Mizrahi 9-month net profit rises 8.5%

Mizrahi is relinquishing the assets in order to comply with the Bachar reforms, which the Knesset passed in July.

By YIGAL GRAYEFF
November 23, 2005 07:21
2 minute read.
mizrahi logo 88

mizrahi logo 88. (photo credit: )

 
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Mizrahi Tefahot Bank's nine-month net profit rose 8.5 percent, boosted by an increase in income from financing operations and a fall in provisions for doubtful debt, but held back by a rise in costs. The company, which earlier this month changed its name from United Mizrahi Bank, said on Tuesday that in the nine months ending on September 30, net profit rose to NIS 397 million from NIS 366m. in the same period a year earlier. Return on equity edged up to 13% from 12.8%, and income from financing operations before provisions for doubtful debt rose to NIS 1.4 billion from NIS 1.27b., due to Mizrahi exploiting foreign exchange fluctuations and increasing profits from bonds activities. Operating and other revenue climbed 7.7%, helped by an increase in commissions from the management of mutual and provident funds and from securities activities. Provisions for doubtful debt fell to NIS 191m. from NIS 247m., due to a fall in specific provisions. However operating and other costs rose 15% to NIS 173m. as a result of an increase in wages. Third-quarter net profit rose to NIS 150m. from NIS 129m., income from financing operations before provisions for doubtful debt rose to NIS 489m. from NIS 392m., and provisions for doubtful debt fell to NIS 64m. from NIS 79m. Return on equity rose to 15.3% from 13.7%. Credit to the public on September 30 was up 1.9% from a year earlier at NIS 64.9b. and deposits from the public were up 1.4% at NIS 69.4b. Shares closed down 0.6% at NIS 24.39 on the Tel Aviv Stock Exchange. Earlier this month, Mizrahi said it had agreed to sell all of its mutual funds operations to Excellence Investments for NIS 405m. and to sell its 25% stake in Excellence Investments to Phoenix Assurance at a company value of NIS 775m. This makes the stake worth NIS 193.75m. In addition, Mizrahi is selling its 60% stake in Netivot Management to Gaon Investment House for NIS 37m. Mizrahi is relinquishing the assets in order to comply with the Bachar reforms, which the Knesset passed in July and which compels the banks to divest their interests in mutual and provident funds.

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