Menif Tightens Real Estate Lending Amid Market Slowdown, Prioritizes Profit Over Growth

Menif, a non-bank credit company specializing in real estate loans, is significantly slowing its credit expansion due to a challenging market environment. CEO Maor Duak revealed during an investor call following the company’s latest financial report that Menif has tightened its credit portfolio and is nearly halting new credit issuance. Duak described the current conditions as a "perfect storm," with both declining demand and intense competition impacting the sector. He emphasized the company’s strategy to focus on profitability rather than forced growth, stating, "We are riding the horse, not letting the horse ride us."

Menif’s credit portfolio, which stands close to 5 billion shekels, has seen a sharp deceleration in growth. In the second quarter of 2025, the portfolio increased by only 43 million shekels, a 1% rise compared to a 6% increase in the previous quarter. Despite this slowdown, the company’s quarterly profit rose 19% to 51 million shekels, while revenues remained stable at 129 million shekels. Duak expressed cautious optimism that the real estate market will recover in the coming quarters and said Menif is preparing its infrastructure to identify when this turnaround occurs.

Menif’s credit facilities total 2.7 billion shekels, sourced from banks, bonds, and insurance companies. The company has extended repayment terms on 18% of its loans due to project delays amid market conditions, which it views as a risk management measure rather than a sign of credit defaults. Menif collected 524 million shekels from clients in the first half of the year, including 113 million shekels from new financing agreements.

Duak highlighted interest rates as the primary driver of real estate market trends, estimating that 50% of market movement is influenced by rates, 30% by market sentiment, and 20% by other factors. He suggested that a further interest rate cut of 0.25% to 0.5% could stimulate demand among buyers and investors, especially given recent sharp increases in rental prices. While acknowledging the complexity of the Israeli market, Duak predicted signs of recovery might emerge by the end of the year, noting early indications such as developers reporting increased sales.

Menif’s stock has fallen nearly 13% since the start of the year amid concerns over its exposure to the residential market, contrasting with a 13% rise in the TA-Finance index. The company is valued at approximately 1.3 billion shekels, with controlling stakes held by Menora Mivtachim (49%) and Clal Insurance (9.7%).