BURGAN BANK GROUP INTERIM CONDENSED CONSOLIDATED FINANCIAL INFORMATION 31 MARCH 2009 (UNAUDITED)

The attached notes 1 to 15 form an integral part of this interim condensed consolidated financial information. 4

Burgan Bank Group Interim Condensed Consolidated Income Statement Period ended 31 March 2009 (Unaudited)

Three months ended 31 March 2009 2008 Note KD 000’s KD 000’s Interest income 53,631 46,233 Interest expense (31,930) (33,372) ──────── ──────── Net interest income 21,701 12,861 Fee and commission income 6,693 5,191 Fee and commission expense (293) (363) ──────── ────────

Net fee and commission income 6,400 4,828 Net gains from foreign currencies 1,789 1,929 Net (loss) gains from financial assets at fair value through profit or loss (207) 3,444 Net (loss) gains from financial assets available for sale (178) 11,461 Dividend income 144 581 Other income 1,937 1,259 ──────── ──────── Operating income 31,586 36,363 Staff expenses (5,287) (4,076) Other expenses (4,481) (2,766) ──────── ──────── Operating profit before provision 21,818 29,521 Provision for impairment of loans and advances (4,296) (3,854) Impairment of investment securities (600) - ──────── ──────── Profit before taxation 16,922 25,667 ──────── ──────── Taxation 9 (2,507) (1,110) Profit for the period 14,415 24,557 ════════ ════════ Attributable to: Equity holders of the Bank 11,345 24,557 Non controlling interest 3,070 - ──────── ──────── 14,415 24,557 ════════ ════════ Fils Fils Basic earnings per share - attributable to the equity holders of the Bank 10 11.2 23.6 ════════ ════════ Diluted earnings per share - attributable to the equity holders of the Bank 10 11.2 23.6 ════════ ════════

The attached notes 1 to 15 form an integral part of this interim condensed consolidated financial information. 5

Burgan Bank Group Interim Condensed Consolidated Statement of Comprehensive Income Period ended 31 March 2009 (Unaudited) Three months ended 31 March 2009 2008 KD 000’s KD 000’s Profit for the period 14,415 24,557 Other comprehensive income Financial assets available for sale: Net fair value (loss) / gain (1,006) 1,165 Net transfer to interim condensed consolidated income statement 419 (11,461) Foreign currency translation adjustment 11,149 - ─────── ───────

Total comprehensive income for the period 24,977 14,261 ═══════ ═══════

Attributable to: Equity holders of the Bank 19,566 14,261 Non controlling interest 5,411 - ─────── ───────

24,977 14,261 ═══════ ═══════

The attached notes 1 to 15 form an integral part of this interim condensed consolidated financial information. 6

Burgan Bank Group Interim Condensed Consolidated Statement of Changes in Equity Period ended 31 March 2009 (Unaudited)

