Leumi starts 2022 with strong results, following his record results in 2021

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Return on equity in Q1 – 15.6%

Q1 credit growth – 7.6%

Further improved efficiency rate – 46.6%

Merger between Leumi UNITED STATES and Valley National was finalized

Leumi to distribute a 322 million shekels ($101 million) dividend

TEL AVIV, Israel, May 24, 2022 /PRNewswire/ —

  • Net revenue in the first quarter of 2022 reached 1.6 billion shekels ($504 million), compared to NIS 1.3 billion ($409 million) at the same time last year.
  • Return on equity in the first quarter of 2022 was 15.6%, compared to 14.2% in the same period last year.
  • Efficiency report in the first quarter of 2022 was 46.6%, compared to 49.4% in the same period last year.
  • Dividend – Leumi (TASE: LUMI) will distribute a NIS 322 ($101 million) dividend, which represents 20% of net income for the first quarter of 2022.
  • Growth of the credit portfolio – the Bank continues to focus its growth on the credit portfolio in the corporate, commercial and mortgage sectors. During the first quarter of 2022, the credit portfolio grew by 7.6% compared to December 31, 2021. The corporate portfolio increased by 11.2%, the commercial portfolio increased by 9.7% and the mortgage portfolio increased by 4.2%.
  • Income for loan losses – in the first quarter of 2022, an income of 0.04% of the average outstanding loans to the public was recorded, compared to an income of 0.28% in the same period last year. First quarter revenue was driven primarily by collections, alongside an increase in the collective provision, notably driven by growth in the credit portfolio.
  • Net interest income in the first quarter of 2022 reached NIS 2.9 billion ($913 million), compared to 2.3 billion shekels ($724 million) at the same time last year. The increase is mainly due to the increase in the Bank’s loan portfolio and variations in the CPI from period to period.
  • Financial income other than interest in the first quarter of 2022 reached 14 million shekels ($4 million), compared to 441 million shekels ($139 million) at the same time last year. The decrease is due to the decline in capital markets and the effect of derivatives and exchange rate differences.
  • Total operating and other expenses in the first quarter of 2022 decreased by 45 million shekels ($14 million), a decrease of 2.4% compared to the same period last year.
  • Merger between Leumi UNITED STATES and Valley National – Sur April 1 2022, the merger between Leumi UNITED STATES (BLUSA) and Valley National Bank was completed. Following the merger, income of 645 million shekels ($203 million), net of tax, will be recorded; on this amount, NIS 194 million ($61 million) was recorded during the reference period, with the balance expected to be recorded in the second quarter of 2022.
  • Capital ratios – Common Equity Tier 1 capital ratio at March 31, 2022 was 10.78% and the total capital ratio was 13.54%. On April 1st 2022, the equity ratio is expected to increase by approximately 0.5% following the merger.
  • Sale of the Leumi headquarters to Tel Aviv (‘Beit Mani’) – As part of preparations to complete the move to Lod in 2023, during April 2022 the Bank entered into an agreement for the sale of one of its headquarters buildings to Tel Aviv. This sale should generate a pre-tax capital gain of 524 million shekels ($165 million), to be recorded in 2023.

Evolution of the balance sheet items (a) :

  • Equity like a March 31, 2022 totaled 42.4 billion shekels ($13.4 billion), compared to NIS 39.1 billion ($12.3 billion) like a March 31, 2021.
  • Net lending to the public like a March 31, 2022 totaled 350 billion shekels ($110 billion), compared to 290 billion shekels ($91 billion) like a March 31, 2021, an increase of 20.7%. Most of the increase was attributable to mortgages, middle market loans and businesses.
  • Deposits by the public like a March 31, 2022 totaled 517 billion shekels ($163 billion), compared to 437 billion shekels ($138 billion) like a March 31, 2021an increase of 18.3%.

Leumi Group – Main data of the financial statements

Profit and profitability (in millions of NIS)


For the three months ended

March, 31st

Change of SNI
Millions

Switch %

2022

2021

Net interest

2,899

2,348

551

23.5

Loan loss Income

(40)

(212)

172

81.1

Non-interest income

950

1,374

(424)

(30.9)

Operating and other expenses

1,794

1,839

(45)

(2.4)

Profit before tax

2,095

2,095


Tax provision

486

753

(270)

(35.9)

Profit after taxes

1,612

1,342

270

20.1

Share of the bank in the profits of the partners

7

7


Net income attributable to non-controlling shareholders
interests

(ten)

(9)

(1)

(11.1)

Net income attributable to banking activity
company shareholders

1,609

1,340

269

20.1

Return on equity (%)

15.6

14.2



Earnings per share (NIS)

1.11

0.92



Evolution of balance sheet items (in millions of NIS) (a)


As of March 31

the 31st of December

2021

2022

2021

Net lending to the public

349,775

289,743

324,956

Deposits by the public

516 711

436,618

514,968

Equity

42,433

39 118

41,610

Total assets

645 875

540,783

632 802

Main financial ratios (%)


As of March 31

the 31st of December

2021

2022

2021

Net lending to the public to total assetss (a)

54.2

53.6

51.4

Public deposits to total assets (a)

80.0

80.7

81.4

Total equity to risk assets

13.54

14.73

14.21

Total Tier 1 capital/assets at risk

10.78

11.73

11:50 a.m.

Leverage ratio

5.91

6.60

6.06

Liquidity coverage ratio

120

130

124

a. Balance sheet items and comparative results do not include Bank Leumi balances UNITED STATESwho since March 31, 2022 have been classified as assets and liabilities held for sale in the first quarter 2022 financial statements.

Data in this press release has been converted to US dollars for convenience only, at the representative exchange rate published by the Bank of Israel on March 31, 2022, NIS 3,176.

Conference call details

A conference call to discuss the results will be held today at 5 p.m. (Israel); 3 p.m. (UK); 10:00 a.m. (ET).

Conference call access details (no password required):

Israel 03-9180610
UK 0-800-917-9141
USA and Canada 1-888-407-2553
All other locations +972-3-918-0610

The call will be accompanied by a presentation that will be posted today on the Israel Securities Authority (MAGNA) reporting website. It will also be available on the Leumi website under Investor Relations, in the Financial Statements, Investor Presentation and Conference Call page.

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

For more information, visit www.leumi.co.il or contact Adi Molcho Weinstein, Vice President, Head of Investor Relations, at [email protected]

The conference call does not replace the need to review the latest periodic/quarterly reports containing complete information, including forward-looking information, as defined in Israeli securities law, and set forth in the aforementioned reports.

SOURCE Bank Leumi

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