Bank Leumi and First International Bank of Israel issued profit warnings for the third quarter of 2011 on Monday.
In a notice to the Tel Aviv Stock Exchange (TASE), Bank Leumi stated that it estimates that its net profit for the third quarter will be NIS 50-100 million, substantially lower than in the two preceding quarters. This means that the bank will post a net profit of NIS 1.17-1.22 billion for January-September.
Bank Leumi attributed the drop in net profit to falling prices of securities traded on the TASE, in particular the cumulative effect of the reduction in value of its investment in Partner Communications Ltd..
Bank Leumi posted a net profit from regular operations of NIS 561 million for the second quarter, giving a return on equity of 10.3%. The bank's total profit was NIS 563 million.