Israel Discount Bank cites stability and strategic planning as key to leap in profits

Israel Discount Bank is attributing its dramatic rise in profits in the second quarter to the bank's strong and stable base and the success of a multiyear strategic plan covering all aspects of its business.

By REBECCA BASKIN
September 3, 2009 12:32
2 minute read.
discount bank88

discount bank88. (photo credit: )

 
X

Dear Reader,
As you can imagine, more people are reading The Jerusalem Post than ever before. Nevertheless, traditional business models are no longer sustainable and high-quality publications, like ours, are being forced to look for new ways to keep going. Unlike many other news organizations, we have not put up a paywall. We want to keep our journalism open and accessible and be able to keep providing you with news and analyses from the frontlines of Israel, the Middle East and the Jewish World.

As one of our loyal readers, we ask you to be our partner.

For $5 a month you will receive access to the following:

  • A user experience almost completely free of ads
  • Access to our Premium Section
  • Content from the award-winning Jerusalem Report and our monthly magazine to learn Hebrew - Ivrit
  • A brand new ePaper featuring the daily newspaper as it appears in print in Israel

Help us grow and continue telling Israel’s story to the world.

Thank you,

Ronit Hasin-Hochman, CEO, Jerusalem Post Group
Yaakov Katz, Editor-in-Chief

UPGRADE YOUR JPOST EXPERIENCE FOR 5$ PER MONTH Show me later Don't show it again

Israel Discount Bank is attributing its dramatic rise in profits in the second quarter to the bank's strong and stable base and the success of a multiyear strategic plan covering all aspects of its business. Israel's third-largest lender on Monday issued its second quarter earnings report, showing a 52.5 percent increase in earnings on the same period last year to NIS 337 million, from NIS 221m. First quarter earnings totalled NIS 140m. Return on equity in the second quarter of the year rose to 15.8% on an annual basis, from 9.9% in the corresponding quarter of 2008 and 6.5% in the first quarter. Shlomo Zohar, Discount's chairman, said the group had managed "to substantially enlarge its earnings despite the difficulties in world markets and financial markets in the last year." He noted that Discount had also achieved its targeted capital-adequacy ratio of 12.08% "long before the planned date of the end of 2009." In a statement, Discount's spokesman said the group's long-term strategic plan was bearing fruit. "Subsidiary companies in the Discount group are displaying impressive earnings," she said. "The Cal company is showing continuing improvement in earnings, particularly in customer credit. Mercantile Bank has seen impressive development in the Arab and haredi sectors." Discount New York had accomplished "a fundamental improvement in its share balance and capital, and shows earnings in all quarters despite the deep financial crisis in the US," she said. Giora Offer, Discount's president and CEO, said the bank's board of directors had recently approved an update for the group strategic plan, whereby "a new return-on-equity target range of 9%-11% has been set for the years 2010-2011." This step, the bank said, stemmed from the demand for a significant increase in capital-yield rates and the necessary spending in implementing regulatory instructions affecting all banks. The statement said the bank intended to focus considerable attention in 2009-2010 on increasing efficiency and was aiming for operational savings totalling some NIS 120m. by year's end. The bank has reduced computerization costs, with the completion of the "Project Horizon" computer project, which had required the investment of significant resources in past years. "Even during these challenging times, the bank has succeeded in remaining attentive to our clients' needs, recruiting new clients and broadening the scope of banking activities across the franchise," Offer said. "Prudent risk management, improvement in asset quality and capital levels, coupled with a high level of liquidity, have continued to allow us to execute our business plans and at the same time improve group results."

Related Content

The Teva Pharmaceutical Industries
April 30, 2015
Teva doubles down on Mylan, despite rejection

By GLOBES, NIV ELIS