Union Bank (Bank Igud) today announced its net profit reached NIS 25 million in the third quarter, a rise of 92.3%.
The bank’s profit in the first nine months of the year amounted to NIS 63 million, a 152% increase. Excluding the effect of the gap between the known index and the index for the month, profit totaled NIS 56 million, a rise of 107%. The Bank deducted NIS 14 million in the first nine months of 1999 for an employee retirement plan. Excluding the effect of this deduction, net profit rose by 90.9%.
Return on capital amounted to an annualized 8.7%, compared with 4.3% in the first nine months last year. The bank’s equity in the period of the report totaled NIS 1.1 billion, compared with NIS 908 million at the end of 1999. The rise in equity is due mostly to the bank’s May issue, in which the bank raised NIS 160 million.
Pre-allowance profit from financing activities in the quarter amounted to NIS 121 million, a 26% rise. Allowance for doubtful debts totaled NIS 10 million, similar to the allowance in the corresponding quarter last year. Operational revenues totaled NIS 48 million, a 6% increase, due mostly to a rise in securities activity, while expenses grew by 8%, reaching NIS 112 million.
The bank’s overall balance sheet total reached NIS 18 billion, a rise of 17% over the corresponding quarter last year. Credit to the public totaled NIS 13.8 billion on September 30, an increase of 25.4%. Deposits by the public increased 16.1% to NIS 15.4 billion.
The bank’s profitability in the first nine months was affected by several principal factors: a 28.2% rise in profits from financial activity after allowance for doubtful debts, an 11.6% rise in operating revenues, and a rise of only 4.4% in operating expenses.
Union Bank, the sixth largest bank in Israel, is controlled by Shlomo Eliyahu, Yeshayahu Landau, and the heirs of David Lubinski. The general manager is Benjamin Oshman and the chairman is Zeev Abeles.
Published by Israel's Business Arena on November 20, 2000