Contents

1 About Bank Leumi USA

2 Financial Highlights

3 Chairman’s Letter

4 Fifty Years in the U.S.

8 Business Segments

12 Management Analysis

16 Consolidated Statements of Financial Condition

17 Consolidated Statements of Income

19 Board of Directors and Management

22 Leumi Group Listing

24 Products and Services

25 Governance

About Bank Leumi USA

Bank Leumi USA, operating in the U.S. for 50 years, is an FDIC-insured full-service commercial bank that

provides financial services to middle- and upper-middle-market firms, international businesses, and not-

for-profit organizations through offices in New York, Chicago, Beverly Hills, Los Angeles, Encino, Palo Alto,

Miami, Aventura, Boca Raton and an offshore office in the Cayman Islands. The bank facilitates investments

and trade between the U.S. and Israel.

Bank Leumi USA offers U.S. and international private banking services, as well as a full range of securities

and insurance products through its brokerage subsidiary, Leumi Investment Services Inc.

Bank Leumi USA is the largest subsidiary of the Leumi Group, Israel’s leading banking group, founded in

1902, with assets exceeding $54 billion. Bank Leumi le-Israel B.M. is recognized as a significant force in

international finance. The Leumi Group serves clients around the world through more than 300 branches and

offices in Israel, major world financial centers in 19 countries and a broad network of correspondent banks.

1

(In thousands of dollars except per share data)

2003 2002 2001

Total Assets $5,347,011 $4,814,806 $4,105,298

Total Loans 2,289,097 1,971,222 1,774,875

Total Deposits 4,071,893 3,832,918 3,295,583

Shareholders’ Equity 373,395 395,009 378,962

Earnings

— Before Tax 48,270 56,068 57,449

— After Tax 30,892 34,762 35,621

Dividends per Common Share1 $ 2.71 $ 2.32 $ 1.16

1Total dividends paid in 2003 were $15,009,364 and declared not paid were $20,055,616.

Financial Highlights

2

Chairman’s Letter

Dear Shareholders, Customers and Friends,

The year 2003 was a busy one for Bank Leumi USA as we took steps that will enable us to take advantageof the expected economic recovery.

We expanded our presence in South Florida with the opening of a branch in Aventura; we relocated ourSan Jose, California branch to a larger space in Palo Alto with additional staff; and we opened a newbranch in downtown Los Angeles. We continued to add key personnel such as a Director of WealthManagement and an Entertainment Banking Lending team.

We have embarked on an ambitious information technology plan to upgrade our systems. This work willallow us to achieve substantial improvements in client service delivery as well as management reporting andmonitoring capabilities. We will be able to provide our customers with a state-of-the-art e-banking systemthat allows them not only to view their static account information, but to initiate and effect transactions inreal time. We also look forward to an enhanced, competitive cash management system that will providecommercial customers with an Internet-based platform.

Staff Changes

This year saw some important changes in personnel. We wish the best of luck to John Nork, Head ofOperations, and Tom Hoffman, Manager of our headquarters branch, who both retired after 30 years ofloyal service to this institution. At the same time, we congratulate Jose Paulucci, who has assumed theposition of Head of Operations and Information Technology.

We also wish to congratulate Jose Paulucci, Chaim Fromowitz, Head of Private Banking and InternationalServices, and John McGann, Head of Branch Banking, Human Resources and Marketing, on their promo-tions to Executive Vice President.

Looking Ahead

It appears that the economy is recovering, though competition continues unabated. Nonetheless, we areconfident we will be able to confront whatever challenges may come our way while maintaining the highstandards that are the core of our existence and business.

We deliver premier products and personalized service to our valued clients. We focus on our specializedmarkets. We leverage our global reach, the strength of our parent, the Leumi Group, and the aptitude ofour diverse employee workforce to build on our foundation of sound financial services. We seize value-creating opportunities when they arise.

With Gratitude

We thank our employees for their ongoing hard work and dedication. Their talent, teamwork, loyalty andrespect for one another enable Bank Leumi USA to continue to prosper. We thank the Board of Directorsfor their leadership and vision, and we thank our parent and shareholders for their continuing support. Weespecially thank our valued clients for their business and for allowing us to serve their financial needs.

Thank you for your support.

3

Eitan RaffChairman of the Board

Dr. Zalman Segal Chief Executive Officer

fifty yearsFifty Years in the U.S.

Celebrating Our Anniversary

In 1954, Bank Leumi le-Israel opened a representative office in New York at 60 Wall Street. In September

1959, the representative office became an agency, and, in 1962, the agency became a branch.

First Israel Bank and Trust Company of New York was established in 1967, and, in 1971, the bank opened

an office at 579 Fifth Avenue that continues as the main branch today.

First Israel Bank and Trust company became Bank Leumi Trust Company of New York in 1973, and Bank

Leumi USA in 1997.

Bank Leumi USA currently has 10 offices around the country: two in New York City, one in Chicago, three

in South Florida, in Miami, Aventura and Boca Raton, and four in California, in Beverly Hills, Los Angeles,

Encino and Palo Alto. It also has an offshore branch in the Cayman Islands.

Each of these offices provides Bank Leumi USA with an opportunity to deliver premier commercial, inter-

national and private banking products, as well as personalized service, to our valued clients.

Our strong capital and high liquidity will allow us to continue to take advantage of opportunities for growth

in our key markets in the U.S. and abroad.

