Israel’s Bank Hapoalim reported NIS 2.05 billion net profit for 2020, up 14% from 2019, when the bank had to set aside large amounts due to the US tax evasion probe and related legal costs. Return on capital in 2020 was 5.3%.
Income from financing activities amounted to NIS 9.4 billion, down 3.4% from 2019. This was due to lower financial margins on deposits, mainly because of the fall in dollar and shekel interest rates and a fall in income from linked difference and a fall in consumer retail credit due to the Covid pandemic.
Expenditure due to credit losses amounted to NIS 1.94 billion last year, 0.64% of the credit to the public, compared with NIS 1.3 billion in 2019.
As of the end of 2020, deferred loans and mortgages amounted to NIS 42.5 billion but by the end of January 2021, this amount had shrunk to just NIS 11.2 billion.
Despite the Covid crisis, Hapoalim’s credit portfolio continued to grow in 2020. Total credit to the public amounted to NIS 302 billion compared with NIS 293 billion at the end of 2019, up 3%. Credit for housing grew 10.5% to NIS 98.7 billion.
The amount of provisions for credit losses was 2% of credit to the public compared with 1.58% in 2019.
Fourth quarter net profit was NIS 915 million, compared with a NIS 629 million net loss in the fourth quarter of 2019, when it was hit by a provision to settle the US tax evasion investigation.
Bank Hapoalim CEO Dov Kotler said, “Despite a challenging year, we continued to show high financial strength, we grew our credit portfolio led by housing credit and commercial credit while adjusting it to recent developments, and we continued to move forward with the bank’s streamlining plan, we entered the world of digital wallets, and developed new collaborations, and we set up for our customers a platform for doing business with the UAE and Bahrain. On the organizational level, we streamlined and shortened procedures, we were goal focused and adapted to the challenges of today’s banking.”
Published by Globes, Israel business news – en.globes.co.il – on March 11, 2021
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