Bank Leumi delivered another strong quarterly report.

The bank continues to benefit from the rising interest rate environment as the Bank of Israel is determined to bring inflation under control.

Leumi’s net profit rose by almost 15% to NIS 1.78B compared to NIS 1.55B in the corresponding quarter in 2021. This is mostly attributed to a 30% jump in interest income which amounted to NIS 3.4B. At the same time, most of the non-interest income declined.

The net profit in the first nine months of the year increased by 17% to NIS 5.4B, compared to NIS 4.6B in the corresponding period of the last year. The bank will distribute a dividend of NIS 356M, with the cumulative dividend for the year reaching NIS 1.6B.

Commission income increased by a more modest 3% to NIS 872M. In terms of expenses, the bank saw a drop in salary costs of NIS 1B, a significant portion of the company’s total cost structure.

On the negative side of things, the bank recorded credit losses of NIS 99M, compared to revenues of NIS 359M in the corresponding quarter last year.

The return on capital in Q3 stood at 14.9% compared to a rate of 15.1% in the corresponding quarter in 2021. According to the company’s statement, this change has occurred as a result of the Bank of Israel’s instructions on how to calculate and present return on capital, income and expense rates. The cumulative return on equity in the first nine months of the year rose slightly to 16.3%, compared to 15.4% in Q3, 2021.

In its US operations, the bank recorded a staggering jump of 77.5% in interest income, amounting to NIS 4.97B compared to NIS 2.8B in the corresponding quarter of the last year. Net interest income for Leumi US amounted to NIS 3.4B, a substantial increase of 38% compared to 2021.

Hanan Friedman, the CEO of Bank Leumi said, “The financial results testify to the successful implementation of the strategy that was defined in the areas of business-focused activity. The healthy growth – which we present in a systematic way – is achieved through careful risk management, alongside convenient, fair banking tailored to the needs of each customer in each of the service channels, which is based on advanced technological tools, data and models. The infrastructure we have established will allow us to continue to do much more with fewer resources.”