Bank Hapoalim BM reported third-quarter net profit attributed to shareholders of 469 million Israeli shekels, down from 699 million shekels in the same period a year ago, on the back of expenses relating to a tax investigation in the U.S. and the bank's exit from Switzerland.
Excluding 280 million shekels in expenses related to provisions for an ongoing investigation by U.S. authorities into the bank for allegedly aiding U.S. clients hide taxes, and a 110 million shekel charge from the discontinuation of the bank's activities in Switzerland, net profit amounted to 861 million shekels, compared to 954 million shekels in the third quarter of 2016.
EPS declined to 36 agorot from 52 agorot. Return on equity fell year over year to 5.3% from 8.3%, though it would have been 9.9% if the expenses from the U.S. tax probe and the Swiss exit were excluded, the bank said. Nov. 28.
Net interest income amounted to 2.16 billion shekels, up from 2.11 billion shekels on a yearly basis. Income from fees declined over the same period to 1.28 billion shekels from 1.35 billion shekels.
The bank booked a 25 million shekel provision for credit losses in the third quarter, compared to a year-ago income of 118 million shekels.
Bank Hapoalim's attributed net profit for the first nine months of 2017 reached 2.05 billion shekels, down from 2.49 billion shekels in the year-ago period. EPS fell on a yearly basis to 1.53 shekels from 1.86 shekels.
Excluding the U.S.- and Switzerland-related expenses, the bank's nine-month profit amounted to 2.44 billion shekels, down from 2.75 billion shekels.
The bank's common equity Tier 1 ratio stood at 11.26% as of Sept. 30, up from 11.01% as of Dec. 31, 2016. Its leverage ratio stood at 7.37%, up from 7.25% from 2016-end and above the 6% minimum requirement by the Bank of Israel's Supervisor of Banks.
Bank Hapoalim said it will pay 188 million shekels in dividends in respect of third-quarter profits, representing a payout ratio of 40%.
As of Nov. 27, US$1 was equivalent to 3.50 Israeli shekels.
