Israel Discount Bank Limited Class A · TASE:DSCT
Israel Discount Bank Limited Class A — Q1 2023 Earnings Presentation
23 slides from Israel Discount Bank Limited Class A's earnings presentation, May 17, 2023
Slide 1: 1Q 2023 Review: Financial Highlights
1Q 2023 REVIEW Financial Highlights Investor Relations May 17, 2023
Slide 2: 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 1st quarter report, as well as in strategic updates referred to in the Bank’s reports. This presentation is not a substitute for the Bank’s 2023 1st quarter fin
Slide 3: Opening Remarks and Financial Review
Opening Remarks and Financial Review Barak Nardi, CFO 3
Slide 4: 1Q 2023 – A Quarter of Record Results
1Q 2023 – A QUARTER OF RECORD RESULTS NET INCOME ROE EFFICIENCY RATIO 1,269M 20.1% 46.1% DIVIDEND PAYOUT NII GROWTH CREDIT GROWTH QoQ / YoY QoQ / YoY 30% +7.9% / 52.2% 3.5% / 14.5 % 4
Slide 5: Signs of Economic Slowdown, Yet Macro Fundamentals Still Solid
SIGNS OF ECONOMIC SLOWDOWN, YET MACRO FUNDAMENTALS ARE STILL SOLID Israel’s GDP Growth (%) is expected to slowdown in 2023 Bank of Israel’s Rate has increased to 4.50% in April 2023 and expected to reach 4.75% by 1Q24 4.75 4.25 3.75 3.25 0.10 Jan21 Jan22 May22 Aug22 Oct22 Dec22 Feb23Apr23 Dec23 Earl
Slide 6: 1Q 2023 Highlights
1Q 2023 HIGHLIGHTS Record profitability with net income of NIS1,269m (adj. NIS1,201m) and ROE of 20.1% (adj. 19.0%) in 1Q23, driven by increase in revenue from core banking activity. Strong positive impact of interest rate increase: NII grew in 1Q23 by 7.9% compared with 4Q22 and by 52.2% compared w
Slide 7: Responsible Credit Growth Inline with Market Conditions
RESPONSIBLE CREDIT GROWTH INLINE WITH MARKET CONDITIONS Total Credit Growth Well Balanced Loan Book Mortgages * Medium Enterprises in NIS bn; growth % in NIS bn; growth % in NIS bn; growth % 14.5% 18.0% 9.0% 2.5% 5.6% 3.5% 252.8 244.3 220.7 Small Enterprises Corporates in NIS bn; growth % in NIS bn;
Slide 8: Continued Growth in NII & in Fees Highlights Core Business Strength
CONTINUED GROWTH IN NII & IN FEES HIGHLIGHTS OUR CORE BUSINESS STRENGTH Total Income Financing Income From Current Operations (NIS m) NIS m 1Q23 ver. 4Q22 1Q23 ver. 1Q22 Period end BOI rate 0.1% 0.75% 2.00% 3.25% 4.25% 3,086 3,654 4,257 16.5% 37.9% Average BOI rate* 0.1% 0.47% 1.53% 2.92% 3.89% 56.9
Slide 9: Sharp Improvement in Cost Income Ratio Due to Positive Jaws
SHARP IMPROVEMENT IN COST INCOME RATIO DUE TO A SUBSTANTIAL POSITIVE JAWS Total Expenses Cost Income Ratio Is Improving Due To Positive Jaws NIS m 1Q23 ver. 4Q22 1Q23 ver. 1Q22 1,707 1,967 1,962 -0.3% 14.8% 66.2% 58.6% 65.1% 55.3% 46.1% 666 693 4.1% 26.2% 549 313 324 JAWS 10.1% 303 3.5% 6.9% 988 -4.
