Israel Discount Bank Limited Class A · TASE:DSCT
Israel Discount Bank Limited Class A — Q1 2024 Earnings Presentation
21 slides from Israel Discount Bank Limited Class A's earnings presentation, May 20, 2024
Slide 1: 1Q 2024 Review: Financial Highlights
1Q 2024 REVIEW Financial Highlights Investor Relations May 20, 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 1st 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 1st quarter fin
Slide 3: 1Q 2024 – Keeping Strong Performance
1Q 2024 – KEEPING STRONG PERFORMANCE NET INCOME ROE EFFICIENCY RATIO 1,050M 14.6% 52.8% Banking in Israel * 868M 17.1%** 45.6%** DIVIDEND PAYOUT NII GROWTH CREDIT GROWTH QoQ / YoY QoQ / YoY 30% -0.7% / -7.4 % 1.2% / 5.2% ** Consolidated figures for banking operations of Discount & Mercantile ** As c
Slide 4: Amidst Ongoing Conflict the Economy Remains Stable
AMIDST ONGOING CONFLICT THE ECONOMY REMAINS STABLE Housing Market shows strong signs of recovery Bank of Israel holds Interest Rate - Commencing the cutting will (Sales in units*, Thousands) take more time than initially expected** (Market Expectations for BoI Rate in Dec2024, %) War in Gaza 7.6 6.0
Slide 5: 1Q 2024 Highlights
1Q 2024 HIGHLIGHTS Net income of NIS 1,050m and ROE of 14.6% in 1Q24, driven by higher non-interest financing income and reduction in collective allowances. Reduction in collective allowance: Credit loss expenses ratio stood at 0.12% due to a reduction in Collective Allowance provisioning. Non Perfo
Slide 6: Credit Growth Aligns with Market Conditions as Demand Slows
CREDIT GROWTH ALIGNS WITH MARKET CONDITIONS AS DEMAND IS EXPERIENCING A SLOWDOWN Total Credit Well Balanced Loan Book Mortgages * Medium Enterprises in NIS bn; growth % in NIS bn; growth % in NIS bn; growth % 5.2% 4.8% 8.4% 1.0% -1.7% 1.2% Small Enterprises Corporates in NIS bn; growth % in NIS bn;
Slide 7: Stable Income from Core Banking Activity; Net Interest Margin Unchanged
STABLE INCOME FROM CORE BANKING ACTIVITY THE NET INTEREST MARGIN REMAINS UNCHANGED Total Income Financing Income From Current Operations (NIS m) NIS m 1Q24 ver. 4Q23 1Q24 ver. 1Q23 Period end BOI rate 4.25% 4.75% 4.75% 4.75% 4.50% Average BOI rate* 3.89% 4.58% 4.75% 4.75% 4.51% -0.8% -11.7% -1.2% -2
Slide 8: Restraining Expenses and Improving Efficiency as a Primary Target
RESTRAINING EXPENSES AND IMPROVING EFFICIENCY AS A PRIMARY TARGET Total Expenses NIS m Cost Income Ratio 46.1% 47.5% 51.8% 53.4% 52.8% 1.1% -1.9% Other Maintenance and depreciation Salary & related 8
Slide 9: Credit Loss Expenses Are Decreasing as War Impact Is Contained
CREDIT LOSS EXPENSES ARE DECREASING AS THE IMPACT OF THE WAR ON THE ECONOMY IS CONTAINED Macro Environment allows reduction of Collective Allowances Steady NPL/Total Credit* Ratio while maintaining a prudent risk appetite (in NIS m and %) Allowance for Loan Loss Provisions from Total Credit** Collec
Slide 10: Robust and Diversified Funding Base
ROBUST AND DIVERSIFIED FUNDING BASE Diversified domestic public deposit base with high share of Sustaining continual stability across the group households deposits 31.3.24 NIS m Non-interest bearing demand deposit Institutional bodies Interest bearing Households demand deposit Time deposit total dom
Slide 11: Strong Performance Across Our Main Subsidiary Companies