Attributable to the equity holders of the Bank

Share capital

KD 000’s

Share premium KD 000’s

Treasury shares

KD 000’s

Statutory reserve

KD 000’s

Voluntary reserve

KD 000’s

Treasury shares reserve

KD 000’s

Investments revaluation

reserve KD 000’s

Share based compensation

reserve KD 000’s

Foreign currency

translation reserve

KD 000’s

Retained earnings KD 000’s

Total KD 000’s

Non

controlling interest

KD 000’s Total equity KD 000’s

Balance at 31 December 2008 94,666 64,759 (16,589) 39,216 39,594 37,286 7,481 484 5,123 39,079 311,099 45,180 356,279 Bonus shares issued (note 8) 9,467 - - - - - - - - (9,467) - - - Total comprehensive income for the period - - - - - - (120) - 8,341 11,345 19,566 5,411 24,977 Cash dividend paid to non controlling interest - - - - - - - - - - - (1,900) (1,900) Purchase of treasury shares - - (1,758) - - - - - - - (1,758) - (1,758) Sale of treasury shares - - 23 - - 2 - - - - 25 - 25 Share based compensation expense (note 14) - - - - - - - 46 - - 46 - 46 ─────── ─────── ─────── ─────── ─────── ─────── ─────── ─────── ─────── ─────── ─────── ─────── ─────── Balance as at 31 March 2009 104,133 64,759 (18,324) 39,216 39,594 37,288 7,361 530 13,464 40,957 328,978 48,691 377,669 ═══════ ═══════ ═══════ ═══════ ═══════ ═══════ ═══════ ═══════ ═══════ ═══════ ═══════ ═══════ ═══════ Balance at 31 December 2007 86,060 64,759 (297) 35,257 35,635 38,489 21,656 176 - 69,405 351,140 - 351,140 Bonus shares issued (note 8) 8,606 - - - - - - - - (8,606) - - - Cash dividend paid (note 8) - - - - - - - - - (51,583) (51,583) - (51,583) Total comprehensive income for the period - - - - - - (10,296) - - 24,557 14,261 - 14,261 Purchase of treasury shares - - (3,009) - - - - - - - (3,009) - (3,009) Sale of treasury shares - - 2,372 - - (1,165) - - - - 1,207 - 1,207 Share based compensation expense (note 14) - - - - - - - 122 - - 122 - 122 ─────── ─────── ─────── ─────── ─────── ─────── ─────── ─────── ─────── ─────── ─────── ─────── ─────── Balance as at 31 March 2008 94,666 64,759 (934) 35,257 35,635 37,324 11,360 298 - 33,773 312,138 - 312,138 ═══════ ═══════ ═══════ ═══════ ═══════ ═══════ ═══════ ═══════ ═══════ ═══════ ═══════ ═══════ ═══════

The attached notes 1 to 15 form an integral part of this interim condensed consolidated financial information. 7

Burgan Bank Group Interim Condensed Consolidated Statement of Cash Flows Period ended 31 March 2009 (Unaudited) Three months ended 31 March 2009 2008 Note KD 000’s KD 000’s Operating activities Profit before taxation 16,922 25,667 Adjustments:

Net loss (gains) from financial assets at fair value through profit or loss 207 (3,444) Net loss (gains) on sale of financial assets available for sale 178 (11,461) Provision for impairment of loans and advances 4,296 3,854 Impairment of investment securities 600 - Dividend income (144) (581) Depreciation 877 462 Provision for share based compensation 46 122 ───────── ─────────

Operating profit before changes in operating assets and liabilities 22,982 14,619 Changes in operating assets and liabilities:

Treasury bills and bonds and Central bank bonds 17,436 12,839 Due from banks and other financial institutions (342,618) (305,441) Loans and advances to customers (106,735) (85,878) Other assets (6,374) (8,439) Due to banks 8,535 107,583 Due to other financial institutions 104,697 167,205 Deposits from customers 260,691 121,405 Other liabilities (22,597) (1,854) ───────── ─────────

Net cash (used in) from operating activities (63,983) 22,039 ───────── ───────── Investing activities Purchase of investment securities (107,297) (182,546) Proceeds from sale of investment securities 102,145 196,708 Purchase of property and equipment (net of disposals) (1,250) (396) Dividends received 144 581 ───────── ───────── Net cash (used in) from investing activities (6,258) 14,347 ───────── ───────── Financing activities Other borrowed funds (15,661) 33,075 Purchase of treasury shares (1,758) (3,009) Sale of treasury shares 25 1,207 Cash dividend paid - (51,583) Cash dividend paid to non controlling interest (1,900) - ───────── ───────── Net cash used in financing activities (19,294) (20,310)

Effect of foreign currency translation 5,300 - ───────── ───────── Net (decrease) increase in cash and cash equivalents (84,235) 16,076 Cash and cash equivalents at 1 January 550,955 431,190 ───────── ───────── Cash and cash equivalents at 31 March 3 466,720 447,266 ═════════ ═════════

Burgan Bank Group Notes to the Interim Condensed Consolidated Financial Information As at 31 March 2009 (Unaudited)

