Israel Discount Bank Announces Q2/2012 Financial Results
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Israel Discount Bank Announces Q2/2012 Financial Results

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Israel Discount Bank Announces Q2/2012 Financial Results PR Newswire TEL-AVIV, Israel, August 30, 2012 TEL-AVIV, Israel, August 30, 2012 /PRNewswire/ -- Q2 Net Income - NIS 165 million compared to NIS 229 million in Q2/2011, a decrease of 27.9%. Excluding the provision for impairment of the Bank's investment in the shares of the First International Bank, Net income in Q2/2012 amounted to NIS 238 million, an increase of 3.9% compared to Q2/2011. Q2 Net Return on Equity attributable to the Bank's Shareholders - 6.1% compared to 9.3% in Q2/2011. Excluding the provision for impairment of the Bank's investment in the shares of the First International Bank, the Net Return on Equity in Q2/2012 would have reached 8.9% on an annual basis. H1/2012 Net Income - NIS 412 million compared to NIS 507 million in H1/2011, a decrease of 18.7%. Excluding the provision for impairment of the Bank's investment in the shares of the First International Bank, the Net Income in H1/2012 would have amounted to NIS 485 million, a decrease of 4.3% H1 Net Return on Equity attributable to the Bank's Shareholders - 7.7% compared to 10.2% in H1/2011, and compared to 8.2% for the whole of 2011. Excluding the provision for impairment of the Bank's investment in the shares of the First International Bank, the Net Return on Equity in H1/2012 would have reached 9.1%. Ratio of Capital to Risk Assets- 14.1%, Core Capital Ratio - 8.

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Israel Discount Bank Announces Q2/2012 Financial Results
PR Newswire TEL-AVIV, Israel, August 30, 2012
TEL-AVIV, Israel,August 30, 2012/PRNewswire/ --Q2 Net Income - NIS 165 million compared to NIS 229 million in Q2/2011, a decrease of 27.9%. Excluding the provision for impairment of the Bank's investment in the shares of the First International Bank, Net income in Q2/2012 amounted toNIS238 million, an increase of 3.9% compared to Q2/2011. Q2 Net Return on Equity attributable to the Bank's Shareholders - 6.1% compared to 9.3% in Q2/2011. Excluding the provision for impairment of the Bank's investment in the shares of the First International Bank, the Net Return on Equity in Q2/2012 would have reached 8.9% on an annual basis. H1/2012 Net Income - NIS 412 million compared to NIS 507 million in H1/2011, a decrease of 18.7%. Excluding the provision for impairment of the Bank's investment in the shares of the First International Bank, the Net Income in H1/2012 would have amounted toNIS485 million, a decrease of 4.3% H1 Net Return on Equity attributable to the Bank's Shareholders - 7.7% compared to 10.2% in H1/2011, and compared to 8.2% for the whole of 2011. Excluding theprovision for impairment of the Bank's investment in the shares of the First International Bank, the Net Return on Equity in H1/2012 would have reached 9.1%. Ratio of Capital to Risk Assets- 14.1%, Core Capital Ratio - 8.25% Israel Discount Bank Limited (TASE:DSCT), one ofIsrael's leading banks, today reported its Q2/2012 financial results.
The Discount Group's Net Income in H1/2012 totaledNIS 412 million, compared toNIS 507 millionin H1/2011, a decrease of 18.7%.
The Return on Equity attributable to the Bank's shareholders in H1/2012 was 7.7% on an annul basis, compared to 10.2% in H1/2011.
Main factors affecting the Group's business results in Q2/2012, compared to Q1/2012:
- Aprovision ofNIS 73 million, net, for impairment of the investment in the First International Bank. - Anincrease ofNIS 55 millionin net interest income (5%). - Adecrease ofNIS 5 millionin expenses for credit losses (4.1%). - Adecrease in non-interest income, affected mainly by fair value adjustments of derivatives. - Anincrease of 2.4% in commissions. - Adecrease ofNIS 45 millionin operating and other expenses (3.0%).
Main factors affecting the Group's business results in H1/2012, compared to H1/2011:
- Aprovision ofNIS 73 million, net, for impairment of the investment in the First International Bank. - Adecrease ofNIS 107 millionin net interest income (4.5%). - Adecrease ofNIS 59 millionin expenses for credit losses (19.7%). - Adecrease ofNIS 9 millionin non-interest income (0.6%).
- Anincrease ofNIS 48 millionin operating and other expenses (1.7%). - Aprovision for taxes ofNIS 222 millionin H1/2012, compared toNIS 298 millionin H1/2011. - Adecrease ofNIS 77 millionin the Bank's share in the operating income of affiliated companies, net of tax. This decrease was caused, inter alia, by a provision for impairment and as aforesaid.
