FIBI FIRST INTERNATIONAL BANK OF ISRAEL O verview

FIBI FIRST INTERNATIONAL BANK OF ISRAEL 2 Net Earnings and ROE NIS Millions * Assuming core capital ratio of (9.13%), (the Israeli banking industry average core capital ratio in H1 2013) the ROE is 9.4% in H and 10.1% in Q Average capital Core capital adequacy ratio 5,9386, % 6, % 6, %+ 11.2%+ ROE

FIBI FIRST INTERNATIONAL BANK OF ISRAEL 3 Statements of income 1-6/ /2012 NIS Millions Change in % Gross change 1-6/ /2013 (1.6%)(18)1,1131,095Interest income, net (15.4%)(8)5244Expenses from credit losses (0.13% provision rate) (*) (0.9%)(10)1,0611,051Net interest income after expenses from credit losses 12.7% Total non-interest income 115.6% Of which: non-interest financing income 1.5% Commissions income 220.0%11516 Other Income (divestment of buildings + pay back of insurance) 1.7%241,3961,420Total operating and other expenses 4.4% Of which: salaries and related expenses (including income/loss of severance fund) (0.9%)(2)220218Maintenance and depreciation of premises and equipment 3.6%38487Amortization and impairment of intangible assets and goodwill (4.9%)(13)266253Other expenses 14.7% Profit before taxes 39.3% Provision for taxes on profit (12.0%)(3)2522The bank’s share in profit of equity-basis investees, after taxes 0.4% Net profit 9.79%8.81%ROE 9.00%9.82%Core capital ratio (end of period) 2.54%1.65%Bank of Israel average interest rate * Excluding provision for mortgages the provision rate is 0.06%

FIBI FIRST INTERNATIONAL BANK OF ISRAEL 4 Income from Financing Activities (before Tax) 1-6/ /2012 NIS Millions Change (%) Gross change 1-6/ /2013 (314)1,9861,672Interest income 296(873)(577)Interest expense (1.6%)(18)1,1131,095Net interest income 115.6% financing income Non-interest 4.8%561,1771,233Total income from interest and non-interest 17(7)10Of which: Hedging of tax provision Fair Value of derivatives 2.7%311,1641,195 Total profit from actions of financing (interest and non-interest) Income from divestment of bonds and shares Divestment of bonds and income from trading portfolio (14)5238Income from divestment of shares 25(28)(3)Provisions for writedown of bonds and shares (0.5%)(8)1,0561,048 Other financial income of financial intermediation and unoccupied capital (0.89%)2.54%1.65%Bank of Israel average interest rate

FIBI FIRST INTERNATIONAL BANK OF ISRAEL 5 Total Income to Total Weighted Risk Assets Ratio

FIBI FIRST INTERNATIONAL BANK OF ISRAEL 6 Operating & Other Expenses NIS Millions 1-6/ / * * Including amortization of 26 NIS Millions ** Resulting mainly from the constant wage rise according to collective wage agreement and update of VAT.

FIBI FIRST INTERNATIONAL BANK OF ISRAEL Improvement in Operational Efficiency Ratio (Consolidated) Total Operating Expenses to Total Income % 74.9% 75.0% 77.1% Total Income Total Operating Expenses % % Total Operating Expenses / Total Income (Before Expenses from credit losses) Total Operating Expenses / Total Income (After Expenses from credit losses) % %

FIBI FIRST INTERNATIONAL BANK OF ISRAEL Credit to the Public 66.8 NIS Billion 8 FIBI Strategic Assets & Liabilities Structure NIS Millions Deposits to Credit Ratio Liquid Assets to Deposits Ratio Capital Adequacy Basel II Core Capital Adequacy Basel II :Of which Corporate and Commercial Consumer 16.8 Mortgage Gov. & Bank Deposits 2.0 NIS Billion 9.82% 122.3% 35.1% 31.6% Of capital available for Investments State of Israel Bonds: 8.9 NIS Billion Deposits-Bank of Israel: 15.8 NIS Billion Sovereigns Bonds: 1.2 NIS Billion Deposits in Banks: 3.1 NIS Billion Banks Bonds: 1.7 NIS Billion NIS+foreign Corporate Bonds: 0.8 NIS Billion Structure Products, Hedge Funds & Stocks:0.6 NIS Billion Market Risks in VAR Terms: (0.07) NIS Billion Capital Notes 5.9 NIS Billion Capital available for Investments 4.7 NIS Billion 15.03%  11.36% Credit against liquid assets Deposits from the Public 82.5 NIS Billion Credit to the Public 67.5 NIS Billion Estimated Core Capital Adequacy Basel III 9.63%

FIBI FIRST INTERNATIONAL BANK OF ISRAEL 9 Total Assets, Deposits & Credit to the public NIS Millions Credit to the Public Public Deposits Equity Total balance 6.3% 6.2% 5.7% Shareholders` equity to total balance ratio

FIBI FIRST INTERNATIONAL BANK OF ISRAEL 10 Credit to the Public by segments NIS Millions Change in % Average Balance Compared to H1/2012 Change in % Compared to %5.25%14,58215,33515,632 Private + Retail (Households) 12.89%9.65%15,34516,25916,826Of which: Mortgage 10.19%7.49%30,19731,59532,458Total private clients (2.21%)(2.85%)13,41213,27413,030 Commercial * + Small Business (2.50%)(5.34%)23,21223,01021,973Corporate 3.28%0.96%66,82167,87967,461 Total Credit to the Public 9.2% FIBI’s share in Local Activities * Of which, 209 NIS Millions decrease, in comparison to , due to the closure of FIBI London. Total Private + Retail 48%

FIBI FIRST INTERNATIONAL BANK OF ISRAEL 11 Expenses for Credit Losses to Credit to the Public Ratio The other 4 Leading Banks FIBI New measurement according to B.O.I Regulation* *In Q1 the Bank has implemented a regulatory one time provision on mortgage portfolio in order to set the Expenses for Credit Losses Ratio to 0.35% of the credit balance (24 NIS million). Excluding this one time provision, the provision ratio is about 0.04% in Q1 and 0.06% in H1.

