Q1 2026 Bank Leumi Le Israel BM Earnings Call Transcript
Key Points
- Bank Leumi Le-Israel BM (BLMIF) reported a strong return on equity (ROE) of 16.3%, reflecting successful strategy implementation.
- The bank announced a significant dividend distribution and share buyback totaling ILS1.3 billion, with a dividend yield of 4.7%, the highest in the industry.
- The credit portfolio expanded by 5.4% in the first quarter, with corporate credit increasing by 10.3%, driven by strategic sectors like real estate and infrastructure.
- Bank Leumi's efficiency ratio stood at 29.1%, among the best globally, driven by technological advancements and AI integration.
- The bank maintained a strong capital position with a core Tier 1 ratio of 11.74% and a total capital ratio of 14.07%, above regulatory requirements.
- Net interest income decreased to ILS3.9 billion from ILS4 billion in 2025, impacted by a negative CPI and lower interest rates.
- The net interest margin (NIM) declined to 1.95% from 2.1% in Q4 2025, primarily due to lower interest rates.
- Total credit loss expenses increased to 0.12% of gross loans compared to 0.05% in the same quarter of 2025.
- The core Tier 1 ratio decreased from 12.05% in the previous quarter to 11.74%, attributed to higher activity levels.
- The bank faces high competition, impacting net interest margins, necessitating proactive measures to manage these challenges.
(audio in progress) ILS125 million for the entire banking system. So next year, it's negligible.
We have also maintained a significant excess capital and when normalized to the banks to our internal capital target, ROE stands at 16.3%. Our performance reflects the successful implementation of our strategy, which is based on technological edge that enables business leadership alongside disciplined risk management and excellent customer experience among all lines of business.
Our strong results were achieved in a quarter marked by geopolitical and security tension in our region. Bank Leumi entered this period with -- from a position of strength with a strong capital position and high liquidity. We continue to operate fully throughout this period, maintain business continuity for our customers, and by that, support the Israel economy.
Today, we also announced a dividend distribution and the share buyback totaling to ILS1.3 billion, reflecting a dividend yield of 4.7%. The
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