JERUSALEM (Reuters) - The board of Bank Hapoalim (POLI.TA), Israel’s largest lender, has instructed management to explore options for selling off its credit card unit Isracard, the bank said on Thursday.
The move comes in the wake of new regulation meant to increase competition in the sector by prohibiting the country’s top two banks from owning credit card companies. Number two Bank Leumi (LUMI.TA) will have to do the same.
Bank Hapoalim said in a statement it is looking into three options - selling shares of Isracard to the public, selling it to an investor or group of investors, or distributing its shares as a dividend to Hapoalim stakeholders. Hapoalim has three years to sell the unit - or four years if it sells Isracard to the public.
The bank is starting to prepare a prospectus for a possible share offering while also holding talks with leading investment banks about finding a buyer.
Isracard is Israel’s largest credit card company, with 4.8 million cardholders, annual revenue of more than 2 billion shekels ($549 million) and net profit of about 300 million shekels.
($1 = 3.6460 shekels)
Reporting by Ari Rabinovitch,; Editing by Tova Cohen