RIYAD BANK

INTERIM CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION

30 September 2012

31 December 2011

30 September 2011

Notes

SAR'000 (Unaudited) 14,482,456 6,998,836

SAR'000 (Audited) 17,623,477 6,085,023 36,616,170 112,972,764 339,954 440,896 1,806,833 5,002,273

SAR'000 (Unaudited) 17,096,578 8,448,421 35,315,931 112,139,139 422,741 1,822,870 5,125,152

ASSETS
Cash and balances with SAMA Due from banks and other financial institutions Investments, net Loans and advances, net Investment in associates Other real estate Property and equipment, net Other assets 5 6

34,094,654 115,286,635 399,756 411,761 1,749,778 3,671,357

Total assets LIABILITIES AND SHAREHOLDERS' EQUITY Liabilities

177,095,233

180,887,390

180,370,832

6,231,049 134,927,590 4,887,918

6,241,948 139,822,500 4,664,587

12,118,595 132,334,742 6,406,628

Total liabilities Shareholders' equity

146,046,557

150,729,035

150,859,965

15,000,000 12,475,088 1,020,156 2,553,432 -

15,000,000 12,475,088 535,749 872,518 1,275,000

15,000,000 11,687,749 666,110 2,157,008 -

Total shareholders' equity Total liabilities and shareholders' equity

31,048,676 177,095,233

30,158,355 180,887,390

29,510,867 180,370,832

The accompanying notes 1 to 16 form an integral part of these interim condensed consolidated financial statements.

RIYAD BANK
INTERIM CONDENSED CONSOLIDATED INCOME STATEMENT (Unaudited)
For the three months period ended 30 September For the nine months period ended 30 September

2012
Special commission income Special commission expense Net special commission income Fee and commission income, net Exchange income, net Trading losses, net Gains on non-trading investments, net Other operating income SAR'000 1,287,551 170,343 1,117,208 412,872 58,853 (1,580) 26,278 73,767 1,687,398

2011
SAR'000 1,227,295 163,757 1,063,538 382,204 68,656 (1,045) 47,751 11,453 1,572,557

2012
SAR'000 3,842,418 561,524 3,280,894 1,374,835 183,431 (4,679) 167,904 182,586 5,184,971

2011
SAR'000 3,637,982 523,841 3,114,141 1,170,161 240,732 (3,853) 80,475 67,422 4,669,078

Total operating income

Salaries and employee-related expenses Rent and premises-related expenses Depreciation of property and equipment Other general and administrative expenses Impairment charge for credit losses, net Impairment charge for investments, net Other operating expenses

276,970 62,364 71,554 142,825 327,284 (40,000) 6,368 847,365 840,033 0.56

324,796 60,523 73,640 158,705 150,939 9,678 778,281 794,276 0.53

891,101 179,561 211,451 490,851 866,707 (130,000) 19,386 2,529,057 2,655,914 1.77

991,781 186,887 216,336 485,064 398,696 18,810 2,297,574 2,371,504 1.58

Total operating expenses Net income for the period

The accompanying notes 1 to 16 form an integral part of these interim condensed consolidated financial statements.

RIYAD BANK
INTERIM CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (Unaudited)
For the three months period ended 30 September For the nine months period ended 30 September

Net income for the period Other comprehensive income: -Available for sale investments Net changes in fair value Net changes in fair value transferred to interim condensed consolidated income statement -Cash flow hedges Effective portion of net changes in fair value Net changes in fair value transferred to interim condensed consolidated income statement Other comprehensive income for the period Total comprehensive income for the period

2012 SAR'000 840,033

2011 SAR'000 794,276

2012 SAR'000 2,655,914

2011 SAR'000 2,371,504

280,770 (66,535) 214,235 (1,747) (145) (1,892) 212,343 1,052,376

(129,040) (59,382) (188,422) (13,219) (13,219) (201,641) 592,635

784,618 (294,506) 490,112 (5,265) (440) (5,705) 484,407 3,140,321

(13,069) (97,459) (110,528) (37,325) (2) (37,327) (147,855) 2,223,649

The accompanying notes 1 to 16 form an integral part of these interim condensed consolidated financial statements.

