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Leumi concludes Q2 2023 with a NIS 2.4 billion ($649 million) profit - and with a dividend distribution and share buyback of some NIS 1 billion ($270 million)

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Bank Leumi (TASE: LUMI) concluded Q2 2023 with a net income of NIS 2.4 billion ($649 million), a return on equity of 19.4%, and an improved efficiency ratio of 29.5%. The company will distribute a NIS 736 million ($199 million) dividend and conduct a NIS 300 million ($81 million) share buyback, representing 40% of the net income. The share buyback is part of an overall plan of up to NIS 800 million ($216 million).
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  • Net income - NIS 2.4 billion ($649 million)
  • Return on Equity - 19.4%
  • Continued improvement of the efficiency ratio - 29.5%
  • Leumi to distribute a NIS 736 million dividend ($199 million), in addition to NIS 300 million ($81 million) in share buyback, bringing the cumulative effective dividend to approx. 40% of the net income
  • The share buyback is part of an overall plan of up to NIS 800 million ($216 million)

TEL AVIV, Israel, Aug. 15, 2023 /PRNewswire/ -- Bank Leumi (TASE: LUMI) published today its financial statements for Q2 2023:

Net income in the second quarter of 2023 amounted to NIS 2.4 billion ($649 million), compared to NIS 2 billion ($541 million) in the corresponding quarter last year.

Return on equity in the second quarter of 2023 was 19.4%, compared to 18.5% in the corresponding quarter last year.

Efficiency ratio in the second quarter of 2023 was 29.5%, compared with 35% in the corresponding quarter last year.

Dividend and share buyback: The Bank's Board of Directors approved a dividend distribution totaling NIS 736 million ($199 million), which together with a share buyback of NIS 300 million ($81 million) represent approx. 40% of the net income for the second quarter of 2023. The share buyback which took place is part of an overall plan of up to NIS 800 million ($216 million).

Responsible growth in the credit portfolio's strategic segments: The Bank continues to focus its growth on the credit portfolio in the corporate, commercial and mortgage segments. From the beginning 2023, the credit portfolio grew by a total of 6.4% (of which 1.4% was in the second quarter). From the beginning of 2023, the corporate portfolio grew by 14.4%, the commercial portfolio - by 5.4%, and the mortgage portfolio - by 3.9%.

High capital adequacy: Common Equity Tier 1 capital ratio as of June 30, 2023 was 11.23% and total capital ratio was 14.44%.

Deposits by private customers on June 30, 2023 totaled NIS 166 billion ($44.9 billion), compared to 158 billion ($42.7 billion) on December 31, 2022 - a 5% increase.

Loan loss expenses in the second quarter of 2023 reflect an expense rate of 0.31% of the average outstanding loans to the public, compared to an expense rate of 0.14% in the corresponding period last year. The expense in the second quarter arose from the collective provision.

Valley National Bank: In the second quarter of 2023, the market cap value of Leumi's holdings in US-based Valley National Bank was up and currently amounts to some NIS 2.6 billion ($700 million). This is the result of a significant 40% increase in Valley's stock price on NASDAQ - approximately 15% more than the US Regional Banks Index.

Sale of Leumi's HQ buildings: As part of the preparations to complete the transition of the Bank's headquarters to Lod, during April 2022 and March 2023, the Bank entered into an agreement to sell its two headquarters buildings in Tel Aviv. These sales are expected to generate a pre-tax capital gain of some NIS 800 million ($216 million) in late 2023 or in early 2024, once the transition has been completed.