5

New York

Our headquarters in New York City, located on prestigious Fifth Avenue in midtown Manhattan, features

sophisticated private banking offices. Just one block from New York’s famed diamond district, 579 Fifth

Avenue is ideally located to serve the diamond and jewelry industry.

In the heart of the fashion district, our 1400 Broadway branch focuses on the textile and apparel industry,

and boasts a beautiful mural of the industry’s history.

Illinois

Since 1974, when our full-service branch opened in Chicago at 100 North LaSalle Street in the financial

district, our Hebrew-numbered clock has gained attention from passers by. Here, the emphasis is on

private banking and serving Chicago’s commercial middle-market. We provide innovative financing to

manufacturers, wholesalers and service companies in the healthcare, diamond and jewelry, real estate,

and apparel industries.

6

7 Florida

Our branches at 800 Brickell Avenue in Miami, 19495 Biscayne Boulevard in Aventura, and 5295 Town

Center Road in Boca Raton cater to both U.S. and international clients. Diverse groups of people call

South Florida home at least part of the year, including permanent American residents, wintering “snow

birds,” Latin Americans and Israelis all requiring services from our full range of private, commercial and

international banking products.

California

Operating first as a branch of our parent, Bank Leumi le-Israel, our Beverly Hills branch at 8383 Wilshire

Boulevard on the west side of Los Angeles now serves U.S. and international private banking and com-

mercial banking clients in the consumer electronics, hi-tech, food products, diamond and jewelry, and

entertainment industries.

The Encino office at 16530 Ventura Boulevard serves the same industries in the San Fernando Valley, and

our new downtown Los Angeles office at 600 Wilshire Boulevard makes it easier for our textile and apparel

clients who operate there to get to us.

Bank Leumi USA is the only Israeli-related banking group to operate in the San Francisco Bay area. Our

Silicon Valley branch at 2000 University Avenue in Palo Alto serves local and Israeli-related technology

companies, private banking clients and commercial middle-market firms.

businessBusiness Segments

International, Commercial and Private Banking

Bank Leumi USA, member FDIC, is the largest subsidiary of the worldwide Leumi Group. We serve mid-

dle- to upper-middle-market companies, including importers and exporters, manufacturers, distributors,

and retailers in such diverse industries as diamonds and jewelry, textiles and apparel, food, entertain-

ment, real estate and high technology. We serve international businesses, not-for-profit organizations and

affluent individuals in the United States and abroad.

International Banking

Through the Leumi Group’s global network, Bank Leumi USA is well equipped to serve companies with

multinational activities. We provide clients access to global markets, enabling them to benefit from a full

range of business and investment opportunities. These may involve trade opportunities abroad, a managed

portfolio in the United States, a specialized investment vehicle offshore or an investment opportunity in Israel.

Our Israeli Desk: A Unique Resource — Our special “Israeli Desk” offers clients a single source for prod-

ucts and information relating to all aspects of U.S.-Israeli business.

International Lending — Our long experience and presence in Latin America give us a wealth of knowledge

that we leverage in developing financial solutions for clients doing business there. And in the United States,

we can provide competitive advantages over any local bank at our clients’ U.S. subsidiary locations.

Commercial Banking

Bank Leumi USA offers a full range of lending services, an extensive array of international trade finance

services and a complete line of cash management services.

Import and Export Financing — Bank Leumi USA uses state-of-the-art technology to provide letters of

credit, acceptances and collections quickly and conveniently. Our international and domestic experience,

as well as our global correspondent relationships, helps us serve importers and exporters efficiently,

guiding them through the complexities of each trade transaction.

Leumi Global Link — Our online communications link connects a client’s PC directly to our International

Trade Finance system. Clients can apply for letters of credit online, access credit balances, collection

balances, customer advices and more, and customize reports when and how they choose. The result is

faster turnaround, more accurate information and more efficient business.

Government Agency Financing — We have ties to both U.S. and Israeli government agencies, and we can

arrange long-term funding for exports through the U.S. EXIMBANK, the Israel Foreign Trade Risk Insurance

Corporation (IFTRIC) and other entities. Our in-depth knowledge of U.S. and Israeli trade regulations and

commercial channels enables us to structure transactions advantageously for our clients.

Equipment Leasing — Through Bank Leumi Leasing Corporation, our wholly owned subsidiary, we arrange

a variety of equipment financing for middle- and upper-middle-market clients, as well as for other financial

institutions through third-party originations. Bank Leumi Leasing Corporation maintains an active syndica-

tions desk, selling and/or participating in transactions. Our product line includes single-investor tax leases,

finance leases, equipment loans, rent discounting programs and synthetic lease structures.

9

Syndicated Loans — With extensive correspondent relationships in the U.S. market, Bank Leumi USA is

experienced at arranging syndicated loans, and can do so for U.S. companies with greater need for

capital, Israeli entities acquiring U.S. companies, and U.S. entities acquiring Israeli companies.

Cash Management — Bank Leumi USA can deliver sophisticated, efficient cash management and deposit

services directly to clients, regardless of location. These services provide accurate, up-to-date financial

information and enable clients to accelerate turnover of receivables into cash, put unused funds to work

and continually raise productivity. The result is improved cash flow, convenient access to account informa-

tion and more effective control of treasury operations.

Leumi Access — Through our direct banking system, clients can monitor and manage their bank

accounts—local accounts, accounts of distant offices and/or accounts of overseas clients’ U.S. sub-

sidiaries—from their own offices. Clients can review a divisional office’s balances, move funds between

a subsidiary and the parent company, or move funds between the subsidiary and a given vendor’s bank.

