Bank Hapoalim unveils plans to regain market leadership

"For us, 2010 is a year in which we return to a trajectory of growing revenues and improving profitability," says chairman Yair Seroussi.

January 25, 2010 05:39
2 minute read.
Bank Hapoalim unveils plans to regain market leadership

Hapoalim. (photo credit: Ariel Jerozolimski)


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Bank Hapoalim, the country's second largest bank, is embarking on a three-year plan to improve profitability, while strengthening its retail and corporate activities in an effort to regain its leadership position as the country's largest bank.

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"For us, 2010 is a year in which we return to a trajectory of growing revenues and improving profitability. I am certain that the implementation of our strategic plan will enable the bank to solidify its leadership in Israeli banking," said Bank Hapoalim chairman Yair Seroussi. "This year, we will continue to strengthen our leadership in retail and corporate banking in Israel; stand by our customers and help them grow; focus our international operations and continue to build the infrastructure for future growth; maintain the bank's level of capital adequacy above the regulatory requirement; and devote special attention to risk management."

In its 2010-2012 work plan, approved by the Board of Directors on Sunday, the bank said that Israel was one of the countries where the impact of the crisis was relatively minor, thanks to the government's prudent fiscal policy, the monetary leadership of the Bank of Israel, and a robust, conservative banking system.

"All of these factors enabled the Israeli economy to start 2010 on a positive note. Of course, we are aware of the remaining risks in the financial systems in the United States and in most European countries, and we recognize that full employment in the developed countries is still a long way off," said Seroussi. "For all of these reasons, we believe it is prudent to maintain a cautious and conservative business policy."

In 2010, the bank also plans to focus on international operations in an effort to build the infrastructure for future growth, maintain a level of capital adequacy above the regulatory requirement of 12 percent, and devote special attention to risk management.

"Bank Hapoalim has experienced two difficult years during which the bank has lost its leadership to Bank Leumi," said Yuval Ben-Zeev, analyst at Clal Finance Brokerage. "2010 opens for the bank as a year with a focus on rebuilding its position and a return to the center of the stage as the leading bank in Israel. Bank Hapoalim wants to win renewed trust of customers, businesses and the central bank's supervision."


In the retail sector the bank plans to expand its branch network in response to customers' needs, with new branches in a variety of formats tailored to different segments of the population, taking into account the demographic shifts in the Israeli population.

"We will continue to improve customer service, making use of new technologies, with special emphasis on providing advisory services, strengthening long-term saving habits, and increasing our market share in mortgages with a focus on customers of the bank," said the bank's CEO Zion Keinan.

"We also plan to take our activity to the next level in the middle market business sector, which is an important component of the backbone of the Israeli economy. We see potential for significant expansion of the bank's business in this area, based, among other factors, on the new infrastructure of business branches, which we will continue to grow over the coming years."

Ben-Zeev noted that two years ago, Bank Hapoalim took a strategic decision to focus on the middle market business, in which it has a market share of 25% compared with Bank Leumi's 40% share.

"We expect Bank Hapoalim's work plan to create fierce competition in the banking sector as other banks will respond to the aggressive steps the bank is planning to take," said Ben-Zeev.

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