Israel Discount Bank finished the third quarter, its last under Lilach Asher-Toplilsky as CEO, with a NIS 427 million net profit, 2.7% less than in the third quarter last year. Asher-Topilsky, whose term as CEO has been a success, is joining FIMI Opportunity Funds. She will be replaced by Uri Levin at the beginning of next week. During her six years as head of the bank, Discount Bank's share price rose 120% (the index of bank shares rose 90%), and its market cap reached NIS 18 billion.
Like other banks and financial companies, Discount Bank's bottom line was affected by the negative inflation in the third quarter. At the same time, the bank managed to partially offset its drop in profit through continued growth in non-interest revenue and various consumer charges.
Discount Bank's revenue totaled NIS 1.4 billion in the third quarter, 1% less than in the corresponding quarter in 2018. Non-interest revenue, on the other hand, rose 7.4% to NIS 970 million (revenue from charges, which is included in this item, was up 4.8% to NIS 765 million).
Discount Bank's credit losses expense jumped 23% to NIS 152 million in the third quarter. Its return on equity was 9.7%, compared with 11% in the corresponding quarter last year.
Dividend policy revised
In line with its policy, the bank's board of directors announced a dividend amounting to 15% of its net profit (NIS 64 million). At the same time, the board of directors decided to revise its policy by increasing the maximum proportion of its dividend to 30% of net profit.
Discount Bank finished the first nine months of 2019 with a NIS 1.38 billion net profit, 16% more than in the corresponding period in 2018. This profit is equivalent to a 10.4% return on equity, compared with 9.9% in the first nine months of last year.
Credit to the public totaled NIS 173.4 billion at the end of September this year, 7.6% more than at the end of September 2018. Deposits from the public were up 5.2% to NIS 194.5 billion. The bank's equity rose 8% since the beginning of the year, reaching NIS 18.5 billion at the end of September.
Published by Globes, Israel business news - en.globes.co.il - on November 27, 2019
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