JERUSALEM, May 21 (Reuters) - Bank Hapoalim (POLI.TA), one of Israel’s two largest banks, said on Wednesday it sold its entire U.S. mortgage backed securities portfolio to U.S. investment fund Pimco for $2.55 billion.
Hapoalim said in a statement the value of its MBS portfolio was $3.42 billion.
The deal was made through Deutsche Bank in a non-financed cash transation.
As a result of the sale, Hapoalim said it will record a loss of $870 million, of which $710 million had previously been reported as a decline in value last month.
The bank said it will post a loss in the first quarter but that it expects to record a profit of at least 1 billion shekels for all of 2008.
“The decision to sell the entire portfoio dispels the uncertainty regarding the MBS portfolio in the United States,” Hapoalim said.
($1 = 3.38 shekels)
Reporting by Steven Scheer; editing by Rory Channing