Israel Discount Bank Ltd.

Investor Presentation • Aug 15, 2024

Investor Relations AUGUST 15, 2024 2Q 2024 REVIEW Financial Highlights

Disclaimer:

This document has been prepared by Israel Discount Bank Ltd. (the "Bank") solely for use by the Bank in its presentation of its 2 nd 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 2 nd quarter financial statements which include the full financial information including forward-looking Information. The English version of the financial statements are 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.

2Q 2024 – DELIVERING STABLE PERFORMANCE

** Consolidated figures for banking operations of Discount & Mercantile

** As calculated

THE ECONOMY IS GAINING MOMENTUM

THE ECONOMY IS GAINING MOMENTUM

BUT HIGH-TECH SERVICES EXPORT IS SLOWING DOWN AND WORKING HOURS REMAIN STAGNANT

AND SHARP INCREASE IN GOVT. DEFICIT OPENS THE SPREAD IN THE BOND MARKET

BOI RATE EXPECTED TO DECREASE DURING 2025 INFLATION IS ANTICIPATED TO STAY WITHIN UPPER LIMITS

2Q24 AND 1H24 FINANCIAL HIGHLIGHTS

• Net income of NIS 1,045m and ROE of 14.1% in 2Q24, driven by higher NII, supported by effect of CPI and increase in Fees & commissions.
• Increase in collective allowance: Credit loss expenses ratio stood at 0.38% due to a higher Collective Allowance provisioning as credit portfolio expand and stringent model parameters. Non Performing Loans (NPL) out of total credit slightly decreased to 0.83% in 2Q24, compared with 0.86% in 1Q24 and 0.91% in 4Q23.
• Credit growth has regained momentum: Total credit grew by 2.5% QoQ and 6.1% YoY, with corporates growing by 4.0% QoQ, mortgage balance by 1.8% QoQ and small businesses with 1.4% growth QoQ.
• NII demonstrated significant growth with strong effect of CPI: NII grew in 2Q24 by 12.2% QoQ and (3.0)% YoY while the BoI interest rate remained at 4.50%. Net Interest Margin (NIM) improved to 3.19% compared with 2.83% in 1Q24.

Operating efficiency reached 51.3% and 47.3% w/o CAL in 1H24, compared with 52.8% in 1Q24 and 47.5% in 2Q23.

4	Net Income	ROE	Cost-Income Ratio	Credit Loss Expenses Ratio	4 2	Net income	ROE	Cost-Income Ratio	Credit Loss Expenses Ratio
2 Q 2	NIS 1,045 1Q24: NIS 1,050 m; 2Q23: NIS 1,187 m	14.1% 1Q24: 14.6%; 2Q23: 18.0%	51.3% 1Q24: 52.8%; 2Q23: 47.5%	0.38% 1Q24: 0.12% 2Q23: 0.49%	H 1	NIS 2,095 1H23: NIS 2,456 m	14.4% 1H23: 19.0%	52.0% 1H23: 46.8%	0.25% 1H23: 0.41%
d e st u dj A	NIS 1,090 1Q24: NIS 1,100 m;	14.7% 1Q24: 15.3%;	50.9% 1Q24: 52.8%;		d e st u dj A	NIS 2,190 1H23: NIS 2,388 m	15.0% 1H23: 18.5%	51.8% 1H23: 47.8%

CREDIT GROWTH IS REBOUNDING – DEMAND ACROSS ALL SEGMENTS

CREDIT LOSS EXPENSES REMAIN WITHIN NORMAL RANGE NPL RATIO IS GRADUALLY DECREASING

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.

INCREASE IN TOTAL INCOME DRIVEN MAINLY BY NET INTEREST INCOME

12

SALARY & MAINTENANCE EXPENSES ARE CONTAINED AS OTHER EXPENSES RISE

ROBUST AND DIVERSIFIED FUNDING BASE WITH STRONG CAPITAL RATIO

PAYBOX DISCOUNT IS ABOUT TO ACQUIRE FULL OWNERSHIP OF PAYBOX

Acquiring complete Ownership of PayBox as part of our strategy to establish it as a significant non-bank provider

• Separate and independent company with entrepreneurial DNA.
• With more than 1.4 m unique users, Paybox is well positioned to challenge the banking sector.
• With full mandate to compete all banks, including Discount.
• A groundbreaking e-wallet to manage mutual accounts was introduced to the market in June 2024.
• Continuously bringing new products with high potential to gain market share.

DISCOUNT HAS ENTERED INTO AGREEMENT TO SELL PAYBOX ~ 15% OF IDBNY TO GALLATIN POINT CAPITAL

Discount signed an agreement with the American investment fund Gallatin Point Capital for the sale of approximately 15% of the shares of IDBNY

• a strategic move to improve the bank's business growth.
• Leveraging the strategic connections of the fund in the financial sector in the US.
• The fund and its managers enjoy a rich experience in the financial sector, including in Israel, with a proven track record

CONTRIBUTION TO PROFIT FROM KEY SUBSIDIARIES

(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.

