bank said in a regulatory filing it will increase its provision
for the tax probe in the fourth quarter to $259 million, in
addition to $611 million it had already set aside.
For several years, U.S. authorities, including the U.S.
Department of Justice (DOJ) and the New York Department of
Financial Services, have been investigating accusations that the
Israeli bank helped U.S. clients evade taxes.
"Recently, the bank group and each of the DOJ and bank
regulatory teams handling the investigations have extensively
negotiated the terms of resolutions, which, once approved by the
U.S. authorities and the bank group and finalized, would resolve
the investigations," Hapoalim said.
The settlement would be a deferred prosecution agreement, the
bank said. Its subsidiary in Switzerland will sign a plea
agreement with the DOJ relating to its business with its
"The final sign off will pave the way (for) the accelerated
growth of Hapoalim’s loan book, dividend resumptions and share
buy-backs," Barclays analyst Tavy Rosner said.
Hapoalim's main rival, Bank Leumi <LUMI.TA>, in 2014 agreed to
pay $400 million to settle two separate investigations into
whether it helped U.S. clients evade taxes. Mizrahi Tefahot Bank
<MZTF.TA> paid $195 million a year ago to settle a five-year
U.S. tax evasion investigation.
Hapoalim also said it expects to pay $30 million in a
non-prosecution agreement, which it will provision in the fourth
quarter, to settle a U.S. probe into alleged corruption
involving officials from world soccer's governing body, FIFA.
Hapoalim has said the U.S. probe was looking into accounts held
by some of the suspects with the bank.
Shares in Hapoalim were down 2.3% in afternoon trade in Tel
Aviv, compared with much steeper 5% declines in the broader
The bank is scheduled to report fourth-quarter results in the
(Reporting by Ari Rabinovitch and Tova Cohen; Editing by Steven
Scheer and Peter Graff)
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