JERUSALEM, Aug 16 (Reuters) - Israel Discount Bank
reported a higher-than-expected gain in quarterly profit as the
country's economy continued to recover from the coronavirus
crisis, allowing it to gradually unwind large loan default
provisions made last year.
Israel's fourth-largest bank by assets said on Monday it
earned 860 million shekels ($267.5 million) in the second
quarter, compared with 174 million a year earlier and above a
forecast of 651 million shekels in a Reuters poll of analysts.
Discount posted income for credit losses of 410 million
shekels, up from 147 million shekels in the first quarter, when
a successful vaccination campaign allowed Israel to begin to
emerge from lockdowns, and versus second quarter 2020 credit
loss expenses of 532 million shekels.
Net interest income grew 15.2% to 1.69 billion shekels from
a year earlier.
Discount said it planned to resume a 20% dividend payment on
ongoing profits when the country's banking regulator lifts
restrictions on payouts, presuming no further limitations will
The ban on dividends, which came at the outset of the
pandemic, is set to expire at the end of September, although it
could be extended.
On the back of improved capital ratios, the Bank of Israel
has allowed one-time dividends of up to 30% of 2020 net profit.
Larger rivals Hapoalim and Leumi have
announced plans to pay a special dividend but Discount has so
far opted against one.
Discount's gross credit balance surpassed 200 billion
shekels for the first time, driven mainly by its core banking
business and with loan book growth of 8.3% over the past year.
Its Tier 1 capital ratio rose to 10.28% at the end of June
from 10.08% at the end of the second quarter of 2020.
($1 = 3.2149 shekels)
(Reporting by Steven Scheer; Editing by Kirsten Donovan)