#Israel #Tel Aviv #earnings report #Financial Growth #Bank Leumi

Bank Leumi's Strong Financial Performance in 2024

Bank Leumi has announced an impressive financial result for the year 2024, reporting a remarkable 40% increase in net income, amounting to NIS 9.8 billion ($2.7 billion). This notable rise evidences the bank's effective strategies and robust operational performance, leading to a return on equity (ROE) of 17%. As part of their capital management, total capital returns for 2024 were approximately NIS 4 billion ($1.1 billion).

Financial Highlights

In the fourth quarter of 2024 alone, Bank Leumi saw a net income of NIS 2.5 billion ($685 million), increasing from NIS 1.8 billion ($494 million) for the same period the previous year. This growth trajectory was supported by a quarterly ROE of 16.2%, improving upon last year's figures. Interestingly, the bank succeeded in enhancing its income without increasing its operational expenses significantly, achieving an efficiency ratio of 29.9%, the best among Israeli banks.

For the year, the loan portfolio expanded by 8.6%, alongside a 8.9% increase in public deposits. With a solid credit portfolio quality reflected in a low non-performing loan (NPL) ratio of just 0.5% and total troubled debts at 1.4%, Bank Leumi demonstrated remarkable discipline in managing its lending operations.

Key Metrics

• - Capital Return in Q4 2024: NIS 980 million ($269 million), including NIS 706 million ($194 million) as cash dividends.
• - Loan Portfolio Growth: The corporate segment grew by 7.8%, commercial by 4.0%, and mortgages by 11.0%.
• - Earnings Performance: Profit before tax for the year rose to NIS 15.5 billion, a 30% increase year-over-year, while total assets climbed to NIS 785.6 billion ($216.3 billion).

Commitments and Future Goals

Turning towards the future, Bank Leumi has laid out ambitious financial targets for 2025-2026. The bank aims for an annual net income ranging between NIS 9 billion and NIS 11 billion ($2.5 - $3.0 billion) while maintaining a defined return on equity target of 15% to 16% per year. Furthermore, the bank plans to ensure that capital returns remain at least 50% of net income each year, coupled with loan portfolio growth expectations of 8% to 10%.

Strategic Developments

Amid a challenging economic climate, exacerbated by geopolitical uncertainty in the region, Bank Leumi has taken proactive initiatives to support its customers and the wider community. This includes unique relief measures for individuals facing hardship due to conflicts, such as full exemptions on mortgage payments and loan repayments for both individuals and small businesses. Their support extends beyond financial assistance, contributing an estimated NIS 526 million ($144 million) towards community relief and recovery projects affected by regional conflicts.

With a firm focus on responsible growth and quality service, Bank Leumi is not only charting a path towards recovery and expansion post-crisis but is also earnestly committed to enhancing its community impact while ensuring strong financial results. The outlook remains optimistic as the bank continues to navigate through these complex times while reinforcing its operational foundations.