8

1. INCORPORATION AND REGISTRATION Burgan Bank S.A.K. ("the Bank”) is a public shareholding company incorporated in the State of Kuwait by Amiri Decree dated 27 December 1975 listed on the Kuwait Stock Exchange and is registered as a Bank with the Central Bank of Kuwait. The Bank’s registered address is P.O. Box 5389, Safat 12170, State of Kuwait. The interim condensed consolidated financial information of the Bank and its subsidiary (collectively “the Group”) for the period ended 31 March 2009 were authorised for issue in accordance with a resolution of the Board of Directors on 19 April 2009. The principal activities of the Group are explained in Note 11. The Bank is a subsidiary of Kuwait Projects Company Holding K.S.C. ("the Parent Company”). 2. BASIS OF PRESENTATION The interim condensed consolidated financial information of the Group have been prepared in accordance with International Accounting Standard (IAS) 34: Interim Financial Reporting except as noted below. The accounting policies used in the preparation of this interim condensed consolidated financial information are consistent with those used in the preparation of the annual consolidated financial statements for the year ended 31 December 2008. The annual consolidated financial statements for the year ended 31 December 2008 were prepared in accordance with the regulations of the State of Kuwait for financial services institutions regulated by the Central Bank of Kuwait. These regulations require adoption of all International Financial Reporting Standards (IFRS) except for the IAS 39 requirement for collective provision, which has been replaced by the Central Bank of Kuwait’s requirement for a minimum general provision as described below. The impairment provision for credit facilities complies in all material respects with the specific provision requirements of the Central Bank of Kuwait and IFRS. In March 2007, the Central Bank of Kuwait issued a circular amending the basis of making minimum general provisions on facilities changing the rate from 2% to 1% for cash facilities and 0.5% for non cash facilities. The required rates were to be applied effective from 1 January 2007 on the net increase in facilities, net of certain restricted categories of collateral during the reporting period. The general provision in excess of the present 1% for cash facilities and 0.5% for non cash facilities would be retained as a general provision until further directive from the Central Bank of Kuwait is issued. During the period, the Group has adopted the following standards effective for annual periods beginning on or after 1 January 2009. IAS 1: Presentation of Financial Statements - Revised The revised standard requires only owner changes in equity to be presented in the statement of changes in equity. All non owner changes in equity (i.e. comprehensive income) are required to be presented separately from owner changes in equity in a performance statement (interim condensed consolidated statement of comprehensive income). Components of comprehensive income are not permitted to be presented in the statement of changes in equity. IFRS 8: Operating segments The new standard which replaced IAS 14 ‘Segment reporting’ requires a ‘management approach’ under which segment information is presented on the same basis as that used for internal reporting purposes. This has resulted in the segments being reported in a manner that is more consistent with the internal reporting provided to the chief operating decision - maker. The interim condensed consolidated financial information do not contain all information and disclosures required for full consolidated financial statements prepared in accordance with International Financial Reporting Standards, and should be read in conjunction with the annual consolidated financial statements for the year ended 31 December 2008. Further, results for the three months ended 31 March 2009 are not necessarily indicative of the results that may be expected for the financial year ending 31 December 2009.

Burgan Bank Group Notes to the Interim Condensed Consolidated Financial Information As at 31 March 2009 (Unaudited)

9

3. CASH AND CASH EQUIVALENTS

31 March

2009 KD 000’s

(Audited) 31 December

2008 KD 000’s

31 March

2008 KD 000’s

Cash in hand and on current account with banks & other financial institutions (OFI’s) 152,886 86,705 31,841 Balances with the Central Bank of Kuwait 903 361 1,151 Due from banks and OFIs maturing within 30 days 312,931 463,889 414,274

─────── ─────── ─────── 466,720 550,955 447,266

═══════ ═══════ ═══════ 4. INVESTMENT SECURITIES In the previous year, the Group adopted IAS 39 amendments issued by IASB on 13 October 2008 and reclassified certain trading investments with a carrying value of KD 14,613 thousand (31 December 2008: KD 15,086 thousand, 31 March 2008: Nil) from the 'fair value through profit or loss' to 'available for sale' category with effect from 1 July 2008. The Group has recorded unrealized loss of KD 1,180 thousand (31 December 2008: KD 1,231 thousand, 31 March 2008: Nil) in respect of the reclassified financial assets in investment revaluation reserve within equity. Had the Group not implemented the amendments to IAS 39, unrealised profit (loss) of KD 51 thousand (31 December 2008: KD (1,231) thousand, 31 March 2008: Nil) would have been recorded in the interim condensed consolidated income statement. 5. BUSINESS COMBINATION The Bank and United Gulf Bank B.S.C "UGB" (subsidiary of the Parent Company) entered into a ‘Memorandum of Understanding’ whereby UGB’s holding in four commercial banks will be acquired by the Bank for KD 194 million. This ‘Memorandum of Understanding’ has certain clauses, including regulatory approvals, to be fulfilled by UGB and the Bank before the transaction can be completed. The entities referred are:

