Israel Discount Bank (TASE: DSCT) today reported sharply lower net profits on lower revenue.
Net profit fell 28% to NIS 165 million for the second quarter from NIS 229 million for the corresponding quarter of 2011. Net return on equity fell to 6.1% on an annual basis for the second quarter from 9.3% for the corresponding quarter. If the NIS 73 million write-down on Discount Bank's 26.45% stake in First International Bank of Israel (TASE: FTIN) is excluded, the second quarter net profit rose 4% to NIS 238 million, and the net return on equity would have been 8.9%.
Discount Bank's capital adequacy ratio rose to 14.1% at the end of June from 13.3% at the end of December, and its core (Tier-1) capital adequacy ratio rose to 8.25% from 8.1%.
Net interest income before the provision for credit losses fell 6% to NIS 1.15 billion for the second quarter from NIS 1.22 billion for the corresponding quarter, and the provision for credit losses fell 37% to NIS 118 million from NIS 188 million. Non-interest income, including commissions, fell 1.1% to NIS 742 million from NIS 750 million.
Net credit to the public rose 2.6% to NIS 119.4 billion at the of June from NIS 116.4 billion at the end of 2011, but deposits from the public fell 1.6% to NIS 150.9 billion from NIS 153.4 billion.
Discount Bank's share price fell 2.1% by midday to NIS 4.08, giving a market cap of NIS 4.3 billion.
Published by Globes [online], Israel business news - www.globes-online.com - on August 30, 2012
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