Using technology to strengthen relationships among a company, its subsidiaries and its suppliers is typi-

cal of Bank Leumi USA’s approach.

Hedging Against Risk — Our Trading Room’s experienced specialists regularly design customized finan-

cial instruments to protect clients from unexpected shifts in interest or currency rates. From options to

interest-rate hedges and swaps, our traders enable clients to execute transactions quickly and efficiently.

Investment Management — We manage portfolios and provide a broad array of investment alternatives for

corporate clients. Our close relationships with leading Wall Street firms enable us to offer a diverse range

of investment products. In addition, we customize products to meet the return and risk parameters appro-

priate for each client.

Wealth Management

Wealth Management serves the banking needs of sophisticated, high-end global private banking clients.

Our business philosophy is to establish and maintain long-term relationships with clients and be conser-

vative in assessing opportunities. We are able to find the appropriate resource at any given moment, be it

tailor-made lending services, alternative investments, or currency and option trading.

Private Banking

Private Banking at Bank Leumi USA provides affluent clients with a diverse selection of products and

services for their personal and business needs at every stage of their life cycles. Private banking adds

value to our client relationships through objective evaluation. We believe that we serve clients best by

helping them select among a variety of options.

We understand the importance of personal service in building and sustaining long-term relationships.

While technology is a necessary tool for disseminating information, Bank Leumi USA puts high value

on people. Our licensed private bankers dedicate the time and resources required to get to know their

customers, inform them about the range of investment and insurance options available, and make sure

all of their questions are answered. The relationships built in one generation often extend to future genera-

tions based on this unique combination of up-to-date technological sophistication and a long-standing

tradition of personal service.

10

Investment Management Services — Bank Leumi USA offers tailored portfolios to our U.S. and international

private banking clients, including equity and fixed-income investments on a discretionary or advisory basis.

Innovative Deposit Products — Private banking clients may take advantage of our Principal Protected

Investments, time deposits linked to a specified market index or currency. Return of principal is guaran-

teed at maturity, making this an attractive product for clients with low risk tolerance.

Leumi Investment Services Inc. (LISI)

Bank Leumi USA’s brokerage firm subsidiary, Leumi Investment Services Inc., provides clients with access

to a full range of securities and investment products. Headquartered in New York, LISI also has branch

offices in Florida, Chicago and California.

LISI is a member of the National Association of Securities Dealers, Inc. (NASD) and the Securities Investors

Protection Corporation (SIPC). Client accounts are fully protected by SIPC, along with a supplemental

insurance policy maintained through a nationally recognized insurance provider.

� Financial and Estate Planning — Our planning specialists assist clients with various wealth manage-

ment strategies, including intergenerational transfers, charitable trusts and succession planning.

� Insurance Programs — LISI offers a variety of annuities and life insurance products for estate planning

and other needs. Programs are available for both U.S. and international individuals and businesses.

� Investment Advisory Programs — Mutual fund asset allocation programs and separate account

manager programs are customized to meet clients’ needs and objectives. Clients have access to

exclusive portfolio managers who are carefully screened and highly regarded.

� U.S. and Foreign Equities and Options — LISI offers competitive commissions for the purchase

and sale of individual securities.

� Mutual Funds — Clients can choose from a large universe of U.S. and global markets mutual

funds managed by industry leaders, ranging from conservative to aggressive growth funds.

� Fixed Income Securities — including government, corporate and municipal bonds.

� Emerging Markets Securities — including sovereign debt, corporate bonds and equities.

� Hedge Funds — Qualified investors have access to individual hedge funds and fund-of-funds products.

PRODUCTS OFFERED THROUGH LISI:

NOT FDIC INSURED / NO BANK GUARANTEE / MAY LOSE VALUE

Securities and insurance products offered through Leumi Investment Services Inc. (LISI), a wholly owned subsidiary of Bank LeumiUSA. Member of SIPC. Securities in LISI client accounts protected up to $500,000. For details, please see www.sipc.org. In addition to this coverage, LISI’s client accounts are protected for their full value through a supplemental insurance policy maintained through a nationally recognized insurance provider.

11

analysisManagement Analysis

In spite of the continuing slowdown in the economy, the year 2003 was a solid one for Bank Leumi USA.

We recorded net earnings of $30.9 million, improved key financial ratios, paid dividends of $15.0 million,

declared an additional dividend of $20.0 million and achieved substantial growth in our major business lines.

We continued to invest in expansion and the renovation of existing facilities amid the changes that are so

prevalent in the financial services industry, without compromising our high standards of underwriting or,

most importantly, the personal service that our clients rightly expect.

Our financial performance in 2003 reflected the strength of our three primary business franchises — Commercial

Banking, Private Banking and International Banking — and the exceptional dedication and talent of Bank

Leumi USA employees. We are confident that 2003 was a year in which we laid the foundation for healthy

and profitable growth in the future.

13

03

02

01

$30,892

$34,762

$35,621

Net Income After Tax (in thousands)

Total Assets (in thousands)

Shareholders’ Equity (in thousands)

Return on Equity

$5,347,011

$4,814,806

$4,105,298

$373,395

$395,009

$378,962

9.05%

10.29%

11.70%

03

02

01

03

02

01

03

02

01

Financial Strength

Bank Leumi USA reported pretax earnings of $48.3 million for 2003, compared with 2002 pretax earn-

ings of $56.1 million. Net income for 2003 was $30.9 million, compared with $34.8 million for 2002.

