Bank Leumi (TASE:LUMI) today launched its division for global private banking, which it founded a year ago. Bank Leumi displayed a variety of services for wealthy customers in Israel and around the world who have invested a minimum of $1 million (for Israelis), or $500,000 (for foreign customers).
Bank Leumi has set up special private banking centers for these customers in Tel Aviv, Jerusalem, Haifa, and Herzliya Pituah, which will handle globally the customers’ assets in Israel and overseas.
Bank Leumi head of Global Private Banking Division Zvi Itskovitch said there were 10,000 people in Israel with liquid assets of $1 million or more.
Itskovitch estimated Israelis had transferred $1.8 billion to overseas banks in 2002, only a quarter of which had been deposited in Israeli banks. “It is regrettable that wealthy Israelis are taking such large sums out of the country. Bank Leumi is trying to keep this money at home, in Bank Leumi branches in Israel and overseas.”
Itskovitch added that in addition to its overseas branches in Europe, the US, South America, Johannesburg, and Melbourne, Bank Leumi planned to found a new private banking center in Miami to handle its South American private banking business. Bank Leumi’s first target there is Brazil. Bank Leumi is also considering an expansion of its private banking activity in Eastern Europe and the Far East.
Bank Leumi’s goal is to derive a third of its revenue and profit from private banking, compared with 20-25% at present, since private banking involves less risk.
Bank Leumi executive VP and head of marketing and strategic development and Leumi Card chairman Yona Fogel said the bank was considering the acquisition of a US bank specializing in private banking. This acquisition is unrelated to Bank Leumi’s wish to acquire the Israel Discount Bank of New York from Israel Discount Bank (TASE:DSCT).
Bank Leumi published private banking figures showing that overseas Jewish-owned assets amount to $340 billion, mostly in the US. 5-10% of Jewish households have a financial worth in excess of $1 million. Bank Leumi estimates that private banking deposits in Israel by foreign residents amount to $15 billion.
Bank Leumi currently manages a total of $16 billion in private banking assets in Israel and overseas.
Published by Globes [online] - www.globes.co.il - on March 17, 2003