TO SUMMARIZE

Solid & continuous results for 2Q24, with net income of 1,045 NIS, and ROE of 14.1%.

Credit growth is gaining momentum, aligned with the economy, with asset quality remaining solid – Credit growth of 2.5%, attributed to Corporates & Mortgages. The economy demonstrated resilience & growth under ongoing conflict.

Credit loss provisions within normal range: As the economy adjusts well to operating amidst ongoing armed conflict, collective allowances reflects the expand of our loan portfolio. Specific provisions are down to 45m NIS, and Non Performing Loans (NPL) out of total credit are down to 0.83% with a sufficient cover ratio standing at 1.53%.

Salary Costs are well managed, other Costs increased in 20%, reflecting higher volumes in CAL and on-time items.

The IDBNY-Gallatin and Paybox deals are key steps in reshaping our group, aimed at strengthening our market position and enhancing our offerings.

APPENDICES

ISRAEL DISCOUNT BANK: P&L AND SELECTED RATIOS

NIS m	2Q24	1Q24	2Q23	vs.1Q24	vs.2Q23
Net interest income	2,846	2,537	2,934	12.2%	)3.0%(
Credit loss expenses	258	82	312	214.6%	)17.3%(
Non-interest financing income	264	358	282	)26.3%(	)6.4%(
Commissions	912	860	869	6.0%	4.9%
Other income	1	2	-	)50.0%(	#DIV/0!
Total non-interest income	1,177	1,220	1,151	)3.5%(	2.3%
Total income	4,023	3,757	4,085	7.1%	1.5%-
Salaries and related expenses	938	986	954	)4.9%(	)1.7%(
Maintenance & depreciation	381	379	326	0.5%	16.9%
Other expenses	746	619	659	20.5%	13.2%
Total operating and other expenses	2,065	1,984	1,939	4.1%	6.5%
Income before taxes	1,700	1,691	1,834	0.5%	)7.3%(
Provision for taxes on income	645	644	626	0.2%	3.0%
Income after taxes	1,055	1,047	1,208	0.8%	)12.7%(
Net income attributable to shareholders	1,045	1,050	1,187	)0.5%(	)12.0%(
ROE	14.1%	14.6%	18.0%
Cost income ratio	51.3%	52.8%	47.5%
CET-1 ratio	10.67%	10.90%	10.35%
NIM	3.19%	2.83%	3.33%
Rate of credit loss expenses	0.38%	0.12%	0.49%
NPL ratio (90 day or over)	0.87%	0.91%	0.89%
Dividend per share (in Agurot)*	25.34	25.46	28.79

* Dividend in respect of the relevant period

ISRAEL DISCOUNT BANK: SELECTED BALANCE SHEET ITEMS

NIS m	30.6.24	31.12.23	30.6.23
Cash and deposits with banks	46.404	51,115	56,696
Securities	60.634	59,268	54,537
Securities borrowed or purchased under agreements to resell	883	851	1,024
Credit to the public	272,558	262,941	256,768
Provision for credit losses	(4,164)	(4,214)	(3,571)
Credit to the public, net	268,394	258,727	253,197
Credit to governments	2,905	3.073	3.036
Investment in investee companies	485	471	483
Buildings and equipment	4.597	4,535	4,245
Intangible assets and goodwill	161	161	162
Assets in respect of derivative instruments	10,330	11,106	12,400
Other assets	6.399	6.417	6.035
Total Assets	401,292	395,724	391,815
Deposits from the public	303,227	297,597	292,656
Deposits from banks and governments	11,260	11.404	14.344
Securities borrowed or sold viarepo agreements*	9,232	12,642	10,728
Bonds and subordinated debt notes	18,177	15,491	16,479
Liabilities in respect of derivative instruments	8,641	10,469	10,124
Other liabilities	19,621	18,883	19,802
Total liabilities	370,158	366,486	364,133
Equity capital attributed to the Bank's shareholders	30,325	28,474	27,016
Non-controlling rights in consolidated companies	809	764	୧୧୧
Total equity	31,134	29,238	27,682
Total Liabilities and Equity	401,292	395,724	391,815

