Leumi Bank Achieves Highest Profits in the Israeli Banking System During the First Quarter of 2026

SadaNews Economy Translation - The Hebrew economic newspaper Calcalist reported on Tuesday that Leumi Bank achieved the highest profits in the Israeli banking system during the first quarter of 2026.

According to the site, as translated by the SadaNews Economy section, the bank concluded the first quarter of the year with a net profit of 2.34 billion shekels, compared to 2.40 billion in the same period of the previous year, reflecting a decrease of 2.5%.

According to the site, this profit translated to a return on equity of 13.5%, compared to a return on equity of 15.4% in the corresponding quarter of the previous year.

The net interest income declined by 2.7% to reach 3.90 billion shekels compared to interest income of 4.01 billion shekels in the corresponding quarter.

In contrast, non-interest income increased by 188 million shekels, bringing the total to 1.56 billion shekels.

This increase is primarily attributed to a rise in commission income by more than 100 million shekels, reaching a total of 1.13 billion shekels, according to the Hebrew site, as translated by the SadaNews Economy section.

It pointed out that excluding the special tax imposed by the Israeli Ministry of Finance on banks, the profit amounted to 2.6 billion Israeli shekels, an increase of 8% compared to the same quarter of the previous year, and the return on capital, excluding tax, would have reached 15.1%.

The bank maintained its net profits largely unchanged compared to the first quarter of 2025, thanks to an 18.4% growth in the credit portfolio during that period, the site mentioned.

The growth was primarily driven by corporate loans, which surged by 27.5%, while the efficiency ratio decreased to 29.1% from 32.1% a year earlier.

The credit portfolio granted to the Israeli public reached 548 billion shekels, compared to 463 billion shekels in the corresponding quarter, while public deposits increased by nearly 100 billion shekels to reach 695 billion shekels.

Residential credit, i.e., mortgages, grew to 160 billion shekels, compared to 148.3 billion shekels in the corresponding period, marking an increase of about 8%.

Israeli banks benefit from an increase in their income when interest rates are high in the economy, leading to higher costs of collecting credit.

The base interest rate in Israel today is 5.5% after two rounds of rate cuts by the Governor of the Bank of Israel over the last year, which is the reason for the decline in net interest income.

Credit loss expenses, which are the amounts that banks write off after defaulted loans, along with general expenses among credit loss guarantees, rose in the first quarter to 166 million shekels, compared to 55 million shekels in the corresponding quarter.