Shuki Bernstein, CEO of Mercantile Bank, stated that 2022 was characterized by an upheaval in the stock markets, a steep rise in inflation and a sharp increase in interest rates.
Speaking at the annual conference of the commercial banking division's customers last week in Kibbutz Gaash, he said that at the same time, the year also saw growth and recovery with the return of the economy to full activity after the COVID-19 pandemic.
However, 2023 will be a challenge
Bernstein said that prices will continue to rise by half in all economic sectors yet the Bank of Israel and the government are putting forth restraints mainly in the area of high-interest rates.
Bernstein reassured the bank's clients by emphasizing that Mercantile has maintained its financial strength and its customers' money for more than 100 years while strictly complying with regulations and safeguarding and controlling its clients' privacy.
"The weight of financing credit transactions has shifted in the last year to be mainly around macro risks: Inflation, interest, rising commodity prices, rising wages, etc. For many years, funding bodies considered every credit transaction on an individual basis," said Zion Becker, VP and head of the commercial banking division.
He further added that the gravity of considering a financing deal has been until now on the essence of credit vis-à-vis collateral and the structure of the credit. In the last year, as mentioned, the weight has shifted and has moved to be mainly around macro risks.
Becker said that it's necessary to look at the big picture and combine the two: The macro economy on the one hand and particular parameters in a specific financing deal on the other.