First International Bank of Israel Reports Financial Results for the Third Quarter of 2024
Reflects continued growth and high profitability while maintaining financial stability
TEL AVIV, Israel, Nov. 25, 2024 /PRNewswire/ -- First International Bank of Israel (TASE: FIBI) one of Israel's major banking groups, today announced its results for the third quarter and nine-month period ended September 30, 2024.
Financial Highlights
Financial Highlights for the Third Quarter of 2024
- Net income of NIS 620 million and a return on equity of 19.4% in the third quarter of 2024;
- Net income of NIS 1,798 million and a return on equity of 19.4% for the first nine months of the year;
- Credit to the public grew by 6% compared to the end of 2023 and by 3.5% compared to the second quarter of the year;
- Deposits by the public grew by 11.4% compared to the end of 2023, and by 4.3% compared to the second quarter of the year;
- The portfolio of customers' assets grew by 19% compared to the end of 2023, and reached NIS 800 billion;
- Equity attributed to the Bank's shareholders was NIS 13 billion, an increase of 8.2% compared to the end of 2023;
- The tier 1 capital ratio was 11.41%;
- The Bank's Board of Directors decided to distribute a dividend in the amount of NIS 248 million, representing 40% of the net income.
Financial Results of the Third Quarter 2024
Net profit for the First International Bank Group was NIS 620 million in the third quarter of 2024, an increase of 36.3 % compared to the comparative quarter in the previous year. Return on equity was 19.4%.
The net profit for the first nine months of the year was NIS 1,798 million, an increase of 7.5% compared to the comparative period in the previous year. The return on equity was 19.4%.
Expense for credit losses was NIS 22 million in the third quarter, amounting to 0.07% of the average balance of credit to the public. Income for credit losses amounted to NIS 51 million in the first nine months of the year, primarily from debt recovery. In the corresponding period of last year, expenses of NIS 336 million were recorded which was due to an increase in collective provisions because of concerns over macroeconomic impacts, amid uncertainty.
High-quality credit portfolio: the NPL (non-performing loan) ratio remained stable and reached 0.57% at the end of the third quarter. This reflects the quality of the credit portfolio, (the balance of debts not accruing or overdue by 90 days or more out of the total credit to the public). The total coverage ratio (the ratio of the total credit loss provisions to the total credit to the public) stood at 1.41%, compared to 1.37% in the comparative period last year.
The operating and other expenses were NIS 2,240 million in the first nine months of the year, an increase of 2% compared to the comparative period in the previous year, mainly due to an increase in other expenses: IT-related, donations, telecommunications and advertising. The efficiency ratio stood at 44.5%.
Credit to the public amounted to NIS 126.4 billion, an increase of 6% compared to the end of 2023. There was an increase in the credit of 3.5% in the third quarter, compared to the second quarter of the year.
Deposits by the public amounted to NIS 213 billion, an increase of 11.4% compared to the end of 2023, and 4.3% compared to the second quarter.
The total customers' assets portfolio increased by 26% year-over-year and by 19% compared to the end of 2023, to approximately 800 billion.
Equity attributed to shareholders in the Bank increased to NIS 13 billion, an increase of 8.2% compared to the end of 2023. The tier 1 capital ratio reached 11.41%, approximately -2.2% above the regulatory requirement, reflecting the highest capital surplus in the Israeli banking system. The liquidity coverage ratio is high and stands at 171%.
Considering the requests of the Banking Supervisor regarding capital planning and profits distribution policies, the Bank's Board of Directors decided to approve the distribution of a cash dividend to the shareholders for NIS 248 million representing 40% of the net income. The Bank's Board of Directors will continue to review the implementation of the Bank's dividend distribution policy in light of ongoing developments and their impact on the Israeli economy and on the Bank.
Management Comment
Eli Cohen, CEO of First International Bank, commented: ,"The Bank's reports reflect a growth trend both on the passive side, including deposits and securities of the public, which reached a record NIS 800 billion, and also on the active side, with a considerable increase in the credit portfolio, which has been achieved while maintaining the quality of the underwriting and portfolio diversification.
"Amid economic uncertainty and the ongoing multi-front war in Israel, the First International Bank maintained high capital and liquidity cushions, ensuring resilience and our ability to continue supporting our customers. The Bank is continuing to provide benefits and relief measures for customers to help them navigate the current challenging period.
