Bank Leumi published one of the strongest quarterly reports in its history

Bank Leumi published one of the strongest quarterly reports in its history.. Leumi, managed by Hanan Friedman, ended the second quarter of 2021 with a net profit of NIS 1.67 billion - a jump of 140% compared to the corresponding quarter in 2020. This profit represents a return on equity of 17.9% compared to 7.7% in the corresponding quarter in 2020.
The strong results were due to the continued aggressive growth trend in the credit portfolio, especially in the real estate and mortgage sectors. Consumer credit to households also grew again.
Leumi enjoys individual income in respect of expenses for credit losses, compared with heavy expenses in the corresponding quarter in 2020. In addition, the bank enjoys a profit of NIS 382 million following successful real investments by Leumi Partners in companies such as Iron Source and Retailers (however, since the beginning of the third quarter, Iron Source shares have fallen by 17%). The reports were also positively affected by the effect of revaluation of derivative instruments and exchange rate differentials.
Leumi ended the first half of 2021 with a huge net profit of NIS 3 billion - a jump of 6.5 times compared to the corresponding half. This profit represented a return on equity of 16.1% compared to 2.6% in the corresponding period.
In accordance with the Bank of Israel's approval, Leumi announced the distribution of a dividend of NIS 630 million for the 2020 results - an amount that constitutes 30% of the Bank's net profit in 2020. Leumi has a capital adequacy ratio of 11.98% as of the end of June 2021 - significantly higher than the Bank of Israel's requirements - so that the bank can continue to grow its credit portfolio at such rates and also distribute much higher dividends.
As of the end of June 2021, Leumi's credit portfolio amounted to NIS 315.2 billion - a growth of 6.7% since the beginning of the year, and of about 10% in the last 12 months. Following the increase in the credit portfolio, net interest income in the first half of the year amounted to NIS 5.12 billion - an increase of approximately 19.4% compared with the corresponding period.
Friedman said following the reports: "I thank the public of employees and managers at Leumi for the impressive results. The results reflect the fruits of the strategy, which has been implemented through structural changes, a change in the organizational culture and a change in the perception of the service - alongside a shift to a reward model that encourages excellence. We will continue to implement this strategy, with the aim of continuing to lead the banking system. "