Mizrahi Tefahot Bank Ltd · TASE:MZTF
Mizrahi Tefahot Bank — Q4 2020 Earnings Presentation
37 slides from Mizrahi Tefahot Bank's earnings presentation, 2021
Slide 1: Financial statements December 31, 2020
Financial statements December 31, 2020 1
Slide 2: Disclaimer
Disclaimer • This document has been prepared by Mizrahi-Tefahot Bank Ltd (UMTB) solely for use at the company's presentation. The information contained in this document constitutes information from the bank's 2020 quarterly reports and/ or immediate reports, as well as the periodic, quarterly and an
Slide 3: Accounting effect of incorporation of Union bank into UMTB's consolidated financial reports
Accounting effect of incorporation of Union bank into UMTB’s consolidated financial reports Deferred credit balance from acquisition of Union Bank (Negative Goodwill), after completion of the Purchase Price Allocation (PPA), amounts to approx. NIS 1.2 billion 3
Slide 4: Effect of Union bank transaction on market shares
Effect of Union bank transaction on market shares Total 22.0% 18.6% 14.9% 18.9% 20.2% 16.6% 16.8% 14.1% לציבור Loansאשראי to הציבור פיקדונות Deposits הון עצמי from Shareholders מאזן Total סך balance the public the public Equity sheet טפחות UMTBמזרחי אגוד Union bank 4 (1) As of Se
Slide 5: Effect of Union bank transaction on market shares
Effect of Union bank transaction on market shares Total 9.5% 20.2% 10.9% 13.0% 39.1% 18.5% 20.6% 14.3% 16.6% 15.8% 10.4% 36.5% 15.0% 18.0% 14.0% 12.0% 8.7% 7.9% Credit אשראי Deposits פיקדונות Credit אשראי Deposits פיקדונות Credit אשראי Credit אשראי Deposits פיקדונות Credit אשראי Depo
Slide 6: 2020 – operation during Corona virus crisis
2020 – operation during Corona virus crisis • After reducing the number of branches open to clients during the first lockdown (following the instruction of the Supervisor of Banks) - the Bank’s branches were open in full layout. • Operating the Bank’s headquarter in capsules. Splitting units between
Slide 7: Adjusting provisions to market conditions
Adjusting provisions to market conditions )1( Rate of provision NIS 345 mil NIS 270 mil NIS 317 mil NIS 118 mil Other credit Other credit Other credit Other credit 34.7% 1.55% 34.9% 1.17% 34.4% 0.87% 34.5% 0.63% 0.66% 0.50% 0.59% 0.19% Mortgages Mortgages Mortgages Mortgages 65.3% 0.19% 65.1% 0.15%
Slide 8: Adjusting provisions to market conditions
Adjusting provisions to market conditions (NIS mil) Applying a dynamic methodology suitable for developments throughout the year Segment 2020 2019 Q4/2020 Q4/2019 Provision Rate of Provision Rate of Provision Rate of Provision Rate of provision provision provision provision Housing loans 279 0.18% 4
Slide 9: Mortgages - return to orderly repayments of most of deferrals
Mortgages - return to orderly repayments of most of deferrals Requested deferrals of housing loans since the outbreak of the Corona virus situation until today totaled NIS 46 bil December 2020 – New Bank of Israel payments outline Balance of deferred loans)1( 22.5.2020 30.6.2020 31.10.2020 31.01.202
Slide 10: Commercial loans deferred
Commercial loans deferred Requested deferrals of commercial loans since the outbreak of the Corona virus situation until today totaled NIS 5,728 mil December 2020 – New Bank of Israel payments outline Balance of deferred loans 30.6.2020 31.10.2020 31.01.2021 NIS 3,583 mil NIS 2,483 mil NIS 1,253 mil
Slide 11: Net profit
Net profit (NIS mil) 1,842 1,610 1,543 )1( 440 506 439 )1( 4Q/2019 4Q/2020 2019 2020 (1) Excluding profitability deriving from Union Bank transaction recorded in 4Q/2020 11
Slide 12: Return on equity
Return on equity 11.5% 11.4% 11.9% 10.7% )1( 9.5% 9.3%)1( 4Q/2019 4Q/2020 2019 2020 (1) Excluding profitability deriving from Union Bank transaction recorded in 4Q/2020 12
Slide 13: Cost/income ratio
Cost/income ratio 58.8% 54.6% 53.9% 54.5% 54.7%)1( )1( 52.7% 4Q/2019 4Q/2020 2019 2020 (1) Excluding the effect of Union Bank transaction in 4Q/2020 13
Slide 14: Effect of Union bank consolidation on capital ratios
Effect of Union bank consolidation on capital ratios 2020 2019 Tier 1 capital adequacy 10.04% 10.14% Total capital adequacy ratio 13.62% 13.88% Leverage ratio 5.19% 5.55% LCR 133% 121% Deposits/loans ration 116% 103% According to the Bank of Israel the capital relief due to Corona virus crisis will
Slide 15: Continuous loan growth
Continuous loan growth (NIS mil) 242 246 194 205 171 181 159 217 221 139 148 2013 2014 2015 2016 2017 2018 2019 30.9.2020 2020 15 (1) In annual terms
Slide 16: Continuous loan growth led by business and mortgages
Continuous loan growth led by business and mortgages (NIS mil) Business segment 31.12.20 31.12.20 30.9.20 30.9.20 31.12.19 % of Including Excluding Including Excluding change Union Union Union Union (31.12.20- 31.12.19 excluding Union) Housing loans 155,422 145,043 152,362 142,155 134,637 7.7% House
Slide 17: Continuous loan growth led by business and mortgages
