Summary of financial results for the period 1-9/2016 Harel Insurance - PowerPoint PPT Presentation

Summary of financial results for the period 1-9/2016 Harel Insurance Investments & Financial Services Ltd. November 2016

Disclaimer This document has been prepared by Harel Insurance Investments and Financial Services Ltd. (hereinafter: the Company) solely for the purpose of presenting the Company's business. The information contained in this document has not been independently verified. No representation or warranty has been expressed or implied and there should be no reliance on the fairness, accuracy, completeness or correctness of the information or opinions contained herein. Neither the Company nor any of its employees or representatives shall bear any liability whatsoever (whether due to negligence or otherwise) for any loss howsoever resulting from using this document or its content or otherwise arising in connection with this document. This document is provided solely for your information and may not be reproduced, distributed or forwarded, directly or indirectly, in any form to any other person, nor published, wholly or partially, for any purpose. This document contains information that under Israel’s Securities Law, 5728-1968, may be deemed or considered Inside Information of Harel Insurance Investments & Financial Services Ltd. Any use of Inside Information is illegal. Distribution of this document may be restricted by law and persons receiving this document should be aware of such restrictions and observe them accordingly. In receiving this report you agree to be bound by the foregoing instructions. Statements concerning the Company’s future business, financial position and results of operations are subject to risks and uncertainties, which may cause actual results to differ materially from those forecast. Such forward-looking information includes, but is not limited to, product demand, pricing, changing economic conditions, product and technology development risks, the effect of the Company's accounting policies as well as certain other risk factors which are specified from time to time in the Company's reports to the Securities Authority. 2 Harel Insurance Investments & Financial Services Ltd

Comprehensive income after tax and ROE in NIS million (in annual terms) Comprehensive income after tax 686 533 381 * 205 150 163 (130) 2013 2014 2015 1 - 9/2015 1 - 9/2016 7 - 9/2015 7 - 9/2016 Return on Equity 16% 13% 11% 8% 6% 4% (11%) 2013 2014 2015 1 - 9/2015 1 - 9/2016 7 - 9/2015 7 - 9/2016 * Including a revision of the outstanding claims in the liabilities sectors in respect of the Winograd recommendations, in the amount of NIS 112 million after tax for the period 1-9/2016. Including an increase in the insurance liabilities for the effect of LAT and interest in the amount of NIS 96 million after tax for the period 1-9/2016. 3 Harel Insurance Investments & Financial Services Ltd

Earned premiums and benefit contributions, gross (NIS million) % לודיג 2013 2014 2015 increase % 1-9/2015 1-9/2016 increase % 7-9/2015 7-9/2016 Life assurance * 1,048 992 6%3,086 3,186 (3%)4,243 3,797 12%3,810 Health insurance 3,192 11% 3,571 3,964 5% 2,956 3,104 5% 1,030 1,085 Non-life insurance 3,103 (4%) 3,198 3,066 (4%) 2,282 2,189 (3%) 766 741 Insurance companies overseas 177 20% 215 258 9% 194 211 25% 65 81 Total 10,282 7% 10,781 11,531 (0%) 8,618 8,590 4% 2,853 2,955 Pension contributions 4,121 13% 4,875 5,516 15% 3,992 4,592 10% 1,434 1,581 Provident contributions 1,593 10% 1,754 1,931 29% 1,314 1,692 32% 447 589 Total 15,996 9% 17,410 18,978 7% 13,924 14,874 8% 4,734 5,125 1,931 1,754 1,593 5,516 1,692 4,875 1,314 4,121 258 4,592 215 3,992 177 3,066 3,198 211 194 3,103 2,282 2,189 3,964 3,571 3,192 589 2,956 3,104 447 1,581 1,434 65 81 741 766 4,243 3,810 3,797 3,186 1,085 3,086 1,030 1,048 992 - - - - * Including a single premium in the amount of NIS 230 million. 4 Harel Insurance Investments & Financial Services Ltd

Assets under management (AUM) and nostro assets (NIS billion) 200 181.9 * Portfolio management 178.4 179.3 180 8.5 8.9 8.7 ETNs 161 13.2 15.3 14.1 160 8.5 19.3 Mutual funds 12.1 24.7 140 33.7 Provident funds 119.1 31.0 32.9 120 2.9 29.6 6.0 101.5 100.3 29.0 Pension funds 100 19.5 2.3 3.6 3.1 3.6 83.2 27.2 42.2 17.0 20.8 Insurance 1.8 37.1 80 1.2 24.2 31.4 15 25.4 22.2 23.4 60 19.4 21.5 13.8 11.7 40 8.9 67.7 64.2 61.0 54.9 47.1 20 41.3 39 34.8 0 . . * Including the offsetting of inter-company balances. 5 Harel Insurance Investments & Financial Services Ltd

