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FIBI
FIRST INTERNATIONAL
BANK OF ISRAEL
Overview 30.09.13
FIBI
FIRST INTERNATIONAL
BANK OF ISRAEL
Net Earnings and ROE NIS Millions
ROE
144
NIS Millions
Average
capital
6,206
6,651
6,648
5,995
6,624
Core capital
adequacy
ratio
9.33%
9.82%
10.04%
9.33%
10.04%
* Assuming core capital ratio of (9.30%), (the Israeli banking industry average core capital ratio in 1-9/2013)
the ROE is 9.4% in 1-9/2013 and 9.7% in Q3 2013.
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FIBI
FIRST INTERNATIONAL
BANK OF ISRAEL
Statements of income
1-9/2013 - 1-9/2012 NIS Millions
Gross Change
change
in %
1-9/2013
1-9/2012
Interest income, net
Expenses from credit losses (0.13% provision rate) (*)
1,653
65
1,693
85
(40)
(20)
(2.4%)
(23.5%)
Net interest income after expenses from credit losses
1,588
1,608
(20)
(1.2%)
Total non-interest income
1,234
1,151
83
7.2%
140
114
26
22.8%
1,050
1,015
35
3.4%
44
22
22
100.0%
2,106
2,078
28
1.3%
Profit before taxes
Provision for taxes on profit
716
295
681
250
35
45
5.1%
18.0%
The bank’s share in profit of equity-basis investees, after taxes
23
30
(7)
(23.3%)
Net profit
ROE
Core capital ratio (end of period)
429
8.7%
10.04%
445
10.0%
9.33%
(16)
(3.6%)
Bank of Israel average interest rate
1.52%
2.44%
Of which: non-interest financing income
Commissions income
Other Income (divestment of buildings + pay back of insurance)
Total operating and other expenses
* Excluding provision for mortgages the provision rate is 0.08%
(0.92%)
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FIBI
FIRST INTERNATIONAL
BANK OF ISRAEL
Income from Financing Activities (before Tax)
1-9/2013 - 1-9/2012 NIS Millions
1-9/2013 1-9/2012
Gross
change
Change
(%)
Interest income
2,612
3,006
(394)
Interest expense
(959)
(1,313)
354
Net interest income
1,653
1,693
(40)
(2.4%)
140
114
26
22.8%
1,793
1,807
(14)
(0.8%)
6
(13)
19
29
35
(6)
(17.1%)
1,771
1,794
(23)
(1.3%)
Income from divestment of bonds and shares
187
171
16
9.4%
Divestment of bonds and income from trading portfolio
131
130
1
0.8%
Income from divestment of shares
59
70
(11)
(15.7%)
Provisions for writedown of bonds and shares
(3)
(29)
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Other financial income of financial intermediation
and unoccupied capital
1,584
1,623
(39)
Bank of Israel average interest rate
1.52%
2.44%
Non-interest financing income
Total income from interest and non-interest
Of which: Hedging of tax provision
Fair Value of derivatives
Total profit from actions of financing (interest and
non-interest)
(2.4%)
(0.92%)
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FIBI
FIRST INTERNATIONAL
BANK OF ISRAEL
Total Income to Total Weighted Risk Assets Ratio
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FIBI
FIRST INTERNATIONAL
BANK OF ISRAEL
Operating & Other Expenses
NIS Millions
1-9/2012
1-9/2013
*
* Including amortization of 39 NIS Millions
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FIBI
FIRST INTERNATIONAL
BANK OF ISRAEL
Improved Operational Efficiency Ratio (Consolidated)
Total Operating Expenses to Total Income
Total Operating Expenses / Total Income (After Expenses from credit
losses)
Total Operating Expenses / Total Income (Before Expenses from credit losses)
%
%
Total Operating Expenses
Total Income
75.3%
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FIBI
FIRST INTERNATIONAL
BANK OF ISRAEL
FIBI Strategic Assets & Liabilities
Structure NIS Billions 30.09.2013
FIBI Strategic Assets & Liabilities composite*
Capital
Adequacy
Basel II
Core Capital
Adequacy
Basel II
30.09.12
30.09.13
14.19%
15.27%
9.33%
10.04%
30.09.2013 (NIS Billions)
Credit to the Public
Public
Deposits
66.9
85.3
Estimate Core
Capital
Adequacy
Basel III
9.88%
State of Israel Bonds 8.6
Deposits to
Credit Ratio
Liquid Assets
to Deposits
Ratio
126.5%
127.6%
Gov. & Bank Bonds
2.0
34.3%
37.8%
Bank of Israel Deposits 19.5
Sovereigns Bonds 1.2
Deposits in Banks 3.1
Banks Bonds 1.7
Capital Notes 5.8
NIS, Corporate Bonds 0.8
Capital Available for
Investment 4.9
* Illustration – not to scale
Structures, Hedge funds
&Stocks 0.7
Market risk in VAR(0.07)
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FIBI
FIRST INTERNATIONAL
BANK OF ISRAEL
Total balance
Equity
Total Assets, Deposits & Credit to the public
NIS Millions
Credit to
the Public
Shareholders`
equity to total
balance ratio
Public
Deposits
5.7%
5.7%
6.2%
6.3%
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FIBI
FIRST INTERNATIONAL
BANK OF ISRAEL
Credit to the Public by segments
30.09.2013 NIS Millions
Change in %
Average
Balance
Compared to
1-9/2012
30.9.13
30.9.12
Change in %
Compared to
30.9.12
Private + Retail
(Households)
16,056
15,091
6.6%
6.1%
Mortgage
17,208
15,989
7.5%
13.9%
Total private clients
33,264
31,080
7.0%
10.0%
Commercial * +
Small Business
13,128
13,335
(1.5%)
(1.5%)
Corporate
20,503
21,784
(6.0%)
(3.5%)
Total Credit to the
Public
66,895
66,199
1.1%
3.0%
Total Private +
Retail 50%
* Of which, 167 NIS Millions decrease, in comparison to 30.09.12, due to the closure of FIBI London.
