Hapoalim announces '08 losses of NIS 895m.

A day after CEO resigns, Israel's 2nd largest bank says year ended in the red for first time since 1988.

bank hapoalim 88 (photo credit: )
bank hapoalim 88
(photo credit: )
Bank Hapoalim, Israel's second largest bank, on Thursday announced that it had registered net losses of NIS 895 million in 2008, significantly more than the profit warning it published in February, according to which it anticipated NIS 780 million in losses. This is the first time since 1988 that the bank has finished the year in the red. In 2007, the bank's profit was NIS 2.679 billion. Danny Dankner, the chairman of Bank Hapoalim's board of directors, said Thursday that despite the losses the steps taken by the bank in response to the global economic crisis would help propel it through the difficult period. "The bank has a solid financial foundation, and we are expecting positive yields in the coming year and renewed growth in the long run," Dankner said. The reports also detailed the salaries of senior bank executives. The highest-earning employee of the bank was Nir Brunstein, the CEO of Poalim Capital Markets, whose salary cost for 2008 was NIS 11.5 million. Dankner's salary cost was NIS 4.8 million. The bank's CEO, Zvi Ziv, resigned on Wednesday over differences of opinion with Dankner. Ziv, 58, who has been CEO for five and a half years, announced his resignation 21 months before his contract expires. After 35 years at the bank, Ziv will step down by the end of the year. He will be replaced by his deputy, Zion Keinan, who is also head of corporate banking. Keinan is a 30-year Hapoalim veteran whose rise is something of a Cinderella story. The bank said on Wednesday that Keinan was the natural candidate for the position and that his retail banking strategy had emphatically proven itself. Ziv's salary cost the bank NIS 3.3 million in 2008. Sharon Wrobel contributed to this report