FIBI FIRST INTERNATIONAL BANK OF ISRAEL 12 Change in Total Total Off-balance sheet Balance sheet Total Off-balance sheet Balance sheet (93)1, ,1471, ,058 Impaired credit risk (2) Inferior credit risk (16) Credit under special supervision risk (111)2, ,4722, ,305 Total problematic credit risk 82.4%85.6% Provision for credit losses Ratio, to impaired credit to the public not accruing interest income BREAKDOWN OF PROBLEMATIC CREDIT * NIS Millions * excluding write offs and before deduction of provision for credit losses.

FIBI FIRST INTERNATIONAL BANK OF ISRAEL 13 Deposits from the Public breakdown by segments NIS Millions Change in % Average Balance Compared to H1/2012 Change in % Compared to %5.3%23,74224,47325,011 Private Banking (5.9%)(10.5%)27,13727,61524,280 Retail (Households) 0.9%(3.1%)50,87952,08849,291 Total Private Deposits (2.5%)5.3%10,63710,73011,205 Commercial + Small Business 2.3%2.4%21,51221,54722,037 Corporate 0.8%(0.6%)83,02884,36582,533 Total Total Private + Retail 59% The customers` securities portfolio grew in 17 NIS Billions compared with June 2012 (about 9%).

FIBI FIRST INTERNATIONAL BANK OF ISRAEL 13.42% * 14.30% 14.57% 13.42% * * * ** * -1.3 *** % %0.97- %0.26- Minimal Regulatory Requirement For HAPOALIM&LEUMI FIBI is the only bank in Israel that has already met the new regulatory requirement for Core Capital ratio (in 31/12/14) according to Basel II Minimal Regulatory requirement Gap Core Capital Ratio – * Core capital in FIBI is 6.6 NIS Billions up to , increase of 8.2% compared with Core Capital ratio – 5 leading banking groups H (%) % 8.44% 8.70% 8.50% 8.55%-8.75% Basel II ** Basel III

FIBI FIRST INTERNATIONAL BANK OF ISRAEL 15 *In annual terms 9.82% 9.21% 9.03% 9.10% 8.74% Ratio of core capital to risk assets 122.3% 111.1% 115.5% 129.9% 102.2% Deposits from the public to credit to the public 73.2% 62.8% 67.1% 76.2% 57.0% Total operating to total income (before Expenses for credit losses) 70.6% 55.9% 63.0% 39.2% 50.0% Provision for credit losses to total impaired credit (without mortgages) Other 4 leading Banks Average 9.08%113.9%67.0%53.8% 15 Core capital ratio and principal financial ratios FIBI is demonstrating relative strength in main financial ratios 3.52% 0.40% % Dividend yield % 0.45% 0.13% 0.50% 0.32% Expenses for credit losses to credit to the public* 0.33%

FIBI FIRST INTERNATIONAL BANK OF ISRAEL 16 Index * RAROC Excess return on riskless asset ** (%) RAROC

FIBI FIRST INTERNATIONAL BANK OF ISRAEL 17 Changes in Net Profit - Subsidiaries NIS Millions Core Capital Ratio ROE Gross change Net profit 1-6/2012 Net profit 1-6/ % 12.1% % 9.3% (4.6) % 10.0% (0.9) % 9.0% (7.6)

FIBI FIRST INTERNATIONAL BANK OF ISRAEL /2013 Highlights  H1/2013 Net profit NIS Million (similar to H1/2012).  H1/2013 ROE - 8.8%  Increase in earnings before tax % (H1/2012 included a tax refund of 25 NIS Million)  ROE in H1/2013 (assuming the Q1/2013 banking industry core capital average ratio) - 9.4%.  Q2/2013 net profit NIS Millions (6% increased compared with Q2/2012)  Q2/ %. (assuming the Q1/2013 banking industry core capital average ratio) %.  The highest Core capital ratio in the banking system %. Rise in capital adequacy ratio % compared to despite the dividend paid in June 2013  Estimated capital adequacy under Basel III %.  Financing income growth rate - 4.8% (despite a reduction of 0.9% in the Bank of Israel interest rate during the period)  Provisions for credit losses in H1/ % (mainly due to a system wide regulatory provision on mortgages)  A continuing decline of the problematic debts % without the one time provision

FIBI FIRST INTERNATIONAL BANK OF ISRAEL /2013 Highlights  Increased customers activity – resulted by an increase in operating commissions, especially in the capital market, although partially offsetes by regulatory effects  Moderate growth in operating expenses - 1.7%. Primarily due to an increase in salaries and related expenses. VAT rise (payroll tax) explains most of the increase in the group’s expenses.  FIBI’s shares recently traded back into the TA-25 index.  Last June, the Bank paid 200 NIS Millions dividends to investors of 200 NIS Million, reflecting a dividend yields of 3.5%.