As of December 31, 2003, Bank Leumi USA had $5.3 billion in total assets and a capital base of

$373.4 million in shareholders’ equity. All capital ratios continue to exceed regulatory requirements

for the designation of “well-capitalized.” The bank enjoys high liquidity, with cash, placements and

marketable securities representing 55% of total assets as of December 31, 2003.

Financial Highlights of 2003 Include:

� Return on Equity — Return on equity, net of deferred taxes, decreased to 9.1% for 2003

from 10.3% for 2002.

� Securities Portfolio Growth — The bank’s securities portfolio remained at $2.5 billion at

year-end 2003, unchanged from year-end 2002.

� Credit Quality — Total nonperforming assets were $10.7 million, or 0.5% of loans, as of December 31,

2003, compared with 1.1% of loans as of December 31, 2002. The allowance for credit losses totaled

$67.1 million at year-end 2003, equaling 626% of nonperforming loans, compared with $73.6 million,

which equaled 349% of nonperforming loans one year earlier. Our reserves-to-loan ratio is still among the

highest in the industry.

� Noninterest Expense and Efficiency — The efficiency ratio in 2003 decreased to 59.3%, compared

with 52.1% in 2002. Total noninterest expense in 2003 increased to $78.9 million, from $70.1 million

in 2002. The increase reflects the full year absorption of consolidating the Miami Agency into the

bank as well as the expansion of our branch network in Florida and California. This, along with the

recruitment of key business developers in private banking and commercial lending are strategic

investments that are expected to generate increased revenues in 2004.

� Capital Strength — Total shareholders’ equity, including tax benefits, at December 31, 2003, was

$373.4 million (net of a $20.0 million dividend declared in December), representing 7.0% of year-end

assets. This compares with total shareholders’ equity of $395.0 million as of December 31, 2002,

representing 8.2% of year-end assets. At year-end 2003, the bank’s Tier 1 capital ratio was 9.9%,

its total capital ratio was 14.1% and its leverage ratio was 6.6%. All capital ratios continued to be

well above regulatory requirements for the designation of “well-capitalized.”

� Staff Complement — The bank’s complement as of December 31, 2003, totaled 443, compared with

440 as of December 31, 2002.

14

$488,205 Real Estate

$120,300 Wholesalers & Importers

$80,194 Steel, Mining & Chemicals

$162,542 Apparel & Textiles

$223,627 Diamonds & Jewelry

$109,818 Retail

All Others $308,581

Services $130,775

Vehicles, Transportation & Storage $42,244

Communications & Utilities $17,628

Financial & Insurance $273,428

Manufacturing $127,715

Individuals $204,040

Loans by Industry (in thousands) December 31, 2003

Efficiency Ratio (unadjusted for unusual items)

Credit Quality

03

02

01

$4,071,893

$3,832,918

$3,295,583

2003

2002

2001

03

02

01

03

02

01

$2,289,097

$1,971,222

$1,774,875

Allowance for Credit Losses /

Nonperforming Loans

Nonperforming Assets / Loans

Total Loans (in thousands)

Total Deposits (in thousands)

Capital Ratios

14.10%

9.91%

6.64%

13.36%

9.34%

7.34%

13.67%

10.86%

8.94%

59.28%

52.05%

52.24%

03

02

01

$2,497,178

$2,461,833

$2,120,188

Total Securities (in thousands)

Total Capital Leverage CapitalTier 1 Capital

03

02

01

626%

349%

325%

03

02

01

0.47%

1.07%

1.32%

Consolidated Statements of Financial ConditionYears Ended December 31(dollar amounts in thousands)

2003 2002

Assets

Cash and due from banks — demand $ 65,423 $ 69,034

Federal funds sold 52,000 30,000

Time deposits with banks 308,406 180,512

Securities available for sale 2,496,316 2,461,039

Trading securities 862 794

Loans 2,289,097 1,971,222

Less: allowance for possible loan losses 67,089 73,576

Loans — Net 2,222,008 1,897,646

Bank premises and equipment 22,907 22,247

Deferred tax assets 42,351 44,768

Other assets 136,738 108,766

Total Assets $5,347,011 $4,814,806

Liabilities

Noninterest-bearing deposits $ 402,537 $ 328,279

Interest-bearing deposits 3,669,356 3,504,639

Total Deposits 4,071,893 3,832,918

Borrowings from FHLB 472,356 362,356

Securities sold under repurchase agreements 187,210 38,313

Long-term debt 100,000 100,000

Other liabilities 142,157 86,210

Total Liabilities 4,973,616 4,419,797

Shareholders’ Equity

Capital stock — $10 par value:

Authorized, 15,000,000 shares

Outstanding, 12,939,107 shares 129,391 129,391

Surplus 150,668 150,668

Retained earnings 100,226 104,399

Accumulated other comprehensive income/(loss) (6,890) 10,551

Total Shareholders’ Equity 373,395 395,009

Total Liabilities and Shareholders’ Equity $5,347,011 $4,814,806

16

Consolidated Statements of IncomeYears Ended December 31(dollar amounts in thousands)