"I am proud to say that the First International Bank's customers are the most satisfied among bank customers in Israel, reporting high satisfaction with the Bank, the professionalism of its services and their willingness to recommend the bank to their friends. This is evidenced via customer surveys, including the recent Marketest survey. This reflects the high quality service and competitiveness of the First International Bank, as well as the professionalism and the dedication of our Group's employees, all of whom have contributed to the achievement.
"We recently announced a number of management changes at the Bank: Vered Golan was appointed to the position of Head of the Corporate Division, Dr. Moriah Hoftman-Doron was appointed to the position of Chief Legal Counsel, and Liora Shechter was appointed CEO of Mataf. I wish considerable success to the new members of our management team."
CONDENSED PRINCIPAL FINANCIAL INFORMATION AND PRINCIPAL EXECUTION INDICES |
||||||
Principal financial ratios |
For the nine months |
For the year ended |
||||
2024 |
2023 |
2023 |
||||
in % |
||||||
Principal execution indices |
||||||
Return on equity attributed to shareholders of the Bank(1) |
19.4 |
20.5 |
19.7 |
|||
Return on average assets(1) |
1.05 |
1.10 |
1.06 |
|||
Ratio of equity capital tier 1 |
11.41 |
10.84 |
11.35 |
|||
Leverage ratio |
5.17 |
5.30 |
5.26 |
|||
Liquidity coverage ratio |
171 |
142 |
156 |
|||
Net stable funding ratio |
142 |
138 |
146 |
|||
Ratio of total income to average assets(1) |
2.9 |
3.3 |
3.2 |
|||
Ratio of interest income, net to average assets (1) |
2.1 |
2.5 |
2.4 |
|||
Ratio of fees to average assets (1) |
0.7 |
0.7 |
0.7 |
|||
Efficiency ratio |
44.5 |
43.6 |
43.5 |
|||
Credit quality indices |
||||||
Ratio of provision for credit losses to credit to the public |
1.29 |
1.25 |
1.36 |
|||
Ratio of total provision for credit losses (2) to credit to the public |
1.41 |
1.37 |
1.50 |
|||
Ratio of non-accruing debts or in arrears of 90 days or more to credit to the public |
0.57 |
0.49 |
0.60 |
|||
Ratio of provision for credit losses to total non-accruing credit to the public |
230.5 |
263.8 |
234.5 |
|||
Ratio of net write-offs to average total credit to the public (1) |
(0.06) |
- |
0.03 |
|||
Ratio of expenses (income) for credit losses to average total credit to the public (1) |
(0.06) |
0.38 |
0.42 |
|||
Principal data from the statement of income |
For the nine months |
|||||
2024 |
2023 |
|||||
NIS million |
||||||
Net profit attributed to shareholders of the Bank |
1,798 |
1,673 |
||||
Interest Income, net |
3,601 |
3,820 |
||||
Expenses (income) from credit losses |
(51) |
336 |
||||
Total non-Interest income |
1,436 |
1,216 |
||||
Of which: Fees |
1,123 |
1,131 |
||||
Total operating and other expenses |
2,240 |
2,197 |
||||
Of which: Salaries and related expenses |
1,302 |
1,353 |
||||
Primary net profit per share of NIS 0.05 par value (NIS) |
17.92 |
16.67 |
||||
Principal data from the balance sheet |
30.9.24 |
30.9.23 |
31.12.23 |
|||
NIS million |
||||||
Total assets |
242,512 |
210,673 |
221,593 |
|||
of which: Cash and deposits with banks |
81,440 |
61,659 |
68,866 |
|||
Securities |
28,860 |
22,043 |
26,985 |
|||
Credit to the public, net |
124,749 |
118,577 |
117,622 |
|||
Total liabilities |
228,823 |
198,542 |
208,947 |
|||
of which: Deposits from the public |
212,907 |
181,274 |
191,125 |
|||
Deposits from banks |
2,631 |
3,824 |
4,314 |
|||
Bonds and subordinated capital notes |
