Israeli bank index records 20 percent drop

shekel shekels
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TEL AVIV – The Israeli bank index has dropped by 20 percent since the beginning of the aggression on Gaza, with reports suggesting that banks are heading for a decline in the fourth quarter of this year, after recording record profits of 14 billion shekels (approximately 3.5 billion dollars) in the first half of 2023.اضافة اعلان

Al-Mamlaka reported that this decline comes due to the retreat of foreign investment due to the expected increase in risks. The index includes the largest five banks in Israel: Leumi Bank, Hapoalim, Discount Bank, Mizrahi Tefahot, and Discount.

The Bank of Israel decided, in a meeting of the Monetary Policy Committee, to keep the key interest rate unchanged at 4.75 percent. It also lowered its expectations for the country's economic performance this year to 2.3 percent, after it had previously anticipated a growth rate of 3 percent in July last year.

The bank estimated that Israel's losses resulting from the government's war on Gaza range from 0.5 to 1 percent of the country's GDP. However, the Israeli investment bank "Meitav" painted a much bleaker picture, expecting the cost of the war to exceed twice the cost of the Second Lebanon War in 2006, at about 70 billion shekels (17.2 billion dollars), representing approximately 3.5 percent of the country's GDP.

The credit rating agency Standard & Poor's earlier lowered its outlook for Israel from stable to negative due to its war on Gaza. The agency also expected the Israeli economy to contract by 5% in the fourth quarter of 2023 compared to the third quarter,

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