JERUSALEM, Nov 27 (Reuters) - Israel Discount Bank reported a decline in quarterly net profit, weighed down by a drop in inflation, but said it would double its dividend payout.
Israel’s fourth-largest bank by assets said on Wednesday it earned 427 million shekels ($123 million) in the third quarter, compared with 439 million a year earlier and below a forecast of 452 million in a Reuters poll of analysts.
Discount said it would pay a dividend of 64 million shekels as part of its policy of paying 15% of net profit. But it said it would start paying a dividend of 30% of profit due to its “strong profitability and solid capital position”.
Discount, which had raised its payout from 10% in late 2018, lags behind other Israeli banks that pay at least 40%, while also buying back their own shares.
Net interest income before credit expenses dipped 1% to 1.4 billion shekels amid a fall in inflation, while credit loss expenses rose 24% to 152 million shekels.
The bank’s Tier 1 capital adequacy ratio, which measures equity capital as a percentage of total risk-weighted assets, rose to 10.41% in the first nine months of the year from 10.02% a year earlier.
$1 = 3.4684 shekels Reporting by Steven Scheer; Editing by Tova Cohen