Bank Leumi Le-israel B.m. · TASE:LUMI

Bank Leumi Le-israel B.m — Q1 2023 Earnings Presentation

18 slides from Bank Leumi Le-israel B.m's earnings presentation, Mar 31, 2023

  1. Slide 1: March 31, 2023 Financial Results Presentation

    MARCH 31, 2023 FINANCIAL RESULTS PRESENTATION

  2. Slide 2: Disclaimer

    The conference call does not replace the need to review the latest periodic/quarterly reports in which full information is contained, including forward looking information, as defined in the Israeli Securities Law, and set out in the aforementioned reports. DISCLAIMER This document and the informati

  3. Slide 3: Key 1Q 2023 Messages

    Key 1Q 2023 Messages • Net Income of NIS 1bn impacted by impairment of the bank’s stake in Valley. • Credit growth and core deposit growth: — Credit growth of 4.9% in the quarter in our strategic segments. — Core deposits grew by 3.2% in the quarter. • Revenue growth of ~40% year-on-year to NIS 5.0b

  4. Slide 4: Major Developments

    Major Developments • Impairment of stake in Valley National Bank by NIS 1.1bn. - Impact on CET1 is negligible. • Renewal of collective agreement with employees (2023-26): - Increase in tenure from 4 years to 10 years. - Increases number of employees on technological agreements. - Bonuses linked to b

  5. Slide 5: Q1 2022 vs. Q1 2023 – Breakdown of Income and Expenses

    Q1 2022 vs. Q1 2023 – Breakdown of Income and Expenses Finance Income Operating and Other Expenses 3,953 46.8% (0.4%) 2,693 3,928 1,636 1,629 912 845 2,699 45.5% Q1 2022 Q1 2023 CPI 1.2% CPI 1.1% 724 784 NIM 1.91% NIM 2.59% 25 -6 Q1 2022 Q1 2023 Q1 2022 Q1 2023 Net Interest Income Non-interest Finan

  6. Slide 6: Rising Net Interest Income and NIM

    Rising Net Interest Income and NIM 2.59% 2.44% 2.30% 2.15% 1.91% FY22 NIM: 2.20% ~45% y-o-y 3,773 3,928 increase in Net 3,414 Interest Income 3,125 2,699 Q1 2022 Q2 2022 Q3 2022 Q4 2022 Q1 2023 (NIS Millions) Excludes Leumi USA. 6

  7. Slide 7: Fees and Commissions Performance Year-over-Year

    Fees and Commissions Performance Year-over-Year 7.5% 948 882 230 187 185 171 150 155 148 151 143 120 98 92 Q1 Q1 Financing Account Securities Exchange Credit Cards Other Fees 2022 2023 Transactions Management Transactions Differentials Q1 2022 Q1 2023 (NIS Millions) Excludes Leumi USA. 7

  8. Slide 8: Consistent Improvement in Cost Structure

    Consistent Improvement in Cost Structure Total Expenses Cost-Income Ratio (0.4%) 1,636 1,629 912 845 45.7% Total Salary & Related Expenses 784 32.6% 724 Maintenance, Depreciation & Other Expenses Q1 2022 Q1 2023 Q1 2022 Q1 2023 (NIS Millions) Excludes Leumi USA. 8

  9. Slide 9: Ongoing Decline in Cost-Income Ratio; Now Comfortably <40%

    Ongoing Decline in Cost-Income Ratio; Now Comfortably <40% 56.8% 53.8% 45.8% 37.2% 32.6% 2019 2020 2021 2022 Q1 2023 * 2020-2022 excludes Leumi USA. 9

  10. Slide 10: Moderate Increase in Loan Loss Expenses

    Moderate Increase in Loan Loss Expenses 0.41% 0.32% 0.39% 0.14% 0.11% 0.34% -0.04% 389 0.26% 0.25% 334 237 233 0.14% 124 0.02% -0.18% -0.12% -0.14% -0.02% (21) 17 (111) (134) (164) Q1 2022 Q2 2022 Q3 2022 Q4 2022 Q1 2023 Specific Collective (NIS Millions) 10

  11. Slide 11: Robust Credit Quality Indicators

    Robust Credit Quality Indicators NPL Ratio Total Provisions / NPLs Total Provisions / Gross Loans Total Troubled Debts to Gross Loans to the Public 1.97% 1.85% 1.54% 1.62% 261% 1.30% 246% 1.28% 1.30% 0.75% 0.75% 174% 1.16% 155% 0.53% 4,986 5,319 0.49% 4,512 3,328 2019 2021 2022 Q1 2023 2019 2021 202

  12. Slide 12: Loan Growth Continues in Line with Strategy

    Loan Growth Continues in Line with Strategy Total Middle-Market 4.9% 3.6% 403.8 384.8 60.8 63.0 31.12.2022 31.3.2023 31.12.2022 31.3.2023 Mortgages Corporate 2.0% 10.5% 120.9 120.9 123.3 109.5 31.12.2022 31.3.2023 31.12.2022 31.3.2023 (NIS Billions) Corporate includes Corporate and Real-Estate. The

  13. Slide 13: Diversified Deposit Base

    Diversified Deposit Base Total Core Deposits Private Individuals 39% 3.1% Capital Markets 11.9% 24% 532.9 516.7 209.4 187.2 Corporate and Real Estate Q1 2022 Q1 2023 Q1 2022 Q1 2023 9% Commercial Small 600.0 557 533 Businesses 515 18% 10% 500.0 428 400.0 374 100% Maintaining Solid NSFR and LCR 76% 7

  14. Slide 14: Solid Capital and Leverage Ratios

    Solid Capital and Leverage Ratios CET1 Minimum internal Total Capital Ratio threshold: 10.50% 11.88% 11.87% 11.50% 11.46% 11.23% 15.67% 15.58% 14.21% 14.29% 14.45% 10.27% 10.21% 10.21% 9.23% 9.19% 13.50% 13.50% 13.50% 12.50% 12.50% 51.6 2019 2020 2021 2022 Q1 2023 2019 2020 2021 2022 Q1 2023 CET1 Ra

  15. Slide 15: Consistent Increase in BVPS

    Consistent Increase in BVPS Shareholder’s Equity Book Value Per Share 32.0 32.3 49.4 49.8 28.6 41.6 37.7 25.9 35.4 24.1 2019 2020 2021 2022 Q1 2023 2019 2020 2021 2022 Q1 2023 (Shareholder’s Equity is NIS Billions; Book Value Per Share is NIS) BVPS = Shareholder’s Equity / Shares Outstanding at the

  16. Slide 16: Thank You / Q&A

    THANK YOU / Q&A Db x e

  17. Slide 17: Appendix

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  18. Slide 18: Macro Factors and Indicators

    Macro Factors and Indicators Robust Economic Growth Further Rate Hikes Expected (Real GDP Growth Evolution) (Rates(2) Evolution) 5.13% 8.6% 4.88% 4.75% 4.33% 4.25% 6.5% 5.6% 4.0% 3.8% 3.08% 3.25% 2.8% 1.0% 2.4% 1.7% 2.6% 2.00% -2.2% 1.58% -4.4% 0.33% 0.10% 0.75% 2018 2019 2020 2021 2022 2023E 1Q22 2

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