Israel Discount Bank Earns NIS143 Million in Q1 2010
Net Income Increases 2.1% to NIS 143 Million; Return on Shareholders' Equity 5.8%
TEL-AVIV, Israel, May 27, 2010 /PRNewswire-FirstCall/ -- Israel Discount Bank Limited (TASE:DSCT), one of Israel's leading banks, today announced its financial results for the first quarter 2010. Additional key results include:
- First quarter Net Income reaches NIS 143 million, compared with NIS 140
million in the first quarter of 2009. Net Income for 2009 totaled NIS
923 million.
- First quarter Return on Shareholders' Equity at 5.8% compared with 6.5%
in the first quarter of 2009. The return on shareholders' equity for
2009 was 9.8%.
- Ratio of capital to risk assets at 13.41% (Basel 1). Tier I ratio at
9.01% (Basel 1)
- Ratio of capital to risk assets 12.50% (Basel 2)
Discount CEO, Giora Offer was quoted "The beginning of 2010 was characterized by the first signs of economic recovery, alongside which we have seen darker clouds coming from Europe. The Discount Group continues to post gains in our core business sectors, despite market conditions and low interest rates. We see an ongoing positive trend in our asset quality, both in terms of provisions and levels of classified loans. A number of personnel changes have taken place, including the appointment of a new CEO to Israel Credit Cards, a complete restructuring of our retail business, the establishment of a new technology and planning division, as well as operations and logistics, and finally, the recent appointment of a group CRO. Our capital continues to grow, which coupled with our stronger capital ratios and high liquidity levels, will allow for continued growth in the next quarters"
Key Financial Highlights
Main factors affecting the Group's business results for the first quarter of 2010, compared with the first quarter of 2009:
- An increase of 18.6% in income from financing activities
before provision for doubtful debts.
- A decrease of 53.6% in the provision for loan losses.
- The Bank's share in operating income of affiliated companies
amounted to NIS 45 million, compared with NIS 28 million in the first
quarter of 2009.
Factors that partially counteracted the increase in net income in the first quarter of 2010:
- A decrease of 11.7% in operating and other income, due
mainly to weaker performance in the employee severance fund
- An increase of 3.2% in operating and other expenses., due to
revised labor agreements and increased depreciation expenses.
- The provision for taxes on operating income amounts to NIS
123 million.
Development of Assets and Liabilities in the first quarter of 2010 compared with the first quarter of 2009
- Total Assets decreased by 0.3% to NIS 187.2 billion,
compared with NIS 187.8 billion at December 31, 2009.
- Credit to the public decreased by 0.1% to NIS 114.3 billion,
compared with NIS 114.4 billion at December 31, 2009.
- Deposits from the public decreased by 1.4% to NIS 139.9
billion, compared with NIS 141.8 billion at December 31, 2009.
- Shareholders' Equity increased by 3.1% to NIS 10.3 billion,
compared with NIS 10.0 billion at December 31, 2009.
