Israel Discount Bank Limited Class A · TASE:DSCT
Israel Discount Bank Limited Class A — Q3 2014 Earnings Presentation
21 slides from Israel Discount Bank Limited Class A's earnings presentation, 2014
Slide 1: Q3-2014 Financial Results & Strategic Updates
Q3-2014 Financial Results & Strategic Updates Investor Presentation www.discountbank.co.il/IR | TASE :DSCT | BLOOMBERG :DSCT.IT | REUTERS:DSCT.TA
Slide 2: P&L and Ratios for Q3 results
P&L and Ratios for Q3 results (NIS m) % Change compared to Q3-13 Q2-14 Q3-14 Q3-13 Q2-14 Net interest income 1,094 1,100 1,061 (3.0) (3.5) Loan loss provisions 171 (35) 40 (76.6) - Commissions 684 637 650 (5.0) 2.0 Non-interest income 839 778 846 0.8 8.7 P&L Operating & other expenses 1,485 1,632 1,
Slide 3: Primary factors impacting Q3-14 results (compared to Q2-14)
Primary factors impacting Q3-14 results (compared to Q2-14) Credit to the public grew by 3.3%. Total expenses decreased by 9.7%. Excluding the provision for early retirement in the last two quarters, expenses stayed almost flat. Non Interest income increased by 8.7% largely due to exchange rat
Slide 4: Financial highlights of Q3
Financial highlights of Q3 1 Capital CT-1 continuously increasing in line with plan Adequacy 2 Asset Continuously improving asset quality Quality LLP in line with the sector Credit 3 Continued retail , SME and commercial credit growth Growth 4 Expenses Continued expenses restraint 5 Subsid
Slide 5: Sufficient capital to support future growth
1 Sufficient capital to support future growth (NIS bln) Basel 3 Basel 2 9.3% 8.6% 9.3%-9.4% 8.1% 9.1% 9.2% 9.3% 7.7% 8.9% CT-1 ratio RWA 141.8 141.9 138.5 139.4 135.7 137.3 135.5 Target 2010 2011 2012 2013 Q1-14 Q2-14 Q3-14 Q4-14 5
Slide 6: Continuously improving asset quality
2 Continuously improving asset quality (NIS m) 998 821 778 998 726 Provisions 580 821 778 726 580 75 40 LLP/ 75 -35 Total Credit 0.83% 0.66% 0.65% 0.61% 0.49% 0.25% -0.12% 0.13% -35 200 2010 2011 2012 2013 Q1-14 Q2-14 Q3-14 2012 2013 Q1-14 Q2-14 Q3-14 Impaired 5,667 4,168 3,864 3,741 3,393 Substanda
Slide 7: Continuous growth in focused segments
3 Continuous growth in focused segments 31.03.14 (NIS m) 30.06.14 30.09.14 1.3% 2.8% 55,868 56,585 58,150 4.8% 4.8% 1.8% 1.0% 1.0% 2.2% 3.7% 18,712 19,610 20,542 20,190 19,835 20,035 4.9% 13,423 13,555 13,857 3,543 3,585 3,716 Total retail Consumer credit Mortgages SME Private banking 2.4% 3.8% 60,0
Slide 8: Continued expenses restraint
4 Continued expenses restraint (NIS m) Total expenses, excluding early retirement provision 1,485 1,557 1,494 (3.8%) 1,437 * 0.3% 1,441 ** Other expenses 275 320 260 261 254 Maintenance & 316 298 321 299 306 depreciation Salary & Related 889 921 936 877 881 Q3-13 Q4-13 Q1-14 Q2-14 Q3-14 * Excl. chan
Slide 9: IDB NY - Continued robust performance due to credit growth
IDB NY - Continued robust performance 5 due to credit growth, largely in the middle market (USD m) 14 13 11 Net income 2 ROE Net Income excl. TRUPS 5.5% 1.2%* 6.5% Q3-13 Q2-14 Q3-14 * Q2 ROE excl. TRUPS= 7.4% Change in % compared to Q3-13 Q2-14 Q3-14 Q3-13 Q2-14 Net Interest Income 43 49 48 11.0 (3.