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FIBI
FIRST INTERNATIONAL
BANK OF ISRAEL
Expenses for Credit Losses to Credit
to the Public Ratio
FIBI maintained low provisions for credit losses even during the recent credit crisis
Provisions for Credit losses 2007-9/2013
FIBI
0.76%
Other 4 Leading Banks
Change of
measurement
according to Impaired
Debts Directive
0.76%
0.43%
0.33%
0.39%
0.42%
0.44%
0.44%
0.32%
0.20%
0.28%
0.14%
* 0.13%
0.18%
0
2007
2008
2009
2010
2011
2012
*1-9/2013
*In Q1 the Bank has implemented a one time regulatory provision on mortgage portfolio in order to set the expenses for
credit losses ratio to 0.35% of the mortgage credit balance (24 NIS million). Excluding this one time provision, the ratio of
FIBI is about 0.05% in 1-9/2013 and the ratio of the group is 0.08%.
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FIBI
FIRST INTERNATIONAL
BANK OF ISRAEL
Deposits from the Public
breakdown by segments NIS Millions
Change in %
30.09.13
30.09.12
Total Private +
Retail 58%
Change in %
Average
Balance
Compared
Compared to
to 30.9.12
Q3/2012
Total Private &
Retail
49,802
51,546
(3.3%)
(0.6%)
Commercial +
Small Business
10,892
10,770
0.9%
(1.8%)
Corporate
24,686
21,458
14.9%
3.9%
Total
85,380
83,774
1.9%
0.4%
The customers` securities portfolio grew in 18 NIS Billions compared to 30.9.12 (about 10% growth). In
private and retail segment the securities portfolio grew in 6 NIS Billions (about 13% growth). 25% of the
growth due to increase in the market value .
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FIBI
FIRST INTERNATIONAL
BANK OF ISRAEL
Core Capital Ratio – 30.09.13
FIBI is the only bank in Israel that has already met the new regulatory requirement for Core
Capital ratio (in 31/12/14) according to Basel II
Basel III
8.82%*-9.03%
8.89%
8.60%
**
8.54%
9.88%
Minimal Regulatory
* Requirement For
HAPOALIM&LEUMI
14.30%
14.57%
Minimal
Regulatory
Basel II**
13.42%
requirement
*
Gap
-0.76
-0.68 *
-1.3-0.72
-0.70
**
-0.16
* Core capital in FIBI is 6.8 NIS Billions up to 30.09.13, increase of 7% compared with 30.09.12.
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FIBI
FIRST INTERNATIONAL
BANK OF ISRAEL
FIBI is demonstrating relative strength
in main financial ratios
Core capital ratio and principal financial ratios 30.09.2013
Other 4 leading Banks
Average
Ratio of core
capital to risk
assets
Deposits from
the public to
credit to the
public
Total operating
expenses /
Revenue
(before credit
losses
expenses
Expenses for
credit losses to
credit to the
public*
Dividend yield
10.04%
127.6%
72.9%
0.13%
3.52%
9.32%
108.1.%
62.8%
0.49%
0.81%
9.28%
116.2%
69.3%
0.06%
-
9.30%
130.6%
76.4%
0.52%
-
8.84%
99.5%
57.7%
0.28%
0.87%
9.24%
112.7%
67.0%
0.32%
(As 18.11.13)
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FIBI
Changes in Net Profit Subsidiaries NIS Millions
FIRST INTERNATIONAL
BANK OF ISRAEL
Net profit
1-9/2013
Gross
change
ROE
Core Capital
Ratio
82.0
0.6
10.45%
9.5%
29.7
(7.8)
8.9%
15.9%
29.9
(2.6)
9.2%
14.5%
24.7
(10.3)
9.7%
12.9%
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FIBI
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FIRST INTERNATIONAL
BANK OF ISRAEL
1-9/2013 Highlights
Net profit - 429 NIS Million. The Profit before taxes increased – 5.1%.
The highest Core capital ratio in the banking system – 10.04%, despite a
dividend paid in June 2013. Estimated Core Capital Adequacy under Basel
III – 9.88%.
ROE in 1-9/2013 -8.7% (9.0% in Q3). Assuming the banking industry core
capital average ratio (9.30%) the ROE is 9.4% in 1-9/2013 and 9.7% in Q3.
Increase in revenue from commissions – in spite of the regulatory reforms
inflicting reductions in commissions, an increase in clients' activity in
capital markets resulted in 7.7% increase in capital markets commissions
and a slight increase in other commissions. Moreover, the 3rd quarter, due
to the timing of the Jewish holidays, included less business days, which
mainly reduced capital markets activity revenues in comparison to
previous years.
Provisions for credit losses in 1-9/2013 - 0.13% (0.08%- excluding
regulatory provision on mortgages).
Moderate growth in operating expenses - 1.3% - mainly explained by the
increase in VAT.
Operational Efficiency Ratio Improvement (before Expenses from credit
losses)- 72.9% in 1-9/2013 compared to 73.1% in 1-9/2012.
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