Overview

31/03/2011

*Forecast

GDP Rate of Growth

2

3

*Bank of Israel Interest rate for the last month of the Year / Period

Bank of Israel Interest Rate

Bank of Israel Interest Rate *and the Rate of Inflation **

Rate of Inflation

**Yearly basis - Forecast

Country Ratings

MOODY’SFITCHS & P

Long TermA1AA

Short TermP1F1A1

OutlookStableStableStable

4

Foreign Investments in Israel

In 2006: Acquisition by “Teva”

Israeli Investments Abroad

In 2006: Acquisition of “Iscar” by Berkshire - Hathaway

11,87114,233

23,866

10,429

6,827

2006 2007 2008 2009 2010

8,844

16,797

22,961

12,4469,950

2006 2007 2008 2009 2010

5

Israeli / Foreign InvestmentsUS$ millions

Financial Reports31/03/2011

Ownership Structure

Bino/Liberman Group

The Public FIBI Holding Company Ltd. FIBI Investment House Ltd.

Israel Discount Bank

The First Int’l & Co. Underwriting and Investments Ltd.

Modus-Selective Investments Management & Advice Ltd.

International Leasing Ltd.

Israel Credit Cards Ltd.

First International Issues Ltd.

E - 79.06, V - 79.06E - 20.94, V - 20.94 E - 0, V – 0 (stocks dormant)

E + V - 53

E + V – 20.02

E + V - 26.45

E – 73.79V – 73.33

E – 100V – 100

E - 51V - 51

E - 100V - 100

E - 100V - 100

E - 100V - 100

E - 100V - 100

E - 100V - 100

E - 28.2V - 21

E - 100V - 100

E - 75V - 75

E - % Share in EquityV - % Voting Rights7

- Retail /Commercial- Branches: 48- Since 2006- Key Audience:

Military Personnel

- Retail- Branches: 19- Since 2008- Key Audience:

Teachers

First International Bank Group

First International Bank

- Corporate + middle market banking- Private + affluent banking- Capital & Money Markets- 80 branches

Retail BankCluster International

- Capital Markets,

Trust & Custody- Private + affluent banking- 7 branches- Since 2004

- Private Banking- Since 1984

- Business / Corporate Banking- Since 1982

- Retail/Commercial- Branches: 20 (as for

20/01/2011)- Since 1977- Key Audience: Ultra

Orthodox

8

99

Shareholders

TheLiberman family

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.

9

1010

Shareholders

Mr. Zadik BinoMr. 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 CEO 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.

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 45.5% 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 Holdings 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 and the Bank. On June 2010 Mr. Gil Bino was appointed as FIBI’s chairman instead of Mr. Zadik Bino. The controlling interest in FIBI and in the Bank is held by the Bino Family (Mr. Zadik Bino and his three children).

10

First International Bank of Israel - FIBI

Universal bank with strong niche position in capital markets, foreign exchange and foreign trade

Domestic subsidiaries target focused audiences: affluent banking (UBank), security sector - retail banking (Otsar Hahayal), ultra-orthodox Jews (PAGI), and teachers (Massad)

Foreign subsidiaries in London (commercial banking) and Zurich (private banking)

Branches: 174 in Israel (including subsidiaries)

Equity: NIS 5.7 Billion

5th largest banking group in Israel

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Bank Ratings

Moody’s

Bank Deposits – foreign & domestic, long & short term

A3 prime-2

Financial StrengthBFSR D+

OutlookStable

Midrug – Israel

MidrugAa1

Ma’a lot - S&P

IssuerAA / Negative

Subordinated NotesAA - / Negative

12

13

Net Operating Earnings and ROENIS Millions

13.5%

9.7% 8.5%

Statements of income Q1/11 – Q1/10NIS Millions

31/03/201131/03/2010Net change

Earnings from financing operations before provision for doubtful debts

59655042

Interest collection-22(14)

Credit lost income (doubtful debts)36(20)32

Operating commissions3693606

Income from sales of shares (& dividend)31119

Other income24(1)

Operating & other expenses73969728

Operating earnings before taxes295220

Provision for taxes119100

Operating earnings after taxes17612056

The banks net equity in operating results of investee companies

1521(6)

