Dubai Islamic Bank

Investor Presentation

May 2008

Contents

Background

About DIB

DIB Financials

Peer Group

Stock Information

• 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

Highly Profitable Banking SectorBanking Sector Profits

5.06 5.396.66

0.00

1.00

2.00

3.00

4.00

5.00

6.00

7.00

Dec-05 Dec-06 Dec-07

US

D B

io

Source: UAE Central Bank

UAE BANKING INDICATORS

170

116103

236

152140

273

168 162

0

50

100

150

200

250

300

350

Bank Assets Bank Deposits Loans & Adv

US

D B

IO

• 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

Key Players in the Islamic Banking Market in UAE / Middle East Region

Existing Players New Entrants

Booming Islamic Banking Market

Contents

Background

About DIB

DIB Financials

Peer Group

Stock Information

Dubai Islamic Bank

The World’s First Islamic Bank

The largest Islamic Bank in UAEAmongst the top 4 Banks in

the country

Government ownership 34%

Part of the Big Five Islamic Banks in the world

Globally recognized Leaderand Innovator in Islamic Banking

Strong Domestic FranchiseNearly 600,000 retail customers

49 branches / nearly300 ATMs, CDM

Rated A1 by Moody’s and A by S&P

“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”

“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”

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

Real Estate, Contracting

Finance, Direct Equities

Investment Banking

Corporate Banking

Treasury

• 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

• 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• Large & Middle Market• Bankers to top corporate houses in GCC• Financing for Trade and Manufacturing and Infrastructure • Cash Management capabilities

• Foreign exchange services • Asset-liability management• Islamic derivatives

Dubai Islamic Bank – Strategic Agenda

To be amongst the Top

33 Banksin UAE

Growth drivers to be Retail, Corporate Banking &

Investment Banking

Leveraging on the success in Dubai to capitalize on

opportunities in other Emirates

Evolving from a pure banking entity

to a more comprehensive Financial Services Group

Diversifying DIB’s revenue streamsthrough penetration and presencein new markets in the MENA region

Continually innovate using thelatest technology and product expertise

leading to ease and convenience

Focus on Value Growth: cross selling,

new Islamic productsembed cost awareness

• 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)

Real Estate26%

Financial Institutions

38%

Retail10%

Manuf / Services19%

Govt7%

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

An Integral, Recognized player in the Islamic Finance sector

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

• 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

Total Assets: USD Billion

14

Key Financials – Trend

Total Deposits: USD Billion

Total Financing: USD Billion

• Strong and consistent growth in total deposits

• DIB is the #3 bank in customer deposits in UAE

• More than 4 fold growth in gross financing in 5 years

• Well diversified and balanced portfolio, with lending to all key industry sectors

15

Key Financials – Trend

ROE

ROA

• Consistent growth in ROE, in line with the top 5 banks

• Marginal drop in 2006 attributed to increase in capital of US$906 million

• Steady growth in ROA in last 5 years

• Return on assets of 3.4%, in the top end among major UAE Banks

Source: Bloomberg

16

67.5%

15.4%

17.1%

Investment Deposits Current Saving

Customer Deposits Composition

64.8%

13.5%

21.7%

20072001

Strong deposit base to support growth plans

17

Key Financials – Trend

Cost-Income

Advances to Deposits

• Cost to Income at 40%

• Increased due to investment in new branding, new branches, improved systems and channels

• Healthy liquidity maintained compared to peer banks in UAE

Contents

About Dubai, UAE

About DIB

DIB Financials

Peer Group

Stock Information

Domestic peer group comparisonNet Profit Growth: USD Million

Total Assets: USD Billion

• Total assets among the top 5 banks in UAE

• DIB net profits CAGR is the highest among comparable peer banks

• Net profits among the top 3 banks in UAE

Total Assets

27.5

22.1

13.0

68.7

38.0

28.9

23.9

22.8

19.9

15.4

45.2

17.5

-

10.0

20.0

30.0

40.0

50.0

60.0

70.0

ENBD NBAD ADCB FGB DIB MESQ

Banks

Tota

l Assets

s ( U

SD 'bln

)

