First International Bank of Israel Ltd. - FIBI First International Bank of Israel Ltd

GDP Rate of Growth (%) * Forecast – based on Bank of Israel Research Division 2 *

Bank of Israel Interest Rate (%) and the Rate of Inflation (%) Annual Average Bank of Israel Interest RateRate of Inflation 3 * I/09 Quarterly Average ** In annual terms * *

Country Ratings 4

Foreign Investments in Israel * (US$ Millions) Israeli Investments Abroad * (US$ Millions) * In 2006: Acquisition by “Teva” 5 * In 2006: Acquisition of “Iscar” by Berkshire - Hathaway

Ownership Structure Bino-Liberman Group FIBI Holding Company Ltd. The Public Israel Discount Bank The First International Bank of Israel Ltd. The Public E % V % E. Percentage of equity share capital ownership V. Percentage of voting power exercised at any general meeting E % V % E % V % E % V % FIBI Investment House Ltd. E % V. 11.1% E % V. 0% E. 100% V.100% As of PAGI Poalei Agudat Israel Bank Ltd. Modus-Selective Investments Portfolio Ltd. FIBI Bank (UK) Plc FIBI Bank (Suisse) Ltd. Kidma – Provident Funds Management Ltd. E % V.68.68% E.50% V. 60% E. 100% V.100% E. 100% V.100% E. 100% V.100% UBank Ltd. E. 100% V.100% Otsar Hahayal E. 68% V.66% Bank Massad The First Int’l & Co. Underwriting and Investments Ltd. E. 75% V. 25% E. 51% V.51% 6

Since: retail/commercial FIBI Retail bank cluster FIBI Bank (UK)FIBI Bank (Switzerland) U - Bank Otsar Hahayal Massad  Corporate + middle market banking  Private + affluent banking  82 branches PAGI International Branches:  Capital markets  Trust and custody  Private and affluent banking  6 branches (unique affluent banking branches)  Business banking  Private banking Focus: 17 retail/commercial retail Key audience:defense + militaryteachersultra-orthodox First International Bank Group  Private banking 7

First International Bank of Israel Ltd The Liberman family has enjoyed sustained success in both Australia and Israel for over 50 years. Jack Liberman, an astute Australian businessman and entrepreneur, along with his children, built a large and diversified investment company (JGL Investments PTY Ltd.) The family, together with the Bino Group, in a long-term partnership, hold a controlling interest in both FIBI Holdings and Paz Oil Company Ltd. (“Paz”), Israel’s leading petrol player. Mr. Zadik Bino is a highly reputable businessman with broad business interests in Israel. In a banking career spanning over 25 years, Mr. Zadik Bino filled senior positions in the local banking sector, which included CEO of Bank Leumi of Israel and Chairman of the Board of Directors and General Manager of The First International Bank of Israel. Mr. Zadik Bino was also a member of the Advisers Committee and the Committee for Banking Matters of the Bank of Israel. Shareholders

First International Bank of Israel Ltd Since 1989, Mr. Bino has devoted himself to his family's private business interests in Israel and abroad. Through the years, the Bino Group has engaged in the execution, development and nurturing of various investments. Besides banking, the main investments of the Bino family is in Energy (through a 42.64% holding in Paz oil Company Ltd. – a listed company which is Israel’s largest supplier of refined petroleum products, and which owns the Ashdod Refinery). Since acquiring the controlling interest in FIBI and the Bank in 2003, both Mr.Zadik Bino and his son, Mr. Gil Bino, serve as members of the Board of Directors of FIBI, as well as of the Bank's. In 2008 Mr. Zadik Bino transferred 47.5% of his indirect holdings in FIBI and in the Bank to his three children; Mr. Gil Bino, Mrs. Hadar Bino Shmueli and Mrs. Daphna Bino Or, in equal shares. Shareholders (continued)

First International Bank of Israel Ltd Universal bank with strong niche position in capital markets, foreign exchange and foreign trade Domestic subsidiaries target focused audiences: affluent banking (UBank), defense sector - retail banking (Otsar Hahayal), ultra-orthodox Jews (PAGI), and teachers (Massad) Foreign subsidiaries in London (commercial banking) and Zurich (private banking) Branches: 172 in Israel (including subsidiaries) Employees: 4,829 Equity: NIS 5,646 Million (US$ Million *) 5th largest banking group in Israel First International Bank of Israel - FIBI * $/NIS = as of March 31, 2009

First International Bank of Israel Ltd Bank Ratings

First International Bank of Israel Ltd Core Capabilities Top class reputation in private banking services, especially dealing room, specialized investment advice center and TASE futures and operations index, where FIBI is a market leader Distinctive professional standards in: global capital markets, currency exchange, structured products and foreign trade Strong traditional position in corporate banking Clients Client-centric vs. product - oriented banking Corporate finance: increase penetration of middle market Private banking: extend presence in affluent segment Retail banking: broaden overall footprint (e.g., acquired Bank Otsar Hahayal and Massad) Strategy - Main Focus

First International Bank of Israel Ltd Group Consolidation Realize synergies from three bank acquisitions: Implement shared-services model, including IT systems (UBnak completed, others in progress) Cross-sell products (mortgages, structured products, advisory services) Create streamlined and effective branch network New Products State-of-the-art pension-planning advice offering Other Upgraded scoring model and processes in anticipation of Basel II, including development of advanced credit-scoring models for risk-based pricing Outsourcing: first Israeli bank to outsource its computer infrastructure Large but conservatively-managed foreign proprietary trading book Strategy - Main Focus

