1. FIBI
FIRST INTERNATIONAL BANK OF ISRAEL
Overview
31/12/15

2. Main events in the last year - Efficiency processes
UBANK merging
The merger of UBANK ended successfully on 30/9/15, while maintaining the brand name – a leading brand in private banking
PAGI merging
The merger of PAGI ended successfully on 31/12/15, while maintaining the brand name – a leading brand in ultra-orthodox sector
Improving the group synergy on the revenue side
Dealing with regulatory barriers related to the activities of small banks
Reducing employees in the headquarters
Reducing group’s real estate space (about 1,400 SF)

3. Main events in the last year –Efficiency processes
7% Decrease in Expenses
7% decrease in operating and other expenses ,despite merger related expenses (excluding the effects of Leumi salaries agreement and the expenses related to the merger of UBANK – a decrease of 4.5%).
202 million NIS decrease in bank expenses:
151 million NIS decrease in salaries, effected by a salary decrease in Leumi salaries agreement (72 million NIS) that was partly offset with one-time expense of 25 million NIS for the UBANK merger.
5.2% decrease in number of employees during 2015
Decrease in other expenses as well: maintenance and depreciation and other expenses as a result of real estate reduction processes in the group.
Regional HQ Integration
Regional HQ (3 regions) integration to the retail division HQ in the beginning of 2016
Branch Deployment Efficiency
Continued efficiency processes in branch deployment:
Closure\merger of branches and savings in branch area –reduction of 7 branches in the group (4 last year)
Cancellation of Cashier's positions in some of the group branches and improve efficiency processes in branches
Labor Dispute Termination
An agreement was signed with the bank employees union in which the employees commit to three years of “peace”

4. Main events in the last year – Growth
Credit Growth
Growth in main activities of FIBI’s Group:
8% increase in credit to retail customers (excluding mortgages)
Continued growth in mortgages – 10% increase
3% increase in commercial (Middle Market) credit
In the 4th quarter, continued growth in all customer segments. 10% growth in corporate credit.
Continued Growth in Clients’ Assets
30 Billion NIS growth (9%) in client’s assets portfolio to a total of 359 Billion NIS (average balance).
OTSAR HA-HAYAL wins the ministry of defense tender
Winning the tender for banking and loan services to the Israeli security forces. winning in this long term tender enables:
Continued growth for OTSAR HA-HAYAL
Establishing leadership in this growing customer segment
Realization of efficiency measures and improvement in credit profitability in comparison with the pervious tender (interest adjustment).

5. Main events in the last year – Financial stability
Equity Capital
(tier 1) Ratio
Increase in equity capital ratio (tier 1) 9.81% vs. a ratio of 9.69% in The highest equity capital tier 1 ratio in the Israeli financial system (5 big groups).
4% increase in equity this year. The bank distributed 130 Million NIS on 2015 (2.6% dividend yield).
Liquidity Coverage Ratio
Average liquidity coverage ratio in Q4/15 was 104% vs. 99% in previous quarter.
Maintaining credit portfolio quality and diversification
Expenses for credit losses of 0.02% in 2015 vs. 0.13% in 2014.
Provision for credit losses to impaired credit (including mortgages) rate of 107.9%, 93.5% (excluding mortgages).
22% decrease in credit risk due to problematic debt.

6. Net Profit and ROE (Millions NIS)
Non-recurring events effecting on ROE in Q3/15
After taxes
effect on ROE (1.8%-) 23
ZEEVI lawsuit provision 9
One time expenses due to merging of UBANK
ROE
Average capital **
6,910
3.6%+
6,668
7,048
0.8%+
6,989
2.8%+
6,797
Common Equity capital (tier 1) to risk weighted assets ratio
9.81%
9.69%
* Goodwill amortization amounts to 44 Million NIS and decreases ROE by 0.65% .

7. Statements of Income 2015 –2014 ((Millions NIS
Change in %
Gross change
2014
2015
(10%)
(229)
2,331
2,102
Interest Income and Non-Interest Financing Income (including the effect of “ZE’EVI” lawsuit - 37 million NIS)
(80%)
(71) 89 18
Expenses from Credit Losses (0.02% in 2015)
(7%)
(158)
2,242
2,084
Interest Income and Non-Interest Financing Income after Expenses from Credit Losses - 3
1,375
1,378
Commissions
(78%)
(48) 62 14
Other income (last year includes the sale of FIBI LONDON and real estate)
(6%)
(203)
3,679
3,476
Total Income after Expenses from Credit Losses
(202)
2,912
2,710
Total Operating and Other Expenses
(8%)
(151)
1,780
1,629
Salaries and Related Expenses
(4%)
(16)
444
428
Maintenance and Depreciation of Property and Equipment
(5%)
(8)
139
131
Amortization and Impairment of Intangible Assets
(27)
549
522
Other Expenses
(2%)
(9)
455
446
Net Profit
6.8%
6.5%
ROE
(0.47%)
0.60%
0.13%
Bank of Israel Average Interest Rate
9.69%
9.81%
Equity Capital (tier 1) to risk components ratio (end of period)
77.3%
77.6%
Efficiency Ratio (Total Operating Expenses to Total Income)