Exterior share holders & extraordinary profit

(8)(12)4

Net earnings1831295414

1515

Ratio of Provision for Doubtful Debts to Credit to the Public

Other 4 Leading Banks FIBI

0.27%

0.99%

1.34%

1.75%

0.44% 0.18%0.39%

-0.23%

0.33%

0.42%

0.91%

0.62%

0.53%0.53%

0.76%

0.43%

0.75%

0.28%

0.85%0.72%

0.92%

1.10%1.28%

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Q1/11

Balance for dateChange

31/03/201131/12/2010

Defective credit risk1,2361,325(89)

Inferior credit risk502553)51(

Credit risk subject to special supervision1,00997435

Off-balance sheet credit risk* 40035347

Total problematic credit risk according to the new orders

3,1473,205)58(

Total Credit Risk according to the new orders (NIS millions)

*After accounting deductions and before credit lost provision

16

17

Operating & Other Expenses NIS Millions

383

135 168

739

447

136 144

697

Total Operating Expenses Salaries & RelatedExpenses

Maintenance,Depreciation, Premises &

Equipment

Other Expenses

Q1/2010 Q1/2011

18

Operating Expenses & Income Adjusted * Operating Expenses & Income

• Financing Income excluding provisions for decline in value, clarification 8 position, interest collection of problematic debts and fair value of derivative instruments, operating income excluding dividend, realization or decline in value of shares and severance pay fund gains; expenses excluding severance pay fund effects, special provisions, bonus and strike effects

Operating Income and Expenses

54.4%

% %Operating

ExpensesOperating

IncomeIncome /

Cost RatioAdjusted Income /

Cost Ratio%

Total income after provision to doubtful debts / expenses adjusted Ratio

Total income before provision to doubtful debts / expenses adjusted Ratio

%

52.4% 54.4%

54.4%52.2%

125.5% 131.1%

136.2%122.6%

19

14.30%14.57%

13.42%

Capital Adequacy Ratio – Basel II

Core 2 capital

Capital Adequacy

Core 1 Capital Adequacy

FIBICore 1 capital 4 top Banks

*

*

*

***

**

*

*

*Poalim & Mizrahi average

20

Changes in Assets, Deposits & Credit to the Public (NIS Billions)

Credit to the public

Deposits from the public

Shareholders equity

Assets

21

Deposits from the Public79.8 NIS Billion

Deposits / Credit Ratio

Liquid Assets

Capital Adequacy – Bazel II

Core capital – Bazel II

Capital Investments

Credit tothe Public63.3 NIS Billion

Gov. & Bank Deposits2.5 NIS Billion

8.19%

126.3%

35.0%

43.4%Of capital available for Investments

Bonds-State of Israel: 9.1 NIS Billion

Cash/Deposits-Bank of Israel:14.1 NIS Billion

Bonds-Foreign states: 0.6 NIS BillionDeposits in Banks: 4.7 NIS Billion

Bonds-Banks: 1.2 NIS Billion

NIS+Forex Corporate Bonds:0.8 NIS Billion

Structure Products, Hedge Funds & Stocks:0.8 NIS Billion

Credit Risks in VAR Terms: (0.04) NIS Billion

Capital Notes4.9 NIS Billion

Capital available for Investments3.8 NIS Billion

12.70%

22

Changes in Net Profit - Subsidiaries NIS Millions

Q1/2011Q1/2010Change

9.58.60.9

16.615.21.4

21.811.210.6

9.68.70.9

PAGI, in which FIBI has a 100% equity holding, is a retail bank with 19 branches. 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 is significant. PAGI’s strategy is to aggressively grow its client base, while focusing on target segments in personal, business, and institutional banking.

UBANK - FIBI acquired 100% of share capital of UBANK (formerly Investec Bank (Israel) Ltd.) in December 2004. 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.

23

Banking Subsidiaries in Israel

2424

OTSAR HAHAYAL - FIBI acquired the majority share of Otsar Hahayal in August, 2006, it now hold 73.8% of the bank. Bank Otsar Hahayal specializes in retail and small to medium-sized businesses (SMEs) and has a high proportion of current and former military and defense 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 activities and earnings. FIBI has completed the process of integrating Otsar Hahayal’s IT systems and is in the process of implementing a shared services model across headquarter functions.

Banking Subsidiaries in Israel

MASSAD - FIBI acquired 51% of the share capital of Massad in May 2008. Massad, is a sectorial bank, specializes in teaching personnel. FIBI completed the process of integrating Massad’s IT System and is currently implementing a shared services model 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.

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