#Israel's Bank Leumi third quarter profit dips, loan loss provisions triple | Reuters

Israel's Bank Leumi third quarter profit dips, loan loss provisions triple | Reuters

Israel's Bank Leumi LUMI.TA reported a smaller-than-expected decline in third-quarter net profit, as higher net interest income and lower expenses offset a tripling of its loan loss provision due the coronavirus pandemic.

Leumi, the first of Israel’s banks to publish quarterly earnings, said on Tuesday it earned 750 million shekels ($223 million) in the July-September period, compared with 765 million a year earlier and 605 million shekels forecast in a Reuters poll of analysts.

Net interest income rose to 2.22 billion shekels from 2.09 billion a year earlier while loan loss expenses surged to 547 million shekels from 181 million a year earlier. Operating and other expenses fell nearly 10% in the quarter.

Leumi said the jump in its loan loss provision stemmed from “from the effect of the changes in the macroeconomic environment, on the back of a second substantial surge in Israel (in COVID infections) and the subsequent lockdown, which further deepened the effect of the economic crisis and the uncertainty regarding its effect of the Israeli and global economy.”