Slide 10: Mercantile: Continued growth of consumer credit & SME credit
Mercantile 5 Continued growth of consumer credit & SME credit (NIS m) 54 44 35 34 Net income Net Income excl. provision ROE 7.7% 9.3% 7.0%* for early retirement Q3-13 Q2-14 Q3-14 * ROE excl. provision=11.1% % Change compared to Q3-13 Q2-14 Q3-14 Q3-13 Q2-14 Net interest Income 186 197 205 10.2 4.1 L
Slide 11: CAL: Continued growth of consumer credit and turnover
CAL 5 Continued growth of consumer credit and turnover (NIS m) 43 40 37 Net income ROE 13.8% 14.5% 15.4% Q3-13 Q2-14 Q3-14 % Change compared to Q3-13 Q2-14 Q3-14 Q3-13 Q2-14 Total Income 291 285 296 1.7 3.9 Payments to Banks 53 55 55 3.8 0.0 Total Expenses 241 228 232 (3.7) 1.8 Net Income 37 40 43 1
Slide 12: Transformation progress update
Transformation progress update Promised in Q2-14: Executed: Retirement plan progresses as planned HR 250 employees will early retire Additional early retirement plan at Mercantile On Costs during the coming months track Reduction in number of management members Branches closure as planned
Slide 13: Change-enabling infrastructure for the strategic plan
In order to execute the strategic plan and our promises, we set up a change-enabling infrastructure 1 A transformation office was established in order to lead, accelerate and facilitate the implementation of the transformation plan 2 The transformation plan was translated into projects, each one bei
Slide 14: A strong transformation governance structure
1 A strong transformation governance structure will steer the transformation effort Board of Directors Management Transformation Office Work Stream Work Stream Work Stream Work Stream Work Stream Sponsor Sponsor Sponsor Sponsor Sponsor Project Managers Project Managers Project Managers Project Manag
Slide 15: 30 projects sponsored by management
2 30 projects sponsored by management Project example Relentless Execution HR & Organizational Consumer Credit Structure SME Procurement Cost Reduce & Reduction Simplify Grow Retail Sales Capabilities Real Estate Cost Costs Focus Service reduction Retail Growth- Back Office Mercantile Lean Banking R
Slide 16: Projects' execution is impact driven
3 Projects’ execution is impact driven Transparent and ongoing monitoring process Total expected and achieved impact Idea 1500 Target (NIS) Defined Latest estimate Achieved Validated 1000 Planned 500 Executed 0 T Planned -500 -1000 -1500 Planned impact of each project 0 Q2-14 Q3-14 Q4-14 Q1-15 Q2-15
Slide 17: Progress is monitored weekly by project managers and management
3 Progress is monitored weekly by the project managers and management team SUN MON TUE WED THU Project Manager Sponsor Project reports Transformation Office Work stream reports Management Transformation report Board (monthly) 17 17
Slide 18: This infrastructure will continue to enable us to achieve future targets
This infrastructure will continue to enable us to achieve future targets What to expect in the next months: Early Finalize early retirement at Discount Bank Retirement Closure of additional branches & rightsizing headquarter offices Non-HR Costs and branches Growth Continued growth in focused segmen
Slide 19: Thank You
THANK YOU HOPE TO SEE YOU AGAIN IN 2014 EARNINGS CALL STAY TUNED
Slide 20: 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 Q3 2014 reports as well as strategic updates referred to in the Bank’s reports. The information contained herein may be partial and may include information that
Slide 21: Investor Information
Investor Information http://www.discountbank.co.il/IR Subscribe to receive email alerts. IR Contact: Tamar Koblenz Tamar.koblenz@dbank.co.il +972-3-5144496 21