Bank Hapoalim maintains its position as Israel’s largest commercial bank. The bank’s assets in 1998 rose 7.5% and amounted to $45 billion. This emerges from a Dun & Bradstreet rating. According to their data, there was no change in the ratings of the other commercial banks.
Bank Leumi is the second largest bank, with assets of $42 billion, an 11% rise in 1998. In third place is Discount Bank, with assets totaling $23.7 billion, an 8.6% increase in 1998.
In fourth place is United Mizrahi Bank, with assets of $12.4 billion, a rise of 10.9% in 1998, followed in fifth place by the First International Bank, with assets of $12.2 billion, an 18.5% rise.
Dun & Bradstreet based its rating on the banks’ assets as of December 31, 1998.
An analysis of the rating shows that the banks’ assets increased 10% in 1998, totaling $143.5 billion. Most of the rise stemmed from a 14% increase in credit to the public, which amounted to $92 million. Part of the rise was offset by a retraction in the volume of credit to the government and other bodies. Total assets of the five major banks amounted to $135.5 billion, representing 94% of the assets of eleven banks included in the rating.
The Dun & Bradstreet rating of provident funds shows that Bank Hapoalim’s Gadish Fund maintains its status as the largest fund in Israel. Its assets totaled $3.4 billion in 1998, a 5.3% decline compared to the previous year.
An analysis of the rating shows that the assets of the ten largest provident funds fell by 5% in real terms, to $13.6 billion. The number of fund members dropped 3% to 2.9 million. The fall in provident fund assets stems from the public preference for increasing its investments in shekel-denominated saving schemes, and the low yields the funds presented in 1998.
The average yield, in real terms, of the ten provident funds was 1% in 1998, compared to 7% in the previous year. The decrease in the yield was caused by the standstill in the economy, and the sharp devaluation of the shekel and the rise in inflation toward year-end, which eroded the funds’ yield in real terms.
The Dun & Bradstreet rating of mortgage banks shows that Tefahot Bank maintains its status as Israel’s largest mortgage bank. Its assets totaled $5.4 billion in 1998, a rise of 8.5%.
An analysis of the rating shows that, in 1998, total credit provided by the mortgage banks fell 11%, and amounted to $5 billion. At the same time, the rate of increase in the mortgage banks’ assets slowed to 9%, and amounted to $20.2 billion.
In 1998, there was an 11% fall in mortgage taking by Ministry of Housing eligible persons. A particularly sharp fall of 34% was posted by eligible new immigrants. Altogether, 41,000 eligible persons utilized their rights to mortgages in 1998.
Dun & Bradstreet economists noted that the slowdown at mortgage banks stems from the recession in the economy, particularly in the building sector. Other factors were the fall in the number of new immigrants arriving in Israel in 1998, and the government’s restrictive budgetary policy.
Published by Israel's Business Arena May 27, 1999