2003 2002

Interest Income

Interest on loans $ 82,638 $ 85,233

Interest on securities 77,164 89,474

Interest on federal funds sold and securities purchased

under resale agreements 974 1,202

Interest on time deposits with banks 553 887

Total Interest Income 161,329 176,796

Interest Expense

Interest on deposits 47,374 58,547

Interest — other 22,509 22,436

Total Interest Expense $ 69,883 $ 80,983

Net Interest Income 91,446 95,813

Less: provision for possible loan losses 5,919 8,503

Net Interest Income after provision for possible loan losses 85,527 87,310

Operating Income

Commissions 16,061 12,651

Fees 8,996 8,232

Other 16,583 17,969

Total Operating Income $ 41,640 $ 38,852

Operating Expense

Salaries 33,456 31,138

Employee benefits 8,926 7,504

Occupancy 10,070 9,211

Professional services 4,541 2,997

Equipment 4,398 4,156

Data processing 3,892 3,191

Other 13,614 11,897

Total Operating Expense 78,897 70,094

Income before income taxes 48,270 56,068

Income tax 17,378 21,306

Net Income $ 30,892 $ 34,762

17

listing

sListings of Management, Office Locations, Products and Services

Board of Directors and Management

Board of Directors

Eitan RaffChairman of the BoardBank Leumi USAChairman of the BoardBank Leumi le-Israel B.M.

Zalman SegalVice Chairman, President

& Chief Executive OfficerBank Leumi USA

Steve M. BarnettPresidentCDC, Inc.

Theodore P. GlueckPresidentEastwood Associates, Inc.

Jacob E. GoldmanChairman of the BoardGB Energy Systems, Inc.

James R. GreeneBusiness Consultant

& Chairman of theLoan Committee

Bank Leumi USA

Malcolm HoenleinExecutive Vice ChairmanConference of Presidents of

Major Jewish Organizations

Donald S. HowardBusiness Consultant

& Chairman of the Investment Committee

Bank Leumi USA

Robert K. LiftonChairman & CEOMedis Technologies Ltd.

Zeev NahariDeputy Chief Executive Officer

& Chief Financial OfficerBank Leumi le-Israel B.M.

Lester PollackManaging DirectorCentre Partners

Management LLC

Itamar RabinovichPresidentTel Aviv UniversityFormer Ambassador of

Israel to the United States

Francis X. StankardCompany Director

& Chairman of the Executiveand Examining Committees

Bank Leumi USA

Frederick E. TetzeliBusiness Consultant

(resigned August 2003)

Michael UrkowitzBusiness ConsultantFormer Executive Vice PresidentChase Manhattan Bank

