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Bank Hapoalim Announces Third Quarter 2015 Financial Results

Return on Equity of 10.4%

Net Profit totaled NIS 802 million

Basel 3 Tier 1 Capital stood at 9.5%

Cash Dividend Payout of NIS 160 million to be paid from Third Quarter 2015 Net Profit

TEL AVIV, Israel, Nov. 16, 2015 (GLOBE NEWSWIRE) -- Bank Hapoalim (TASE:POLI) (ADR:BKHYY), Israel's leading financial group, today announced financial results for the third quarter ended September 30, 2015.

Third Quarter 2015 Financial Highlights:

  • Net profit totaled NIS 802 million compared with a profit of NIS 718 million in the same quarter last year.
  • Return on equity reached 10.4%, compared with 9.8% in the same quarter last year.
  • Cost Income Ratio stood at 59.4% In the first nine months of 2015.
  • Tier 1 Capital Ratio, in Basel 3 terms, stood at 9.5% at the end of the third quarter of 2015, compared with 9.3% at December 31, 2014.
  • Total Capital Ratio, in Basel 3 terms, as at September 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 160 million from its third quarter 2015 earnings.

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

Profit from regular financing activity totaled NIS 2,131 million in the third quarter of 2015, compared with NIS 2,003 million in the same quarter last year.

Net Provision for credit losses in the third quarter of 2015 totaled NIS 55 million, compared with NIS 80 million in the same quarter last year.

The rate of the gross provision for credit losses stood at 0.50% in the third quarter of 2015.

Fees and other income totaled NIS 1,354 million in the third quarter of 2015 compared with NIS 1,304 million in the same quarter last year.

Operating and other expenses totaled NIS 2,183 million in the third quarter of 2015 compared with NIS 2,245 million 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 7.2% at the end of the third 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 92.0% at the end of the third quarter.

Dividend declared - The Bank's Board of Directors declared a dividend with respect to the third quarter 2015 profits, of approximately NIS 160 million, which amounts to about 12.08 agorot per share. The record date is November 30, 2015 and the date of payment is December 9, 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 nine months of 2015 was expressed in a financial value of approximately NIS 35 million.

Developments in Balance Sheet Items:

The consolidated balance sheet as at September 30, 2015 totaled NIS 422.9 billion, compared with NIS 408.0 billion at the end of 2014, an increase of 3.6%.

Net Credit to the public totaled NIS 275.2 billion, compared with NIS 264.0 billion at the end of 2014, an increase of 4.2% mainly from retail, small business and commercial segments.

Consumer credit in Israel totaled NIS 37.9 billion compared with NIS 35.4 billion at the end of 2014, an increase of 7.0%.

Mortgages in Israel totaled NIS 65.5 billion compared with NIS 61.7 billion at the end of 2014, an increase of 6.3%.

Credit to Small Businesses totaled NIS 31.1 billion compared with NIS 29.3 billion at the end of 2014, an increase of 5.9%.

Credit to the Commercial segment in Israel totaled NIS 30.8 billion compared with NIS 28.4 billion at the end of 2014, an increase of 8.6%.

Credit to the Corporate segment in Israel totaled NIS 75.5 billion compared with NIS 77.1 billion at the end of 2014, a decrease of 2.1%.

Deposits from the public totaled NIS 310.7 billion compared with NIS 297.2 billion at the end of 2014, an increase of 4.5%.

Shareholders' Equity totaled NIS 32.7 billion as at September 30, 2015, compared with NIS 31.0 billion at the end of 2014, an increase of 5.7%.

