JERUSALEM, May 22 (Reuters) - Israel Discount Bank reported a 37 percent drop in quarterly profit, missing estimates as it was hit by a one-time provision and lower interest income.
Discount, Israel’s third-largest lender, said on Thursday it earned 165 million shekels ($47 million) in the first quarter, compared with 263 million a year earlier and expectations of 185 million shekels in a Reuters poll of analysts.
Excluding a provision for the decline in the value of its holdings in the First International Bank of Israel (FIBI) , Discount posted profit of 191 million shekels in the January-March period.
Net interest income slipped 2.5 percent to 1.02 billion shekels while its credit loss expense dropped 48 percent to 75 million shekels to reflect an improvement in its credit quality.
Discount’s core Tier I capital to risk-weighted assets stood at 9.1 percent in Basel III terms and the bank said it intended to achieve its target of 9.3-9.4 percent by the end of the year.
“Meeting this year-end target, together with those already achieved, will allow us to return to risk weighted assets growth in 2015,” said Lilach Asher Topilsky, Discount’s chief executive.
She added that the bank’s main challenge was to restrain its costs and improve its cost-income ratio, which will be a focus of a new strategic plan to be presented at the end of August.
$1 = 3.4928 Israeli Shekels Reporting by Steven Scheer