Bank Hapoalim (TASE: POLI) reported NIS 4.3 billion revenue from interest in the first quarter of 2025, up 12% from the corresponding quarter of 2024. Total financing revenue, which also includes and non-interest financing income, rose 13% to NIS 4.6 billion.
The increase in interest income was due, among other things, to an increase in the bank's average credit balances of 9.5% in the first quarter. There was also an increase in interest income due to the asset portfolio's turnover and the extension of its average life during the past year.
The bank, led by CEO Yadin Antebi, set aside NIS 262 million for credit losses in the first quarter. A large part of the increase in expenses for credit losses was due to a group provision and automatic write-offs of NIS 293 million in the first quarter, compared to NIS 17 million in the same period, due to the growth in credit provision.
Net profit in the first quarter of 2025 jumped 25% from the corresponding quarter to NIS 2.4 billion. The bank said the increase in net profit was mainly due to an increase in financial profit and recording of tax revenues of NIS 300 million, due to beginning liquidation of the bank's subsidiary in Switzerland. On the other hand, Hapoalim cited the increase in credit losses in the past quarter as a factor that reduced net profit.
Return on capital of 16.4% showed a significant improvement from 14.6% in the corresponding quarter last year.
A dividend of 40%
The bank's credit portfolio grew 2.7% in the first quarter, with total credit to the public (net) of NIS 456 billion at the end of the first quarter. The bank noted that the growth in the credit portfolio was reflected in all segments of activity. Since the beginning of the year, business credit has increased 3.6%, commercial credit has increased 3.4%, housing credit has increased 2%, credit to small businesses has increased 3.4% and credit to private customers has increased 1%.
The bank also collected fees and other income worth NIS 1.1 billion in the first quarter, up from NIS 1 billion in the corresponding quarter in 2024. The increase was due to a rise in account management fees, fees from securities activities and credit card fees, which was offset by a fall in credit processing fees.
In addition, the bank's board of directors announced the distribution of 40% of the net profit – NIS 970 million. The distribution will be made in cash (NIS 720 million) and the balance (NIS 250 million) through the purchase of the bank's own shares.
Published by Globes, Israel business news – en.globes.co.il – on May 18, 2025.
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