Continuous loan growth led by business and mortgages (NIS mil) Business segment 31.12.20 31.12.20 30.9.20 30.9.20 31.12.19 % of Including Excluding Including Excluding change Union Union Union Union (31.12.20- 31.12.19 excluding Union) Housing loans 155,422 145,043 152,362 142,155 134,637 7.7% House
Slide 18: Credit growth mainly in business segments
Credit growth mainly in business segments* Credit to the public growth rate 19.9% 31.12.19 Credit – business segments growth rate 33.6% 31.12.20 Including Union Bank 20.3 10% 26.0 7.1 11% Rate of 9.4 3% Segment change 4% 20.9 10% Total business credit Mortgages 15.4% Total business credit 28.9 NIS 4
Slide 19: Government guaranteed special Corona program – Bank's share higher than its market share
Government guaranteed special Corona program – Bank’s share higher than its market share Market share of the Bank in Credit to small businesses 22.4% Government guaranteed Corona program 12.0% for small and medium businesses: NIS 4.2 bil (granted, as of January 31, 2021) Stateהמדינה guaranteed בע
Slide 20: Continuous deposit growth
Continuous deposit growth (NIS mil) 276 284 211 239 247 199 178 184 152 162 141 2013 2014 2015 2016 2017 2018 2019 30.9.2020 2020 20 (1) In annual terms
Slide 21: Growth of core deposit
Growth of core* deposit (NIS mil) Deposits growth rate 34.7% 31.12.19 31.12.20 Core deposits growth rate 42.0% Including Union Bank Rate of 90.3 74.4 Segment change 35% 32% Total core deposits House holds and Total core deposits Private banking 33.9% NIS 136.6 bil 100.9 NIS 193.9 bil 135.1 48% Small
Slide 22: Financing revenues from current operations continue to grow despite erosion in margins
Financing revenues from current operations continue to grow despite erosion in margins (NIS mil) BoI rate: FED rate: 1-12/2019 0.25% 1-12/2019 2.33% 1-12/2020 0.14% 1-12/2020 0.38% 1,412 5,571 5,466 1,388 4Q/2019 4Q/2020 2019 2020 22
Slide 23: Return to growth in financing revenues from current operations
Return to growth in financing revenues from current operations (NIS mil) 23
Slide 24: Increase in commissions
Increase in commissions (NIS mil) Led by the increase in activities involving securities, financing transactions and translation differences 2020 2020 2019 Rate of change Including Excluding (2020 excluding Union Union Union) Account management 356 345 360 -4.2% Activities involving securities 282 2
Slide 25: Expenses
Expenses (NIS mil) Annual growth target according to the strategic plan – 6% Salaries Operating and other expenses )1( 3,997 3,988 2,562 )2( 2,524 2019 2020 2019 2020 (1) Including operating and other expenses for Union Bank for 4Q/2020 of NIS 4,279 mil, an increase of 7.3% compared to 2019 (2) Incl
Slide 26: Bank Yahav business results continue to improve
Bank Yahav business results continue to improve 80% 13% 78% 76.6% 76.2% 77.3% 11.3% 11.2% 12% 75.5% 76% 10.2% 11% 74% 10% 72% 9% 70% 7.4% 7.1% 8% 6.2% 7.1% 70.7% 68% 7% 68.4% 66% 67.2% 6% 64% 5% 62% 4% 2014 *2015 2016 2017 2018 2019 2020 להון ROEתשואה יעילות יחס Cost/income ratio 26 * 2015 r
Slide 27: Financial Statements
Financial Statements 27 2019 יולי
Slide 28: Net profit
Net profit (NIS mil) 1,842 1,610 2019 2020 28
Slide 29: Net profit - ROE
Net profit - ROE 11.9% 9.5% 2019 2020 29
Slide 30: Equity
Equity (NIS mil) 18,804 16,033 2019 2020 30
Slide 31: Condensed P&L report
Condensed P&L report (NIS mil) 2020 2019 Rate of change (%) Interest revenue, net 5,820 5,340 9.0 Non interest revenues 2,113 1,966 7.5 Total 7,933 7,306 8.6 Expenses with respect to 1,050 364 188.5 credit losses Operating and other expenses 4,279 3,988 7.3 Net profit 1,610 1,842 )12.6( 31
Slide 32: Total revenues
Total revenues (NIS mil) 7,933 7,306 2019 2020 32
Slide 33: Financing revenues
Financing revenues (NIS mil) Rate of 2020 2019 change (%) Interest revenues, net 5,820 5,340 Non-interest financing revenues 221 357 Total financing revenues 6,041 5,697 6.0 Less: Linkage differentials with respect to CPI position )105( 76 Revenues from collection of interest on troubled debt 39 44
Slide 34: Provisions / loans to the public
Provisions / loans to the public 0.43% 0.18% 2019 2020 34
Slide 35: Operating and other expenses
Operating and other expenses (NIS mil) 2020 2019 Rate of change (%) Salaries 2,644 2,562 3.2 Building and equipment 871 770 13.1 maintenance and depreciation Others 764 656 16.5 Total 4,279 3,988 7.3 35
Slide 36: Total balance sheet items development
Total balance sheet items development (NIS mil) 31.12.2020 31.12.2019 Rate of change (%) Total balance sheet 360,140 273,244 31.8 Loans to the public, net 245,525 204,708 19.9 Deposits from the public 284,224 210,984 34.7 Securities 17,290 10,113 71.0 Equity 18,804 16,033 17.3 36
Slide 37: Capital adequacy
Capital adequacy 13.88% 13.62% Total ratio 10.14% 10.04% Tier 1 31.12.2019 31.12.2020 BoI minimum 13.33% 12.18% Total ratio requirement 9.83% 8.68% Tier 1 37