Data Regarding Subsidiaries
Q1 2010
Return on Capital
Net Shareholders' Adequacy
Income Equity Ratio
Discount Bancorp Inc. USD 15 M 8.6% 15.0%**
Mercantile Discount Bank NIS 30 M 7.3% 12.4%*
Discount Mortgage Bank NIS 6.2 M 2.3% 19.1%*
Israel Credit Cards ICC (the Bank holds
71.83% of the equity) NIS 64 M 25.8% 16.0%*
**As per binding principles in the US * Computed according to Basel II
guidelines
Q1 2009
Return on Capital
Net Shareholders' Adequacy
Income Equity Ratio
Discount Bancorp Inc. USD 9 M 5.6% 11.8%**
Mercantile Discount Bank NIS 26 M 7.1% 12.8%*
Discount Mortgage Bank NIS 11.4 M 5.2% 10.8%*
Israel Credit Cards ICC (the Bank holds
71.83% of the equity) NIS 60 M 31.9% 21.3%*
* Computed according to Basel I guidelines. ****As per binding principles
in the US
2009
Return on Capital
Net Shareholders' Adequacy
Income Equity Ratio
USD 44
Discount Bancorp Inc. M 6.6% 14.9%**
Mercantile Discount NIS 180
Bank M 11.1% 12.3%*
NIS 31
Discount Mortgage Bank M 3.4% 19.3%*
Israel Credit Cards
ICC (the Bank holds NIS 249
71.83% of the equity) M 26.3% 13.7%*
**As per binding principles in the US * Computed according to Basel
II guidelines
Discount Group - Principal Data from the Financial Statements
Income and Profitability (in NIS millions)
First Quarter Annual
%
2010 2009 change 2009
Income from financing
activities before
provision for doubtful debts 1,115 940 18.6 4,757
Provision for doubtful debts 117 252 (53.6) 998
Operating and other
income 640 725 (11.7) 3,091
Operating and other
expenses 1,397 1,354 3.2 5,486
Operating Income before
taxes 241 59 308.5 1,364
Operating Income after taxes 118 145 (18.6) 857
Net operating income 143 157 (8.9) 943
Net income for the period 143 140 2.1 923
Return on net operating
income in % 5.6 8.2 10.7
Return on net income in % 5.8 6.5 9.8
Development of Assets and Liabilities (in NIS billions)
March 31 December 31
% %
2010 2009 change 2009 change
Total Assets 187.2 193.1 (3.1) 187.8 (0.3)
Credit to the public 114.3 120.4 (5.1) 114.4 (0.1)
Deposits from the public 139.9 146.6 (4.6) 141.8 (1.4)
Shareholders' equity 10.3 9.0 14.9 10.0 3.1
Principal Financial Ratios (in percentages)
March 31 December 31
2010 2009 2009
Financial resources in relation to total
assets 5.7 4.8 5.5
Credit to the public to deposits from the
public 81.7 82.1 80.7
Total capital to risk assets (capital
adequacy ratio)Basel 2 12.50 - 12.06
Total capital to risk assets (capital
adequacy ratio)* 13.41 10.42 13.12
Tier I capital to risk assets 7.75 - 7.51
Provision for doubtful debts to credit
granted to the public 0.39 0.80 0.83
Interest margin 1.37 0.66 1.39
Operating expenses to total income
(efficiency ratio) 79.6 81.3 69.9
* Computed according to Basel I guidelines.
About Israel Discount Bank
Israel Discount Bank is a leading financial group in Israel. With nationwide coverage, and a fast-growing domestic franchise, Israel Discount Bank provides a full spectrum of corporate and retail financial products and services to its clients, both in Israel and key financial centers around the world. Israel Discount Bank is a member of and is traded on the Tel-Aviv Stock Exchange under the Ticker DSCT; Bloomberg: DSCT.IT Reuters: DSCT.TA
For additional information, please visit the Company's investor relations website at http://www.discountbank.co.il/IR
The above constitutes an English convenience translation of the Hebrew Press Release issued by the Bank
It is hereby emphasized that no representation or warranty whatsoever is given as to the achievement or fulfillment of any forecasts regarding the future prospects of the bank. The actual performance of the bank may vary materially from any forecasts provided, due, among others, to changes in macro economic conditions, changes in capital markets, regulatory and other changes not within the control of the bank. Such changes may contribute to certain risks and uncertainties regarding and predictions and or forecasts provided by the bank, and which could lead to material differences between actual performance of the bank and any forecasts provided. Forward-looking information is generally typified by terms such as "believe", "anticipate", "expect", "intend", "project" "forecast" and or similar expressions.
For further details, please refer to the "Forward Looking Information" section in the bank's financial statements.
Company Contact
Barry Simon
Investor Relations
Tel: +972-3-5146593
[email protected]
SOURCE Israel Discount Bank Ltd
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