RIYAD BANK
INTERIM CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY (Unaudited) For the nine months period ended 30 September 2012 and 2011 SAR'000
Share capital Statutory reserve Other reserves
Available for Cash flow sale hedges investments

Retained earnings

Proposed dividends

Total

30 September 2012 Balance at the beginning of the period Total comprehensive income for the period Final dividends paid - 2011 Interim dividends paid -2012 15,000,000 15,000,000 30 September 2011 Balance at the beginning of the period Total comprehensive income for the period Final dividends paid - 2010 Interim dividends paid -2011 15,000,000 15,000,000 11,687,749 11,687,749 751,238 (110,528) 640,710 62,727 (37,327) 25,400 610,504 2,371,504 (825,000) 2,157,008 1,121,000 (1,121,000) 29,233,218 2,223,649 (1,121,000) (825,000) 29,510,867 12,475,088 12,475,088 526,651 490,112 1,016,763 9,098 (5,705) 3,393 872,518 2,655,914 (975,000) 2,553,432 1,275,000 (1,275,000) 30,158,355 3,140,321 (1,275,000) (975,000) 31,048,676 -

Balance at the end of the period

Balance at the end of the period

The accompanying notes 1 to 16 form an integral part of these interim condensed consolidated financial statements.

RIYAD BANK
INTERIM CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited) For the nine months period ended 30 September 2012 and 2011
For the nine months period ended 30 September

2012
Notes SAR'000 2,655,914

2011
SAR'000 2,371,504

OPERATING ACTIVITIES
Net income for the period Adjustments to reconcile net income for the period to net cash from (used in) from operating activities: Accretion of discounts on non-trading investments, net and debt securities in issue,net Gains on Available for sale investments, net Depreciation of property and equipment Impairment charge for credit losses, net Impairment charge for investments, net Net (increase) decrease in operating assets: Statutory deposit with SAMA Due from banks and other financial institutions maturing after three months from date of acquisition Loans and advances Other real estate Other assets Net increase (decrease) in operating liabilities: Due to banks and other financial institutions Customer deposits Other liabilities Net cash (used in) from operating activities 100,049 1,690,669 (3,180,578) 29,135 1,330,916 (10,899) (4,894,910) 130,240 (1,398,661) (461,778) 79,085 (6,503,095) 8,837 (1,587,650) 1,482,044 5,389,283 1,524,918 2,797,681

(29,451) (167,904) 211,451 866,707 (130,000) 3,406,717

(40,024) (80,475) 216,336 398,696 2,866,037

INVESTING ACTIVITIES
Proceeds from sales and maturities of non-trading investments Purchase of non-trading investments Purchase of property and equipment, net Net cash from (used in) investing activities 28,941,335 (25,667,859) (154,396) 3,119,080 8 (2,156,909) (2,156,909) (436,490) 14,483,739 11 14,047,249 3,843,552 582,688 484,407 26,234,864 (27,754,383) (176,351) (1,695,870) (1,875,050) (1,931,769) (3,806,819) (2,705,008) 20,837,007 18,131,999 3,563,946 568,502 (147,855)

FINANCING ACTIVITIES
Repayment of debt securities in issue Dividend and zakat paid Net cash used in financing activities Net decrease in cash and cash equivalents Cash and cash equivalents at beginning of the period

Cash and cash equivalents at end of the period

The accompanying notes 1 to 16 form an integral part of these interim condensed consolidated financial statements.

