March 26, 2018 / 5:50 AM / a year ago

Israel's Bank Hapoalim Q4 profit up more than expected

TEL AVIV, March 26 (Reuters) - Bank Hapoalim, Israel’s largest lender, reported a higher than expected quarterly net profit despite a provision for a U.S. tax investigation, as credit loss expenses fell sharply and interest income rose.

Hapoalim said on Monday it earned 612 million shekels ($175.6 million) in the fourth quarter, up from 138 million shekels a year earlier and compared with 579 million shekels forecast in a Reuters poll of analysts.

The bank said it provisioned $79.5 million in the quarter to cover a possible future settlement in a U.S. tax evasion investigation, bringing the amount provisioned so far to $348 million. The provision was slightly higher than the $75 million it had said last month it would set aside.

Net interest income rose to 2.23 billion shekels in the quarter from 2.03 billion a year earlier while credit loss expenses plunged to 24 million shekels from 469 million.

Its core Tier 1 capital ratio to risk-weighted assets, a key measure of financial strength, rose to 11.26 percent from 11.01 percent at the end of 2016.

The bank declared a quarterly dividend of 245 million shekels, or 18.345, shekels a share for a payout of 40 percent of net profit. ($1 = 3.4850 shekels) (Reporting by Tova Cohen and Steven Scheer)

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