International Bank Posts Strong Financial Performance Amidst Economic Uncertainty: net profit amounted to NIS 1.673 billion

The International Bank has released its financial reports for the first nine months of 2023, showcasing robust growth in core activities while maintaining financial stability. Notably, the net profit for the international group during this period amounted to NIS 1.673 billion, reflecting a substantial 48% increase compared to the same period last year.

The return on capital stood at an impressive 20.5%, underscoring the bank's solid financial position. However, the third quarter saw a slight dip in net profit, totaling 455 million shekels, a 2.6% decrease compared to the same period in 2022 and a notable 22.5% decrease from Q2 2023. The return on capital for the third quarter was reported at 16%.

Total revenues for the first nine months reached NIS 5.036 billion, marking a significant 32.3% increase from the corresponding period in the previous year. In Q3 alone, total revenues amounted to NIS 1.601 billion, reflecting a 12% increase from the same period last year but a 7.7% decrease compared to Q2 2023.

The positive financial performance was attributed to a 43.7% increase in financial profit from current activities, driven by rising shekel and dollar interest rates, as well as increased activity volumes. However, the bank reported total expenses for credit losses in the third quarter at NIS 165 million, representing a 0.55% rate of the credit portfolio. This increase was primarily due to the group provision for credit losses amid economic uncertainty stemming from geopolitical events, including the war.

Expenses for credit losses in the first nine months amounted to NIS 336 million, with a 0.38% rate of the credit portfolio. The increase of NIS 262 million compared to the previous year was largely attributed to adjustments in the group provision, reflecting concerns about predicted macroeconomic effects, increased interest rates, and the potential for an economic slowdown.

In response to market uncertainties, the bank's board of directors approved a cash dividend distribution of NIS 90 million gross to shareholders. The bank affirmed its annual dividend distribution policy of up to 50% of the annual net profit but stated that discussions would continue regarding the policy's future implementation in light of evolving economic conditions.

Samdar Barber-Tsadik, CEO of the International, expressed confidence in the bank's resilience, stating, "The International entered the period of uncertainty created following the war as a solid, strong, and stable bank." Barber-Tsadik highlighted the bank's high financial stability, diversified credit portfolio, and continued responsible growth.

In closing, the statement expressed condolences for those affected by the war, wishing a speedy recovery to the injured and safety for all abductees. Barber-Tsadik thanked the board, management, and employees of the International and extended best wishes to incoming CEO Eli Cohen.

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