Conference Call Information

Bank Hapoalim will host a conference call as well as a slide presentation webcast on Monday November 16, 2015 to review the Third 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 Third 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 11:00 a.m. U.S. Eastern Time / 4:00 p.m. UK Time / 6:00 p.m. Israel Time on Monday, November 16, 2015 through 11:00 a.m. U.S. Eastern Time / 4:00 p.m. UK Time / 6:00 p.m. Israel Time on Monday November 23, 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
Sept. 30,
2015
June 30,
2015
March 31,
2015
Dec. 31,
2014
Sept. 30,
2014
Profit and Profitability
Net financing profit***2,1792,4722,1722,146 2,160
Fees and other income1,3541,3441,3831,438 1,304
Total income3,5333,8163,5553,584 3,464
Provision (income) for credit losses5521360363 80
Operating and other expenses2,1832,1082,1882,485*2,245*
Net profit attributed to shareholders of the Bank802886808487*718*
For the nine months endedFor the year
ended
Sept. 30,
2015
Sept. 30,
2014
Dec. 31,
2014
Net financing profit*** 6,8236,538 8,684
Fees and other income 4,0813,900 5,338
Total income 10,90410,438 14,022
Provision (income) for credit losses 32862 425
Operating and other expenses 6,4796,698*9,183*
Net profit attributed to shareholders of the Bank 2,4962,226*2,713*
Sept. 30,
2015
June 30,
2015
March 31,
2015
Dec. 31,
2014
Sept. 30,
2014
Balance Sheet – Principal Data
Total balance sheet422,919416,614426,426408,033*394,234*
Net credit to the public275,192270,817268,921263,980 257,826
Securities61,06456,23254,32858,778 57,190
Deposits from the public310,692304,382307,895297,230 281,760
Bonds and subordinated notes35,06134,82934,80833,671 34,073
Shareholders’ equity32,74132,26031,84530,966*30,696*
Net total problematic credit risk9,89810,75012,34912,721 13,362
Of which: net impaired balance sheet debts4,7805,2685,7025,389 5,719


For the three months ended
Sept. 30,
2015
June 30,
2015
March 31,
2015
Dec. 31,
2014
Sept. 30,
2014
Main Financial Ratios
Net loan to deposit ratio 88.6% 89.0% 87.3% 88.8% 91.5%
Net loan to deposit ratio including bonds and subordinated notes 79.6% 79.8% 78.5% 79.8% 81.6%
Shareholders’ equity ratio to total assets 7.7% 7.7% 7.5% 7.6%* 7.8%*
Common equity Tier 1 capital ratio to risk-adjusted assets(6) 9.5% 9.4% 9.4% 9.3% 9.3%*
Total capital ratio to risk-adjusted assets(6) 14.2% 14.2% 14.2% 14.6% 14.6%*
Liquidity coverage ratio**(6) 92.0% 88.0%
Leverage ratio**(6) 7.2% 7.2%
Financing margin from regular activity(1)(2) 2.2% 2.2% 2.0% 2.2% 2.3%
Cost-income ratio(3) 61.8% 55.2% 61.5% 56.0%* 63.3%*
Total income to assets(4) 3.4% 3.7% 3.5% 3.7% 3.7%*
Total expenses to assets(5) 2.1% 2.0% 2.2% 2.5% 2.4%*
Provision for credit losses as a percentage of the average recorded balance of credit to the public(1) 0.1% 0.3% 0.1% 0.5% 0.1%
Net return of profit attributed to shareholders of the Bank on equity(1) 10.4% 11.6% 10.7% 6.4%* 9.8%*
Basic net earnings per share in NIS attributed to shareholders of the Bank 0.60 0.67 0.61 0.37 * 0.54 *


For the nine months
ended
For the year
ended
Sept. 30,
2015
Sept. 30,
2014
Dec. 31,
2014
Financing margin from regular activity(1)(2) 2.1% 2.3% 2.3%
Cost-income ratio(3) 59.4% 63.1%* 61.3%*
Total income to assets(4) 3.5% 3.7%* 3.7%
Total expenses to assets(5) 2.1% 2.4%* 2.4%
Provision for credit losses as a percentage of the average recorded balance of credit to the public(1) 0.2% 0.2%
Net return of profit attributed to shareholders of the Bank on equity(1) 10.6% 10.2%* 9.1%*
Basic net earnings per share in NIS attributed to shareholders of the Bank 1.88 1.69 * 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).
(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 average 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 additional information, see the section "Capital Adequacy, Liquidity, and Leverage" below.


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: +972-3-5676166 effie.werber@mailpoalim.co.il

Source:Bank Hapoalim