Israel Discount Bank Earns NIS 288 Million in Q3 2010
TEL AVIV, Israel, November 29, 2010 /PRNewswire-FirstCall/ --
- Return on Shareholders' Equity in Q3/10 is 11.3%
- Third Quarter Net Income Increases 82.3% Over Q2/10, From NIS158
Million to NIS288 Million and Decreases 1.4%, Compared With NIS 292
Million in Third Quarter 2009
- Return on Shareholders' Equity 11.3% Compared With 12.7% in 2009
Israel Discount Bank Limited (TASE:DSCT), one of Israel's leading banks, today announced its financial results for the third quarter of 2010. Additional key results include:
- Third Quarter Net Income - Increases by 82.3 % to NIS 288 million,
compared with NIS 158 million in the second quarter of 2010 and
decreases by 1.4%, compared with NIS 292 million in the corresponding
quarter last year.
- Third Quarter Return on Shareholders' Equity - 11.3% on an annual
basis, compared with 6.3% in the second quarter of 2010 and compared
with 12.7% in the corresponding quarter last year.
- First Nine Months of 2010 Net Income - NIS 589 million, compared with
NIS 769 million in the corresponding period last year, a decrease of
23.4%.
- First Nine Months of 2010 Return on Shareholders' Equity - 7.7% on an
annual basis, compared with 11.3% in the corresponding period last year
and 9.8% for the whole of 2009.
- Ratio of capital to risk assets at September 30, 2010:
Basel II Basel I
Total capital ratio 12.93 13.54
Tier I capital 8.01 9.00
ratio
Core capital ratio 7.37 -
(Logo: http://www.newscom.com/cgi-bin/prnh/20100810/403645 )
Commenting on the results, President & CEO, Giora Offer, noted, "The Net Income for the third quarter and the first nine months of 2010 totals NIS 288 million and NIS 589 million, respectively, and the return on shareholders' equity is 11.3% and 7.7%, respectively. The shareholders' equity of the Bank amounts to NIS 10.8 billion and its capital adequacy ratio is 12.93%.
The results announced today reflect the Group's achievements in the various fields of its business activity: building strong capital adequacy without forsaking growth, increasing income, reducing provisions for doubtful debts and continuing to improve the credit portfolio. All these have been attained while keeping expenses under control, an expression of the efficiency measures implemented in recent years. The sale of the Bank's shares by the State and the offering expected in the coming weeks are significant events for all the Bank's stakeholders.
The pace at which new customers are being attracted continues to be a source of satisfaction and the positive effects thereof are noticeable in every item in the financial statements. "Discount Key", which we launched in May this year, continues to be the central marketing platform, with more than 250,000 having joined the various savings programs.
In accordance with the board's instructions, the Bank's management is focusing on the strategy plan for 2011-2015, whose main emphasis lies on Group synergy, efficiency and further growth and development of core businesses.
The financial statements as at September 30, 2010 are the last financial statements that I shall be presenting in my role as President & CEO of the Group and I would like to again thank the members of the Board of Directors, management and, in particular, all the employees of the Bank and the Group for ten wonderful years during which the Bank has established its position, and become a leading, competitive bank known for its dedication toward its customers.
I wish all the best to my successor "Mr. Reuven Spiegel, who will take over the position at the end of the year, and who I am sure will lead the Bank to new and even higher performance levels."
Main factors affecting the Group's profits for the first nine months of 2010, compared with the corresponding period last year:
- A decrease of 25.0% in the provision for doubtful debts.
- An increase of 0.4% in income from financing activities
before provision for doubtful debts.
- A decrease of 15.0% in operating and other income that was
affected by a NIS 169 million reduction in other income, mainly from
profits recognized on the severance pay fund, and also from a 3.9%
reduction in operating commissions, arising primarily from the decrease
in income from credit cards.
- A decrease of 58.0% in the Bank's share in the operating
income of affiliated companies, from NIS 236 million in the first nine
months of 2009 (including NIS 130 million with respect to the reversal
of a provision for taxes on the investment in The First International
Bank of Israel) to NIS 99 million in the first nine months of 2010.
- An increase of 1.5% in operating and other expenses, due
mainly to higher depreciation expenses.
Main developments in assets and liabilities of the Discount Group in the first nine months of 2010
- Total assets decreased by 0.4% to NIS 187.0 billion,
compared with NIS 187.8 billion at December 31, 2009.