Honorary Director

Abraham L. GitlowProfessor of Economics

& Dean EmeritusNew York University

College of Business andPublic Administration

Senior Management

Zalman SegalVice Chairman, President

& Chief Executive Officer

Yair TalmorSenior Executive Vice PresidentHead of U.S. & International Lending

Robert R. GiordanoExecutive Vice PresidentTreasurer

Jose PaulucciExecutive Vice PresidentHead of Operations

& Information Technology

Chaim FromowitzExecutive Vice PresidentHead of Private Banking

& International Services

John P. McGannExecutive Vice PresidentHead of Human Resources

& Branch Banking

Ira RomoffExecutive Vice PresidentChief Credit Officer

& Risk Manager

Anthony MauroSenior Vice PresidentController

Wendi G. GlassmanSenior Vice PresidentGeneral Counsel

& Corporate Secretary

19

Management

U.S. & International Lending

Yair TalmorSenior Executive Vice President

Richard SilversteinSenior Vice PresidentDeputy Division Head Lending

Haim V. SionSenior Vice PresidentDeputy Division HeadTrade Finance & e-Banking

Lending

Michaela KleinSenior Vice PresidentInternational Lending

Gloria BucherSenior Vice PresidentCorporate Finance

Joseph A. SciarilloSenior Vice PresidentReal Estate Lending

Jeff E. PfefferSenior Vice PresidentDiamond and Jewelry Lending

John KoenigsbergFirst Vice PresidentUpper-Middle-Market Lending

Scott MorelloFirst Vice PresidentTextiles and Apparel

Eric HalpernFirst Vice PresidentTextiles and Apparel

Gerard LobFirst Vice PresidentTrade Finance Lending

Moshe BensdonFirst Vice PresidentSystems Development

Bank Leumi Leasing CorporationSteven CaligorPresident

Trade Finance

Manashe BassousFirst Vice PresidentCollections

A.T. GobalakrishnaFirst Vice PresidentLetters of Credit

Branch Banking

John P. McGannExecutive Vice President

New York

Steven SchieffelinFirst Vice PresidentManager579 Fifth Avenue

Sheldon LaufgrabenFirst Vice PresidentManager1400 Broadway

California

Dan MeiriExecutive Vice President

& Regional Manager

Robert KosofSenior Vice PresidentMiddle-Market Lending

Melanie L. KrinskyFirst Vice PresidentEntertainment Banking

Cynthia CarmeliFirst Vice PresidentHead of Operations

Moti Levy-TsedekFirst Vice PresidentManagerBeverly Hills

Ira PinskerFirst Vice PresidentManagerLos Angeles

Yael CohenVice PresidentManagerEncino

Boaz BlumovitzFirst Vice PresidentManagerPalo Alto

Chicago

Israel KorenSenior Vice President

& Manager

Jon SpoerryFirst Vice PresidentMiddle-Market Lending

Terrance G. HughesFirst Vice PresidentPrivate Banking

Sandra ArcherVice PresidentHead of Operations

Shoshana SendlinVice PresidentBranch Banking

Florida

Akiva SegalSenior Vice President

& Regional Manager

Richard OleszewskiFirst Vice PresidentMiddle-Market Lending

& Manager, Boca Raton

Juan SutijaVice PresidentOperations

Iris GallegoVice PresidentManagerAventura

20

Private Banking & International Services

Chaim FromowitzExecutive Vice President

Yaacov OsmoSenior Vice PresidentInternational Customer Service

Hillel WaxmanSenior Vice PresidentPreferred Customer Unit

Dan HoffmanFirst Vice PresidentInternational Customer

Service Operations

Steven SchieffelinFirst Vice PresidentInvestment Services

& U.S. Private Banking

Susan PearceFirst Vice PresidentWealth Management Lending

Leumi Investment Services Inc.Nancy EidenPresident

Credit & Risk Management

Ira RomoffExecutive Vice President

Christopher MillerFirst Vice PresidentCredit Administration

Richard SchwamFirst Vice PresidentSpecial Lending

Legal

David HertzSenior Vice PresidentAssociate General Counsel

& Department Head

Donald BittkerFirst Vice PresidentAssociate General Counsel

General Counsel

Wendi G. GlassmanSenior Vice PresidentGeneral Counsel

& Corporate Secretary

Maryellen ChomskyVice PresidentCompliance Officer

Operations

Jose PaulucciExecutive Vice President

Ronald J. CiborowskiSenior Vice PresidentLoan Operations

& Check Processing

Vincent GrayVice PresidentMoney Transfer

Arline PeetersVice PresidentData Security Officer

Lourdes ProdigalidadVice PresidentAdministrative Services

Carl SchuttVice PresidentTreasury Support

Treasury

Robert R. GiordanoExecutive Vice President

Jacob BarakFirst Vice PresidentDeputy TreasurerForeign Exchange

& Securities Sales

Administration

Herzl RahimiSenior Vice PresidentChief Internal Auditor

Michael W. SantimauroSenior Vice PresidentHead of Loan Review

Controller’s Group

Anthony MauroSenior Vice President

Richard R. MunyanFirst Vice PresidentDeputy Controller

& Financial Planning

Human Resources

John P. McGannExecutive Vice President

Jean CowanVice PresidentBenefits, Compensation

& Recruiting

Peter CalabreseVice PresidentPayroll Administration

Marketing

Leslie B. KahleVice PresidentDirector of Marketing

21

Leumi Group Listing

IsraelBank Leumi le-Israel B.M.Tel Av iv Headquarters24–32 Yehuda Halevi StreetTel Aviv 65546Tel: 972.3.514.8111Fax: 972.3.514.8656www.leumi.co.il

Leumi Global Private Banking Division

35 Yehuda Halevi StreetTel Aviv 65546Tel: 972.3.514.7717Fax: 972.3.514.9602

Leumi International Private Banking Centers

Dizengoff Top Tower17th Floor/23rd FloorTel Aviv 64332 Tel: 972.3.621.7333/7444Fax: 972.3.621.7355/7455/7456

Jerusalem 19 King David StreetJerusalem 94101Tel: 972.2.620.1811Fax: 972.2.624.0431

Leumi Foreign Residents and Tourists Centers

Tel Av iv Jerusalem HaifaNetanya Herzliya PituachBat YamAshdod

Leumi & Co. Investment House Ltd.

25 Kalisher StreetTel Aviv 65165Tel: 972.3.514.1212Fax: 972.3.514.1275

Bank Leumi le-Israel TrustCompany Ltd.

8 Rothschild BoulevardTel Aviv 66881Tel: 972.3.517.0777Fax: 972.3.517.0770

Psagot-Ofek Securities & Investments Ltd.

14 Ahad Ha’am StreetTel Aviv 65142Tel: 972.3.796.8888Fax: 972.3.796.8889

United States of AmericaBank Leumi le-Israel B.M. New York Regional Office562 Fifth Avenue, 2nd FloorNew York, NY 10036Tel: 1.212.626.1355Fax: 1.212.626.1366

Bank Leumi USA

New York

Headquarters579 Fifth AvenueNew York, NY 10017Tel: 1.917.542.2343Fax: 1.917.542.2254www.leumiusa.com

1400 Broadway at 38th StreetNew York, NY 10018Tel: 1.917.542.2343Fax: 1.917.542.2254

International Private Banking564 Fifth AvenueNew York, NY 10036Tel: 1.212.626.1001Fax: 1.212.626.1009

Bank Leumi Leasing Corporation562 Fifth AvenueNew York, NY 10036Tel: 1.212.626.1230Fax: 1.212.626.1271

Leumi Investment Services Inc.562 Fifth AvenueNew York, NY 10036Tel: 1.212.407.4345Fax: 1.212.407.4351

California

Beverly Hills8383 Wilshire Boulevard, Suite 400Beverly Hills, CA 90211Tel: 1.323.966.4700Fax: 1.323.966.4245

Los Angeles600 Wilshire Boulevard, Suite 1500 Los Angeles, CA 90017 Tel: 1.213.452.8600Fax: 1.213.452.8630

Encino16530 Ventura BoulevardEncino, CA 91436Tel: 1.818.906.1836Fax: 1.818.986.3021

Palo Alto2000 University Avenue, Suite 605Palo Alto, CA 94303Tel: 1.650.289.2400Fax: 1.650.289.2424

Illinois

Chicago100 North LaSalle StreetChicago, IL 60602Tel: 1.312.781.1800Fax: 1.312.750.1984

Florida

Miami 800 Brickell Avenue, Suite 1400Miami, FL 33131Tel: 1.305.702.3500Fax: 1.305.377.6544

Boca Raton5295 Town Center RoadBoca Raton, FL 33486Tel: 1.561.347.2300Fax: 1.561.394.8796

AventuraOne Turnberry Place19495 Biscayne Boulevard Suite 801Aventura, FL 33180Tel: 1.305.918.6960Fax: 1.305.918.6975

Cayman Islands

Grand Cayman British West Indiesc/o Bank Leumi USA International Customer Service 564 Fifth AvenueNew York, NY 10036 Tel: 1.212.626.1001 Fax: 1.212.626.1009

North, Central and South America

CanadaBank Leumi le-Israel B.M.

