Q1 2025 Bank Leumi Le Israel BM Earnings Call Transcript
Key Points
- Bank Leumi Le-Israel BM (BLMIF) reported a net profit of ILS2.4 billion for Q1 2025, up 12% year-on-year when excluding one-time profits from the previous year.
- The bank's return on equity (ROE) was 15.4%, maintaining a high and stable performance in line with its strategic plan.
- Credit loss expenses improved significantly to 0.05% from 0.21% in Q1 2024, reflecting a low non-performing loan (NPL) ratio and improvement in problematic debt.
- Net interest income increased by 7% to ILS4 billion, driven by higher volumes and a favorable deposit and credit mix.
- The bank's capital ratios remain strong, with a C1 ratio of 12.15% and a total capital ratio of 14.83%, providing a significant capital buffer.
- Non-interest financing income decreased due to losses from derivatives used to hedge the securities portfolio.
- Total deposits fell in the quarter, primarily due to the volatility of capital market deposits.
- The cost-income ratio was negatively impacted by a low Consumer Price Index (CPI) and the P&L impact of derivatives.
- The geopolitical situation and military circumstances in the region pose ongoing uncertainties that could affect future operations and dividend approvals.
- The bank's ability to increase its payout ratio is contingent on regulatory approval from the Bank of Israel, which is currently limited due to geopolitical uncertainties.
Ladies and gentlemen, thank you for standing by. Welcome to Leumi's first-quarter 2025 results conference call. (Operator Instructions)
As a reminder, this conference is being recorded May 20, 2025.
I would now like to -- I would like to remind everyone that forward-looking statements for the respected company's business, financial condition and results of its operations are subject to risks and uncertainties that could cause actual results to differ materially from those contemplated. Such forward-looking statements include, but are not limited to, product demand, pricing, market acceptance, changing economic conditions, risks in product and technology development and the effect of the company's accounting policies as well as certain other risk factors, which are detailed from time to time in the company's filings with the various securities authorities.
I would now like to turn over the call to Mr. Michael Klahr, Head of Investor Relations.
Mr. Klahr, please go ahead.
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