Net Profit totaled NIS 886 million
Return on Equity of 11.6%
Basel 3 Tier 1 Capital stood at 9.4%
Cash Dividend Payout of NIS 177 million to be paid from Second Quarter 2015 Net Profit
TEL AVIV, Israel, Aug. 19, 2015 (GLOBE NEWSWIRE) -- Bank Hapoalim (TASE:POLI) (ADR:BKHYY), Israel's leading financial group, today announced financial results for the second quarter ended June 30, 2015.
Second Quarter 2015 Financial Highlights:
- Net profit totaled NIS 886 million compared with a profit of NIS 782 million in the same quarter last year.
- Return on equity reached 11.6%, compared with 11.1% in the same quarter last year.
- Cost Income Ratio reached 55.2% at the end of the second quarter of 2015.
- Tier 1 Capital Ratio, in Basel 3 terms, stood at 9.4% at the end of the second quarter of 2015, compared with 9.3% at December 31, 2014.
- Total Capital Ratio, in Basel 3 terms, as at June 30, 2015 was 14.2% compared with 14.6% at December 31, 2014.
- 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 177 million from its second quarter 2015 earnings.
Main developments in the financial statements for the second quarter of 2015:
Profit from regular financing activity totaled NIS 2,172 million in the second quarter of 2015, compared with NIS 2,103 million in the same quarter last year.
Provision for credit losses (before recoveries), in the second quarter of 2015 totaled NIS 530 million, compared with NIS 382 million in the same quarter last year.
Net Provision for credit losses in the second quarter of 2015 totaled NIS 213 million, compared with income of NIS 3 million in the same quarter last year.
Fees and other income totaled NIS 1,344 million in the second quarter of 2015 compared with NIS 1,297 million in the same quarter last year.
Operating and other expenses totaled NIS 2,108 million in the second quarter of 2015 compared with NIS 2,254 in the same quarter last year.
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 second quarter.
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 88.0% at the end of the second quarter.
Dividend declared - The Bank's Board of Directors declared a dividend with respect to the second quarter 2015 profits, of approximately NIS 177 million, which amounts to about 13.3 agorot per share. The record date is August 26, 2015 and the date of payment is September 8, 2015.
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 second quarter of 2015 was expressed in a financial value of approximately NIS 25 million.
Developments in Balance Sheet Items:
The consolidated balance sheet as at June 30, 2015 totaled NIS 416.6 billion, compared with NIS 408.0 billion at the end of 2014, an increase of 2.1%.
Net Credit to the public totaled NIS 270.8 billion, compared with NIS 264.0 billion at the end of 2014, an increase of 2.6% mainly from retail, small business and commercial segments.
Consumer credit in Israel totaled NIS 37.1 billion compared with NIS 35.4 billion at the end of 2014, an increase of 4.7%.
Mortgages in Israel totaled NIS 63.9 billion compared with NIS 61.7 billion at the end of 2014, an increase of 3.6%.
Credit to Small Businesses totaled NIS 30.7 billion compared with NIS 29.3 billion at the end of 2014, an increase of 4.7%.
Credit to the Commercial segment in Israel totaled NIS 30.0 billion compared with NIS 28.4 billion at the end of 2014, an increase of 5.7%.
Credit to the Corporate segment in Israel totaled NIS 76.5 billion compared with NIS 77.1 billion at the end of 2014, a decrease of 0.8%.
Deposits from the public totaled NIS 304.4 billion compared with NIS 297.2 billion at the end of 2014, an increase of 2.4%.
Shareholders' Equity totaled NIS 32.3 billion as at June 30, 2015, compared with NIS 31.0 billion at the end of 2014, an increase of 4.2%.
