Bank Leumi posts record Q2 2026 profit, beats estimates

Bank Leumi reported a record quarterly net profit of $1.2 billion for Q2 2026, topping analyst estimates as loan growth and reduced credit provisions offset margin pressures.

The Israeli lender’s results, disclosed in an earnings call transcript, marked its highest-ever quarterly earnings, surpassing the median estimate of $1.1 billion among analysts surveyed by Refinitiv. Revenue rose 8% year-over-year to $2.1 billion, driven by a 12% increase in net interest income, while non-interest income declined 3% due to lower trading activity.

Credit costs fell to $85 million from $150 million in the same period last year, reflecting improved asset quality and lower provisions for bad loans. The bank’s net interest margin narrowed to 2.4% from 2.6% in Q2 2025, attributed to competitive pricing in the mortgage and corporate lending segments.

Bank Leumi’s CEO, Hanan Friedman, cited robust demand for credit in Israel’s economy as a key driver, alongside disciplined risk management. The bank’s Tier 1 capital ratio improved to 14.2%, up from 13.8% in the prior quarter, reinforcing its financial resilience.

Analysts at HSBC noted that the results underscored Leumi’s ability to navigate a challenging operating environment, including geopolitical risks and fluctuating interest rates. Shares of Bank Leumi were up 1.5% in pre-market trading following the announcement.

The bank reaffirmed its full-year 2026 guidance for net profit growth of 5-7%, supported by expectations of stable economic conditions in Israel and continued loan expansion.