8. Main Changes in Net Profit (2015 - 2014 (Millions NIS
Net Change
Gross Change
2014
2015 46 73
(1,749)
(1,676)
Decrease in Salaries and Related expenses (excluding compensation provision for the merger of U-Bank and Leumi agreement) 64
103
(31) 72
Decrease in Salaries due to Leumi Agreement 40 71
(89)
(18)
Decrease in Expenses from Credit Losses 10 17 2 19
Increase in the Reconciliations in Fair Value of Derivative Instruments 37 55
(1,132)
(1,077)
Decrease in Operating and Other Expenses (excluding Salaries) 3
639
642
Increase in Capital Markets Commissions
השפעות חיוביות
Main Positive Influences

9. Main Changes in Net Profit (2015 - 2014 (Millions NIS
Net Change
Gross Change
2014
2015
(63)
(101)
2,078
1,977
Decrease in Net Interest Income
(71)
(114)
257
143
Decrease in Profit Realized from Bonds and Equity Portfolios
(23)
(37) -
Outcome due to “ZE’EAVI” Lawsuit
(26)
(31) 31
Capital Gain from the Sale of FIBI London
(19)
(30)
Expenses related to the merger of U-Bank
(10)
(17) 14
Decrease in profit from selling buildings and others
השפעות שליליות
Main Negative Influences
Total Decrease of 9 million NIS in Net Profit

10. Operating & Other Expenses (Millions NIS)
Excluding the effect of LEUMI Agreement and on time expenses due to merging UBANK – reduced by 73 million NIS
2015
2014
202-
6.9%
151-
8.5%-
27-
61- 8- *
* Includes amortization of goodwill in 2015 in respect of subsidiaries in the amount of NIS 44 million (0.65% ROE), of which 34 NIS millions expected to be completed until 8/16 (effect of 0.5% on ROE).

11. FIBI Strategic Assets & Liabilities composite (*)
FIBI Strategic Assets & Liabilities Structure
(NIS Billions)
FIBI Strategic Assets & Liabilities composite (*)
(NIS Billions)
Public
Deposits
103.3
Credit to the Public
72.6
Capital to Risk Assets Total Ratio
equity capital (tier 1) to risk components ratio
Deposits to Credit Ratio
Liquid Assets to Deposits Ratio
13.26%
14.24%
9.81%
9.69%
142.3%
138.0%
42.0%
40.2%
Capital Available for Investments to Investment Capital Ratio
34.1%
31.5%
State of Israel Bonds 8.4
Bank of Israel Deposits 27.1
Gov. & Bank deposits
2.1
Capital Notes 5.9
Capital Available for Investment 5.4
Corporate and banks Bonds (foreign & Israel currency) 3.6
Bonds of foreign countries 3.9
Liquidity Ratio (LCR)
104%
Structures, Hedge Funds &Stocks 0.3
Market Risk in VAR(0.01)
(*) For iIllustration only – not to scale

12. The highest equity capital (tier 1) ratio in the banking system
Equity Capital (tier 1) Ratio- Capital Adequacy
Equity capital (tier 1) ratio target at 31/12/17 *
9.26%
10.75%
10.50%
9.15%
9.8% *
14.30%
14.57%
13.42%
13.42% * *
The highest equity capital (tier 1) ratio in the banking system
The data is updated to 31/12/15.

13. Deposits from the public
The Development in Balance Sheet, Equity, Credit and Deposits - consolidated, end of (period (Billions NIS
Credit to the public
Deposits from the public
Capital attributed to the shareholders of the Bank
Balance sheet
Leverage ratio at 31/12/15 is 5.43%
7%+ 6% 5% 4%
9%+
5%+
4%+

14. Credit to the Public by Segment (Millions NIS)
Rates of Change compared to
31/12/14
30/9/15
31/12/15
7.9%
2.5%
18,489
Private Clients (excluding mortgage)
10.2%
1.1%
20,431
Mortgages
9.1%
1.7%
38,920
Credit to Private Clients
(0.2%)
9.6%
20,302
Corporate
3.2%
1.8%
13,333
Commercial and Small Businesses
5.3%
3.8%
72,555
Total Credit to the Public
() – 31/12/14

15. Decrease of 22% in credit risk due to Problematic Debt (Millions NIS)
31/12/15
31/12/14
Gross
Change
Balance -Sheet
Off- Balance- Sheet
Total
Balance- Sheet
Impaired Credit Risk
771
151
922
806
112
918 4
Inferior Credit Risk
220 45
265
484
183
667
(402)
Credit Under Special Supervision Risk
770
262
1,032
1,136
143
1,279
(247)
Total Problematic Credit Risk
1,761
458
2,219
2,426
438
2,864
(645)
Ratio of the provision for credit losses to impaired credit to the public not accruing interest income accruing
NPL coverage ratio
107.9%
109.6%