Conference Call Information
Bank Hapoalim will host a conference call as well as a slide presentation webcast today to review the Second Quarter 2015 financial results at 11:00 a.m. U.S. Eastern Time / 4:00 p.m. UK Time / 6:00 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 Second Quarter 2015 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 2:00 p.m. U.S. Eastern Time / 7:00 p.m. UK Time / 9:00 p.m. Israel Time on Wednesday, August 19, 2015 through 2:00 p.m. Eastern Time / 7:00 p.m. UK Time / 9:00 p.m. Israel Time on Wednesday August 26, 2015 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 over 250 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 | |||||||||||||||||||||||||||||||
| June 30, 2015 | March 31, 2015 | Dec. 31, 2014 | Sept. 30, 2014 | June 30, 2014 | |||||||||||||||||||||||||||
| Profit and Profitability | |||||||||||||||||||||||||||||||
| Net financing profit*** | 2,472 | 2,172 | 2,146 | 2,160 | 2,322 | ||||||||||||||||||||||||||
| Fees and other income | 1,344 | 1,383 | 1,438 | 1,304 | 1,297 | ||||||||||||||||||||||||||
| Total income | 3,816 | 3,555 | 3,584 | 3,464 | 3,619 | ||||||||||||||||||||||||||
| Provision (income) for credit losses | 213 | 60 | 363 | 80 | (3 | ) | |||||||||||||||||||||||||
| Operating and other expenses | 2,108 | 2,188 | 2,485 | * | 2,245 | * | 2,254 | * | |||||||||||||||||||||||
| Net profit attributed to shareholders of the Bank | 886 | 808 | 487 | * | 718 | * | 782 | * | |||||||||||||||||||||||
| For the six months ended | For the year ended | ||||||||||||||||||||||||||||||
| June 30, 2015 | June 30, 2014 | Dec. 31, 2014 | |||||||||||||||||||||||||||||
| Net financing profit*** | 4,644 | 4,378 | 8,684 | ||||||||||||||||||||||||||||
| Fees and other income | 2,727 | 2,596 | 5,338 | ||||||||||||||||||||||||||||
| Total income | 7,371 | 6,974 | 14,022 | ||||||||||||||||||||||||||||
| Provision (income) for credit losses | 273 | (18 | ) | 425 | |||||||||||||||||||||||||||
| Operating and other expenses | 4,296 | 4,453 | * | 9,183 | * | ||||||||||||||||||||||||||
| Net profit attributed to shareholders of the Bank | 1,694 | 1,508 | * | 2,713 | * | ||||||||||||||||||||||||||
| June 30, 2015 | March 31, 2015 | Dec. 31, 2014 | Sept. 30, 2014 | June 30, 2014 | |||||||||||||||||||||||||||
| Balance Sheet – Principal Data | |||||||||||||||||||||||||||||||
| Total balance sheet | 416,614 | 426,426 | 408,033 | * | 394,234 | * | 370,399 | * | |||||||||||||||||||||||
| Net credit to the public | 270,817 | 268,921 | 263,980 | 257,826 | 252,066 | ||||||||||||||||||||||||||
| Securities | 56,232 | 54,328 | 58,778 | 57,190 | 63,800 | ||||||||||||||||||||||||||
| Deposits from the public | 304,382 | 307,895 | 297,230 | 281,760 | 268,935 | ||||||||||||||||||||||||||
| Bonds and subordinated notes | 34,829 | 34,808 | 33,671 | 34,073 | 30,533 | ||||||||||||||||||||||||||
| Shareholders’ equity | 32,260 | 31,845 | 30,966 | * | 30,696 | * | 29,907 | * | |||||||||||||||||||||||
| Net total problematic credit risk | 10,750 | 12,349 | 12,721 | 13,362 | 13,483 | ||||||||||||||||||||||||||
| Of which: net impaired balance sheet debts | 5,268 | 5,702 | 5,389 | 5,719 | 6,038 | ||||||||||||||||||||||||||
| For the three months ended | |||||||||||||||||||||||||||||||
| June 30, 2015 | March 31, 2015 | Dec. 31, 2014 | Sept. 30, 2014 | June 30, 2014 | |||||||||||||||||||||||||||
| Main Financial Ratios | |||||||||||||||||||||||||||||||
| Net loan to deposit ratio | 89.0 | % | 87.3 | % | 88.8 | % | 91.5 | % | 93.7 | % | |||||||||||||||||||||
| Net loan to deposit ratio including bonds and subordinated notes | 79.8 | % | 78.5 | % | 79.8 | % | 81.6 | % | 84.2 | % | |||||||||||||||||||||
| Shareholders’ equity ratio to total assets | 7.7 | % | 7.5 | % | 7.6 | % | * | 7.8 | % | * | 8.1 | % | * | ||||||||||||||||||
