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Bank Hapoalim Announces First Quarter 2015 Financial Results

Net Profit totaled NIS 808 million

Return on Equity of 10.7%

Basel 3 Tier 1 Capital rose to 9.4%

Cash Dividend Payout of NIS 162 million to be paid from First Quarter 2015 Net Profit

TEL AVIV, Israel, May 20, 2015 (GLOBE NEWSWIRE) -- Bank Hapoalim (TASE:POLI) (ADR:BKHYY), Israel's leading financial group, today announced financial results for the first quarter ended March 31, 2015.

First Quarter 2015 Financial Highlights:

  • Net profit totaled NIS 808 million compared with a profit of NIS 726 million in the same quarter last year.
  • Return on equity reached 10.7%, compared with 10.5% in the same quarter last year.
  • Cost Income Ratio reached 61.5% at the end of the first quarter of 2015.
  • Tier 1 Capital Ratio, in Basel 3 terms, stood at 9.43% at the end of the first quarter 2015, compared with 9.29% at December 31, 2014.
  • Total Capital Ratio, in Basel 3 terms, as at March 31, 2015 was 14.2% compared with 14.9% at December 31, 2014.
  • Quarterly Dividend - The Bank's Board of Directors approved an increase of the quarterly cash dividend distribution, to a rate of approximately 20% of net profit, from its first quarter 2015 earnings in the amount of NIS 162 million.

Main developments in the financial statements for the first quarter of 2015:

Net financing profit totaled NIS 2,172 million in the first quarter of 2015, compared with NIS 2,056 million in the same quarter last year.

Profit from regular financing activity totaled NIS 1,836 million in the first quarter of 2015, compared with NIS 1,899 million in the same quarter last year.

Provision for credit losses (before recoveries), in the first quarter of 2015 totaled NIS 340 million, compared with NIS 257 million in the same quarter last year.

Net Provision for credit losses in the first quarter of 2015 totaled NIS 60 million, compared with income of NIS 15 million in the same quarter last year.

Fees and other income totaled NIS 1,383 million in the first quarter of 2015 compared with NIS 1,299 million in the same quarter last year.

Operating and other expenses totaled NIS 2,188 million in the first quarter of 2015 compared with NIS 2,199 in the same quarter last year.

Dividend declared - The Bank's Board of Directors declared a dividend with respect to the first quarter 2015 profits, of approximately NIS 162 million, which amounts to about 12 agorot per share. The record date is May 28, 2015 and the date of payment is June 10, 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 first quarter of 2015 was expressed in a financial value of approximately NIS 15 million.

Developments in Balance Sheet Items:

The consolidated balance sheet as at March 31, 2015 totaled NIS 426.4 billion, compared with NIS 408.0 billion at the end of 2014, an increase of 4.5%.

Net Credit to the public totaled NIS 268.9 billion, compared with NIS 264.0 billion at the end of 2014, an increase of 1.9% from all business segments.

Credit to Retail customers totaled NIS 36.0 billion compared with NIS 35.4 billion at the end of 2014, an increase of 1.7%.

Mortgages totaled NIS 62.1 billion compared with NIS 61.7 billion at the end of 2014, an increase of 0.7%.

Credit to Small Businesses totaled NIS 30.1 billion compared with NIS 29.3 billion at the end of 2014, an increase of 2.6%.

Credit to the Commercial segment totaled NIS 37.3 billion compared with NIS 35.3 billion at the end of 2014, an increase of 5.8%.

Credit to the Corporate segment totaled NIS 85.5 billion compared with NIS 84.0 billion at the end of 2014, an increase of 1.8%.

Deposits from the public totaled NIS 307.9 billion compared with NIS 297.2 billion at the end of 2014, an increase of 3.6%.

Shareholders' Equity totaled NIS 31.8 billion as at March 31, 2015, compared with NIS 31.0 billion at the end of 2014, an increase of 2.8%.

Conference Call Information

Bank Hapoalim will host a conference call as well as a slide presentation webcast today to review the First Quarter 2015 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 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 1:00 p.m. U.S. Eastern Time / 6:00 p.m. UK Time / 8:00 p.m. Israel Time on Wednesday, May 20, 2015 through 1:00 p.m. Eastern Time / 6:00 p.m. UK Time / 8:00 p.m. Israel Time on Wednesday May 27, 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 about 260 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, 2015 Dec. 31, 2014 Sept. 30, 2014 June 30, 2014 March 31, 2014
Profit and Profitability
Net financing profit** 2,172 2,146 2,160 2,322 2,056
Fees and other income 1,383 1,438 1,304 1,297 1,299
Total income 3,555 3,584 3,464 3,619 3,355
Provision (income) for credit losses 60 363 80 (3) (15)
Operating and other expenses 2,188 2,485 * 2,245 * 2,254 * 2,199 *
Net profit attributed to shareholders of the Bank 808 487 * 718 * 782 * 726 *
March 31, 2015 Dec. 31, 2014 Sept. 30, 2014 June 30, 2014 March 31, 2014
Balance Sheet – Principal Data
Total balance sheet 426,426 408,033 * 394,234 * 370,156 * 376,866 *
Net credit to the public 268,921 263,980 257,826 252,066 250,232
Securities 54,328 58,778 57,190 63,800 65,333
Deposits from the public 307,895 297,230 281,760 268,935 276,014
Bonds and subordinated notes 34,808 33,671 34,073 30,533 31,314
Shareholders' equity 31,845 30,966 * 30,696 * 30,308 * 29,241 *
Net total problematic credit risk*** 12,349 12,721 13,362 13,483 14,205
Of which: net impaired balance sheet debts*** 5,702 5,389 5,719 6,038 6,305
For the three months ended
March 31, 2015 Dec. 31, 2014 Sept. 30, 2014 June 30, 2014 March 31, 2014
Main Financial Ratios
Net loan to deposit ratio 87.3% 88.8% 91.5% 93.7% 90.7%
Net loan to deposit ratio including bonds and subordinated notes 78.5% 79.8% 81.6% 84.2% 81.4%
Shareholders' equity to total assets 7.5% 7.6% * 7.8% * 8.2% * 7.8% *
Common equity Tier 1 capital according to risk-adjusted assets 9.4% 9.3% 9.3% * 9.5% * 9.4% *
Total capital according to risk-adjusted assets 14.2% 14.6% 14.6% * 14.9% * 14.9% *
Financing margin from regular activity(1)(2) 1.95% 2.21% *** 2.32% *** 2.44% *** 2.21% ***
Cost-income ratio(3) 61.5% 56.0% * 63.3% * 60.8% * 65.5% *
Total income to assets(4) 3.5% 3.7% 3.7% * 3.9% * 3.6% *
Total expenses to assets(5) 2.2% 2.5% 2.4% * 2.4% * 2.4% *
Provision (income) for credit losses as a percentage of the average recorded balance of credit to the public(1) 0.09% 0.54% 0.12% (0.00%) (0.02%)
Net return of profit attributed to shareholders of the Bank on equity(1) 10.69% 6.43% * 9.78% * 11.06% * 10.49% *
Basic net earnings per share in NIS attributed to shareholders of the Bank 0.61 0.37 * 0.54 * 0.59 0.55 *
* 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.
** 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.

CONTACT: For further information please contact: Press: Ofra Preuss, Bank's Spokesperson Tel: +972-3-567-3635; Fax: +972-3-567-3500 spokesperson@mailpoalim.co.il Investors: Effie Werber, Head of Investor Relations Tel. +972-3-567-3440; Fax: +972-3-5673470 effie.werber@mailpoalim.co.ilSource:Bank Hapoalim