First International Bank of Israel (TASE: FTIN), headed by Smadar Barber-Tsadik, posted a net profit of NIS 750 million for 2020, 13% less than in the previous year, and representing a return on equity of 8.6%.
First International is Israel’s fifth largest bank, and like its larger peers it substantially reduced its credit loss expense in the fourth quarter of last year in comparison with the previous quarters, coming close to a normal level. Its fourth quarter profit was NIS 210 million, 5.4% less than in the fourth quarter of 2019, but this included NIS 20 million in expenses on account of early retirement of employees.
Credit to the public grew by 3.5% last year, which compares with an average for the banking sector of 4.4%, while deposits from the public grew by 18%, as customers rushed to certainty in the face of volatile capital markets.
For 2020 as a whole, First International Bank posted provisions for credit losses of NIS 464 million, 236% more than in 2019, mostly in general provisions. At the end of 2020, the bank had loans of NIS 1.75 billion on which repayments were frozen; by the end of January 2021 this figure had fallen to NIS 941 million. Payments were frozen on 3.5% of the bank’s mortgage portfolio at the end of last year, the lowest proportion among Israel’s banks. The bank’s mortgage portfolio grew by 10.8% last year, and its share of the mortgage market rose from 6.6% to 6.7%. The bank with the greatest growth in market share in 2020 was Israel Discount Bank (TASE: DSCT), to 10.2% from 9.6% in 2019.
One of First International Bank’s strengths is in securities trading. Trading commissions rose by NIS 100 million in 2020, up 25% in comparison with 2019.
The bank’s headcount was reduced by 5.3% last year, with only Discount Bank achieving a higher relative streamlining of its workforce.
Published by Globes, Israel business news – en.globes.co.il – on March 17, 2021
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