Information and Reporing Unit, Banking Supervision Division					6/8/2003
Statement for the first quarter - bank
Arab Israel Bank Ltd., Main data, NIS million
Taken from the quarterly report to 31.03.2003. Adjusted to the CPI for 03.2003.

Summary consolidated balance sheet	31.03.2003	31.12.2002	Bank's share of the banking system
Summary consolidated balance sheet	31.03.2003	31.12.2002	31.03.2003	31.12.2002
Cash and deposits in banks	1,279	1,250	1.3%	1.3%
Securities	207	217	0.2%	0.2%
Credit to the public	1,377	1,420	0.2%	0.2%
Credit to the government	0	0	0.0%	0.0%
Investments in companies included on an equity basis	0	0	0.0%	0.0%
Buildings and equipment	24	25	0.2%	0.2%
Other assets	30	34	0.1%	0.2%
Total assets	2,917	2,945	0.3%	0.3%
Deposits of the public	2,549	2,598	0.4%	0.4%
Deposits of banks	9	10	0.0%	0.0%
Deposits of the government	0	0	0.0%	0.0%
Bonds and subordinated notes	0	0	0.0%	0.0%
Other liabilities	45	38	0.2%	0.2%
Total liabilities	2,602	2,646	0.3%	0.3%
Quasi-capital items	0	0	0.0%	0.0%
Equity	315	299	0.7%	0.7%

Summary consolidated profit and loss statement	Three months to		Bank's share of the banking system
	Three months to		Three months to
	31.03.2003	31.03.2002	31.03.2003	31.03.2002
Net interest profit before loan-loss provision	35.9	36.4	0.9%	1.1%
Loan-loss provision	2.9	3.0	0.3%	0.4%
Operating and other income	21.5	21.6	1.0%	1.1%
Of which: Operating income	20.8	20.9	1.1%	1.2%
Operating and other expenses	26.1	25.4	0.7%	0.8%
Of which: Salaries and related expenses	17.7	17.9	0.8%	0.9%
Ordinary before-tax provision	28.4	29.6	2.3%	2.6%
Provision for taxes on ordinary profit	14.3	14.6	2.2%	2.7%
Ordinary after-tax profit	14.1	15.0	2.4%	2.5%
Bank's share in the profit of subsidiaries	0.0	0.0
Share of minority shareholders in profit of consolidated companies
Extraordinary after-tax profit	0.0	0.0
Net profit	14.1	15.0	2.4%	2.7%
Profit after the effect of the difference between the known index and the "in lieu" index	15.4	16.8	2.2%	2.5%

Balances and rates of return on financial items by indexation base on 31.03.2003	Unindexed NIS	CPI-indexed NIS	Foreign Currency (1)	Total financial items
Balance of financial assets on balance-sheet date	2,048	793	53	2,893
Balance of financial liabilities on balance-sheet date	1,974	589	40	2,602
Excess of financial assets over financial liabilities	73	204	13	291
Total indexation balance (incl.forwards and options in term of basis assets) 2	73	204	13	291
Rate of income on assets (percent) 3	7.80	2.34	-2.22	6.71
Rate of expenditure on liabilities (percent) 3	-4.45	-1.89	1.92	-4.03
Interest-rate differential	3.35	0.44	-0.30	2.68

Problem borrowers	31.03.2003	31.12.2002
Total credit risk dew to problem borrowers	116.40	100.90
Total credit to problem borrowers	102.00	93.90

Main financial ratios - consolidated (percent)	31.03.2003	31.12.2002
Equity/balance-sheet ratio	10.79	10.15
Finanancial capital/equity ratio	92.38	91.71
Equity/risk-weighted-assets ratio	25.44	24.17
Return on equity (net profit/gross weighted-capital ratio) 4	20.20	21.10
Operating income/operating expenses ratio 5	82.38	83.44

^{1 Including foreign-currency indexed NIS.}
^{2 Forwards transactions.}
^{3 Three-month rate of income (expenses), on annual basis including hedging, embedded and ALM derivatives.}
^{4 Annual basis.}
^{5 For three months. Comparative data are annual.}
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