4,474 |
4,751 |
4,767 |
|||
Capital attributed to the shareholders of the Bank |
13,066 |
11,583 |
12,071 |
|||
Additional data |
30.9.24 |
30.9.23 |
31.12.23 |
|||
Share price (0.01 NIS) |
15,410 |
16,360 |
14,990 |
|||
Dividend per share (0.01 NIS) |
739 |
706 |
795 |
|||
(1) Annualized. |
||||||
(2) Including provision in respect of off-balance sheet credit instruments. |
||||||
CONSOLIDATED STATEMENT OF INCOME |
||||||||||
(NIS million) |
||||||||||
For the three months |
For the nine months |
For the year Ended |
||||||||
2024 |
2023 |
2024 |
2023 |
2023 |
||||||
(unaudited) |
(unaudited) |
(unaudited) |
(unaudited) |
(audited) |
||||||
Interest Income |
2,955 |
2,590 |
8,410 |
7,289 |
9,850 |
|||||
Interest Expenses |
1,690 |
1,363 |
4,809 |
3,469 |
4,884 |
|||||
Interest Income, net |
1,265 |
1,227 |
3,601 |
3,820 |
4,966 |
|||||
Expenses (income) from credit losses |
22 |
165 |
(51) |
336 |
502 |
|||||
Net Interest Income after expenses from credit losses |
1,243 |
1,062 |
3,652 |
3,484 |
4,464 |
|||||
Non- Interest Income |
||||||||||
Non-Interest Financing income |
153 |
(1) |
300 |
78 |
142 |
|||||
Fees |
396 |
375 |
1,123 |
1,131 |
1,502 |
|||||
Other income |
3 |
- |
13 |
7 |
8 |
|||||
Total non- Interest income |
552 |
374 |
1,436 |
1,216 |
1,652 |
|||||
Operating and other expenses |
||||||||||
Salaries and related expenses |
430 |
438 |
1,302 |
1,353 |
1,746 |
|||||
Maintenance and depreciation of premises and equipment |
91 |
89 |
264 |
256 |
341 |
|||||
Amortizations and impairment of intangible assets |
36 |
31 |
99 |
91 |
122 |
|||||
Other expenses |
220 |
175 |
575 |
497 |
668 |
|||||
Total operating and other expenses |
777 |
733 |
2,240 |
2,197 |
2,877 |
|||||
Profit before taxes |
1,018 |
703 |
2,848 |
2,503 |
3,239 |
|||||
Provision for taxes on profit |
390 |
247 |
1,033 |
869 |
1,090 |
|||||
Profit after taxes |
628 |
456 |
1,815 |
1,634 |
2,149 |
|||||
The bank's share in profit of equity-basis investee, after taxes |
22 |
21 |
62 |
105 |
113 |
|||||
Net profit: |
||||||||||
Before attribution to non‑controlling interests |
650 |
477 |
1,877 |
1,739 |
2,262 |
|||||
Attributed to non‑controlling interests |
(30) |
(22) |
(79) |
(66) |
(90) |
|||||
Attributed to shareholders of the Bank |
620 |
455 |
1,798 |
1,673 |
2,172 |
|||||
NIS |
||||||||||
Primary profit per share attributed to the shareholders of the Bank |
||||||||||
Net profit per share of NIS 0.05 par value |
6.18 |
4.53 |
17.92 |
16.67 |
21.65 |
|||||
STATEMENT OF COMPREHENSIVE INCOME |
||||||||||
(NIS million) |
||||||||||
For the three months |
For the nine months |
For the year Ended |
||||||||
2024 |
2023 |
2024 |
2023 |
2023 |
||||||
(unaudited) |
(unaudited) |
(unaudited) |
(unaudited) |
(audited) |
||||||
Net profit before attribution to non‑controlling interests |
650 |
477 |
1,877 |
1,739 |
2,262 |
|||||
Net profit attributed to non‑controlling interests |
(30) |
(22) |
(79) |
(66) |
(90) |
|||||
Net profit attributed to the shareholders of the Bank |
620 |
455 |
1,798 |
1,673 |
2,172 |
|||||
Other comprehensive income (loss) before taxes: |
||||||||||
Adjustments of available for sale bonds to fair value, net |
129 |
52 |
(115) |
78 |
213 |
|||||
Adjustments of liabilities in respect of employee benefits(1) |
(2) |
34 |
10 |
37 |
25 |
|||||
Other comprehensive income (loss) before taxes |
127 |
86 |
(105) |
115 |
238 |
|||||
Related tax effect |
(49) |
(29) |
41 |
(40) |
(81) |
|||||
