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Dubai Islamic Bank Investor Presentation May 2008

Dubai Islamic Bank Investor Presentation May 2008. Contents. Background About DIB DIB Financials Peer Group Stock Information. Highly Profitable Banking Sector. Sector comprises of 49 banks 22 national/local banks; 27 foreign banks Sector of strategic importance to Govt.

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Dubai Islamic Bank Investor Presentation May 2008

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  1. Dubai Islamic Bank Investor Presentation May 2008

  2. Contents Background About DIB DIB Financials Peer Group Stock Information

  3. Highly Profitable Banking Sector • Sector comprises of 49 banks • 22 national/local banks; 27 foreign banks • Sector of strategic importance to Govt. • Direct/indirect govt. ownership in majority of national banks • Precedents available for Govt. support • Sector dominated by the national banks • Top 10 banks account for approximately 60-70% of total banking sector assets • Sector experiencing strong growth Source: UAE Central Bank

  4. Islamic banking is one of the fastest growing industry segments in the Financial Services sector Growth momentum, both in the Arab world and globally, estimated at 20% p.a. plus Approximately 400 Islamic institutions globally with assets in excess of US$ 500 billion More than US$ 20 billion in international Islamic bond issuance to date Targeted regions include GCC, South Asia, South East Asia and select niche markets Entry by Global Commercial/ Investment banks in this sector Booming Islamic Banking Market Key Players in the Islamic Banking Market in UAE / Middle East Region Existing Players New Entrants

  5. Contents Background About DIB DIB Financials Peer Group Stock Information

  6. Dubai Islamic Bank The World’s First Islamic Bank Part of the Big Five Islamic Banks in the world Globally recognized Leader and Innovator in Islamic Banking The largest Islamic Bank in UAE Amongst the top 4 Banks in the country Government ownership 34% Strong Domestic Franchise Nearly 600,000 retail customers 49 branches / nearly 300 ATMs, CDM

  7. Rated A1 by Moody’s and A by S&P • “One of the World’s Top Islamic Banks; Systemically important to its domestic banking market” • Key Strengths: • “Robust and sustainable financial performance” • “Strong liquidity” • “Likely government support in case of need” • “Solid risk-monitoring architecture, improving asset quality” • Profitability: “Improved and of good quality, reflecting superior business diversification” A “DIB’s ratings reflect its strong franchise as a leading Islamic Financial Institution, its relationship with the Dubai government and its satisfactory financial fundamentals” • “DIB’s foreign currency issuer ratings are set at A1/Prime-1 based on the bank’s intrinsic safety and soundness and on a strong likelihood of external support from the UAE authorities and DIB’s main shareholders in case of need.” • “DIB’s relationship with the Dubai government enhances its franchise” • “DIB’s foreign currency issuer ratings benefit from a high degree of external support” • “Increasing earning power and profitability” • “DIB enjoys a good deposit base, with a lower deposit concentration than other UAE banks” A1

  8. DIB’s principal business is focused on its five core units Largest business unit within DIB Full range of products and services Customer segments: Mass affluent, Wealth management, SME One of the largest Retail customer base in UAE Market leaders: Deposits products and Auto finance Retail & Business Banking • Millennium Capital and Millennium Finance subsidiaries incorporated in Dubai International Financial Centre • Investment banking activities such as project finance, loan syndication, capital markets, asset management and structured finance as well as Corporate Advisory Services • Global leaders in Sukuk issuance: #1 in the Bloomberg league table in 2006 Investment Banking • Leading provider of Real Estate Finance services in the UAE with significant role in supporting real estate developments • Financing to contractors in the oil, gas, power and water sectors • Short term equity investments in established companies and business start-ups across MENA region Real Estate, Contracting Finance, Direct Equities • Large & Middle Market • Bankers to top corporate houses in GCC • Financing for Trade and Manufacturing and Infrastructure • Cash Management capabilities Corporate Banking • Foreign exchange services • Asset-liability management • Islamic derivatives Treasury

  9. Dubai Islamic Bank – Strategic Agenda Growth drivers to be Retail, Corporate Banking & Investment Banking Leveraging on the success in Dubai to capitalize on opportunities in other Emirates To be amongst the Top 3 Banks in UAE Continually innovate using the latest technology and product expertise leading to ease and convenience Focus on Value Growth: cross selling, new Islamic products embed cost awareness Evolving from a pure banking entity to a more comprehensive Financial Services Group Diversifying DIB’s revenue streams through penetration and presence in new markets in the MENA region

