Bank Leumi Le Israel B M : Fitch Assigns Bank Leumi's Proposed USD Senior Notes 'A(EXP)' Expected Rating

RATING ACTION COMMENTARY

Fitch Assigns Bank Leumi's

Proposed USD Senior Notes

'A(EXP)' Expected Rating

Mon 18 Jul, 2022 - 09:27 ET

Fitch Ratings - London - 18 Jul 2022: Fitch Ratings has assigned Bank Leumi Le-Israel B.M.'s (Leumi; A/Stable) proposed US dollar senior unsecured notes an expected rating of 'A(EXP)'. Leumi's other ratings are unaffected by this rating action.

The assignment of a fnal rating is contingent on the receipt of fnal documents conforming to the information already received.

KEY RATING DRIVERS

Fitch rates the proposed notes at the same level as Leumi's Long-Term Foreign- Currency Issuer Default Rating (IDR), as they constitute the bank's unsecured and unsubordinated obligations.

Leumi's Long-Term IDR is at the same level as its Government Support Rating (GSR), which itself is in line with the domestic systemically important bank (D-SIB) GSR for Israel, and refects Fitch's view of a very high probability that Israel (A+/Stable) would provide support to Leumi, if needed. Fitch believes that Israel has a strong ability to support its banking sector and that the sovereign's propensity to support Leumi is high, particularly given the bank's systemic importance in the country with a market share of about 30% of banking-sector assets.

For further details on Leumi's key rating drivers and sensitivities, seeFitch Affrms Bank Leumi at 'A'; Outlook Stable.

RATING SENSITIVITIES

Factors that could, individually or collectively, lead to negative rating action/downgrade:

The expected rating on the proposed notes will be downgraded if Leumi's Long-Term IDR is downgraded.

Factors that could, individually or collectively, lead to positive rating action/upgrade:

The expected rating on the proposed notes will be upgraded if Leumi's Long-Term IDR is upgraded.

BEST/WORST CASE RATING SCENARIO

International scale credit ratings of Financial Institutions and Covered Bond issuers have a best-case rating upgrade scenario (defned as the 99th percentile of rating transitions, measured in a positive direction) of three notches over a three-year rating horizon; and a worst-case rating downgrade scenario (defned as the 99th percentile of rating transitions, measured in a negative direction) of four notches over three years. The complete span of best- and worst-case scenario credit ratings for all rating categories ranges from 'AAA' to 'D'. Best- and worst-case scenario credit ratings are based on historical performance. For more information about the methodology used to determine sector-specifc best- and worst-case scenario credit ratings, visit https://www.ftchratings.com/site/re/10111579

DATE OF RELEVANT COMMITTEE

04 July 2022

REFERENCES FOR SUBSTANTIALLY MATERIAL SOURCE CITED AS KEY DRIVER OF RATING

The principal sources of information used in the analysis are described in the Applicable Criteria.

PUBLIC RATINGS WITH CREDIT LINKAGE TO OTHER RATINGS

Leumi's IDRs and GSR refect Fitch's expectation of a very high probability of state support from Israel.

ESG CONSIDERATIONS

Unless otherwise disclosed in this section, the highest level of ESG credit relevance is a score of '3'. This means ESG issues are credit-neutral or have only a minimal credit

impact on the entity, either due to their nature or the way in which they are being managed by the entity. For more information on Fitch's ESG Relevance Scores, visit www.ftchratings.com/esg.

RATING ACTIONS

ENTITY / DEBT 	RATING 

Bank Leumi Le-Israel B.M.

senior unsecured	LT	A(EXP)	Expected Rating

VIEW ADDITIONAL RATING DETAILS

FITCH RATINGS ANALYSTS

Christian Scarafa

Managing Director Primary Rating Analyst [phone] [e-mail] Fitch Ratings Ltd

30 North Colonnade, Canary Wharf London E14 5GN

Michael Bojko, CFA

Director

Secondary Rating Analyst [phone] [e-mail]

Christian Kuendig

Managing Director Committee Chairperson [phone] [e-mail]

MEDIA CONTACTS

Peter Fitzpatrick

London

[phone] [e-mail]

Additional information is available on www.ftchratings.com

PARTICIPATION STATUS

The rated entity (and/or its agents) or, in the case of structured fnance, one or more of the transaction parties participated in the rating process except that the following issuer(s), if any, did not participate in the rating process, or provide additional information, beyond the issuer's available public disclosure.

APPLICABLE CRITERIA

Bank Rating Criteria (pub. 12 Nov 2021) (including rating assumption sensitivity)

ADDITIONAL DISCLOSURES

Dodd-Frank Rating Information Disclosure Form

Solicitation Status

Endorsement Policy

ENDORSEMENT STATUS

Bank Leumi Le-Israel B.M.

UK Issued, EU Endorsed

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