In 2021, Bank Hapoalim earned NIS 4.91 billion, a profit that reflects a return on equity of 11.8%, which stands at NIS 42.7 billion, compared with a profit of NIS 2 billion in 2020. This is the highest profit in the bank’s history. Despite this, Bank Leumi, which will publish its reports today, will present a higher net profit.
Bank Hapoalim is managed by Dov Kotler, and Reuven Krupik serves as chairman of the board. Despite the extraordinary profit, the CEO will receive NIS 3.3 million, a compensation package 18% lower than that received by Moshe Larry, his counterpart at Mizrahi Tefahot.
According to the data, the jump in the bank’s profit is mainly due to the cancellation of provisions of NIS 1.94 billion from credit losses and beyond the recording of income of NIS 1.2 billion due to an improvement in the state of the economy and an increase in activity. Revenues increased by 9.2% to NIS 14.4 billion.
The activity through Poalim Equity (the bank’s real investment arm) generated a profit of NIS 268 million, compared with a profit of NIS 45 million in 2020. The investment portfolio amounted to NIS 3.5 billion at the end of the year, and the bank’s activity in this area is directly attributable to Kotler. Credit to the public jumped by 16.8%, amounted to NIS 352.6 billion, and places Hapoalim as the economy’s main growth engine in the field of business and commercial credit, as well as in the field of credit for households and small businesses.
Due to the high demand in the housing market, the Bank increased its credit portfolio in the field by NIS 15.9 billion. The volume of credit in this area amounted to NIS 114.6 billion at the end of the year.
The bank set aside NIS 50 million in its balance sheets for a class action lawsuit filed against it in the US tax evasion case. However, the balance sheet did not record an income of $ 140 million that would be received as compensation from the insurance companies.
In view of the capital restrictions and the Bank’s reaching the credit ceiling in the real estate and construction sector, the Board of Directors avoided a dividend dispute of NIS 400 million in the fourth quarter, although it could. – Financial expenditure to the bank estimated at half a billion shekels.
CEO Kotler said: “2021 will be remembered primarily as a year of return to routine from the Corona crisis. The recovery trend, which is reflected in high growth rates along with low unemployment rates, expresses more than anything else the return of the economy to a routine of life alongside the crisis that has not yet completely ended. “
He added: “Despite the waves of illness, we have shown accelerated growth in our credit portfolio in all areas of activity in the past year, and we have responded to our customers’ high credit demand, with an emphasis on business credit and housing credit. We have also continued to develop innovative and advanced digital products.”