Comprehensive income before tax from operating segments (NIS million) 2013 2014 2015 1-9/2015 1-9/2016 7-9/2015 7-9/2016 * Long-term savings 432 164 298 117 (20) (106) 89 Health 202 140 2 (38) 128 (37) 33 ** Non-life insurance 219 287 124 56 35 (40) 38 Insurance companies overseas (12) 5 (7) (6) 7 (4) 2 Finance 27 64 8 36 35 (7) 17 Other capital 221 160 150 54 76 (27) 59 Total 1,089 819 574 220 260 (222) 238 1,089 1,150 221 950 819 27 750 219 160 574 64 550 5 202 150 287 8 260 350 124 220 238 2 76 54 140 432 59 36 35 17 150 35 7 2 298 38 56 33 164 117 128 89 -12 -7 -6 -50 -20 -106 -38 -37 -40 -4 -7 -27 -250 (222) - - - - * Including an increase in the insurance liabilities for the effect of LAT and interest in the amount of NIS 149 million before tax for the period 1-9/2016. ** Including a revision of the outstanding claims in the liabilities sectors in respect of the Winograd recommendations, in the amount of NIS 175 million before tax for the period 1-9/2016. 6 Harel Insurance Investments & Financial Services Ltd

Non-life insurance segment – comprehensive income before tax (NIS million) 2013 2014 2015 1-9/2015 1-9/2016 7-9/2015 7-9/2016 Compulsory motor 112 129 88 43 (27) (22) 2 Motor property 24 34 (12) (4) 8 (8) 2 Property and other branches 25 47 59 44 53 14 21 Liabilities and other branches 4 13 (65) (63) (43) (24) (1) Mortgage insurance 54 64 53 36 45 1 15 Total * 219 287 124 56 35 (40) 38 400 287 300 219 64 124 13 200 54 47 53 4 56 25 34 35 24 59 100 36 45 129 44 38 112 88 53 15 43 1 21 -4 14 0 8 2 2 -1 -12 -22 -27 -8 -63 -24 -65 -43 (40) -100 - - - - * Including a revision of the outstanding claims in the liabilities sectors in respect of the Winograd recommendations, in the amount of NIS 175 million before tax, for the period 1-9/2016. 7 Harel Insurance Investments & Financial Services Ltd

Life assurance and long-term savings segment - comprehensive income before tax (NIS million) 7-9/2015 7-9/2016 2013 2014 2015 1-9/2015 1-9/2016 * Life assurance 31 (72) (130) 66 346 40 185 Pension 57 69 69 53 39 15 14 Provident 29 55 44 33 13 8 9 Total 432 164 298 117 (20) (106) 89 432 500 29 400 57 298 300 44 164 69 200 117 346 89 55 100 33 185 9 69 14 13 53 66 40 31 39 8 0 15 -72 -130 -100 (20) (106) -200 - - - - * Including an increase in the insurance liabilities for the effect of LAT and interest in the amount of NIS 149 million before tax for the period 1-9/2016. 8 Harel Insurance Investments & Financial Services Ltd

Financial services segment (NIS million) 2013 2014 2015 1-9/2015 1-9/2016 7-9/2015 7-9/2016 Revenus 254 304 300 231 196 71 62 Comprehensive income (loss) before * ** ** *** 27 64 8 36 35 (7) 17 taxes EBIDTA 50 83 91 71 67 20 20 304 300 254 231 196 91 83 71 71 67 64 62 50 36 35 27 20 20 17 8 (7) 2013 2014 2015 1 - 9/2015 1 - 9/2016 7 - 9/2015 7 - 9/2016 Revenus Comprehensive income before taxes EBIDTA * Including reduced value of the mutual fund activity by NIS 68 million before tax. ** Including reduced value of the mutual fund activity by NIS 25 million before tax for the period 1-9/2016 and NIS 22 million before tax for the period 1-9/2015. *** Including reduced value of the mutual fund activity by NIS 22 million before tax for the period 7-9/2015. 9 Harel Insurance Investments & Financial Services Ltd

Equity – Harel Investments (NIS million) 4,912 4,950 4,724 4,512 Dividend (NIS million) 308 320 235 171 Dividend yield (%) 7.6% 7.5% 6.3% 5.7% 10 Harel Insurance Investments & Financial Services Ltd

Capital surpluses – Harel Insurance (NIS million) Surplus capital Required capital 8,000 6,905 6,768 * 7,000 6,326 1,339 1,230 6,000 1,085 5,000 4,000 3,000 5,538 5,566 5,241 2,000 1,000 0 . . * As a result of the merger of Dikla’s insurance activity, the capital surplus of Harel Insurance increased by NIS 180 million. This increase is due to the transfer of a capital note from Dikla to Harel and also to relief in the method of calculating the aggregate capital requirement for outstanding claims. 11 Harel Insurance Investments & Financial Services Ltd