Q2 2024 Bank Leumi Le Israel BM Earnings Call Transcript
Key Points
- Bank Leumi Le-Israel BM (BLMIF) reported a strong profit with a second-quarter 2024 ROE of 15.9%, which would have been 20.2% excluding the ILS0.6 billion impairment of the Valley Bank stake.
- The bank saw a meaningful decrease in troubled debt and non-performing loans (NPLs), resulting in much lower loan loss expenses.
- The cost-to-income ratio improved significantly to 28.7%, making it the best in the sector.
- Net income for the second quarter was ILS2.3 billion, with a reported ROE for the first half of 2024 at 18%.
- Core deposits grew by 3.4% year-to-date, continuing the strong growth recorded in 2023.
- Consumer confidence remains low due to the ongoing war, despite a modest economic recovery.
- Geopolitical risks remain high, which could impact future financial performance.
- Net interest income and fee income increased only by 2% compared to the parallel quarter last year, affected by lower net interest margins (NIMs) and higher funding costs.
- Total expenses declined by only 2%, mainly due to lower bonuses, indicating limited cost-cutting measures.
- The bank has not released any collective provisions despite improvements in credit quality, maintaining a conservative approach due to geopolitical uncertainties.
Ladies and gentlemen, thank you for standing by. Welcome to Leumi's second-quarter 2024 results conference call. (Operator Instructions) As a reminder, this conference is being recorded August 14, 2024.
I would like to remind everyone that forward-looking statements for the respected company's business, financial condition and results of its operations are subject to risks and uncertainties that could cause actual results to differ materially from those contemplated.
Such forward-looking statements include, but are not limited to, product demand, pricing, market acceptance, changing economic conditions, risks in product and technology development and the effect of the company's accounting policies as well as certain other risk factors, which are detailed from time to time in the company's filings with the various securities authorities.
I would now like to turn over the call to Mr. Michael Klahr, Head of Investor Relations. Mr. Klahr, please go ahead.
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