Toronto5140 Yonge Street, Suite 2220Toronto, Ontario M2N 6L7Tel: 1.416.594.0681Fax: 1.416.594.0801

Montréal1 Westmount Square, Suite 400Montréal, Québec H3Z 2P9Tel: 1.514.931.4457Fax: 1.514.931.5240

MexicoBank Leumi le-Israel B.M.

Mexico CityFuente de Pirámides 1-305Lomas de Tecamachalco53950 NaucalpanEdo. de MéxicoTel: 52.555.294.6155Fax: 52.555.294.4000

PanamaBank Leumi le-Israel B.M.

El DoradoCalle Manuel MariaIcaza No. 10, Edificio GrobmanPanama CityMailing Address:Apartado 6-4518El Dorado, Panama CityTel: 50.7.263.9377Fax: 50.7.269.2674

Cayman IslandsBank Leumi le-Israel B.M.

George Town BranchBritish West Indies

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CuraçaoLeumi International

Investments N.V.

Mailing Address for Cayman Islands and Curaçao:

c/o Bank Leumi (Luxembourg) S.A.6D, Route de TrèvesL-2633 SenningerbergLuxembourgTel: 35.2.346390Fax: 35.2.346396

VenezuelaBank Leumi le-Israel B.M.

CaracasPlaza la CastellanaEdificio BancaracasPiso 9, Of. 903La Castellana, CaracasTel: 58.212.265.4887/5052Fax: 58.212.267.6454

BrazilBank Leumi le-Israel B.M.

São PauloEdificio os BandeirantesAvenida Brigaderio Faria Lima #2179 Conjunto 81/82CEP 01452-000São PauloTel: 55.11.3812.2494Fax: 55.11.3812.0711/5369

Rio de JaneiroAvenida Rio Branco, 122-14 FT Rio de Janeiro 20040/001Tel: 55.21.2507.2121Fax: 55.21.2221.1417

Porto AlegreRua Padre Chagas 185CONJ. 408, Porto AlegreTel: 55.51.3346.7210Fax: 55.51.3346.7960

ChileBank Leumi le-Israel B.M.

SantiagoTorre del BosqueAv. El Bosque Norte 0177Of. 604, SantiagoTel: 56.2.332.0140Fax: 56.2.332.0144

ArgentinaBank Leumi le-Israel B.M.

Buenos Aires25 de Mayo 555Piso 15(1002) Buenos AiresTel: 54.11.4311.0034Fax: 54.11.4313.4845

UruguayLeumi (Latin America) S.A.

Montevideo25 de Mayo 549MontevideoMailing Address:P.O.B. 89, 11000, MontevideoTel: 598.2.916.0223Fax: 598.2.917.0673

Punta del Este Avenida Gorlero, Calle 28Edif. Torre de las AméricasLocal 006, Punta del EsteTel: 598.42.44303Fax: 598.42.44492

Europe

United KingdomBank Leumi (UK) plc

London20 Stratford PlaceLondon W1C 1BGTel: 44.20.7907.8000Fax: 44.20.7907.8001

ManchesterBlackfriars House, 4th FloorThe ParsonageManchester M3 2JATel: 44.161.832.8995 Fax: 44.161.833.3627

Channel Islands

Bank Leumi (Jersey) Ltd.P.O. Box 52847-49 La Motte StreetJersey JE4 5ULTel: 44.1534.617.445Fax: 44.1534.617.446

Leumi Overseas TrustCorporation Ltd.

P.O. Box 65834 Hilgrove StreetSt. Helier, Jersey JE4 5ZNTel: 44.1534.639.486Fax: 44.1534.639.487

FranceBanque Leumi France S.A.

Paris35, Boulevard des Capucines75002 ParisTel: 33.1.53.45.65.65Fax: 33.1.53.45.65.70

LuxembourgBank Leumi (Luxembourg) S.A.Luxinvest S.A. Holding

6D Route de TrèvesL-2633 SenningerbergLuxembourgTel: 35.2.346390Fax: 35.2.346396

SwitzerlandBank Leumi le-Israel

(Switzerland)

ZurichClaridenstrasse 348022 ZurichTel: 41.1.207.9111Fax: 41.1.207.9100

Geneva80 Rue du Rhone1211 Geneva 3Tel: 41.22.318.3555Fax: 41.22.310.8318

GermanyBank Leumi le-Israel B.M.

FrankfurtSchillerstrasse 560313 Frankfurt am MainTel: 49.69.288031/41Fax: 49.69.288061

BerlinTauentzienstrasse 7 b/c10789 BerlinTel: 49.30.2579.8804/5Fax: 49.30.2579.8080

Asia, Australia and Africa

Hong KongBank Leumi le-Israel B.M.

617 Central BuildingQueens Road and Pedder StreetHong KongTel: 8522.524.0320/4710Fax: 8522.525.1318

AustraliaBank Leumi le-Israel B.M.

MelbourneNauru House, 43rd Floor80 Collins StreetMelbourne 3000 VICMailing Address:P.O.B. 1513nGPO Melbourne 3001Tel: 61.3.9654.2696Fax: 61.3.9650.6473

South AfricaBank Leumi le-Israel B.M.