  10. Diversified portfolio both with respect to economic sectors and customer segments Key economic sectors include government / public sector and real estate Among the most significant Arrangers of financing for Dubai Government Portfolio Diversification, Business Overview Segmental Revenue; % of Total Revenue (2007) Sectorial Exposure of Financial Assets (2007)

  11. An Integral, Recognized player in the Islamic Finance sector • Mega Deals • US$ 3.52 Bn Sukuk issue for Nakheel (Dubai World) • US$ 3.5 Bn Sukuk issue for PCFC (Govt of Dubai) • US$ 2 Billion Sukuk for Dubai Civil Aviation for expansion project of Dubai International Airport • US$ 600m Government of Malaysia Sukuk • US$ 600m Pakistan Sovereign Sukuk • US$ 550m Sukuk for Emirates Airlines • US$ 530m Lead Arranger for Qatar Gas II • Awards & Accolades (2005-’07) • Best Bank in UAE, 2006: The Banker • Best Islamic Bank in ME, 2006: Euromoney • Best Debt house UAE, 2005: Euromoney • Best Sukuk House, 2005: Euromoney • Award for Finance (2005): Shaikh Mohammed Bin Rashid Business Award • Quality Recognition Award, 2005: JP Morgan Chase • Banking Achievement Award for the Middle East, by Emerging Markets Publication during the IMF Conference in New York, Oct’07

  12. Contents Background About DIB DIB Financials Peer Group Stock Information

  13. Key Financials – Trend Net Profit: USD Million • Maintaining robust profitability • About 12-fold growth in net profits over the last 5 years • Improved profitability attributed to both growth in core business and growth in Islamic market Total Assets: USD Billion • Strong and consistent growth in total assets. Increase of 4+ times over last 5 years • Focus on quality and portfolio mix of assets along with aggressive growth 13

  14. Key Financials – Trend Total Deposits: USD Billion • Strong and consistent growth in total deposits • DIB is the #3 bank in customer deposits in UAE Total Financing: USD Billion • More than 4 fold growth in gross financing in 5 years • Well diversified and balanced portfolio, with lending to all key industry sectors 14

  15. Key Financials – Trend ROE • Consistent growth in ROE, in line with the top 5 banks • Marginal drop in 2006 attributed to increase in capital of US$906 million ROA • Steady growth in ROA in last 5 years • Return on assets of 3.4%, in the top end among major UAE Banks 15 Source: Bloomberg

  16. Strong deposit base to support growth plans Customer Deposits Composition 2001 2007 16

  17. Key Financials – Trend Cost-Income • Cost to Income at 40% • Increased due to investment in new branding, new branches, improved systems and channels Advances to Deposits • Healthy liquidity maintained compared to peer banks in UAE 17

  18. Contents About Dubai, UAE About DIB DIB Financials Peer Group Stock Information

  19. Domestic peer group comparison Net Profit Growth: USD Million • DIB net profits CAGR is the highest among comparable peer banks • Net profits among the top 3 banks in UAE Total Assets: USD Billion • Total assets among the top 5 banks in UAE

  20. Domestic peer group comparison • Total deposits among top 3 banks in UAE Total Deposits: USD Billion Total Financing: USD Billion • Total financing among the top 5 banks

  21. Domestic peer group comparison ROE: 2007 • ROE top amongst peer banks • Compares favorably with major banks globally ROA: 2007 • ROA among top 3 banks 21 Source: Bloomberg

  22. Domestic peer group comparison Cost Income Ratio 2007 • Increased due to infrastructure spend, technology, new branches, and staff packages in line with the market Financing to Deposit 2007 • Most liquid amongst banks in UAE 22 Source: Bloomberg

  23. Contents About Dubai, UAE About DIB DIB Financials Peer Group Stock Information

  24. Key MetricsBloomberg ID: DIB UH Equity Key Indicators: USD US$ 3.40 Current US$ 2.50 US$ 2.40 Face value for 2003, 2004 equated to $0.27/ share Source: DFM, DIB Published accounts 24

  25. Steady growth in dividend payments to shareholders 2006 and 2007 dividend includes payment of bonus through shares of 7% and 15% respectively Dividend payments Dividend Payment History 25

  26. DIB Shares Share Trading on DFM • Highly Liquid • DIB capitalization as a % of total DFM: 6.9% • 5th largest market capitalization • Percentage of DIB shares allowed to be owned by foreigners: 15% Source: DFM The information provided in this presentation should not be used as a substitute for any form of advice. Decisions based on this information are for your own account and risk. Although DIB attempts to provide accurate, complete and up-to-date information, which has been obtained from sources that are considered reliable, DIB makes no warranties or representations, express or implied, as to whether information provided is accurate, complete or up-to-date. 26

  27. THANK YOU

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