• Jordan Kuwait Bank P.S.C (“JKB”) • Bank of Baghdad (“BOB”) • Algeria Gulf Bank S.P.A (“AGB”) • Tunis International Bank S.A (“TIB”)

In the pervious year, the Bank acquired 51.1 % equity interest in JKB and has been consolidated from this date of exercise of control. Provisional values have been assigned to the identifiable assets and liabilities of JKB as on the acquisition date and the management is in the process of determining the fair values of assets, liabilities and contingent liabilities acquired. On 30th March 2009, the bank signed supplementary agreements with United Gulf Bank for the execution of the transfer of 60% of the shares of Algeria Gulf Bank and 45.31% of the shares of Bank of Baghdad with a stipulated completion date being 30th April 2009.

Burgan Bank Group Notes to the Interim Condensed Consolidated Financial Information As at 31 March 2009 (Unaudited)

10

6. OTHER BORROWED FUNDS

Effective Interest rate

31 March

2009 KD 000’s

(Audited) 31 December

2008 KD 000’s

31 March

2008 KD 000’s

Long term subordinated borrowing CBKDR + 1% 96,233 96,233 - Medium term USD borrowing due 2009 LIBOR + 0.450% 45,880 43,462 41,816 Medium term USD borrowing due 2009 LIBOR + 0.300% 14,565 13,798 13,275 Medium term EURO borrowing due 2009 LIBOR + 0.525% - 19,290 20,982 Medium term EURO borrowing due 2009 Euribor + 0.550% 19,394 19,290 - Other borrowing –subsidiary 5.91% - 8.6% 6,210 5,870 -

────── ────── ────── 182,282 197,943 76,073 ══════ ══════ ══════ 7. OTHER LIABILITIES

31 March (Audited)

31 December 31 March 2009

KD 000’s 2008

KD 000’s 2008

KD 000’s

Accrued interest payable 32,852 44,157 29,267 Staff benefits 7,162 6,768 4,108 Provision for non-cash credit facilities 9,865 10,512 8,988 Sundry creditors – subsidiary 41,065 30,671 - Other balances 36,634 55,560 29,652 ────── ────── ────── 127,578 147,668 72,015 ══════ ══════ ══════ 8. EQUITY a) The authorised, issued and fully paid up share capital of the Bank comprises 1,041,330,766 shares of 100

fils each. b) Treasury shares

31 March

2009

(Audited) 31 December

2008

31 March

2008

Number of shares held 29,629,491 23,027,545 915,008 ══════════ ══════════ ══════════

Percentage of shares held 2.85% 2.43% 0.10% ══════════ ══════════ ══════════

Market value KD 000’s 11,259 15,889 1,171 ══════════ ══════════ ══════════

Reserves equivalent to the cost of the treasury shares held are not available for distribution. c) Dividend At the annual general meeting of the shareholders held on 31 March 2009, 10% bonus shares (2007: bonus shares 10% and cash dividend of 60 fils per share) for the year 2008 was approved and issued. This resulted in an increase in the number of authorised and issued shares by 94,666,433 shares and share capital by KD 9,467 thousand. d) Capital increase The ordinary and extraordinary general meeting of shareholders held on 30 June 2008 approved the increase of the bank’s capital through the issuance of 200 million ordinary shares at 100 fils par value and share premium of 900 fils. The shareholders at record as of the meeting date agreed to waive their pre-emptive right to subscribe in the capital increase in favor of strategic investors. This was subject to an Amiri Decree approval, which has not been received. Subsequently, at the annual general meeting of the shareholders held on 31 March 2009, the request for capital increase has been withdrawn.