Johannesburg16 Galliot Road, GlenhazelJohannesburg, South Africa, 2192Tel: 27.0.11.447.7860Fax: 27.0.11.447.5030

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Products and Services

Commercial Banking

Lending

Working Capital

Revolving Credit Lines

Term Loans

Acquisition and Bridge Financing

Commercial Loans and Lines

Loan Syndications and Participations

Real Estate Construction and Bridge Loans

Import and Export Financing

Government Agency Financing

Equipment Lease Financing

High-Technology Financing

Trade Finance

Documentary and Clean Collections

Bank-to-Bank Reimbursements

Commercial Letters of Credit

Standby Letters of Credit

Acceptance Financing

Air Releases/Steamship Guarantees

Leumi Global Link Customer Connection

Money Transfers

EXIMBANK Financing

Eurodollar Transactions

FX Forward, Spot and Deposit Transactions

Forfaiting

Interest Rate and Options Hedging and Swaps

International Banking Facilities

Cash Management

Account Reconciliation Services

Automated Clearing House (ACH)

Call Accounts

Cash Concentration

Demand Deposit Accounts

Electronic Tax Payment Services

Leumi Access Customer Connection

Lockbox Services

Payroll Processing/Direct Deposits

Real Estate Management/

Rent Security Accounts

Merchant Services

Zero Balance Accounts

Wealth Management

Customized and Structured Lending

Alternative Investments

Currency and Options Trading

Private Banking

Advisory Services

Financial and Estate Planning

Retirement Services

Investment Management Services

Brokerage Services

U.S. and Foreign Equities

Equity and Fixed-Income Options

U.S. Treasury and Agency Securities

Corporate and Municipal Bonds

Emerging Market Securities

U.S.-Registered and Offshore Mutual Funds

Equity and Fixed-Income Research

Corporate Employee Benefits

Defined Benefit Plans

Defined Contribution Plans – 401(k), 403(b), Profit Sharing

529 Plans

Executive Nonqualified Deferred Compensation Plans

Insurance Products

U.S.

Life and Disability Income Insurance

Fixed and Variable Annuities

Long Term Care Insurance

Structured Settlement Annuities

Premium Financing

Business Insurance

International

Fixed and Variable Annuities

Fixed Life Insurance

Kidnap & Ransom Insurance

Deposit Products

Checking, Money Market and Savings Accounts

Fixed and Variable Rate Time Deposits

Structured Products

Credit Products

Home Equity Loans

Enhanced Overdraft Protection

VISA® Credit/Debit Cards

24

BANK LEUMI USA

COMMERCIAL BANKINGINTERNATIONAL BANKINGPRIVATE BANKING

800.892.5430www.leumiusa.com

© 2004 BANK LEUMI USA. MEMBER FDIC.

The Board of Directors of Bank Leumi USA has adopted and adheres to corporate governance practices that it believesare sound, compliant with applicable law and represent best practices. Bank Leumi USA is not a public company; however,following enactment of the Sarbanes-Oxley Act of 2002, the Board and management enhanced bank policies and pro-cedures to meet many of the standards set by the Act and its implementing rules.

The Board of Directors consists of 14 members, 10 of whom are independent of management of the bank underapplicable law. In July 2003, the Board of Directors appointed Francis X. Stankard as lead director. Mr. Stankard, whois independent of management, is also Chairman of the Executive and Examining Committees. In his capacity as leaddirector, Mr. Stankard has additional corporate governance responsibilities. Shareholders and other interested partiesmay communicate with the lead director or the nonmanagement directors as a group by sending communications tothe principal office of Bank Leumi USA in care of the Corporate Secretary.

The Board of Directors has four standing committees: Executive, Examining, Investment and Loan. In 2003 the ExecutiveCommittee met nine times, the Examining Committee four times, the Investment Committee four times and the LoanCommittee 11 times. The Board of Directors met seven times.

The Examining Committee (which performs the typical functions of an audit committee) has three members. The Boardhas determined they (1) are “outside directors,” (2) have banking or related financial management expertise, and (3)are financially literate, as required by applicable FDIC rules and regulations. The Examining Committee members areFrancis X. Stankard, Jacob E. Goldman and Donald S. Howard. At least one of the members, Mr. Donald S. Howard,qualifies as an “audit committee financial expert” under SEC criteria. Among his many professional achievements,Mr. Howard previously served as the chief financial officer of Salomon Inc.

The Examining Committee operates pursuant to a charter, last revised in July 2003. The charter may be viewed on thebank’s website at www.leumiusa.com. The charter gives the Examining Committee the authority and responsibility forthe appointment, retention, compensation and oversight of the bank’s independent auditors. The committee preapprovesall audit and nonaudit services to be performed by the independent auditors. The Examining Committee appointedDeloitte & Touche LLP as the independent auditors of the bank after reviewing the firm’s performance and independencefrom management.

The bank has a Code of Ethics, last approved by the Board of Directors in February 2004. It is applicable to all directors,officers and employees. It is a code of conduct that expresses the bank’s commitment to promoting (1) honest and ethicalconduct; (2) full, fair, accurate and timely reporting; (3) compliance with all applicable laws, rules and regulations by alldirectors, officers and employees of the bank; and (4) the prompt internal reporting of violations of the Code of Ethicsin accordance with procedures set forth in the Code of Ethics. The Code of Ethics may be viewed on the bank’s websiteat www.leumiusa.com.

Governance