- Credit granted to the public increased by 4.1% to NIS 119.1
billion, compared with NIS 114.4 billion at December 31, 2009.
- Deposits from the public decreased by 2.8% to NIS 137.8
billion, compared with NIS 141.8 billion at December 31, 2009.
- Shareholders' equity increased by 7.7% to NIS 10.8 billion,
compared with NIS 10.0 billion at December 31, 2009.
Data Regarding Subsidiaries
First Nine Months of 2010
Return on Capital
Net Shareholders' Adequacy
income Equity Ratio
Discount Bancorp Inc. USD 42 M 7.7% **14.6%
Mercantile Discount Bank NIS 121 M 9.3% *13.1%
Discount Mortgage Bank NIS 24.2 M 2.9% *18.3%
Israel Credit Cards ICC (the
Bank holds 71.83% of the equity) NIS 176 M 20.9% *16.9%
* Computed according to Basel II guidelines.
** In accordance with the obligatory US guidelines.
First Nine Months of 2009
Return on Capital
Net Shareholders' Adequacy
income Equity Ratio
Discount Bancorp Inc. USD 29 M 6.1% **13.5%
Mercantile Discount Bank NIS 158 M 13.5% *12.9%
Discount Mortgage Bank NIS 25.6 M 3.8% *10.4%
Israel Credit Cards ICC (the
Bank holds 71.83% of the equity) IS 199 M 30.6% *21.5%
* Computed according to Basel I guidelines.
** In accordance with the obligatory US guidelines.
2009
Return on Capital
Net Shareholders' Adequacy
income Equity Ratio
Discount Bancorp Inc. USD 44 M 6.6% **14.9%
Mercantile Discount
Bank NIS 180 M 11.1% *12.2%
Discount Mortgage Bank NIS 31 M 3.4% *18.8%
Israel Credit Cards
ICC (the Bank holds
71.83% of the equity) NIS 249 M 26.3% *13.7%
* Computed according to Basel II guidelines.
** In accordance with the obligatory US guidelines.
Discount Group - Principal Data from the Financial Statements
Income and Profitability (in NIS millions)
Third Quarter First Nine Months Annual
Sept.
% Sept. %
2010 2009 change 2010 2009 change 2009
Income from
financing
activities
before
provision
for
doubtful
debts 1,331 1,326 0.4 3,537 3,522 0.4 4,757
Provision
for
doubtful
debts 169 246 [31.3] 547 729 [25.0] 998
Operating
and other
income 659 814 [19.0] 1,957 2,302 [15.0] 3,091
Operating
and other
expenses 1,316 1,375 [4.3] 4,071 4,010 1.5 5,486
Operating
income
before
taxes 505 519 [2.7] 876 1,085 [19.3] 1,364
Operating
income
after taxes 275 267 2.2 516 608 [15.1] 857
Net income 288 292 [1.4] 589 769 [23.4] 923
Return on
net income
in % 11.3 12.7 7.7 11.3 9.8
Development of Assets and Liabilities (in NIS billions)
September 30 December 31
% %
2010 2009 change 2009 change
Total Assets 187.0 187.2 [0.1] 187.8 [0.4]
Credit granted to the public 119.1 115.5 3.1 114.4 4.1
Securities 39.6 35.9 10.4 36.3 9.0
Deposits from the public 137.8 140.4 [1.8] 141.8 [2.8]
Shareholders' equity 10.8 10.0 7.8 10.0 7.7
Principal Financial Ratios (in percentages)
September 30 December 31
2010 2009 2009
Financial resources in relation to total 5.9 5.5 5.5
assets
Credit granted to the public to deposits 86.4 82.3 80.7
from the public
Total capital to risk components (capital 12.93 - 12.15
adequacy ratio)*
Total capital to risk components (capital 13.54 12.95 13.22
adequacy ratio)**
Tier I capital to risk components 8.01 - 7.57
Provision for doubtful debts to credit 0.58 0.80 0.83
granted to the public
Interest margin 1.40 1.36 1.39
Operating expenses to total income 74.1 68.9 69.9
(efficiency ratio)
* Computed according to Basel II guidelines.
** 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
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.
For additional information, please visit the Company's investor relations website at http://www.discountbank.co.il/IR
Company Contact
Barry Simon
Investor Relations
Tel: +972-3-5146593
[email protected]
SOURCE Israel Discount Bank Ltd
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