STRONG PERFORMANCE ACROSS OUR MAIN SUBSIDIARY COMPANIES 23.0% 15.7% 14.7% 16.2% 3.8% 14.2% In NIS m YoY growth in In NIS m 6.0% Total credit YoY growth in 8.9% Credit card transactions ROE Cost income ROE Net income 43.3% ratio Net income YoY growth in as reported as reported 5.7% consumer credit Ad
Slide 12: Post S&P Sovereign Rating Downgrade CET-1 Capital Ratio Remains Adequate
POST S&P* SOVEREIGN RATING DOWNGRADE CET-1 CAPITAL RATIO REMAINS ADEQUATE Growing our buffer Effect of 1.00% change on CET-1 ratio Total Capital Ratio & Tier I Capital Ratio after S&P Sov downgrade ** (% , selected, separated scenarios) 13.66% 0.00% 10.90% 10.68% QoQ 10.56% 10.68% 10.63% +0.18% 1.70
Slide 13: Dividend Ratio Reinstated to 30%
DIVIDEND RATIO HAS BEEN REINSTATED TO 30%, COVERING THE SHORTFALL FROM THE LAST TWO QUARTERS (NIS million) 30% 30% 20% 20% * Exp. 15% 15% 15% 100% Net Income Dividend Dividend distribution, % Dividend Yield, %, as calculated 13
Slide 14: To Summarize
TO SUMMARIZE Solid results for 1Q24, with net income of 1,050 NIS, and ROE of 14.6%. Decrease in credit loss provisions: As the economy adjusts well to operating amidst ongoing armed conflict, collective allowances are reduced. Credit loss expense are down to 0.12%. and Non Performing Loans (NPL) ou
Slide 15: Appendices
APPENDICES SBE, olgegghr
Slide 16: Israel Discount Bank: P&L and Selected Ratios
ISRAEL DISCOUNT BANK: P&L AND SELECTED RATIOS NIS m 1Q24 4Q23 1Q23 vs.4Q23 vs.1Q23 Net interest income 2,537 2,555 2,740 ) 0.7%( ) 7.4%( Credit loss expenses 82 390 204 ) 79.0%( ) 59.8%( Non-interest financing income 358 295 329 21.4% 8.8% Commissions 860 821 887 4.8% ) 3.0%( Other income 2 118 301
Slide 17: Israel Discount Bank: Selected Balance Sheet Items
ISRAEL DISCOUNT BANK: SELECTED BALANCE SHEET ITEMS NIS m 31.3.24 31.12.23 31.3.23 Cash and deposits with banks 46,538 51,115 60,040 Securities 56,061 59,268 51,215 Securities borrowed or purchased under agreements to resell 930 851 1,251 Credit to the public 265,990 262,941 252,845 Provision for cre
Slide 18: Israel Discount Bank: Adjustments to P&L
ISRAEL DISCOUNT BANK: ADJUSTMENTS TO P&L Quarter ended at 31 March NIS m NIS m 1Q24 4Q23 1Q23 Reported net income 1,050 919 1,269 Realization of assets - )97( )142( Provisions stemming from the separation of ICC - ) 1( 74 Total - )98( )68( Adjusted net income 1,050 821 1,201 18
Slide 19: Mercantile: Financial Performance
MERCANTILE: FINANCIAL PERFORMANCE Main P&L and Balance Sheet metrics and selected ratios NIS m 1Q24 4Q23 1Q23 Vs. 4Q23 Vs. 1Q23 Net interest income 528 536 563 ) 1.5%( ) 6.2%( Non-interest income 111 209 109 )46.9%( 1.8% Total income 639 745 672 ) 14.2%( ) 4.9%( Operating & other expenses 277 252 25
Slide 20: IDBBank: Financial Performance
IDBBANK: FINANCIAL PERFORMANCE Main P&L and Balance Sheet metrics and selected ratios USD m 1Q24 4Q23 1Q23 Vs. 4Q23 Vs. 1Q23 Net Interest Income 81 80 87 1.3% ) 7.1%( Non-Interest income (Expenses) 18 ) 10( 17 N/A 4.7% Total Income 99 70 104 41.4% )5.1%( Operating & Other Expenses 70 77 68 ) 9.1%( 2
Slide 21: CAL: Financial Performance
CAL: FINANCIAL PERFORMANCE Main P&L and Balance Sheet metrics and selected ratios NIS m 1Q24 4Q23 1Q23 Vs. 4Q23 Vs. 1Q23 Income From Credit Card Transactions 438 401 423 9.2% 3.5% Credit Loss Expense 40 98 41 ) 59.2%( ) 2.4%( Non-Interest Financing Expenses 5 - 301 N/A N/A Total Income 663 614 918 8