Bank Leumi (TASE: LUMI) has laid off 1,000 employees over the past three years and will shed a similar number by 2017, it said last night in its fourth quarter and full year 2014 financial report.
The bank ended 2014 with a net profit of NIS 1.5 billion, down 24% from NIS 1.98 billion the previous year. In the fourth quarter, Leumi lost NIS 111 million, mainly because of fines it was forced to pay to the US authorities over tax evasion allegations. Income from interest fell 0.4% in the fourth quarter to NIS 1.8 billion but rose 0.1% in 2014 overall to NIS 7.36 billion.
Without the fine for allegedly helping US clients evade US taxes, Bank Leumi's net return on equity was 9.3% in 2014 and net profit would have been NIS 2.5 billion.
Expenses for credit losses rose to NIS 472 million, up from NIS 204 million in 2013, representing 0.19% of credit to the public.
The salary cost of president and CEO Rakefet Russak Aminoach was NIS 4.1 million in 2014, and the salary cost of chairman David Brodet was NIS 3.1 million.
Russak Aminoach said, "The past year was a testing time for the Group, and I am happy to say we successfully overcame it. Despite the many and difficult challenges we encountered, our core indices reflect exceptional results. It is important to note that after excluding the provision we made in favor of the agreement with the US authorities, the Group’s return on equity is 9.3%."
"The settlement we reached allows us to open a new chapter, to look forward and concentrate our efforts on accelerating our business activity. Over the last two years, we have adapted ourselves to the many changes taking place in the world of private banking. Today, we are working in accordance with the new regulatory requirements, including strict implementation of a white-money policy, as practiced currently in banking in the Western world. Within this framework, we closed several overseas representative offices and branches, sold our Swiss banking operations and made organizational changes in our private banking activity."
She added," At the same time, at the beginning of the year, a new collective labor agreement was signed between the Bank's management and the Workers' Committee, for a four-year period. We have proved once again that when both sides hold a transparent and open dialogue, we can achieve the best results - for our employees, our customers and our shareholders."
Published by Globes [online], Israel business news - www.globes-online.com - on April 1, 2015
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