Leumi Group - Key Financials 


For the three months ended June 30

Change in NIS million

Change in %

2023

2022

Net Interest income

4,284

3,125

1,159

37.1

Loan loss expenses

318

126

192

+

Non-interest income

1,412

1,557

(145)

(9.3)

Operating and other expenses

1,683

1,641

42

2.6

Profit before tax

3,695

2,915

780

26.8

Provision for tax

1,364

1,007

357

35.5

Profit after tax

2,331

1,908

423

22.2

The Bank's share in the profits of associates

122

84

38

45.2

Net income attributable to non-controlling interests

-

-

-

-

Net income attributable to the banking corporation's
shareholders

2,453

1,992

461

23.1

Return on equity (%)

19.4

18.5



Earnings per share (NIS)

1.59

1.36



 

Profit and profitability (in NIS million)


For the six months ended June 30

Change in NIS million

Change in %

2023

2022

Net Interest income

8,212

6,024

2,188

36.3

Loan loss expenses

724

86

638

+

Non-interest income

2,483

2,507

(24)

(1.0)

Operating and other expenses

3,312

3,435

(123)

(3.6)

Profit before tax

6,659

5,010

1,649

32.9

Provision for tax

2,253

1,490

763

51.2

Profit after tax

4,406

3,520

886

25.2

The Bank's share in the profits (losses) of associates

(972)

91

(1,063)

-

Net income attributable to non-controlling interests

-

(10)

10

100

Net income attributable to the banking corporation's shareholders

3,434

3,601

(167)

(4.6)

Return on equity (%)

13.6

17.1



Earnings per share (NIS)

2.23

2.47



 

Development of balance sheet items (in NIS millions)


As at June 30

December 31, 2022

2023

2022

Net loans to the public

409,565

364,924

384,782

Deposits by the public

533,977

532,737

557,084

Shareholders' equity

51,771

47,060

49,438

Total assets

686,857

667,680

699,166

 

Principal financial ratios (%) 


As at June 30

December 31, 2022

2023

2022

Net loans to the public to total assets

59.6

54.7

55.0

Deposits by the public to total assets

77.7

79.8

79.7

Total equity to risk assets

14.44

14.00

14.29

Tier 1 capital to risk assets

11.23

11.25

11.46

Leverage ratio

6.69

6.25

6.36

Liquidity coverage ratio

128

122

131

 

The data in this press release has been converted into US dollars solely for convenience purposes, at the representative exchange rate published by the Bank of Israel on June 30, 2023, NIS 3.70.

Conference Call Details

A conference call to discuss the results will be held today at 5 PM (Israel); 3 PM (UK); 10 AM (ET).

To access the conference call please use one of the numbers below (no passcode required):

Israel  03-918-0610
UK 0-800-917-9141
US & Canada 1-888-407-2553
All other locations +972-3-918-0610

The call will be accompanied by a presentation which will be published on the day of the publication of the Financial Results on the Israeli Securities Authority reporting website (MAGNA). It will also be available on the Leumi website under Investor Relations, in the Financial Statements page, Investor Presentation and Conference Call.

An archived recording will be available on the Leumi website one business day after the call ends.

For more information visit the investor relations page on our website or contact Michael Klahr, VP, Head of Investor Relations, at investorrelations@bankleumi.co.il.

The conference call does not replace the need to review the latest periodic/quarterly reports containing full information, including forward-looking information, as defined in the Israeli Securities Law, and set out in the aforementioned reports.

Cision View original content:https://www.prnewswire.com/news-releases/leumi-concludes-q2-2023-with-a-nis-2-4-billion-649-million-profit--and-with-a-dividend-distribution-and-share-buyback-of-some-nis-1-billion-270-million-301900531.html

SOURCE Bank Leumi

FAQ

What is Bank Leumi's ticker symbol?

Bank Leumi's ticker symbol is TASE: LUMI.

What was Bank Leumi's net income in Q2 2023?

Bank Leumi's net income in Q2 2023 was NIS 2.4 billion ($649 million).

What is the return on equity for Bank Leumi in Q2 2023?

Bank Leumi's return on equity in Q2 2023 was 19.4%.

What is the efficiency ratio for Bank Leumi in Q2 2023?

Bank Leumi's efficiency ratio in Q2 2023 was 29.5%.

What is the dividend distribution and share buyback plan for Bank Leumi?

Bank Leumi will distribute a NIS 736 million ($199 million) dividend and conduct a NIS 300 million ($81 million) share buyback, representing 40% of the net income. The share buyback is part of an overall plan of up to NIS 800 million ($216 million).

BANK LEUMI LE ISRAEL

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