A WOMAN uses an automated teller machine outside a Bank Hapoalim branch in Tel Aviv three years ago..
(photo credit: REUTERS)
Bank Hapoalim, Israel’s largest bank, has opened up a yawning gap ahead of its competitors.
In the past four years alone, the bank has leaned down, focusing on increasing levels of digital banking, and managed to open up a NIS 6 billion lead over its next largest competitor, Bank Leumi.
The two banks had a similar valuation four years ago.
Today, Hapoalim’s market cap is 31 percent higher ($25.7b. to $19.6b.).
In particular, the bank has managed to make its labor force more efficient. It has gone out of its way to highlight digital services that are not only convenient for customers, but also automated, thus required fewer workers.
All in all, the bank has cut its staff from 13,900 to 12,000 in the past four years, meaning its workforce is smaller than Leumi’s, despite being the bigger bank.
Indeed, one of the bank’s major advantages over Leumi has been its looser labor restrictions. Unlike Leumi, whose wage bills are huge as a result of outdated wage agreements for the bank’s employees, Hapoalim has more maneuverability to adjust its labor force as necessary.
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In measures of profits, dividends and stock growth, Hapoalim has outshone its nearest competitor.
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