Other comprehensive income (loss) before attribution to non‑controlling interests, after taxes |
78 |
57 |
(64) |
75 |
157 |
|||||
Less other comprehensive income (loss) attributed to non‑controlling interests |
3 |
1 |
(2) |
6 |
9 |
|||||
Other comprehensive income (loss) attributed to the shareholders of the Bank, after taxes |
75 |
56 |
(62) |
69 |
148 |
|||||
Comprehensive income before attribution to non‑controlling interests |
728 |
534 |
1,813 |
1,814 |
2,419 |
|||||
Comprehensive income attributed to non‑controlling interests |
(33) |
(23) |
(77) |
(72) |
(99) |
|||||
Comprehensive income attributed to the shareholders of the Bank |
695 |
511 |
1,736 |
1,742 |
2,320 |
|||||
(1) Mostly reflects adjustments in respect of actuarial assessments as of the end of the period regarding defined benefits pension plans and deduction of amounts recorded in the past in other comprehensive income. |
||||||||||
CONSOLIDATED BALANCE SHEET |
||||||
(NIS million) |
||||||
September 30, |
December 31, |
|||||
2024 |
2023 |
2023 |
||||
(unaudited) |
(unaudited) |
(audited) |
||||
Assets |
||||||
Cash and deposits with banks |
81,440 |
61,659 |
68,866 |
|||
Securities |
28,860 |
22,043 |
26,985 |
|||
Securities borrowed |
147 |
155 |
57 |
|||
Credit to the public |
126,374 |
120,073 |
119,240 |
|||
Provision for Credit losses |
(1,625) |
(1,496) |
(1,618) |
|||
Credit to the public, net |
124,749 |
118,577 |
117,622 |
|||
Credit to the government |
1,611 |
1,015 |
1,055 |
|||
Investment in investee company |
854 |
776 |
786 |
|||
Buildings and equipment |
852 |
871 |
877 |
|||
Intangible assets |
350 |
305 |
328 |
|||
Assets in respect of derivative instruments |
2,308 |
3,940 |
3,651 |
|||
Other assets(2) |
1,341 |
1,332 |
1,366 |
|||
Total assets |
242,512 |
210,673 |
221,593 |
|||
Liabilities and Capital |
||||||
Deposits from the public |
212,907 |
181,274 |
191,125 |
|||
Deposits from banks |
2,631 |
3,824 |
4,314 |
|||
Deposits from the Government |
689 |
665 |
750 |
|||
Securities lent or sold under agreements to repurchase |
1,542 |
- |
- |
|||
Bonds and subordinated capital notes |
4,474 |
4,751 |
4,767 |
|||
Liabilities in respect of derivative instruments |
2,086 |
3,496 |
3,784 |
|||
Other liabilities(1)(3) |
4,494 |
4,532 |
4,207 |
|||
Total liabilities |
228,823 |
198,542 |
208,947 |
|||
Shareholders' equity |
13,066 |
11,583 |
12,071 |
|||
Non-controlling interests |
623 |
548 |
575 |
|||
Total capital |
13,689 |
12,131 |
12,646 |
|||
Total liabilities and capital |
242,512 |
210,673 |
221,593 |
|||
(1) Of which: provision for credit losses in respect of off-balance sheet credit instruments in the amount of NIS 160 million and NIS 150 million and NIS 165 million at 30.9.24, 30.9.23 and 31.12.23, respectively. |
||||||
(2) Of which: other assets measured at fair value in the amount of NIS 16 million and NIS 13 million and NIS 10 million at 30.9.24, 30.9.23 and 31.12.23, respectively. |
||||||
(3) Of which: other liabilities measured at fair value in the amount of NIS 48 million and NIS 26 million and NIS 11 million at 30.9.24, 30.9.23 and 31.12.23, respectively. |
||||||
STATEMENT OF CHANGES IN EQUITY |
||||||||||||
(NIS million) |
||||||||||||
For the three months ended September 30, 2024 (unaudited) |
||||||||||||
Share |
Accumulated |
Retained |
Total |
Non- |
Total |
|||||||
Balance as of June 30, 2024 |
927 |
(292) |
11,980 |
12,615 |
590 |
13,205 |
||||||
Net profit for the period |
- |
- |
620 |
620 |
30 |
650 |
||||||
Dividend |
