S&P Corrects Mizrahi-Tefahot Report After Erroneous Equity Forecast Sparks Drop
Standard & Poor's issued a correction to an investor report on Mizrahi-Tefahot Bank after erroneous forecasts of a sharp drop in return on equity triggered temporary stock losses.
Standard & Poor's was forced to correct a report distributed to investors regarding Mizrahi-Tefahot Bank after an initial projection of a sharp decline in the bank's return on equity triggered brief downward pressure on the stock. S&P left the bank's rating unchanged at BBB+ with a stable outlook, noting its strong position as Israel's largest mortgage lender.
In the original report, analysts projected that heightened banking competition and anticipated interest rate cuts by the Bank of Israel would drag the bank's return on equity down to 12%–13.3% in 2026. A corrected update issued later in the day revised the projected return on equity for the current year to a range of 14%–14.9%, and similarly adjusted the forecast for subsequent years.
Meanwhile, the banking index dropped sharply amid broader market pressures linked to domestic political uncertainties and political shifts in the United States. Mizrahi-Tefahot shares initially led the losses with a 4.5% decline before stabilizing as market participants realized the initial S&P figures stemmed from an analytical error.