Slide 10: Asset Quality Matrix Reflects Robustness of Our Portfolio
ASSET QUALITY MATRIX REFLECTS THE ROBUSTNESS OF OUR PORTFOLIO Group Basis Provision drives the overall NPL/Total Credit* remain relatively low Credit Loss Expenses 0.81% (in NIS m and %) 0.71% 0.67% 0.67% 0.63% 1Q22 2Q22 3Q22 4Q22 1Q23 NPLs are well covered by Loan Loss Provision ** Group Basis Spec
Slide 11: Dividend Payout Increased to 30%
DIVIDEND PAYOUT INCREASED TO 30% REFLECTING OUR SUCCESSFUL JOURNEY Continuously growing net income and dividend payout Total Capital Ratio (NIS m) 30% 6.38% 12.91% * Exp. 20% 3.50% 15% 2.70% 2.44% 2.53% 1.86% 1.39% 1.42% 1.54% 1.46% 1.13% 1.10% 1.06% Tier I Capital Ratio 0.44% 0.66% 0.00% 10% 10.22%
Slide 12: Mercantile: Record Results Driven by Substantial NII Increase
MERCANTILE: RECORD RESULTS DRIVEN BY SUBSTANTIAL NII INCREASE Net Income and ROE Total Credit Credit Loss Expenses 1Q23 Strong ROE of 23% and net (NIS m ) (NIS bn ) (in NIS m and %) income of NIS 237 million were driven by increase in net interest 12.9% 15.1% 23.0% income (8.1% QoQ, 56.8% YoY), main
Slide 13: IDBBANK: Solid Performance and Deposit Growth
IDBBANK: SOLID PERFORMANCE AND DEPOSIT GROWTH EXHIBIT THE BANK’S RESILIENCE Net Income and ROE Total Credit Total Deposits IDBNY presents solid performance in (USD m) (USD bn) (USD bn) 1Q23 with net income of $29.6m and ROE of 10.5%, compared with 9.7% 11.5% 10.5% net income of $27.8m and ROE of .in
Slide 14: CAL: Growing Consumer Credit and Transaction Turnover
CAL: GROWING CONSUMER CREDIT AND TRANSACTION TURNOVER SUPPORT STRONG RESULTS Net Income and ROE (Adj.) Consumer Credit Transaction Turnover in NIS m in NIS bn in NIS bn CAL reported strong results in 1Q23 with adjusted net income of NIS 85m 14.3% 13.3% 16.2% and 16.2% ROE. Reported net income of NIS
Slide 15: To Summarize
TO SUMMARIZE We delivered yet again record results for 1Q23, with net income of 1.27BN NIS, and ROE of 20.1%. Substantial revenue increase from core banking activity – NII is growing by 7.9% QoQ, and by 52.2% YoY. Net Interest Margin (NIM) reached 3.18% compared with 2.98% in 4Q22 and 2.36% in 1Q22.
Slide 16: Q&A
Q&A Barak Nardi, CFO Yossi Beressi, Chief Accountant 16
Slide 17: Appendices
APPENDICES ‘space olgeoonr
Slide 18: Israel Discount Bank: P&L and Selected Ratios
ISRAEL DISCOUNT BANK: P&L AND SELECTED RATIOS NIS m 1Q23 4Q22 1Q22 vs.4Q22 vs.1Q22 Net interest income 2,740 2,540 1,800 7.9% 52.2% Credit loss expenses (expenses release) 204 230 (60) (11.3%) N/A Non-interest financing income 329 248 45 32.7% 631.1% Commissions 887 857 825 3.5% 7.5% Other income 30
Slide 19: Israel Discount Bank: Selected Balance Sheet Items
ISRAEL DISCOUNT BANK: SELECTED BALANCE SHEET ITEMS NIS m 31.03.23 31.12.22 31.03.22 Cash and deposits with banks 60,040 65,713 60,997 Securities 51,215 44,794 42,918 Securities borrowed or purchased under agreements to resell 1,251 857 1,156 Credit to the public 252,845 244,288 220,733 Provision for
Slide 20: Israel Discount Bank: Adjustment to P&L
ISRAEL DISCOUNT BANK: Adjustment to P&L NIS m 1Q23 4Q22 1Q22 Reported net income 1,269 939 983 Realization of Assets (142) (315) Effect of settlment 19 Cost associated with the separation of CAL 74 Total (68) 19 (315) Adjusted net income 1,201 958 668 20
Slide 21: Mercantile: Financial Performance
MERCANTILE: FINANCIAL PERFORMANCE Main P&L and Balance Sheet metrics and selected ratios NIS m 1Q23 4Q22 1Q22 Vs. 4Q22 Vs. 1Q22 Net interest income 563 521 359 8.1% 56.8% Non-interest income 109 97 89 12.4% 22.5% Total income 672 618 448 8.7% 50.0% Operating & other expenses 255 310 241 (17.7%) 5.8%
Slide 22: IDBBANK: Financial Performance
IDBBANK: FINANCIAL PERFORMANCE Main P&L and Balance Sheet metrics and selected ratios USD m 1Q23 4Q22 1Q22 Vs. 4Q22 Vs. 1Q22 Net Interest Income 87 92 72 (5.4%) 21.8% Non-Interest Income 17 12 18 44.5% (2.3%) Total Income 104 104 90 0.2% 15.9% Operating & Other Expenses 68 64 58 7.1% 17.0% Net Incom
Slide 23: CAL: Financial Performance
CAL: FINANCIAL PERFORMANCE Main P&L and Balance Sheet metrics and selected ratios NIS m 1Q23 4Q22 1Q22 Vs. 4Q22 Vs. 1Q22 Income From Credit Card Transactions 423 428 377 (1.2%) 12.2% Credit Loss Expenses (Expenses Release) 41 43 (1) (4.7%) N/A Non-Interest Financing Income 301 (7) 17 N/A N/A Total I