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Bank Leumi to buy back shares as FY'17 profit rises 13.7%

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Bank Leumi to buy back shares as FY'17 profit rises 13.7%

Bank Leumi le-Israel BM unveiled plans to buy back up to 700 million Israeli shekels of its own shares as it posted a year-over-year increase in 2017 profit.

The share buyback will commence April 1, 2018, and end March 31, 2019. The transaction is subject to meeting, at each buyback date, a Tier 1 equity ratio of no less than 10.9%.

The Israeli lender reported full-year 2017 profit attributable to shareholders of 3.17 billion shekels, up 13.7% from 2.79 billion shekels earned in 2016. EPS rose to 2.08 shekels from 1.85 shekels, and return on equity for 2017 stood at 9.8%, compared to 9.3% a year earlier.

Net interest income rose 6.9% year over year to 8.05 billion shekels from 7.53 billion shekels. Non-interest income came in at 5.43 billion shekels, compared to the year-ago 5.41 billion shekels.

The net interest margin stood at 2.05% at the end of 2017, compared to 1.94% at 2016-end.

For the fourth quarter of 2017, net profit came in at 854 million shekels. Bank Leumi's board of directors approved the distribution of a dividend of 40% of the net income of the fourth quarter of 2017, amounting to 342 million shekels. The accumulated dividend for 2017 totaled 969 million shekels.

As of 2017-end, the bank's common equity Tier 1 capital ratio stood at 11.43%. The leverage ratio stood at 6.94% as of 2017-end, compared to the Bank of Israel's minimal threshold of 6%.

As of March 5, US$1 was equivalent to 3.47 Israeli shekels.