Israel Discount Bank Ltd.

Quarterly Report • May 20, 2024

1Q 2024 REVIEW Financial Highlights

Investor Relations

May 20, 2024

Disclaimer:

This document has been prepared by Israel Discount Bank Ltd. (the "Bank") solely for use by the Bank in its presentation of its 1st quarter report, as well as in strategic updates referred to in the Bank's reports. This presentation is not a substitute for the Bank's 2024 1st quarter financial statements which include the full financial information including forward-looking Information. The English version of the financial statements are www.investors.discountbank.co.il available on the Bank's investor relations website at www.investors.discountbank.co.il

This presentation includes forward-looking information, as defined in the Israeli Securities Law, 5728 - 1968. Such information includes, among other things, projections, objectives, estimates and assessments of the Bank, which relate to future events or issues, the occurrence of which is not certain and is outside the control of the Bank. Forward-looking information does not constitute proven, factual information, and is based solely on the viewpoint of the Bank's management, which is based, among other things, on analysis of general information that is known to the Bank's management as of the date of this presentation. Forward-looking information, by definition, is subject to the substantial risk of not coming to fruition, and such information is not definite and cannot be estimated in advance and is at times even beyond the Bank's control. The fulfillment of forward-looking information is impacted by risk factors that are characteristic of the Bank's activities and also by developments in the general environment and external factors that affect the Bank's operations, which cannot be estimated in advance and that by their nature are beyond the control of the Bank. Therefore, readers of this presentation are hereby warned that the results and achievements of the Bank in the future may be significantly different than those presented in the forward-looking information included in this presentation. Similarly, forward-looking projections and estimations are based on assumptions and information in the possession of the Bank as of the time of the presentation, and the Bank shall not be required to update or revise any such projection or estimation in order to reflect events or conditions that transpire after the date of the presentation.

Disclaimer regarding unsponsored American Depository Receipt (ADR):

U.S. depository institutions or banks may establish ADR programs in respect of the shares of certain non-U.S. issuers without the consent or participation of such issuers (the so called "Unsponsored ADRs"(. An ADR or American Depositary Receipt, which is issued by a U.S. bank or depository to evidence a share of a non-U.S. issuer that has been deposited with the U.S. bank or depository. An Unsponsored ADR program is set up without the cooperation of the non-U.S. issuer or even without its consent. Israel Discount Bank does not support or encourage the creation of Unsponsored ADR programs in respect of its securities and, in any event, disclaims any liability in connection with an Unsponsored ADR.

Israel Discount Bank makes no representation regarding its compliance with Rule 12g3-2(b) of the U.S. Securities Exchange Act of 1934, as amended.

1Q 2024 – KEEPING STRONG PERFORMANCE

^** Consolidated figures for banking operations of Discount & Mercantile

^** As calculated

AMIDST ONGOING CONFLICT THE ECONOMY REMAINS STABLE

4

Source: * Source: CBS May2024

** Market data May 2024

Bank of Israel holds Interest Rate - Commencing the cutting will take more time than initially expected**

(Market Expectations for BoI Rate in Dec2024, %)

1Q 2024 HIGHLIGHTS

• Net income of NIS 1,050m and ROE of 14.6% in 1Q24, driven by higher non-interest financing income and reduction in collective allowances.
• Reduction in collective allowance: Credit loss expenses ratio stood at 0.12% due to a reduction in Collective Allowance provisioning. Non Performing Loans (NPL) out of total credit slightly decreased to 0.86% in 1Q24, compared with 0.91% in 4Q23 and 0.84% in 3Q23.
• Credit growth aligns with market conditions as demand is experiencing a slowdown: Total credit grew by 1.2% QoQ and 5.2% YoY, with corporates growing by 2.0% QoQ, mortgage balance by 1.0% QoQ and small enterprises stable with 0.1% growth QoQ.
• NII demonstrated stability despite the decrease in BoI rate: NII declined in 1Q24 by 0.7% QoQ and 7.4% YoY while the average BoI interest rate declined in 0.24% QoQ. Net Interest Margin (NIM) remained stable at 2.83% compared with 4Q23.
• Operating efficiency reached 52.8% and 48.1% w/o CAL In 1Q24, compared with 53.4% in 4Q23 and 46.1% in 1Q23.

4	Net Income	ROE	Cost-Income Ratio	Expenses Ratio for Credit Loss	CET-1 Ratio	LCR
2 Q 1 d	NIS 1,050m 4Q23: NIS 919m; 1Q23: NIS 1,269m	14.6% 4Q23: 13.2%; 1Q23: 20.1%	52.8% 4Q23: 53.4%; 1Q23: 46.1%	0.12% 4Q23: 0.59% 1Q23: 0.33%	10.90% 4Q23: 10.71%; 1Q23: 10.22%	141.9% 4Q23: 130.7% 1Q23: 137.3%
e st u dj A	NIS 1,050m 4Q23: NIS 821m; 1Q23: NIS 1,201m	14.6% 4Q23: 11.8%; 1Q23: 19.0%	52.8% 4Q23: 55.2%; 1Q23: 48.1%

CREDIT GROWTH ALIGNS WITH MARKET CONDITIONS AS DEMAND IS EXPERIENCING A SLOWDOWN

STABLE INCOME FROM CORE BANKING ACTIVITY THE NET INTEREST MARGIN REMAINS UNCHANGED

Financing Income From Current Operations (NIS m)

Total Income

* As calculated ** Net yield on interest bearing assets

RESTRAINING EXPENSES AND IMPROVING EFFICIENCY AS A PRIMARY TARGET

CREDIT LOSS EXPENSES ARE DECREASING AS THE IMPACT OF THE WAR ON THE ECONOMY IS CONTAINED

Allowance for Loan Loss Provisions from Total Credit**

* NPL: percent of non accrual from gross total credit.