Main Balance Sheet Developments as atJune 30, 2012:
- TotalAssets decreased by 0.9%, amounting toNIS 200.6 billion, compared toNIS 202.5 billionat the end of 2011. - NetCredit granted to the public increased by 2.6%, amounting toNIS 119.4 billion, compared toNIS 116.4 billionat the end of 2011. - Securitiesincreased by 6.0%, amounting toNIS 45.5 billion, compared to NIS 42.9 billionat the end of 2011. - Depositsfrom the public decreased by 1.6%, amounting toNIS 150.9 billion, compared toNIS 153.4 billionat the end of 2011. - TheEquity attributable to the Bank's shareholders increased by 5.7%, amounting toNIS 11.3 billion, compared toNIS 10.7 billionat the end of 2011. - TotalEquity increased by 5.6%, amounting toNIS 11.6 billion, compared to NIS 11.0 billionat the end of 2011.
Data Regarding Subsidiaries
 H12012  Returnon  Equity  AttributableCapital  Netto Adequacy  incomeShareholders Ratio  DiscountBancorp Inc.USD 22 M5.5% *15.5%  MercantileDiscount BankNIS 84 M9.8% 14.2%  DiscountMortgage BankNIS 29.4 M6.9% 13.3%  IsraelCredit Cards (ICC) (the Bank holds  71.8%of the equity)NIS 108 M19.6% 17.0%
* In conformity with U.S. Reporting Standards
 H12011  Returnon  Equity  AttributableCapital  Netto Adequacy  IncomeShareholders Ratio  DiscountBancorp Inc.USD 28 M7.3% *16.2%  MercantileDiscount BankNIS 106 M13.3% 13.1%  DiscountMortgage BankNIS 20.3 M3.7% 16.9%  IsraelCredit Cards (ICC) (the Bank holds  71.8%of the equity)NIS 120 M22.6% 15.6%
* In conformity with U.S. Reporting Standards
 2011  Returnon  Equity  AttributableCapital  Netto Adequacy  IncomeShareholders Ratio  DiscountBancorp Inc.USD 46 M5.9% *16.5%  MercantileDiscount BankNIS 162 M9.6% 13.2%  DiscountMortgage BankNIS 45.3 M4.0% 13.9%  IsraelCredit Cards (ICC) (the Bank holds  71.8%of the equity)NIS 230 M20.6% 16.7%
* In conformity with U.S. Reporting Standards
 DiscountGroup - Principal Data from the CONSOLIDATED  FinancialStatements  Incomeand Profitability (in NIS millions)  SecondQuarter HalfYear Annual  20122011 %change 20122011 %change 2011
 Netinterest income1,153 1,225(5.9) 2,251 2,358(4.5) 4,617  Expensesfor credit  losses118 188 (37.2) 241 300 (19.7)778  Totalnon-interest income742 750(1.1) 1,607 1,616(0.6) 2,930  Totaloperating and other  expenses1,451 1,4400.8 2,947 2,8991.7 5,838  Operatingincome after  taxes219 220(0.5) 448 477(6.1) 817  Netincome attributable  tothe Bank's  shareholders165 229 (27.9) 412 507 (18.7)848  Netreturn on equity  attributableto the  Bank'sshareholders in %6.1 9.37.7 10.2
 Developmentof Assets and Liabilities (in NIS millions)  June30 December31  20122011 % change2011 % change  TotalAssets 200,641186,001 7.9202,471 (0.9)  NetCredit granted to the  public119,412 117,2891.8 116,3832.6  Securities45,455 33,10237.3 42,8986.0  Depositsfrom the public150,862 139,2968.3 153,368(1.6)  Equityattributable to the  Bank'sshareholders 11,30610,333 9.410,701 5.7
 TotalEquity 11,63210,652 9.211,020 5.6
 PrincipalFinancial Ratios (in percentages)  June30 December31  20122011 2011  TotalEquity to Total Assets5.8 5.75.4  Ratioof capital to risk assets14.1 13.314.1  CoreCapital ratio8.3 7.68.1  Expensesfor credit losses to credit  grantedto the public0.41 0.500.65  NetCredit granted to the public, to  totalassets 59.563.1 57.5  NetCredit granted to the public, to  depositsfrom the public79.2 84.275.9  Depositsfrom the public to total assets75.2 74.975.7  TotalNon-Interest Income to Operating  Expenses54.5 55.750.2  OperatingExpenses to Total Income76.4 72.977.4  AdjustedReturn on Risk Assets8.3 9.98.1
Israel Discount Bank Israel Discount Bank is a leading financial group inIsraelnationwide. With coverage, Israel Discount Bank provides a full spectrum of corporate and retail financial products and services to its clients, both inIsraeland key financial centers around the world.Israel Discount Bank is traded on the Tel-Aviv Stock Exchange under the ticker DSCT. Israel Discount Bank Ltd. Head Office: Discount Tower 23 Yehuda Halevi Street,Tel Aviv, Israel Tel:+972-3-5145555 Website: http://www.discountbank.co.il For additional details please contact: SaritWeiss Spokesperson Tel:+972-3-5145516 Mobile:+972-52-2-461151 E-mail: spokes@discountbank.net