| Common equity Tier 1 capital ratio according to risk-adjusted assets(6) | 9.4 | % | 9.4 | % | 9.3 | % | 9.3 | % | * | 9.5 | % | * | |||||||||||||||||||
| Total capital ratio according to risk-adjusted assets(6) | 14.2 | % | 14.2 | % | 14.6 | % | 14.6 | % | * | 14.9 | % | * | |||||||||||||||||||
| Liquidity coverage ratio**(6) | 88.0 | % | |||||||||||||||||||||||||||||
| Leverage ratio**(6) | 7.1 | % | |||||||||||||||||||||||||||||
| Financing margin from regular activity(1)(2) | 2.2 | % | 2.0 | % | 2.2 | % | **** | 2.3 | % | **** | 2.4 | % | **** | ||||||||||||||||||
| Cost-income ratio(3) | 55.2 | % | 61.5 | % | 56.0 | % | * | 63.3 | % | * | 60.8 | % | * | ||||||||||||||||||
| Total income to assets(4) | 3.7 | % | 3.5 | % | 3.7 | % | 3.7 | % | * | 3.9 | % | * | |||||||||||||||||||
| Total expenses to assets(5) | 2.0 | % | 2.2 | % | 2.5 | % | 2.4 | % | * | 2.4 | % | * | |||||||||||||||||||
| Provision (income) for credit losses as a percentage of the average recorded balance of credit to the public(1) | 0.3 | % | 0.1 | % | 0.5 | % | 0.1 | % | (0.0 | %) | |||||||||||||||||||||
| Net return of profit attributed to shareholders of the Bank on equity(1) | 11.6 | % | 10.7 | % | 6.4 | % | * | 9.8 | % | * | 11.1 | % | * | ||||||||||||||||||
| Basic net earnings per share in NIS attributed to shareholders of the Bank | 0.67 | 0.61 | 0.37 | * | 0.54 | * | 0.59 | ||||||||||||||||||||||||
| | |||||||||||||||||||||||||||||||
| For the six months ended | For the year ended | ||||||||||||||||||||||||||||||
| June 30, 2015 | June 30, 2014 | Dec. 31, 2014 | |||||||||||||||||||||||||||||
| Financing margin from regular activity(1)(2) | 2.1 | % | 2.3 | % | **** | 2.3 | % | **** | |||||||||||||||||||||||
| Cost-income ratio(3) | 58.3 | % | 63.1 | % | * | 61.3 | % | * | |||||||||||||||||||||||
| Total income to assets(4) | 3.6 | % | 3.8 | % | * | 3.7 | % | ||||||||||||||||||||||||
| Total expenses to assets(5) | 2.1 | % | 2.4 | % | * | 2.4 | % | ||||||||||||||||||||||||
| Provision (income) for credit losses as a percentage of the average recorded balance of credit to the public(1) | 0.2 | % | (0.0 | %) | 0.2 | % | |||||||||||||||||||||||||
| Net return of profit attributed to shareholders of the Bank on equity(1) | 11.0 | % | 10.6 | % | * | 9.1 | % | * | |||||||||||||||||||||||
| Basic net earnings per share in NIS attributed to shareholders of the Bank | 1.28 | 1.14 | * | 2.05 | * | ||||||||||||||||||||||||||
| * Retrospective implementation – for details regarding the retrospective implementation of the Supervisor of Banks' guidelines concerning capitalization of software costs and implementation of US GAAP regarding employee benefits, see Note 1B to the Condensed Financial Statements. | |||||||||||||||||||||||||||||||
| ** Initial implementation as of April 1, 2015. | |||||||||||||||||||||||||||||||
| *** Net financing profit includes net interest income and non-interest financing income (expenses). | |||||||||||||||||||||||||||||||
| **** Restated. | |||||||||||||||||||||||||||||||
| (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) divided by total financial assets after allowance for credit losses, net of non-interest bearing balances in respect of credit cards. | |||||||||||||||||||||||||||||||
| (3) Does not include provision for efficiency plans and provision for banking services to US clients. | |||||||||||||||||||||||||||||||
| (4) Total income divided by the average balance of total assets. | |||||||||||||||||||||||||||||||
| (5) Total operating and other expenses, divided by the average balance of total assets. | |||||||||||||||||||||||||||||||
| (6) For more information, see the section "Capital Adequacy, Liquidity and Leverage" below. | |||||||||||||||||||||||||||||||