a decrease in credit to large businesses.