Israel Discount Bank (TASE: DSCT) is expanding its capital market business with today's launch of Discount Invest and the upgrade of its services for wealthy customers with investment portfolios larger than NIS 700,000. The bank says that these customers account for 8% of capital market investors.
"Discount has returned to the arena of competition. We're acting to plug holes where we were weak," said Discount Bank CEO Reuven Spiegel at today's press conference.
Discount Bank has a 16% share of the retail banking market, and 11% share of revenue from the capital market. Bank figures show that 35% of its customers carry out capital market transactions via a different bank. The bank therefore sees increasing its market share of capital market activity as a key target for the coming years, and as one of its growth engines.
Discount Bank's revenue from the capital market totaled NIS 318 million in January-September 2011. It is the fourth largest bank in the sector, although it is Israel's third largest bank overall.
"We will bring our customers back home," said Spiegel. He set a target of increasing the bank's capital market revenue by NIS 120 million in four years - 20% growth in this segment. Growth via the capital market has another advantage, since it does not require capital allocations, and therefore it does not affect the bank's capital adequacy ratio.
Discount Bank's share price fell 0.2% by mid-afternoon to NIS 5.30, giving a market cap of NIS 5.6 billion.
Published by Globes [online], Israel business news - www.globes-online.com - on February 20, 2012
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