Israel Discount Bank Limited Class A · TASE:DSCT
Israel Discount Bank Limited Class A — Q3 2024 Earnings Presentation
22 slides from Israel Discount Bank Limited Class A's earnings presentation, Nov 18, 2024
Slide 1: 3Q 2024 Review: Financial Highlights
3Q 2024 REVIEW Financial Highlights Investor Relations November 18, 2024
Slide 2: Disclaimer
Disclaimer: This document has been prepared by Israel Discount Bank Ltd. (the “Bank”) solely for use by the Bank in its presentation of its 3rd quarter report, as well as in strategic updates referred to in the Bank’s reports. This presentation is not a substitute for the Bank’s 2024 3rd quarter fin
Slide 3: 3Q 2024 – Delivering Robust Performance
3Q 2024 – DELIVERING ROBUST PERFORMANCE NET INCOME ROE EFFICIENCY RATIO 1,137 M 14.9% 49.1% Banking in Israel * 976M 18.0%** 40.5%** DIVIDEND PAYOUT + SHARE BUYBACK NII GROWTH CREDIT GROWTH QoQ / YoY QoQ / YoY 30% + 10% 0.7% / 5.8% 3.2% / 7.2% ** Consolidated figures for banking operations of Discou
Slide 4: The Economy Adapted to Operating Under Challenging Conditions
THE ECONOMY ADAPTED TO OPERATING UNDER CHALLENGING CONDITIONS Following the recovery, the housing market maintains its momentum Private Consumption turnover remains steady (Sales in units) (Purchase in Credit-Cards, Jan 2023 = 100) 8,112 118.1 6,585 100.0 106.0 101.9 108.0105.5 106.2 4545 79.1 3,160
Slide 5: The Economy Is at Full Employment; GDP Growth Expected to Recover in 2025
THE ECONOMY IS AT FULL EMPLOYMENT GDP GROWTH IS EXPECT TO RECOVER IN 2025 The war has impacted GDP growth in 2024, Job market shows resilience and strength 6.5 with recovery anticipated in 2025 (%) (GDP growth, in %) 9.7 8.5 6.3 6.1 3.5 5.5 4.8 3.0 4.4 4.1 4.0 1.4 3.8 3.9 3.7 3.6 1.2 0.7 3.3 3.3 2.0
Slide 6: Govt. Deficit Projected to Remain High; 10Y Spread Narrowing
GOVT. DEFICIT IS PROJECTED TO REMAIN HIGH THE 10Y SPREAD REMAINS HIGH BUT NARROWING Fiscal Deficit is anticipated to decline 10Y Spread is closing since Sept. – US vs. Israel Bond 34.0% only slightly by year’s end (spread in bps) 31.8% 160 200 140 190 24.0% 23.9% 120 180 14.0% 100 170 80 4.0% 160 60
Slide 7: BOI Rate Stays Higher for Longer; Inflation Above the Limit
BOI RATE STAY HIGHER FOR LONGER INFLATION IS EXPECTED TO REMAIN ABOVE THE LIMIT Bank of Israel holds Interest Rate - higher for longer Inflation is projected to converge within BoI upper range (Market Expectations for BoI Rate at year-end on specific dates, %) (Israel Inflation - CPI Forwards, %) 4.
Slide 8: 3Q24 and 9M24 Financial Highlights
3Q24 AND 9M24 FINANCIAL HIGHLIGHTS Net income of NIS 1,137m and ROE of 14.9% in 3Q24, driven by increase in Fees & commissions and non-interest financing income. Credit growth has regained momentum: Total credit grew by 3.2% QoQ and 7.2% YoY, with corporates growing by 4.6% QoQ, small businesses wit
Slide 9: Credit Growth Is Rebounding – Demand Across All Segments
CREDIT GROWTH IS REBOUNDING – DEMAND ACROSS ALL SEGMENTS Total Credit Well Balanced Loan Book Mortgages Corporates in NIS bn; growth % in NIS bn; growth % in NIS bn; growth % 7.2% 5.4% 13.8% 1.8% 4.6% 3.2% 281.4 12.0% 74.9 12.5% 72.0 71.6 70.1 68.3 65.8 272.6 262.5 26.8% 25.8% 3Q23 2Q24 3Q24 3Q23 2Q
Slide 10: Credit Loss Expenses Within Normal Range While NPL Ratio Decreasing
CREDIT LOSS EXPENSES REMAIN WITHIN NORMAL RANGE WHILE NPL RATIO IS GRADUALLY DECREASING Provision for Collective Allowances is driven by Continued improvement in NPL/Total Credit* Ratio growth in Credit Balances 0.92% (in NIS m and %) 800 0.91% 0% 750 0.86% 0.84% 0.83% 700 0% 650 0.76% 596 0.59% 0.3
Slide 11: Fees and Non-Interest Financing Income Support Total Income
