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FIBI FIRST INTERNATIONAL BANK OF ISRAEL O verview 31.12.13.

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Presentation on theme: "FIBI FIRST INTERNATIONAL BANK OF ISRAEL O verview 31.12.13."— Presentation transcript:

1 FIBI FIRST INTERNATIONAL BANK OF ISRAEL O verview

2 FIBI FIRST INTERNATIONAL BANK OF ISRAEL 2 Net Profit and ROE NIS Millions * Assuming core capital ratio of (9.33%), (the Israeli banking industry average core capital ratio as of ), the ROE is 9.18% in FY2013 and 9.42% in Q ** The Net profits include amortization of 51 NIS Millions, inflicting a 0.8% reduction in the years ROE. Average capital Core capital adequacy ratio 6, % 6, % 6, %+ 9.8%+ ROE 141 NIS Millions 6, % 9.65% **

3 FIBI FIRST INTERNATIONAL BANK OF ISRAEL 3 Statements of income NIS Millions Change in % Gross change (2.8%)(63)2,2502,187Interest income, net (27.6%)(37)13497Expenses from credit losses (0.14% provision rate) (*) (1.2%)(26)2,1162,090Net interest income after expenses from credit losses 8.7%1351,5471,682Total non-interest income 33.3% Of which: non-interest financing 4.1%561,3621,418Commissions 82.9%293564Other Income 3.0%1093,6633,772Total income (after expenses from credit losses) 1.2%342,7912,825Total operating and other expenses 8.6% Profit before taxes 19.1% Provision for taxes on profit (41.2%)(21)5130 The banks share in profit of equity-basis investees, after taxes (1.2%)(7)577570Net profit 9.5%8.6%ROE 9.65%10.04%Core capital ratio (end of period) (0.96%) 2.35%1.39%Bank of Israel average interest rate * Excluding a one time regulatory provision for mortgages - the provision rate is 0.11% (13)

4 FIBI FIRST INTERNATIONAL BANK OF ISRAEL 4 Excluding fees from capital markets activity we maintain a 11 NIS Millions growth An increase in customers activity resulted in a 4.1% increase in Operating commissions income ( NIS Millions) % An increase of 8.6% in capital markets fees (linked to an increase in customers activity)

5 FIBI FIRST INTERNATIONAL BANK OF ISRAEL 5 Total Income to Total Weighted Risk Assets Ratio

6 FIBI FIRST INTERNATIONAL BANK OF ISRAEL 6 An increase of 1.2% in Operating & Other Expenses (NIS Millions) 1-12/ / % * * Including amortization of 51 NIS Millions 6 The operating expenses increase resulted mainly by the VAT increase on salaries and other expenses 3.3% 1.0% (4.7%)

7 FIBI FIRST INTERNATIONAL BANK OF ISRAEL Improved Operational Efficiency Ratio (Consolidated) Total Operating Expenses to Total Income % Total Income Total Operating Expenses % % Total Operating Expenses / Total Income (Before Expenses from credit losses) Total Operating Expenses / Total Income (After Expenses from credit losses) % %

8 FIBI FIRST INTERNATIONAL BANK OF ISRAEL Capital Adequacy Basel II Basel II Core Capital Adequacy Basel II Basel II Estimate Core Capital Adequacy Basel III Deposits to Credit Ratio Liquid Assets to Deposits Ratio 14.94%14.96% 9.65%10.04% 10.11% 124.3%129.7% 35.4%38.4% Capital Notes 5.7 Capital Available for Investment 5.0 Public Deposits 89.1 Gov. & Bank Bonds 2.0 Credit to the Public 68.7 Sovereigns Bonds 1.2 State of Israel Bonds 6.9 Bank of Israel Deposits 23.1 Deposits in Banks 3.0 Banks Bonds 1.5 NIS, Corporate Bonds 0.8 Structures, Hedge funds &Stocks 0.6 Market risk in VAR(0.04) * illustration – not to scale 8 FIBI Strategic Assets & Liabilities composite* (NIS Billions) FIBI Strategic Assets & Liabilities Structure NIS Billions

9 FIBI FIRST INTERNATIONAL BANK OF ISRAEL 9 5.1% 4.1% An increase of 5% in balance sheet NIS Billions

10 FIBI FIRST INTERNATIONAL BANK OF ISRAEL 10 5% 13% Shareholders` equity to total balance ratio 6.2% 5.7% The presented growth in equity is after dividend distribution of 200 Nis Millions in june Additional dividend of 100 Nis Millions was distributed in Q1/13. Continued Growth in Equity Shareholders` equity to total balance ratio is stable despite of the substantial growth in the total balance

11 FIBI FIRST INTERNATIONAL BANK OF ISRAEL 11 Statement Of Changes in Equity NIS Millions 6,563 Balance At 31/12/12 Total Shareholders Equity Net Earnings for the year (200)Dividend Paid 2013 (41) Other Comprehensive loss and others 6,892Balance At 31/12/13 Total Shareholders Equity 5% Increase in Equity 8% Increase in Equity Excluding Dividend Paid

12 FIBI FIRST INTERNATIONAL BANK OF ISRAEL 12 Credit to the Public by segments NIS Millions Change in % Average Balance Compared to 2012 Gross Change in Average Balance Compared to 2012 Gross Change Compared to %9121,05515,33516,390 Private + Retail (Households) 13.4%2,0611,16716,26017,427Mortgage 9.8%2,9732,22231,59533,817Total private clients (2.2%)(290)(331)13,27412,943 Commercial * + Small Business (5.9%)(1,344)(1,064)23,01021,946Corporate 2.0%1, ,87967,706 Total Credit to the Public * The decrease is due to the closure proceedings of FIBI London. () – (23%) (19%) (34%) (24%)