- |
- |
(244) |
(244) |
- |
(244) |
||||||
Other comprehensive income, after tax effect |
- |
75 |
- |
75 |
3 |
78 |
||||||
Balance as at September 30, 2024 |
927 |
(217) |
12,356 |
13,066 |
623 |
13,689 |
||||||
For the three months ended September 30, 2023 (unaudited) |
||||||||||||
Share |
Accumulated |
Retained |
Total |
Non- |
Total |
|||||||
Balance as of June 30, 2023 |
927 |
(290) |
10,655 |
11,292 |
525 |
11,817 |
||||||
Net profit for the period |
- |
- |
455 |
455 |
22 |
477 |
||||||
Dividend |
- |
- |
(220) |
(220) |
- |
(220) |
||||||
Other comprehensive income, after tax effect |
- |
56 |
- |
56 |
1 |
57 |
||||||
Balance as at September 30, 2023 |
927 |
(234) |
10,890 |
11,583 |
548 |
12,131 |
||||||
For the nine months ended September 30, 2024 (unaudited) |
||||||||||||
Share |
Accumulated |
Retained |
Total |
Non- |
Total |
|||||||
Balance as at December 31, 2023 (audited) |
927 |
(155) |
11,299 |
12,071 |
575 |
12,646 |
||||||
Net profit for the period |
- |
- |
1,798 |
1,798 |
79 |
1,877 |
||||||
Dividend |
- |
- |
(741) |
(741) |
(29) |
(770) |
||||||
Other comprehensive loss, after tax effect |
- |
(62) |
- |
(62) |
(2) |
(64) |
||||||
Balance as at September 30, 2024 |
927 |
(217) |
12,356 |
13,066 |
623 |
13,689 |
||||||
For the nine months ended September 30, 2023 (unaudited) |
||||||||||||
Share |
Accumulated |
Retained |
Total |
Non- |
Total |
|||||||
Balance as at December 31, 2022 (audited) |
927 |
(303) |
9,935 |
10,559 |
476 |
11,035 |
||||||
Adjustment of the opening balance, net of tax, due to the effect of initial implementation in investee company* |
- |
- |
(10) |
(10) |
- |
(10) |
||||||
Adjusted balance at January 1, 2023, following initial implementation |
927 |
(303) |
9,925 |
10,549 |
476 |
11,025 |
||||||
Net profit for the period |
- |
- |
1,673 |
1,673 |
66 |
1,739 |
||||||
Dividend |
- |
- |
(708) |
(708) |
- |
(708) |
||||||
Other comprehensive income, after tax effect |
- |
69 |
- |
69 |
6 |
75 |
||||||
Balance as at September 30, 2023 |
927 |
(234) |
10,890 |
11,583 |
548 |
12,131 |
||||||
STATEMENT OF CHANGES IN EQUITY (CONT'D) |
||||||||||||
(NIS million) |
||||||||||||
For the year ended December 31, 2023 (audited) |
||||||||||||
Share |
Accumulated |
Retained |
Total |
Non- |
Total |
|||||||
Balance as at December 31, 2022 |
927 |
(303) |
9,935 |
10,559 |
476 |
11,035 |
||||||
Adjustment of the opening balance, net of tax, due to the effect of initial implementation in investee company * |
- |
- |
(10) |
(10) |
- |
(10) |
||||||
Adjusted balance at January 1, 2023, following initial implementation |
927 |
(303) |
9,925 |
10,549 |
476 |
11,025 |
||||||
Net profit for the year |
- |
- |
2,172 |
2,172 |
90 |
2,262 |
||||||
Dividend |
- |
- |
(798) |
(798) |
- |
(798) |
||||||
Other comprehensive income, after tax effect |
- |
148 |
- |
148 |
9 |
157 |
||||||
Balance as at December 31, 2023 |
927 |
(155) |
11,299 |
12,071 |
575 |
12,646 |
||||||
* Cumulative effect of the initial implementation of US accounting principles in the matter of financial instruments - credit losses (ASC-326). |
||||||||||||
(1) Including share premium of NIS 313 million (as from 1992 onwards). |
||||||||||||
(2) Including an amount of NIS 2,391 million which cannot be distributed as dividend. |
||||||||||||
Contact:
Dafna Zucker
First International Bank of Israel
[email protected]
+972-3-519-6224
SOURCE First International Bank of Israel
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