* Including securities borrowed or purchased under agreements to resell

NIS m 30.6.24 31.12.23 30.6.23

983 851 1,024

11,260 11,404 14,344

banks 46,404 51,115 56,696 Securities 60,634 59,268 54,537

Credit to the public 272,558 262,941 256,768 Provision for credit losses (4,164) (4,214) (3,571) Credit to the public, net 268,394 258,727 253,197 Credit to governments 2,905 3,073 3,036

companies ^{485 471 483} Buildings and equipment 4,597 4,535 4,245

goodwill ^{161 161 162}

derivative instruments 10,330 11,106 12,400 Other assets 6,399 6,417 6,035 Total Assets 401,292 395,724 391,815 Deposits from the public 303,227 297,597 292,656

sold via repo agreements* 9,232 12,642 10,728

debt notes 18,177 15,491 16,479

derivative instruments 8,641 10,469 10,124 Other liabilities 19,621 18,883 19,802 Total liabilities 370,158 366,486 364,133

the Bank's shareholders 30,325 28,474 27,016

consolidated companies ^{809 764 666} Total equity 31,134 29,238 27,682 Total Liabilities and Equity 401,292 395,724 391,815

Cash and deposits with

Securities borrowed or purchased under agreements to resell

Investment in investee

Intangible assets and

Assets in respect of

Deposits from banks and

Securities borrowed or

Bonds and subordinated

Liabilities in respect of

Equity capital attributed to

Non-controlling rights in

governments

ISRAEL DISCOUNT BANK: ADJUSTMENTS TO P&L

NIS m	2Q24	1Q24	2Q23
Reported net income	1,045	1,050	1,187
Realization of assets	34	50	-
Provisions stemming from the separation of ICC	11	-	-
Total		-	-
Adjusted net income	1,090	1,100	1,187

MERCANTILE: FINANCIAL PERFORMANCE

Main P&L and Balance Sheet metrics and selected ratios

NIS m	2Q24	1Q24	2Q23	Vs. 1Q24	Vs. 2Q23
Net interest income	580	528	608	9.8%	)4.6%(
Non-interest income	99	111	111	)10.8%(	)10.8%(
Total income	679	639	719	6.3%	)5.6%(
Operating & other expenses	282	277	266	1.8%	6.0%
Net income - Adjusted	225	184	258	22.3%	)12.8%(
Return on equity - Adjusted	17.9%	14.7%	23.7%
Cost-income ratio - Adjusted	41.5%	43.3%	37.0%
Rate of credit loss expenses	0.45%	0.50%	0.57%
NIM	3.77%	3.47%	3.91%
Total assets	66,657	63,674	63,137	4.7%	5.6%
Credit to the public, net	47,311	46,223	44,163	2.4%	7.1%
Securities	8,920	7,712	6,872	15.7%	29.8%
Deposits from the public	53,116	50,042	49,637	6.1%	7.0%
Total equity	5,217	5,147	4,531	1.4%	15.1%

IDBBANK: FINANCIAL PERFORMANCE

Main P&L and Balance Sheet metrics and selected ratios

IDB Bank
USD m	2Q24	1Q24	2Q23	Vs. 1Q24	Vs. 2Q23
Net Interest Income	79.0	81.0	86.2	(2.5%)	(8.4%)
Non-Interest income (Expenses)	21.0	18.0	16.7	16.7%	25.7%
Total Income	100.0	99.0	102.8	1.0%	(2.7%)
Operating & Other Expenses	71.0	70.0	73.0	1.4%	(2.7%)
Net Income	17.0	21.5	22.0	-0.2	-0.2
Return on Equity	5.3%	7.1%	7.5%
Cost-Income Ratio	71.7%	70.7%	70.9%
Credit Loss Expenses ratio	0.3%	0.1%	0.1%
NIM	2.78%	0.9%	3.0%
Total Assets	12,276	12,014	12,224	2.2%	0.4%
Loans, net	8,381	8,140	7,982	3.0%	5.0%
Securities	2,564	2,605	2,705	(1.6%)	(5.2%)
Deposits from the Public	10,116	10,157	10,266	(0.4%)	(1.5%)
Total Equity	1,254	1,239	1,167	1.2%	7.5%

CAL: FINANCIAL PERFORMANCE

Main P&L and Balance Sheet metrics and selected ratios

CAL
NIS m	2Q24	1Q24	2Q23	Vs. 1Q24	Vs. 2Q23
Income From Credit Card Transactions	479	438	447	9.4%	7.2%
Credit Loss Expense	67	40	53	67.5%	26.4%
Non-Interest Financing Expenses	8	5	-	60.0%	#VALUE!
Total Income	713	663	650	7.5%	9.7%
Total Expenses (excluding credit loss expenses)	540	510	483	5.9%	11.8%
Net income - Adjusted	81	81	82	-	)1.2%(
Return on equity - Adjusted	12.6%	13.2%	14.2%
Cost-income ratio - Adjusted	75.7%	76.9%	74.3%
Total assets	20,759	20,639	19,633	0.6%	5.7%
Interest bearing credit	8,981	8,909	8,762	0.8%	2.5%
Consumer credit	7,654	7,626	7,549	0.4%	1.4%
Total equity	2,620	2,529	2,358	3.6%	11.1%