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Bank Leumi Climbs to One-Month High After First-Quarter Profit

May 22 (Bloomberg) -- Bank Leumi Le-Israel Ltd. climbed to the highest level in more than a month and Bank Hapoalim Ltd. rose for the second day as the country’s two biggest lenders by assets said first-quarter profit increased.

Leumi added 0.1 percent to 13.81 shekels, the highest since April 16, by the close in Tel Aviv after earlier advancing as much as 1.5 percent, while Hapoalim increased 0.5 percent to 20.22 shekels following a 2.4 percent intraday gain. The benchmark TA-25 Index rose 0.1 percent. Bank Hapoalim said net income surged 21 percent to 753 million shekels ($216 million) in the first three months. Bank Leumi’s jumped 10 percent to 625 million shekels.

“The banks have presented strong earnings,” Terence Klingman, head of research at Psagot Investment House Ltd., said by phone from Tel Aviv. “Credit quality is good as companies are paying back their loans helped by very low interest rates, and as the economy continues to expand.”

Israel’s lenders have pared corporate lending and targeted households and small businesses amid tougher capital adequacy directives from the central bank, which has cut interest rates 10 times since 2011 to 0.75 percent. Economic growth is expected to accelerate to 3.5 percent next year from 3.3 percent in 2014, according to the average estimate of 13 economists surveyed by Bloomberg.

To contact the reporter on this story: Shoshanna Solomon in Tel Aviv at ssolomon22@bloomberg.net

To contact the editors responsible for this story: Samuel Potter at spotter33@bloomberg.net Zahra Hankir

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