Burgan Bank Group Notes to the Interim Condensed Consolidated Financial Information As at 31 March 2009 (Unaudited)

11

9. TAXATION

Three months ended 31 March

2009 2008 KD 000’s KD 000’s National Labour Support Tax 295 627 Contribution to the Kuwait Foundation for the advancement of Science 107 231 Zakat 119 252 Taxation arising outside Kuwait 1,986 - ───────── ────────── 2,507 1,110 ═════════ ══════════

10. EARNINGS PER SHARE Basic earnings per share is computed by dividing the profit for the period by the weighted average number of shares outstanding during the period less treasury shares. Diluted earnings per share is computed by dividing the profit for the period by the weighted average number of ordinary shares outstanding during the period plus the weighted average number of ordinary shares that would be issued on the conversion of all the dilutive potential ordinary shares into ordinary shares. The computation of basic and diluted earnings per share is as follows: Three months ended

31 March

2009 2008 KD 000's KD 000's Profit for the period attributable to equity holders of the Bank 11,345 24,557 ══════════ ══════════ Shares Shares Number of shares outstanding: Weighted average number of paid up shares 1,041,330,766 1,041,330,766 Weighted average number of treasury shares (28,835,094) (851,187) ────────── ────────── Weighted average number of outstanding shares 1,012,495,672 1,040,479,579 Effect of share based payments - 1,690,486 ────────── ────────── Weighted average number of outstanding shares adjusted for effect of dilution 1,012,495,672 1,042,170,065 ══════════ ══════════ Basic earnings per share (fils) 11.2 23.6 ══════════ ══════════ Diluted earnings per share (fils) 11.2 23.6 ══════════ ══════════ Basic and diluted earnings per share for the comparative period presented have been restated to reflect the increase in bonus shares issued on 31 March 2009 (note 8).

Burgan Bank Group Notes to the Interim Condensed Consolidated Financial Information As at 31 March 2009 (Unaudited)

12

11. SEGMENTAL ANALYSIS The Group is organised into two main business segments: • Banking: incorporating private customer current account, business current accounts savings, deposits,

investment products, credit and debit cards, consumer and housing loans, overdrafts, commercial loans and other credit facilities

• Treasury and investment banking: incorporating money market, foreign exchange, Treasury bills and bonds and Central bank bonds, investments and fund management.

Management monitors the result of its operating segments separately for the purpose of making decisions about resource allocation and performance assessment. Segment performance is evaluated based on operating profit and loss which is in certain respects is measured differently from operating profit or loss in the consolidated financial information. Segment results include revenue and expenses directly attributable to each particular segment as the Bank does not have any inter-segment charges.

Banking KD 000’s

Treasury and investment

banking KD 000’s

Total KD 000’s

31 March 2009 Segment operating income 25,504 6,082 31,586 ───────── ───────── ─────────Segment result before provisions 20,612 4,352 24,964 Release of provision for impairment of loans and advances 912 (5,208) (4,296) Impairment of investment securities - (600) (600) ───────── ───────── ─────────Segment result 21,524 (1,456) 20,068 ───────── ───────── ─────────Unallocated expenses (3,146) ─────────Profit for the period before taxation 16,922 ═════════Segment assets 2,287,203 1,985,836 4,273,039 ═════════ ═════════ ═════════Segment liabilities 1,708,694 2,186,676 3,895,370 ═════════ ═════════ ═════════

Banking KD 000’s

Treasury and investment

banking KD 000’s

Total KD 000’s

31 March 2008 Segment operating income 15,588 20,775 36,363 ───────── ───────── ─────────Segment result before provisions 12,297 19,629 31,926 Provision for impairment of loans and advances (1,782) (2,072) (3,854) ───────── ───────── ─────────Segment result 10,515 17,557 28,072 ───────── ───────── ─────────Unallocated expenses (2,405) ─────────Profit for the period before taxation 25,667 ═════════Segment assets 1,575,811 1,661,258 3,237,069 ═════════ ═════════ ═════════Segment liabilities 1,224,022 1,700,909 2,924,931 ═════════ ═════════ ═════════