Bank Hapoalim (TASE: POLI) today announced financial results for the second quarter of 2016, the final set of results that will be published under outgoing CEO Zion Kenan who leaves at the end of next month. Net profit was NIS 1.117 billion, up 26% from NIS 886 million in the corresponding quarter last year. The increase in profit resulted mainly from the decrease in provisions for credit losses and from one-time gains from the sale of "Visa Europe" shares and sale of loans.
Return on equity reached 13.9% in the second quarter of 2016, compared with 11.6% in the same quarter last year and Cost Income Ratio was 57.4% for the second quarter of 2016. Tier 1 Capital Ratio was 10.20% on June 30 2016, compared with 9.63% on December 31 2015 while Total Capital Adequacy Ratio was 14.43% on June 30 2016, compared with 14.36% on December 31 2015.
The Bank's board of directors have approved a cash dividend distribution, at a rate of about 20% of net profit, totaling NIS 223 million from its second quarter 2016 earnings.
Profit from regular financing activity was NIS 2.274 billion in the second quarter of 2016, compared with NIS 2.172 billion in the same quarter last year. Net Provision (income) for credit losses in the second quarter of 2016 totaled income of NIS 128 million (0.18%), compared with a provision of NIS 213 million, 0.31%, in the same quarter last year. Fees and other income totaled NIS 1,319 million in the second quarter of 2016 compared with NIS 1,344 million in the same quarter last year. Operating and other expenses totaled NIS 2,242 million in the second quarter of 2016 compared with NIS 2,108 million in the same quarter last year.
Cost-Income ratio stood at 57.4% at the end of the second quarter of 2016 compared with 55.2% in the same quarter last year. Tier 1 Capital Ratio stood at 10.20% on June 30 2016, compared with 9.63% on December 31 2015. The Bank continues to optimize its capital base and completed a reinsurance transaction in respect of Sales Law guarantees, following the date of the second quarter financial statement. This will lead to an increase of roughly 0.27% in the capital ratio in the third quarter financial statement.
Published by Globes [online], Israel business news - www.globes-online.com - on August 11, 2016
© Copyright of Globes Publisher Itonut (1983) Ltd. 2016