Mizrahi Tefahot Bank Ltd · TASE:MZTF
Mizrahi Tefahot Bank — FY2019 Earnings Presentation
36 slides from Mizrahi Tefahot Bank's earnings presentation, Dec 31, 2019
Slide 1: Financial statements December 31, 2019
Financial statements December 31, 2019 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 2019 annual and/or quarterly reports and/ or immediate reports, as well as the periodic, qu
Slide 3: It's all about (long term) growth
It’s all about (long term) growth 3 2019 יולי
Slide 4: Continuous loan growth while focusing on business segments
Continuous loan growth while focusing on business segments (NIS mil) 204,708 194,381 181,118 171,341 159,204 2015 2016 2017 2018 2019 4
Slide 5: Credit growth in small and micro businesses
Credit growth in small and micro businesses (NIS mil) 20,857 18,977 16,717 15,122 13,909 2015 2016 2017 2018 2019 5
Slide 6: Credit growth in medium businesses
Credit growth in medium businesses (NIS mil) 7,063 6,585 5,779 4,786 4,785 2015 2016 2017 2018 2019 6
Slide 7: Leading the mortgage market – continuous growth of balance and revenues
Leading the mortgage market – continuous growth of balance and revenues Total balance (average)(NIS bil) Total interest revenue (NIS mil) 129 119 115 384 109 348 96 307 249 216 7 * Operating segments in conformity with management approach. Note 12 to quarterly reports, note 29 to the annual report
Slide 8: Continuous deposit growth
Continuous deposit growth (NIS mil) 210,984 199,492 178,252 183,573 162,380 2015 2016 2017 2018 2019 8
Slide 9: Continuous growth of core deposits
Continuous growth of core* deposits (NIS mil) 136,575 126,892 113,536 105,617 95,524 2015 2016 2017 2018 2019 9 * Households/small businesses/medium businesses
Slide 10: The result is continuous growth in income
The result is continuous growth in income (NIS mil) 7,306 6,889 6,000 5,640 5,392 2015 2016 2017 2018 2019 10
Slide 11: Financing revenues from current operations continue to grow every quarter
Financing revenues from current operations continue to grow every quarter (NIS mil) 5,466 4,939 4,333 1,388 3,510 3,876 1,324 1,124 1,018 1,372 909 1,253 1,095 990 904 1,357 1,067 1,221 851 946 1,141 1,349 846 922 1,047 2015 2016 2017 2018 2019 1 רבעון Q1 2 רבעון Q2 3 Q3 רבעון 4 רבעון Q4 11
Slide 12: Income growth combined with controlled expenses result in improving efficiency ratio
Income growth combined with controlled expenses result in improving efficiency ratio 63.6% 59.8% 60.2% 58.5% 57.2%* 54.6% 2015 2016 2017 2018 2019 *Excluding the provisions for the US Department of Justice's investigation, and taking into account provisions for bonuses in line with the level of 12 p
Slide 13: Continuous growth in net profit
Continuous growth in net profit (NIS mil) 11.8% 1,842 1,647* 1,347 1,266 1,134 1,206 2015 2016 2017 2018 2019 *Excluding the provisions for the US Department of Justice's investigation, and taking into account provisions for bonuses in line with the level of 13 profitability from current operations,
Slide 14: Return on equity increasing while broadening the equity base
Return on equity increasing while broadening the equity base תשואה ROE* (%) Equity (NIS mil) 14% 11.9% 12% 11.6% * 10.0% 10.2% 10.2% 16,034 10% 14,681 11,847 12,714 13,685 8% 8.5% 6% 4% 2% 0% 2015 2016 2017 2018 2019 * For 2018 Excluding the provisions for the US Department of Justice's investigat
Slide 15: Achieving the strategic plan targets two years in advance
Achieving the strategic plan 15 targets two years in advance 2019 יולי
Slide 16: Achieving ROE target
Achieving ROE target ROE 2021 target according to the strategic plan 11.9% 11.6%* 8.5% 11.5% 2018 2019 2021 *Excluding the provisions for the US Department of Justice's investigation, and taking into account provisions for bonuses in line with the level of 16 profitability from current operations, a
Slide 17: Achieving cost/income ratio target
Achieving cost/income ratio target Cost/income ratio 2021 target according to the strategic plan 63.6% 57.2%* 54.6% 55% 2018 2019 2021 *Excluding the provisions for the US Department of Justice's investigation, and taking into account provisions for bonuses in line with the level of 17 profitability
Slide 18: Growing while taking market share
Growing while taking market share Credit to the public Deposits from the public in Israel 2021 in Israel 2021 strategic strategic plan target plan target 20.0% 20.1% 20.1% 17.0% 17.6% 18.8% 19.7% 16.1% 16.4% 16.2% 20.0% 17.5% 2015 2016 2017 2018 1-9/19 2021 2015 2016 2017 2018 1-9/19 2021 18 * O
Slide 19: Income and expenses
Income and expenses Actual gap between income and expenses for 2017-2019 was 2.5% compared to 2% forecasted in the strategic plan 2015 2016 2017 2018 1 2019 אסטרטגית תכנית- הכנסות Income strategic plan אסטרטגית תכנית- הוצאות Expenses strategic plan בפועל הכנסות Income בפועל הוצא
Slide 20: It's time for a new strategic plan!