FEES AND NON-INTEREST FINANCING INCOME SUPPORT THE INCREASE IN TOTAL INCOME Total Income Financing Income From Current Operations (NIS m) NIS m 3Q24 ver. 2Q24 3Q24 ver. 3Q23 Period end BOI rate 4.75% 4.75% 4.50% 4.50% 4.50% 4,225 Average BOI rate* 4.58% 4.75% 4.51% 4.50% 4.50% 5.0% 7.2% 4,023 7 3,94
Slide 12: Total Expenses Are Contained
TOTAL EXPENSES ARE CONTAINED Total Expenses NIS m Cost Income Ratio 51.8% 53.4% 52.8% 51.3% 49.1% 1.6% 0.5% 2,043 2,022 2,065 2,075 1,984 687 680 619 746 747 384 363 379 381 380 Other Maintenance and depreciation Salary & related 972 979 986 938 948 3Q23 4Q23 1Q24 2Q24 3Q24 12
Slide 13: Robust and Diversified Funding Base with Strong Capital Ratio
ROBUST AND DIVERSIFIED FUNDING BASE WITH STRONG CAPITAL RATIO Diversified domestic public deposit base Capital ratio well above the regulatory requirement with high share of households deposits Total Capital Ratio Tier I Capital Ratio Leverage Ratio 13.48% 10.57% 6.7% QoQ QoQ QoQ Institutional House
Slide 14: Contribution to Profit from Key Subsidiaries
CONTRIBUTION TO PROFIT FROM KEY SUBSIDIARIES 17.1% 17.9% 17.1% 13.2% 12.6% 13.6% 90 In NIS m YoY growth in In NIS m 90 225 226 7.3% Total credit 80 YoY growth in 79 81 11.4% Credit card 70 transactions 197 ROE Cost income ROE 60 Net income 38.5% Ratio 3Q24 Net income YoY growth in as reported as rep
Slide 15: To Summarize
TO SUMMARIZE Solid & continuous results for 3Q24, with net income of 1,137 NIS, and ROE of 14.9%. Responsible Credit growth continues the momentum, with asset quality remaining solid – Credit growth of 3.2%, across all segments. Credit loss provisions within normal range: As the economy adjusts well
Slide 16: Appendices
2024 Q3 CONDENSED FINANCIAL STATEMENTS. APPENDICES
Slide 17: Israel Discount Bank: P&L and Selected Ratios
ISRAEL DISCOUNT BANK: P&L AND SELECTED RATIOS NIS m 3Q24 2Q24 3Q23 vs.2Q24 vs.3Q23 9M24 9M23 change Net interest income 2,865 2,846 2,707 0.7% 5.8% 8,248 8,381 )1.6%( Credit loss expenses 274 258 596 6.2% )54.0%( 614 1,112 )44.8%( Non-interest financing income 389 264 312 47.3% 24.7% 1,011 923 9.5%
Slide 18: Israel Discount Bank: Adjustments to P&L
ISRAEL DISCOUNT BANK: ADJUSTMENTS TO P&L NIS, m -- 3Q24 2Q24 3Q23 Reported net income 1,137 1,045 817 Profit from the sale of rights in Visa Europe )18( Special Income Tax 74 54 - Effect of Settlement 5 11 - Effect of change in VAT )20( Adjusted net income 1,198 1,090 817 18
Slide 19: Israel Discount Bank: Selected Balance Sheet Items
ISRAEL DISCOUNT BANK: SELECTED BALANCE SHEET ITEMS NIS m 30.9.24 31.12.23 30.09.23 Cash and deposits with banks 57,816 51,115 57,552 Securities 67,217 59,268 52,380 Securities borrowed or purchased under agreements to 1,155 851 1,150 resell Credit to the public 281,386 262,941 262,463 Provision for
Slide 20: Mercantile: Financial Performance
MERCANTILE: FINANCIAL PERFORMANCE Main P&L and Balance Sheet metrics and selected ratios NIS m 3Q24 2Q24 3Q23 Vs. 2Q24 Vs. 3Q23 9M24 9M23 Change Net interest income 588 580 577 1.4% 1.9% 1,696 1,748 )3.0%( Non-interest income 93 99 104 )6.1%( )10.6%( 303 324 )6.5%( Total income 681 679 681 0.3% - 1,
Slide 21: IDBBank: Financial Performance
IDBBANK: FINANCIAL PERFORMANCE Main P&L and Balance Sheet metrics and selected ratios USD m 3Q24 2Q24 3Q23 Vs. 1Q24 Vs. 2Q23 9M24 9M23 Change Net Interest Income 81.6 79.0 82 3.3% )0.5%( 242 255 )5.1%( Non-Interest income (Expenses) 20.1 21.0 21 )4.3%( )4.3%( 59 55 7.3% Total Income 101.7 100.0 103
Slide 22: CAL: Financial Performance
CAL: FINANCIAL PERFORMANCE Main P&L and Balance Sheet metrics and selected ratios NIS m 3Q24 2Q24 3Q23 Vs. 2Q24 Vs. 3Q23 9M24 9M23 Change Income From Credit Card Transactions 526 479 480 9.8% 9.6% 1,443 1,350 6.9% Credit Loss Expense 79 67 93 17.9% )15.1%( 186 187 )0.5%( Total Income 784 713 701 10.