v  In recent years, there has been a marked shift from business to retail activity, reflected in a decline in the volume of total credit to the business segments (business and commercial) and in an increase in total credit in the retail sector (small businesses, private banking, and households (including mortgages).
v  The average return on assets (in the past three years) is higher in the business segments and in the small businesses segment than in the retail segments.  The gap between the segments is attributed to economic developments during the reviewed period, to the extent of customer risk, to operational cost, and to the extent of competition and competitive threat.  For instance, risk in the small businesses sector is high compared to the other activity segments.  This is not unique to Israel, and is the result of, among other things, asymmetry of information between the banking corporation and the small business owner, which exists as a direct result of the lack of quality and timely information as to the borrower’s status.
v  The cost of operations inherent in the banking groups’ activity in the retail segments is significantly higher than that of the business segments, because activity in the retail segments involves high costs for maintenance and operation of a broad network of branches, including a high amount of physical and human infrastructure.  In contrast, activity in the business segment is concentrated in a small number of centers, leading to lower costs.
v  The average income from credit activity is high in the small businesses and households (excluding housing loans) segments, low in the households (mortgages) and private banking segments, and average in the business segments.  The rate of income reflects the cost of raising funds, operating costs related to generating the loan, the extent of the risk involved in activity in each segment, and the extent of competition and competitive threat.
v  The groups’ efficiency in their activity in the retail segments is stable, while there is a high level of variation in their efficiency in the business segments.  This variation is the result of the fact that business activity is more in line with economic activity and with the business cycles.


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