The new CEO of Israel Discount Bank, Reuven Spiegel, has his work cut out for him. Net profit fell 21 percent to NIS 724 million (NIS 0.73 per share) in 2010, from NIS 923m. in 2009.Discount Bank’s return on equity fell to 6.9% for 2010, from 9.8% for 2009. The core Tier-1 capital-adequacy ratio was 7.9%. These are among the lowest figures in the Israeli banking system.Income from financing operations after provision for doubtful debts rose 6.7% to NIS 4 billion in 2009, from NIS 3.76b. in 2009.The provision for doubtful debts fell 17.7% to NIS 821m., from NIS 998m. Net income from financing operations fell 33.3% to NIS 572m. in 2010, from NIS 857m. in 2009. The provision for doubtful debts amounted to 0.66% of the bank’s credit portfolio, the highest ratio in the banking system.Discount Bank’s income from fees fell 3.3% to NIS 2.55b. in 2010, from NIS 2.63b. in 2009, and the bank’s salary cost rose 0.5% to NIS 3.2b. The bank’s operating and other expenses rose 2.6% to NIS 5.63b. in 2010, from NIS 5.49b. in 2009. The bank’s operating efficiency ratio (costs as a percentage of income) remains its Achilles heel, rising to 75.2% in 2010, from 69.9% in 2009.Discount Bank’s shareholders’ equity rose 12.5% to NIS 11.24b. at the end of 2010, from NIS 10b. a year earlier. However, deposits from the public fell 2.7% to NIS 138b. at the end of 2010, from NIS 141.8b. a year earlier. Credit to the public rose 3.7% to NIS 118.7b., from NIS 114.4b.The debt crisis in Europe prompted Discount Bank to reduce its exposure to Portugal, Ireland, Greece and Spain by 48% to NIS 255m. at the end of 2010, from NIS 491m. at the end of 2009.Spiegel earned NIS 9.3m. (including a bonus and stock-based compensation) in 2010 in his previous job as CEO of Israel Discount Bank of New York. His predecessor, Giora Ofer, earned NIS 1.6m. in 2010, and Discount Bank chairman Yossi Bachar earned NIS 10.7m.