16. Rates of Change in Compared to
Deposits from the Public Breakdown by Segment (Millions NIS)
Rates of Change in Compared to
31/12/14
31/12/15
10.7%
54,222
Total Private Clients
8.6%
33,402
Corporate
1.5%
15,638
Commercial + Small Businesses
8.5%
103,262
Total
26.5%
42,915
Of which: Positive Current Account Balance
(16%)
(52%)
(32%)
() – 31/12/14

17. Client Assets Portfolio (Deposits & Securities) present continued growth (average balances, Billions NIS)
359
9.1%
329
11.1% 30
8.4%
296 33
273 23
continued increase in client assets portfolio. Increase of 30 Billion NIS(9%) compared to 2014.

18. Of witch: Israel government bond
NOSTRO
NIS millions
Change compare to
31/12/14
30/9/15
31/12/15
NIS millions
Wage in %
NIS million
3,545
2,625
72%
9,085
74%
10,005
77%
12,630
Government bond
574
363
62%
7,818
59%
8,029
51%
8,392
Of witch: Israel government bond
109 6
17%
2,162
2,265
14%
2,271
Banks bond
282
191 8%
996
1,087
1,278
Corporate bond
(50) 13 2%
311
248
261
stocks
3,885
2,834
100%
12,554
13,605
16,439
Total equity
Negative capital fund available due to available for sale securities on 31/12/15 is 18 NIS millions. As of 22/2/16 20 NIS millions.

19. Net profit 2015 Millions NIS
Subsidiaries Net Profit
Growth Centers
Equity Capital (tier 1) to Risk Components Ratio
ROE
Net profit Millions NIS
Specialization
Winning the tender of the Ministry of Defense for the provision of loans and banking services to entitled customers in the coming years
Expansion of the factoring activity
Joining the Fund in cooperation with the Manufacturers Association - together with FIBI
Winning the government tender for the provision of loans to SME together with institutional partner
9.6%
5.8%
65.6
Retail Clients
Commercial/ Corporate
Defense Forces Personnel
Factoring
Winning in the teachers loans tender during 2014
Growth in the teachers sector due to winning the tender
Growth in the Israeli-Arab sector (6 branches)
13.8%
7.1%
(10.2%)*
36.5
Teachers Sector
Israeli-Arab Sector
Increasing network coverage in the ultra-orthodox sector
12.3%
10.6%
(13.6%)*
39.4
Ultra-Orthodox Sector
Merged into FIBI On 31/12/15 while maintaining the brand name
* ROE in accordance to average Equity capital (tier 1) to risk components ratio in the Israeli banking system

20. Main characteristics and strengths of FIBI group√
Diversified growing high quality credit portfolio
Level of credit loss provisions is low over the years
Expenses for credit losses of 0.02% in 2015.
22% decrease in credit risk due to problematic debt
Consistent growth in client assets portfolio as a result of our strength in private banking and capital markets activity.
In 2015, 9% growth in client assets portfolio to 360 Billion NIS.
High financial stability high equity capital and liquidity ratios
Equity capital ratio (tier1) 9.81% (higher than the regulatory requirement)
Liquidity coverage ratio 104%
Tight expenses control and reduction to improve operational efficiency
In 2015, a 202 Million NIS decrease in operating expenses (7% of total expenses) √ √ √

21. Distribution of up to 50% of net profit
Dividend policy
Distribution of up to 50% of net profit
(*)
(*) Dividend yield

22. Disclaimer
Without derogating from the generality of the conditions of use specified in the First International Bank of Israel Ltd. (the “Bank”) website, the content exhibited in this presentation has been prepared by the Bank solely for use of the Bank’s presentation of the quarterly and/or annual financial reports as well as strategic updates.
The content contained herein is partial and may include information and/or data that have not been independently verified by any outside entity. It is further emphasized that this presentation does not constitute an offer or invitation to purchase any securities and/or investments of any kind whatsoever.
This presentation should not be relied upon in connection with any transaction, contract, commitment or investment. For full and complete overview of the Bank’s financial situation and results of operation, please view the Bank’s quarterly and/or annual financial reports.
Neither the Bank nor any of its employees or representatives shall have any liability whatsoever (in negligence or otherwise) for any loss and/or damages of any kind whatsoever arising, directly or indirectly, from any use of the content presented in this file or otherwise arising in connection with this file.
It is hereby emphasized that portions of the information exhibited herein are regarded as forecasts about the future prospects of the Bank and the actual results of the Bank may differ materially from those contemplated taking into account the various risk factors, including but notwithstanding, changes in legislation and governmental supervision policies, changing economic conditions and uncertainties which exist regarding the Bank’s business and the result of various operations. For a more accurate and detailed description see forward looking information section in the Banks financial statements.