** Calculated as percent of Loan Loss Provisions from total credit.

ROBUST AND DIVERSIFIED FUNDING BASE

LCR NSFR

STRONG PERFORMANCE ACROSS OUR MAIN SUBSIDIARY COMPANIES

1Q24 Group Results	With CAL	w/o CAL *
Net Income; NIS bn.	1,050	1,004
ROE	14.6%	14.6%
Efficiency Ratio	52.8%	48.1%

* (1) The data for ICC has been totally eliminated, with no calculation in respect of the alternative use of the risk assets that would become available as a result of the separation as well as the yield produced by them and with no calculation of the gains produced by the realization of the holdings in ICC and the yield produced by the investment thereof in an alternative activity.

(2) In congruence of that stated above, the capital has been standardized so as to maintain the actually existing capital adequacy level, and accordingly, the return on equity has been standardized.

POST S&P* SOVEREIGN RATING DOWNGRADE CET-1 CAPITAL RATIO REMAINS ADEQUATE

* On April 18, 2024, S&P Global Ratings lowered its long-term foreign and local currency sovereign credit ratings on Israel to 'A+' from 'AA-' , This measure will impact the RWA & CET-1 capital ratio in 2Q24.

DIVIDEND RATIO HAS BEEN REINSTATED TO 30%, COVERING THE SHORTFALL FROM THE LAST TWO QUARTERS

TO SUMMARIZE

Solid results for 1Q24, with net income of 1,050 NIS, and ROE of 14.6%.

Decrease in credit loss provisions: As the economy adjusts well to operating amidst ongoing armed conflict, collective allowances are reduced. Credit loss expense are down to 0.12%. and Non Performing Loans (NPL) out of total credit are down to 0.86% with a sufficient cover ratio standing at 182%.

Credit growth aligned with market conditions, with asset quality remaining solid – Credit growth of 1.2%, attributed to Corporates & Mortgages. The economy demonstrated resilience under ongoing conflict.

Stable Net Interest Margin – NII slightly decreased by 0.7% in 1Q24 as BoI rate decreased in 0.25%. Net Interest Margin (NIM) remained at 2.83%.

Costs trimmed for two consecutive quarters, countering previous increase in expenses.

Dividend payout has been reinstated to 30% distribution.

APPENDICES

ISRAEL DISCOUNT BANK: P&L AND SELECTED RATIOS

NIS m	1Q24	4Q23	1Q23	vs.4Q23	vs.1Q23
Net interest income	2,537	2,555	2,740	)0.7%(	)7.4%(
Credit loss expenses	82	390	204	)79.0%(	)59.8%(
Non-interest financing income	358	295	329	21.4%	8.8%
Commissions	860	821	887	4.8%	)3.0%(
Other income	2	118	301	)98.3%(	)99.3%(
Total non-interest income	1,220	1,234	1,517	)1.1%(	)19.6%(
Total income	3,757	3,789	4,257	)0.8%(	)11.7%(
Salaries and related expenses	986	979	945	0.7%	4.3%
Maintenance & depreciation	379	363	324	4.4%	17.0%
Other expenses	619	680	693	)9.0%(	)10.7%(
Total operating and other expenses	1,984	2,022	1,962	)1.9%(	1.1%
Income before taxes	1,691	1,377	2,091	22.8%	)19.1%(
Provision for taxes on income	644	470	763	37.0%	)15.6%(
Income after taxes	1,047	907	1,328	15.4%	)21.2%(
Net income attributable to shareholders	1,050	919	1,269	14.3%	)2.1%(
ROE	14.6%	13.2%	20.1%
Cost income ratio	52.8%	53.4%	46.1%
CET-1 ratio	10.90%	10.71%	10.22%
NIM	2.83%	2.83%	3.18%
Rate of credit loss expenses	0.12%	0.59%	0.33%
NPL ratio	0.86%	0.91%	0.58%
Dividend per share (in Agurot)*	25.46	14.86	30.78

