Full Breakdown
Bank Hapoalim Reports Record Profit Amid Controversy
3/6/2026, 6:57:53 AM
Financial Performance Overview
Bank Hapoalim, Israel's largest bank by assets, announced a record net profit of NIS 9.8 billion (approximately $3.14 billion) for the year 2025, marking a 30% increase from NIS 7.6 billion in 2024. This growth is attributed to stronger core activities and several one-time financial items, including a pre-tax profit of NIS 300 million from the liquidation of its subsidiary, Bank Hapoalim Switzerland. The bank's return on equity rose to 15.9%, up from 13.8% in the previous year.
In the fourth quarter of 2025, Bank Hapoalim reported a net profit of NIS 2.08 billion, a 64% increase compared to the same period in 2024. The bank's board approved a dividend distribution of NIS 1.24 billion, with NIS 991 million to be paid in cash and NIS 248 million allocated for a share buyback program. The total profit distribution for 2025 amounted to NIS 4.9 billion.
Growth in Lending and Financial Metrics
The bank's net credit to the public increased by 13.4% year-on-year, reaching NIS 502.9 billion. This growth was driven primarily by lending to large businesses, which surged by 26% to NIS 176 billion. The mortgage portfolio also grew by 6.8% to NIS 149 billion, while lending to households increased similarly to NIS 42 billion. Despite this growth, credit loss expenses surged by 87% to NIS 1.3 billion, largely due to higher provisions linked to the expansion of the loan portfolio.
Improvements in credit quality were reported, with the non-performing loan ratio decreasing to 0.48% and the charge-off rate declining to 0.08%. The bank's efficiency ratio improved significantly, falling to 34.2% from 41% in 2024.
Criticism and Opposition
Despite the positive financial results, Bank Hapoalim faced criticism from its workers' union, which expressed discontent over the bank's management decisions amid ongoing labor disputes. The union stated, “It is inconceivable that the bank’s management publishes enormous profits... and at the same time... chooses to directly harm employees’ pockets.” This statement highlights the tension between the bank's financial success and employee compensation concerns.
Official Statements & Responses
Bank Hapoalim's CEO, Yadin Antebi, attributed the profit increase to higher total income and improved operational efficiency, noting that the bank's financial performance reflects the hard work of its employees. The bank's management emphasized that the results were achieved in a challenging economic environment, with moderating inflation and lower interest rates expected to impact future profitability.
What's Next
Looking ahead, Bank Hapoalim has set ambitious targets for 2026-2027, forecasting an annual net profit of NIS 9 billion to NIS 10 billion, a return on equity of 14% to 15%, and annual loan growth of 8% to 9%. However, the bank acknowledges potential challenges in maintaining profitability in a changing economic landscape.
