Warburg to invest over $220m to help Leumi take bank share of Israel consumer, SME lending

US buyout giant Warburg Pincus has reportedly plans to invest more than $220m to expand its new Israeli credit card portfolio company Leumi over the next five years.

The firm recently completed an ILS2.5bn ($690m) takeover of Leumi, and in February decided to bring in a trio of strategic partners for the company.

Menorah Mivtachim, Clal Insurance & Finance and Allied Group will all hold 5 per cent of the company’s shares, with Menorah and Clal increasing their holdings to 10 per cent each once regulatory approvals have been received.

The firm has now said it will commit another ILS800m to grow the business into areas of lending currently dominated by banks, Reuters has reported.

It cited Warburg European investment activities head Daniel Zilberman, who it said told a Bank of Israel conference on Tuesday he wanted to offer credit to more consumers, as well as small and medium sized enterprises.

Zilberman said in February, at the time of the strategic partner news, “Our investment in Leumi Card reflects the tremendous trust and respect that we have for the Israeli economy, its people and the considerable developing opportunity in the country’s financial service sector.

“Leumi Card is an excellent business that we hope to bring our global expertise to, and help build a true leader and innovator in the Israeli payments, and consumer and SME lending sectors.”

Warburg has made a number of investments in Israel, including Cyren, Ness Technologies and Alliance Tire Company.

The firm closed its first dedicated fund for financial services on $2.3bn at the end of 2017.

Copyright © 2019 FinTech Global

Enjoying the stories?

Subscribe to our daily FinTech newsletter and get the latest industry news & research


The following investor(s) were tagged in this article.