First International Bank of Israel Ltd Net Operating Earnings and ROE – Quarterly NIS Millions 8.0% 6.6%

First International Bank of Israel Ltd Ratio of Provision for Doubtful Debts to Credit to the Public 4 Other Leading Banks FIBI

First International Bank of Israel Ltd Total Credit Risk in Respect of Problematic Debts (NIS millions)

First International Bank of Israel Ltd Composition of Total Proprietary Trading Book (NIS Millions) for * Including 485 Million NIS investment in BEZEQ Shares and 100 M NIS in HOT shares, the rest is in Hedge Funds and Private Equity

First International Bank of Israel Ltd Composition of Foreign Currency Proprietary Trading Book (NIS Millions) for * Including 475 Million NIS MBS Bonds secured by the US Government, the rest is banks & corporate bonds secured by foreign governments. ** Single issuer exposure up to 3% of portfolio. Average Duration: 2.09 years

First International Bank of Israel Ltd I / 09I / 08 Massad Operating & Other Expenses (NIS Millions)

First International Bank of Israel Ltd Operating Income and Expenses Adjusted* Operating Income & Expenses Operating Income & Expenses 357 Operating Income Cost/Income Ratio Adjusted Cost/ Income Ratio Operating Expenses (*) Income excluding dividends, provisions for decline in value of proprietary trading book and severance pay fund gains; expenses excluding severance pay fund effects and standard % 57.2% 52.2% 53.6%

First International Bank of Israel Ltd First Tier Capital Adequacy First Tier Second Tier * * As of * FIBI 4 Bank Groups Capital Adequacy Ratio Capital Adequacy

First International Bank of Israel Ltd Changes in Assets, Deposits and Credit to the Public (NIS Billions) Deposits from the Public Credit to the Public Total assets * The average deposits/credit ratio in the five leading banking groups (as of Dec. 2008) : 110% Ratio of Deposits to Credit 131% * Shareholders Equity

% changeI / 08I / (0.5) FIBI Bank (UK) (GBP K) FIBI Bank (Switzerland) (CHF K) Changes in Net Profit - Subsidiaries 23

First International Bank of Israel Ltd Gov. & Bank Deposits NIS 2.0 M Capital Notes NIS 4.7 B Capital available for Investments** NIS 3.9 M Credit to the Public NIS 61.8 Billion Deposits from the Public NIS 81.7 Billion Liquid Assets (32.7% Deposits from the Public) Deposits / Credit Ratio 131% Capital Investments 81.0% of capital available for Investments Bonds – State of Israel NIS 8.7 Billion Bonds-foreign states NIS 1,0 Billion Cash/Deposits-Bank of Israel NIS 11.2Billion Deposits in Banks NIS 5.7 B Bonds – Banks NIS 3.4 B 13% is secured under liquid Assets (Deposits / State Bonds) NIS Corporate Bonds, NIS 966 M MBS Prime+AltA NIS 315 M Hedge Funds & Stocks NIS 168 M Credit Risks in VAR Terms NIS 73 M Structure Products NIS 245 M FOREX Corporate Bonds NIS 655 M BEZEQ+HOT NIS 585 M * Out of this MBS GNMA & Agencies NIS 475 M ** Equity less Liquid Assets 24 Capital Adequacy 12.9% First Tier 8.9%

First International Bank of Israel Ltd Banking Subsidiaries in Israel PAGI PAGI, in which FIBI has a 68% equity holding is a commercial bank with 20 branches, and the majority of its clients belong to the ultra-orthodox and orthodox sectors. PAGI maintains a unique positioning as Israel’s only orthodox oriented bank and its share in its target segment has grown significantly. PAGI’s strategy is to aggressively grow its client base, while focusing on target segments with intensive financial activity in personal, business, and institutional banking. UBANK UBANK - FIBI acquired 100% of share capital of UBANK (formerly Investec Bank (Israel) Ltd.) in December It is maintained as an independent subsidiary. The acquisition of UBANK significantly bolstered FIBI’s competitive position in private banking, capital markets and foreign currency trading. In 2007 UBANK launched an innovation in Israeli banking – dedicated branches for affluent clients. This premium service (above retail and bellow classic private banking) comprises distinctive branch design and hours of operation, along with many other attractive features.

First International Bank of Israel Ltd OTSAR HAHAYAL OTSAR HAHAYAL - FIBI acquired 68% of the share capital of Otsar Hahayal in August, Bank Otsar Hahayal specializes in retail and small to medium-sized businesses (SMEs) and has a high proportion of current and former Defence Industry personnel within its client base. The inclusion of Bank Otsar Hahayal’s operations creates a banking group with a comprehensive and diverse range of activity and earning base. FIBI is currently in the process of integrating Otsar Hahayal’s IT systems and coordinating across headquarters support functions. MASSAD MASSAD - FIBI acquired 51% of the share capital of Massad in May 2008.Massad, as a sectorial bank, specializes in teaching personnel as its client base. FIBI is currently in the process of integrating Massad’s IT System and coordinating across headquarter support functions. Massad's identity as the “teachers' bank” also places it in an advantageous position in the Arab sector, and explains its success in this sector despite rising competition..