It’s time for a new strategic plan! Achieving the strategic plan targets ahead of time led the Bank’s Board of Directors to instruct management to present a new strategic plan for the years 2021-2025, during Q3/2020 . 20
Slide 21: Together with the merger of Union bank
Together with the merger of Union bank • The antitrust court has approved the Union Bank transaction under several conditions • The agreement with Union Bank controlling share holders was extended to May 2020 • The merger would be one of the main pillars of the new strategic plan • The transaction w
Slide 22: The new plan together with the merger of Union Bank
The new plan together with the merger of Union Bank Strategic plan 2021-2025 will take the Bank to the next level 22
Slide 23: Continue to distribute dividend of 40% of net profit
Continue to distribute dividend of 40% of* net profit (NIS mil) 737 700 Q4/19 176 600 500 404 400 Q1-Q3/19 300 190 561 200 120 122 137 100 75 0 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 23 * For the relevant period
Slide 24: Financial Statements
Financial Statements 24 2019 יולי
Slide 25: Net profit
Net profit (NIS mil) 1,842 1,647* 1,347 1,206 2017 2018 2019 *Excluding the provisions for the US Department of Justice's investigation, and taking into account provisions for bonuses in line with the level of 25 profitability from current operations, and the tax expenses derived from these
Slide 26: Net profit - ROE
Net profit - ROE 11.6%* 11.9% 8.5% 2018 2019 *Excluding the provisions for the US Department of Justice's investigation, and taking into account provisions for bonuses in line with the level of 26 profitability from current operations, and the tax expenses derived from these
Slide 27: Net profit - ROE
Net profit - ROE 15.8% 14.1% 13.4% 11.3% 11.1% 11.5% 10.3% 10.7% 6.1% 5.7% Q1/2018 Q2/2018 Q3/2018 Q4/2018 Q1/2019 Q2/2019 Q3/2019 Q4/2019 *Excluding the provisions for the US Department of Justice's investigation, and taking into account provisions for bonuses in line with the level of 27 profitabi
Slide 28: Equity
Equity (NIS mil) 16,033 14,681 2018 2019 28
Slide 29: Condensed P&L report
Condensed P&L report (NIS mil) 2019 2018 % of change Interest revenue, net 5,340 4,922 8.5 Non interest revenues 1,966 1,967 )0.1( Total 7,306 6,889 6.1 Expenses with respect to 364 310 17.4 credit losses Operating and other expenses 3,988 4,384 )9.0( Net profit 1,842 1,206 52.7 29
Slide 30: Total revenues
Total revenues (NIS mil) 7,306 6,889 6,000 2017 2018 2019 30
Slide 31: Financing revenues
Financing revenues (NIS mil) 2019 2018 % of change Interest revenues, net 4,922 4,922 Non-interest financing revenues 445 445 Total financing revenues 5,367 5,367 6.1 Less: Linkage differentials with respect to CPI position 76 182 Revenues from collection of interest on troubled debt 44 41 Gain from
Slide 32: Provisions/loans to the public
Provisions/loans to the public 0.18% 0.16% 2018 2019 32
Slide 33: Operating and other expenses
Operating and other expenses (NIS mil) 2019 2018 % of change Salaries 2,562 2,407 6.4 Building and equipment 770 747 3.1 maintenance and depreciation Others 656 1,230 - Total 3,988 4,384 )9.0( 33
Slide 34: Total balance sheet items development
Total balance sheet items development (NIS mil) 31.12.2019 31.12.2018 % of change Total balance sheet 273,244 257,873 6.0 Loans to the public, net 204,708 194,381 5.3 Deposits from the public 210,984 199,492 5.8 Securities 10,113 11,081 )8.7( Equity 16,033 14,681 9.2 34
Slide 35: Capital adequacy
Capital adequacy 13.64% 13.88% Total Ratio 10.01% 10.14% Tier 1 31.12.2018 31.12.2019 35
Slide 36: Thank you
Thank you 36