2006 2007

52%

38%

31%55%

30% 53%

Net Profit (USD 'Mn)573

425

428

1,0

74

682

681

541

547

517567

815

418

-100200300400500600700800900

1,0001,1001,200

ENBD NBAD DIB ADCB FGB MESQ

Banks

Net Pro

fit ( USD

'Mn )

2006 2007

32%

19% 60%

-5% 31%21%

Domestic peer group comparison

Total Deposits: USD Billion

Total Financing: USD Billion

• Total financing among the top 5 banks

• Total deposits among top 3 banks in UAETotal Deposits

19.3

13.0

9.4

37.7

22.3

17.7

15.6

14.2

13.111.8

26.0

9.4

-

10.0

20.0

30.0

40.0

ENBD NBAD DIB ADCB FGB MESQ

Banks

Tot

al D

epos

its

( USD

'bln

)

2006 2007

45%

16%

36%32%

52% 39%

Total Financing (USD 'Mn)

15.7

17.0

9.6

6.8

8.0

45.3

21.7

20.6

13.3

12.1

10.4

29.7

(3.0)

7.0

17.0

27.0

37.0

47.0

ENBD NBAD ADCB DIB FGB MESQ

Banks

Fin

ance A

mt (USD 'Bn)

2006 2007

CAGR

53%

39%21%

39% 77%30%

21

Domestic peer group comparison

ROE: 2007

ROA: 2007

• ROA among top 3 banks

• ROE top amongst peer banks

• Compares favorably with major banks globally

Source: Bloomberg

ROE

26.0

%

25.0

%

23.8

%

22.0

%

21.0

%

18.0

%

15%

17%

19%

21%

23%

25%

27%

DIB NBAD ENBD MESQ FGB ADCB

Banks

RO

E

ROA

3.3

8%

3.3

2%

2.6

3%

2.1

2%

2.0

8%

1.8

9%

1.5%

1.7%

1.9%

2.1%

2.3%

2.5%

2.7%

2.9%

3.1%

3.3%

3.5%

DIB FGB MESQ ADCB NBAD ENBD

Banks

RO

A

2007

22

Domestic peer group comparison

Cost Income Ratio 2007

Financing to Deposit 2007

• Most liquid amongst banks in UAE

• Increased due to infrastructure spend, technology, new branches, and staff packages in line with the market

Source: Bloomberg

Advance / Deposit Ratio

75%79%

85%

98%

120%

132%

0%

20%

40%

60%

80%

100%

120%

140%

DIB MESQ FGB NBAD ENBD ADCB

Banks

Ad

van

ce / D

ep

osit

Ratio

2007

Cost/ Income Ratio

27%29%

37% 38%40%

22%

0%

10%

20%

30%

40%

50%

FGB ADCB NBAD MESQ ENBD DIB

Banks

Co

st/In

com

e R

atio

2007

Contents

About Dubai, UAE

About DIB

DIB Financials

Peer Group

Stock Information

24

Key MetricsBloomberg ID: DIB UH Equity

Key Indicators: USD

US$ 2.40

US$ 3.40

Current

US$

2.50

Face value for 2003, 2004 equated to $0.27/ shareSource: DFM, DIB Published accounts

1.75 2.98

7.5

2.65 2.93 3.4

12.7514.78

26.2

11.67 11.29

14.61

0

5

10

15

20

25

30

35

40

2003 2004 2005 2006 2007 Q1 2008

Perc

enta

ge

PB Ratio PE Ratio

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

10%

15%

20%

40%42%

55%

0%

10%

20%

30%

40%

50%

60%

2002 2003 2004 2005 2006 2007

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.

YTD Mar 2008

DFM trading volume (bn)26.34

DIB trading volume (bn)0.81

DIB % of DFM Volume3.07%

 

DFM trading value (USD Bio)$ 34.14

DIB trading value (USD Bio)$ 2.49

DIB % of DFM Value7.29%

 

DFM Market Cap Value (USD Bio)$126.81

DIB Market Cap Value$8.77

DIB % of DFM Market Cap6.91%

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