* Dividend in respect of the relevant period

ISRAEL DISCOUNT BANK: SELECTED BALANCE SHEET ITEMS

NIS m	31.3.24	31.12.23	31.3.23
Cash and deposits with banks	46,538	51,115	60,040
Securities	56,061	59,268	51,215
Securities borrowed or purchased under agreements to resell	930	851	1,251
Credit to the public	265,990	262,941	252,845
Provision for credit losses	)4,187(	)4,214(	)3,362(
Credit to the public, net	261,803	258,727	249,483
Credit to governments	2,889	3,073	2,912
Investment in investee companies	487	471	491
Buildings and equipment	4,558	4,535	4,031
Intangible assets and goodwill	161	161	162
Assets in respect of derivative instruments	10,030	11,106	11,959
Other assets	6,640	6,417	5,928
Total Assets	390,097	395,724	387,472
Deposits from the public	295,468	297,597	289,712
Deposits from banks and governments	11,773	11,404	17,648
Securities borrowed or sold via repo agreements*	5,351	12,642	7,787
Bonds and subordinated debt notes	17,844	15,491	15,097
Liabilities in respect of derivative instruments	8,784	10,469	10,005
Other liabilities	20,650	18,883	20,473
Total liabilities	359,870	366,486	360,722
Equity capital attributed to the Bank's shareholders	29,431	28,474	26,096
Non-controlling rights in consolidated companies	796	764	654
Total equity	30,227	29,238	26,750
Total Liabilities and Equity	390,097	395,724	387,472

* Including securities borrowed or purchased under agreements to resell

ISRAEL DISCOUNT BANK: ADJUSTMENTS TO P&L

	Quarter ended at 31 March
	NIS m
NIS m	1Q24	4Q23	1Q23
Reported net income	1,050	919	1,269
Realization of assets	-	)97(	)142(
Provisions stemming from the separation of ICC	-	)1(	74
Total	-	)98(	)68(
Adjusted net income	1,050	821	1,201

MERCANTILE: FINANCIAL PERFORMANCE

Main P&L and Balance Sheet metrics and selected ratios

NIS m	1Q24	4Q23	1Q23	Vs. 4Q23	Vs. 1Q23
Net interest income	528	536	563	)1.5%(	)6.2%(
Non-interest income	111	209	109	)46.9%(	1.8%
Total income	639	745	672	)14.2%(	)4.9%(
Operating & other expenses	277	252	255	9.9%	8.6%
Net income - Adjusted	184	188	237	)2.1%(	)22.4%(
Return on equity - Adjusted	14.7%	15.7%	23.0%
Cost-income ratio - Adjusted	43.3%	40.1%	37.9%
Rate of credit loss expenses	0.50%	0.76%	0.50%
NIM	3.50%	3.64%	3.61%
Total assets	63,674	63,789	64,417	)0.2%(	)1.2%(
Credit to the public, net	46,223	45,678	43,718	1.2%	5.7%
Securities	7,712	7,410	7,109	4.1%	8.5%
Deposits from the public	50,042	50,306	50,741	)0.5%(	)1.4%(
Total equity	5,147	4,977	4,262	3.4%	20.8%

IDBBANK: FINANCIAL PERFORMANCE

Main P&L and Balance Sheet metrics and selected ratios

USD m	1Q24	4Q23	1Q23	Vs. 4Q23	Vs. 1Q23
Net Interest Income	81	80	87	1.3%	)7.1%(
Non-Interest income (Expenses)	18	)10(	17	N/A	4.7%
Total Income	99	70	104	41.4%	)5.1%(
Operating & Other Expenses	70	77	68	)9.1%(	2.5%
Net Income	21	)5(	30	)520.0%(	)30.0%(
Return on Equity	7.0%	)1.8%(	10.5%	)488.9%(	)33.3%(
Cost-Income Ratio	70.7%	110.0%	65.4%	)35.7%(	8.1%
Credit Loss Expenses ratio	0.05%	0.24%	)0.18%(	N/A	N/A
NIM	2.89%	2.77%	3.03%	4.3%	)4.6%(
Total Assets	12,014	12,219	12,830	)1.7%(	)6.4%(
Loans, net	8,140	8,102	8,086	0.5%	0.7%
Securities	2,605	2,608	2,679	)0.1%(	)2.0%(
Deposits from the Public	10,157	10,316	10,773	)1.5%(	)5.7%(
Total Equity	1,239	1,222	1,161	1.4%	6.7%

CAL: FINANCIAL PERFORMANCE

Main P&L and Balance Sheet metrics and selected ratios

NIS m	1Q24	4Q23	1Q23	Vs. 4Q23	Vs. 1Q23
Income From Credit Card Transactions	438	401	423	9.2%	3.5%
Credit Loss Expense	40	98	41	)59.2%(	)2.4%(
Non-Interest Financing Expenses	5	-	301	N/A	N/A
Total Income	663	614	918	8.0%	)27.8%(
Total Expenses (excluding credit loss expenses)	510	474	542	7.6%	)5.9%(
Net income - Adjusted	87	24	85	262.5%	2.4%
Return on equity - Adjusted	14.2%	3.8%	16.2%
Cost-income ratio - Adjusted	75.7%	77.5%	75.2%
Total assets	20,639	19,378	19,435	6.5%	6.2%
Interest bearing credit	8,909	9,005	8,416	)1.1%(	5.9%
Consumer credit	7,626	7,741	7,216	)1.5%(	5.7%
Total equity	2,529	2,447	2,278	3.4%	11.0%