13 FIBI FIRST INTERNATIONAL BANK OF ISRAEL 13 Provisions for Credit losses *In Q1 the Bank has implemented a one time regulatory provision on mortgage portfolio in order to set the expenses for credit losses ratio to 0.35% of the mortgage credit balance (24 NIS million). Excluding this one time provision, the banks ratio is about 0.08% and the groups ratio is 0.11% in ** In Q4 Expenses for Credit Losses to Credit to the Public Ratio is 0.19% Expenses for Credit Losses to Credit to the Public Ratio **

14 FIBI FIRST INTERNATIONAL BANK OF ISRAEL 14 An increase of Total Client Assets NIS Millions Change in % Compared to Gross Change Compared to %4,75784,36589,122Total Deposits 16.8%32,420192,678225,098 Securities clients portfolio 13.4%37,177277,043314,220Total Client Assets () – (13%) (23%) (32%) (30%) Breakdown of deposits portfolio

15 FIBI FIRST INTERNATIONAL BANK OF ISRAEL 13.42% * 14.30% 14.57% 13.42% * * * ** * -1.3 *** Minimal Regulatory Requirement For HAPOALIM&LEUMI Minimal Regulatory requirement Gap The highest Core Capital Ratio compare to other 4 leading banks % 8.73% 8.80% 9.20%9.15% Basel II ** Basel III Basel II Basel lII % % %

16 FIBI FIRST INTERNATIONAL BANK OF ISRAEL 16 *In annual terms. Financial ratios are as of ** In Q1/14 additional dividend of 100 Nis Millions was distributed, hence dividend yield as of 30/6/13 is 5.3%. 16 Core capital ratio and principal financial ratios FIBI is demonstrating relative strength in main financial ratios Dividend yield 2013 Expenses for credit losses to credit to the public* Provision for credit losses, to impaired credit (excluding mortgage) Deposits from the public to credit to the public Ratio of core capital to risk assets Shareholders` equity to total balance ratio 3.53%**0.14%73.9%129.7%10.04%6.20% 1.17%0.34%48.7%109.9%9.37%7.64% -0.11%59.3%118.7%9.43%7.06% -0.50%56.8%128.5%9.30%6.10% 0.87%0.21%59.7%101.9%9.01%5.49% 0.27%57.0%114.2%9.33%6.84% Other 4 leading Banks Average

17 FIBI FIRST INTERNATIONAL BANK OF ISRAEL 17 Subsidiaries net profit Core Capital Ratio ROE Net profit 2013 Nis Millions Specialization 9.6% 9.65% Retail customers Defense forces personnel Commercial/ Corporate Factoring 15.5% 9.5% 42.0 Capital Markets, Trust & Custody services Private& affluent banking 15.1% 9.6% 42.1 Retail customers Teachers sector Israeli-Arab segment 12.4% 11.1% 38.5 Ultra orthodox segment

18 FIBI FIRST INTERNATIONAL BANK OF ISRAEL Highlights n Net profit of 570 NIS Million in 2013 similarly to 2012, despite of substantially decrease in interest rate and regulatory reforms inflicting reductions in commissions n The Profit before taxes increased by 8.6%. n Net profit of 570 NIS Million in 2013 similarly to 2012, despite of substantially decrease in interest rate and regulatory reforms inflicting reductions in commissions n The Profit before taxes increased by 8.6%. Stable net profit The Highest dividend yield in the Israeli banking system The highest Core capital ratio n In 2013 the bank distributed a dividend of 200 NIS Million, additional dividend of 100 Nis Millions was distributed in Q1/2013. n The highest Core capital ratio in the Israeli banking system (also according to Basel III regulation ) – 10.04%.

19 FIBI FIRST INTERNATIONAL BANK OF ISRAEL Highlights n Total income increased by 3% while Operating & Other Expenses increased by only 1.2% (despite of an increase of salaries). n Most of the increase in the operating expenses is related to the VAT increase n Total income increased by 3% while Operating & Other Expenses increased by only 1.2% (despite of an increase of salaries). n Most of the increase in the operating expenses is related to the VAT increase Improve in Operational Efficiency Ratio Maintaining quality and spreading of credit portfolio Continued growth in retail core activity n Decrease in credit losses Provisions % compared to 0.2% in n A yearly increase of 5% in total balance over the last two years n 2.0% increase in the average credit balance, and 9.8% in private clients credit balance n Total client assets (deposits & securities) increased by about 23 Nis Billion (13.4%), including an increase of 8.6% in capital markets fees n An increase of 4.1% in commissions due to growth in customers activity particularly in capital markets n A yearly increase of 5% in total balance over the last two years n 2.0% increase in the average credit balance, and 9.8% in private clients credit balance n Total client assets (deposits & securities) increased by about 23 Nis Billion (13.4%), including an increase of 8.6% in capital markets fees n An increase of 4.1% in commissions due to growth in customers activity particularly in capital markets

20 FIBI FIRST INTERNATIONAL BANK OF ISRAEL FIBIs Main Strategic Objectives for the next years nContinued development of online and mobile banking nMaintain market position in private banking & investment consultancy nCustomer base growth via subsidiaries and organic growth Retail Customers nContinued efforts to Improve income per employee and per account nMaximizing groups synergies and economies of scale nContinued on going process to utilize the groups real estate including reduction of HQ areas & effective planning of branches format Operational improvement nMaintaining quality and diversified credit portfolio nIncreasing the Bank`s market share in the commercial sector Commercial & Corporate Banking nMaintain market leader position and professional reputation in capital and money markets Capital and money market Services Strategy 20


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