Record profits for the International Bank in 2021: more than NIS 1.4 billion
The excellent year spent on the financial system in Israel continues to be reflected in the reports: Record profits for the International Bank in 2021. The CEO, Smadar Barber-Tzadik: "The results presented by the International in 2021 reflect the Bank's growth in all areas of strategic focus"
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Of money
07/03/2022
Monday, 07 March 2022, 12:03 Updated: 12:25
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The International Bank publishes the business results for 2021, which well express the good year that has passed for the banking system, with the exit from the corona locks and the return of the economy to full function.
Here are the main points of the report:
Net profit of NIS 1,405 million internationally in 2021, an increase of 87.3% compared to 2020. Return on equity - 14.7%.
Net profit of NIS 333 million in the fourth quarter of 2021, an increase of 58.6% compared to the corresponding quarter last year. Return on equity - 14%, growth in credit to the public - 10.8% in 2021 and 5.4% in the fourth quarter of the year
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Record profits for an international that concludes, like most of its colleagues, an excellent year for the financial system in Israel (Photo: Shai Oknin)
Profitability
Record profits for International: The net profit of the International Group amounted to NIS 1,405 million in 2021, compared to NIS 750 million in 2020, an increase of 87.3%.
The return on capital reached 14.7% compared to a return on capital of 8.6% in 2020.
In the fourth quarter, the net profit amounted to NIS 333 million, compared with NIS 210 million in the corresponding quarter in 2020, an increase of 58.6% and the return on capital reached 14%.
Growth and efficiency
International continues the consistent growth trend that is evident in all areas of activity: the Bank's revenues increased by 9.4% in 2021 compared to the corresponding period last year and amounted to NIS 4,550 million.
Net financial income increased by approximately 11.2%, compared with the corresponding period last year and amounted to NIS 3,097 million.
Revenues from commissions increased by 5.3% and amounted to NIS 1,444 million, revenues from commissions from capital market activity grew by 7.3%.
Credit to the public has increased by 10.8% in the past year and amounted to NIS 102,240 million.
Credit growth is characterized by credit diversification and the maintenance of proportionate risk management policies.
The housing loan portfolio grew by 13.8%, the small business sector by 11.5%, the medium-sized businesses by 13.3%, the large businesses by 11%, and credit to households by 6%.
In the fourth quarter, credit to the public increased by 5.4%.
The growth is also evident in the areas of the capital market and investment advice: the client assets portfolio (deposits and securities) has grown at a rate of 13.5% in the past year and amounted to NIS 601 billion.
International continues to become more efficient - the efficiency ratio amounted to 58.3% in 2021, compared to 61.8% in 2020. Operating and other expenses increased by 20% in 2021 compared to the same period last year, an increase explained by an increase in salary expenses. the bank.
Also this year, disposal expenses were included in respect of an early retirement plan implemented mainly in the fourth quarter of the year.
The streamlining processes implemented by the Bank and the voluntary retirement plan implemented at the end of the year resulted in a decrease of 4.6% in the average number of jobs at the Bank.
Financial strength and quality of the credit portfolio
The upward trend in capital attributed to the Bank's shareholders continues, which grew by 9.4% in 2021 (an increase of NIS 862 million) and amounts to NIS 10,003 million on December 31, 2021. The Tier 1 equity ratio reached 11.46% compared to the required regulatory ratio. The
Bank's Board of Directors today approved the distribution of a dividend of NIS 165 million, which constitutes 50% of the net profit for the fourth quarter of 2021, in addition to the dividend of NIS 215 million distributed.
In January of this year, the Bank distributed a
dividend of NIS 545 million in 2021. The annual dividend yield as of February 14, 2002 reached 6.07%.
Revenues from credit losses amounted to NIS 216 million in 2021 (negative provision rate of 0.23%), compared with expenses of NIS 464 million (positive provision rate of 0.52%) in 2020. In 2021, revenues for credit losses were recorded and were mainly due to a decrease. In the group provision, which is explained by an improvement in the macroeconomic indices and indicators that indicate the level of risk inherent in the Bank's credit portfolio and the continued decrease in the volume of debts that are in deferred payments (constituting 0.08% of total credit to the public).
In 2020, expenses for credit losses were mainly due to an increase in the group provision following continued changes in the macroeconomic environment as a result of the spread of the corona virus and the uncertainty regarding the impact on the state of the economy and borrowers.
Smadar Barber-Tzadik, CEO of the International Group (Photo: Yachz)
Innovation and digital
International continues to develop innovative products and services in the app and on the site that enjoy high usage rates and high customer satisfaction.
2021 was the year in which the international entered the world of digital wallets: at the beginning of the year, it developed a digital wallet - FibiPay and also offers its customers Apple Pay and Google Pay.
With the advent of open banking and the "click-through" it was the first international to open MultiBank, a multi-banking aggregation that enables service comparisons and increases competitiveness.
In addition, a variety of innovations and upgrades in digital activities were launched in the areas of investment in which the international focuses and leads: the Advise.Me consulting system, pension consulting, mortgages (digital mortgage application and approval in principle) and innovations for business clients in foreign exchange and guarantees. To improve and streamline customer service.
"It is important to emphasize the high level of profitability over time"
Smadar Barber-Tzadik, CEO of the International Group
: “The results presented by International in 2021 reflect the Bank's growth in all areas of strategic focus, a growth that is reflected in an accelerated increase in both credit and customer assets.
It is important to emphasize the high level of profitability of the international over time, while maintaining low volatility and maintaining high resilience.
These days mark two years since the global health crisis, which is affecting the entire world in social and economic aspects.
Throughout the period, the international has been careful to provide its customers with assistance and support, which has been expressed in deferring loan repayments, granting credit to businesses and households, and proactive investment advice during the volatility and uncertainty that characterized the markets.
The Bank also made sure to develop a variety of innovative digital tools in all areas of activity, tools that make it easier and more efficient to receive the service, especially in the reality of social distance.
The bank's high strength together with the managerial strength have led the bank to overcome the crisis well while sustained growth, efficiency and innovation.
As the first bank to launch a comparative system based on the open banking system, the Multibank system, International will continue to compete and grow both in the Bank's field of leadership - the field of investments, and in the variety of areas of banking activity.
As a competitive bank, we will continue to develop innovative digital means and offer our customers competitive value propositions. "
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