Bank Leumi Le-israel B.m. · TASE:LUMI
Bank Leumi Le-israel B.m — FY2023 Earnings Presentation
18 slides from Bank Leumi Le-israel B.m's earnings presentation, Dec 27, 2024
Slide 1: FY 2023 Financial results presentation
FY 2023 Financial results presentation
Slide 2: Disclaimer
Disclaimer This document and the information contained herein – The conference call does not replace the need to review the 1. Has been prepared by Bank Leumi le-Israel B.M. (the “Bank”) solely for the purpose of presenting the Bank's business; latest periodic / quarterly reports in 2. Is provided s
Slide 3: Slower growth in 2024
Slower growth in 2024 Economic fundamentals remain strong GDP impact in 2024 (Real GDP Growth) Inflation slowing (Inflation Evolution) Israel 5.3% OECD 9.3% 3.0% 2.8% 6.5% 2.3% 5.6% 5.0% 2.0% 3.8% 1.7% 2.8% 2.0% 1.7% 1.8% 1.4% 1.8% 0.6% -0.7% -1.5% -4.4% 2019 2020 2021 2022 2023 2024E 2025E 2019 202
Slide 4: Long-term growth in revenues and adjusted profit
Long-term growth in revenues and adjusted profit ↗︎ Revenues ↗︎ Expenses ↗︎ Adjusted net income 42% 21.2 Adjusted ROE 17.2 15.9% 15.6% 15.0% 14.9 1% 35% 8.1 6.8 6.9 7.1 6.7 6.0 2021 2022 2023 2021 2022 2023 2021 2022 2023 (NIS Billions). 4 Revenues and Expenses in 2021 and 2022 is excluding Leumi US
Slide 5: Key 4Q 2023 messages
Key 4Q 2023 messages • The Iron Swords War which began in Israel on October 7th has resulted – among other things – in a decline in economic activity and an increase in economic uncertainty and risk. • Measures taken by the bank to support those affected by the war include among others, exemptions a
Slide 6: Strong underlying performance
Strong underlying performance Key financial metrics FY 2023 FY 2022 4Q 2023 Net Income 7,027 7,709 1,826 ROE 13.7% 17.0% 13.8% Cost Income Ratio 32.6% 37.2% 36.1% Credit Loss Expenses 0.58% 0.13% 0.63% Y-o-Y Y-o-Y Q-o-Q Net Loan Growth 9.0% 18.4% 0.5% Y-o-Y Y-o-Y Q-o-Q Core Deposit Growth 6.9% 9.5%
Slide 7: 2023 vs. 2022 – Breakdown of Income and Expenses
2023 vs. 2022 – Breakdown of Income and Expenses ↗︎ Finance Income ↗︎ Operating and Other Expenses 20.0% 17,276 14,399 3.2% 15,997 6,677 6,894 13,011 4,433 4,345 22.9% 2022 2023 CPI 5.3% CPI 3.3% 1,388 1,279 2,244 2,549 NIM 2.20% NIM 2.57% 2022 2023 2022 2023 Net Interest Income Non-interest Finance
Slide 8: Q4 2023 vs. Q4 2022 – Breakdown of Income and Expenses
Q4 2023 vs. Q4 2022 – Breakdown of Income and Expenses ↗︎ Finance Income (7.7%) ↗︎ Operating and Other Expenses 4,535 4,186 7.6% 1,860 3,773 3,850 1,729 2.0% 1,190 1,106 Q4 2022 Q4 2023 762 CPI 0.8% 336 CPI 0.1% NIM 2.44% NIM 2.42% 623 670 Q4 2022 Q4 2023 Q4 2022 Q4 2023 Net Interest Income Non-inte
Slide 9: Higher assets and NIM driving higher NII ex. CPI
Higher assets and NIM driving higher NII ex. CPI (NIS Millions) 2022 is excluding Leumi USA. 9
Slide 10: Higher activity driving growth in fees and commissions
10 Higher activity driving growth in fees and commissions 5.9% CAGR 3,487 3,737 3,335 7.2% 3,737 3,487 1,049 FY 2021 FY 2022 FY 2023 752 639 616 650 8.7% 591 587 597 477 501 382 383 861 936 Q4 Q4 FY FY Financing Account Securities Exchange Credit Cards Other Fees 2022 2023 2022 2023 Transactions Man
Slide 11: Multi-year decline in cost-income ratio
Multi-year decline in cost-income ratio 57.9% 53.2% 45.8% 37.2% 32.6% 2019 2020 2021 2022 2023 Leumi cost income ratio for 2019 is net of the effect of Leumi Card and excludes Leumi USA and for 2020-2022 excludes Leumi USA. 11
Slide 12: Higher collective provisions due to macro
Higher collective provisions due to macro Specific provisions remain low ↗︎ Loan loss expenses 0.58% 0.50% 2,033 0.13% 0.95% 0.25% 0.63% 0.83% 0.41% 937 0.31% 869 0.45% 0.08% 0.39% 0.29% 0.18% 476 389 0.12% (0.12%) 0.02% 0.02% 299 (454) 350 17 19 122 192 FY 2022 FY 2023 Q1 2023 Q2 2023 Q3 2023 Q4 20
Slide 13: Credit quality indicators remain robust
Credit quality indicators remain robust Higher provisions provide a healthy buffer ↗︎ Credit Quality Indicators ↗︎ Total Provisions The increase in total provisions in 2023 was mainly due to an increase Total Troubled Debts in the collective provision – the total Total Provisions credit loss expense
Slide 14: Higher than sector credit growth, but moderating
Higher than sector credit growth, but moderating ↗︎ Total Loans ↗︎ Mortgages 132.1 120.9 384.8 419.5 104.5 15.7% 9.2% 325.0 18.4% 9.0% 2021 2022 2023 2021 2022 2023 ↗︎ Middle-Market ↗︎ Corporate 127.4 60.8 62.6 109.5 51.4 85.1 28.7% 16.3% 18.3% 2.9% 2021 2022 2023 2021 2022 2023 14 (NIS Billions) To
Slide 15: Expanding and diversifying deposit base
Expanding and diversifying deposit base ↗︎ Core Deposits (in Israel) ↗︎ Diversified deposit base 216.9 6.9% Capital 203.0 Markets Private Individuals 28% 38% 2022 2023 Corporate and Real Deposits from the Public Estate ↗︎ Deposits from the public 8% Loan / deposit ratio Commercial Small 557.1 567.8
Slide 16: Solid capital and leverage ratios
Solid capital and leverage ratios ↗︎ CET1 ↗︎ Total Capital Ratio ↗︎ TCE and Leverage Ratios 14.72% 14.21% 14.29% TCE / Total Assets 11.50% 11.46% 11.66% 7.4% 7.7% 13.50% 13.50% 6.2% 12.50% 10.21% 10.22% 6.65% 6.06% 6.36% 9.19% 5.5% 5.5% 5.5% 2021 2022 2023 2021 2022 2023 2021 2022 2023 CET1 Ratio Mi
Slide 17: Investment highlights
Investment highlights 1 Healthy mid-teen ROE despite challenging economic backdrop 2 High-single digit asset growth and stable NIM driving higher NII and fees 3 Operating leverage from best-in-class cost income ratio 4 NPLs and specific provisions remain low – large allowance for doubtful debts prov
Slide 18: Thank you / Q&A
FY 2023 Results presentation Thank you / Q&A 18
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