Bank Hapoalim (TASE: POLI) reported net profit of NIS 2 billion for the first quarter of 2023, up 21.4% from the corresponding quarter of 2022. The jump in profit stems mainly from the rise in financing income due to higher interest rates and inflation.
Hapoalim's higher net profit resulted in 17% return on equity, and consequently the bank has raised its dividend payout by 40% to NIS 803 million.
Most of Hapoalim's profit was due to high income from interest, which jumped from 0.1% to 4.25% over the last year and is expected to rise again today. Hapoalim recorded a 47% increase in interest income to more than NIS 4 billion.
On the other hand, the consequence of high interest rates was reflected in a decline in the rate of credit growth, and with the bank reporting in recent quarters more moderate growth in its credit portfolio. In the first quarter of 2023, the bank continued its trend of responsible growth, while balancing elements of risk, profitability and growth and in keeping with the uncertainties in the markets and maintaining high-quality and strong credit indices that correspond to the bank's risk appetite. This saw the bank's credit portfolio grow 1.5% in the first quarter in several sectors led by business credit, which has grown 5% since the start of 2023.
Published by Globes, Israel business news - en.globes.co.il - on May 22, 2023.
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