RIYAD BANK
NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) For the nine months period ended 30 September 2012 & 2011
1. GENERAL Riyad Bank (the Bank) is a Saudi Joint Stock Company incorporated in the Kingdom of Saudi Arabia, formed pursuant to the Royal Decree and the Council of Ministers Resolution No. 91 dated 1 Jumad Al-Awal 1377H (corresponding to 23 November 1957G). The Bank operates under commercial registration No. 1010001054 dated 25 Rabi Al-Thani 1377H (corresponding to 18 November 1957G) through its 252 branches (30 September 2011: 245) in the Kingdom of Saudi Arabia, a branch in London, United Kingdom, an agency in Houston, United States, and a representative office in Singapore. The Banks Head Office is located at the following address:
Riyad Bank P.O. Box 22622 Riyadh 11416 Kingdom of Saudi Arabia The objective of the Bank is to provide a full range of banking services. The Bank also provides to its customers Islamic(non-interest based) banking products which are approved and supervised by an independent Shariah Board established by the Bank.

2. BASIS OF PREPARATION These interim condensed consolidated financial statements are prepared in accordance with the Accounting Standards for Financial Institutions promulgated by the Saudi Arabian Monetary Agency (SAMA) and IAS 34 Interim Financial Reporting. The Bank also prepares its interim condensed consolidated financial statements to comply with the Banking Control Law and the Regulations for Companies in the Kingdom of Saudi Arabia. The interim condensed consolidated financial statements do not include all information and disclosures required for the annual consolidated financial statements, and should be read in conjunction with the annual consolidated financial statements for the year ended 31 December 2011.
These interim condensed consolidated financial statements are expressed in Saudi Arabian Riyals (SAR) and are rounded off to the nearest thousands.

3. BASIS OF CONSOLIDATION The interim condensed consolidated financial statements comprise the interim condensed financial statements of Riyad Bank and its wholly owned subsidiaries, Riyad Capital and Ithra Riyad Real Estate Company (collectively referred to as the Group). The financial statements of the subsidiaries are prepared for the same reporting period as that of the Bank, using consistent accounting policies.
Subsidiaries are all entities controlled by the Bank. Control exists when the Bank has the power to govern the financial and operating policies, so as to obtain benefits from its activities, generally accompanying an ownership interest of more than one half of the voting rights. Subsidiaries are consolidated from the date on which control is transferred to the Bank and cease to be consolidated from the date on which the control is transferred from the Bank. Balances between the Bank and its subsidiaries, and any income and expenses arising from intra-group transactions, are eliminated in preparing the interim condensed consolidated financial statements. Losses are eliminated in the same way as gains, but only to the extent that there is no evidence of impairment.

4. SIGNIFICANT ACCOUNTING POLICIES The accounting policies used in the preparation of these interim condensed consolidated financial statements are consistent with those used in the preparation of the annual consolidated financial statements for the year ended December 31, 2011 except for the adoption of amendment to IAS 12: Deferred Tax: Recovery of underlying assets, which has had no material financial impact on the interim condensed consolidated financial statements of the Group.

RIYAD BANK
NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) For the nine months period ended 30 September 2012 & 2011
5. INVESTMENTS, NET Investment securities are classified as follows:
30 September 2012 31 December 2011 30 September 2011

SAR 000' Investments: - Available for sale - Other investments held at amortised cost - Held to maturity Total

(Unaudited) 16,603,896 14,312,357 3,178,401 34,094,654

(Audited) 15,209,735 14,397,624 7,008,811 36,616,170

(Unaudited) 15,064,583 15,202,418 5,048,930 35,315,931

On September 1, 2008, the Group reclassified investments held in trading portfolio reported under its investments at fair value through income statement ("FVIS") category to the Available for sale category. The carrying and fair value of these reclassified investments as at 30 September 2012 was SR 3,721 million (30 September 2011 was SR 3,428 million). Had the reclassification not occurred, the interim condensed consolidated income statement for the three and nine months period ended 30 September 2012 would have included unrealised fair value gain on such reclassified investments amounting to SAR 95.1 million (30 September 2011: SAR 113.9 million) and SAR 250.8 million (30 September 2011: SAR 28.4 million). +
30 September 2012 31 December 2011 30 September 2011

6. LOANS AND ADVANCES, NET Loans and advances are comprised of the following:
SAR 000' Consumer Loans Commercial loans and overdrafts Credit Cards Performing Loans and Advances Non performing loans and advances Gross loans and advances Allowance for impairment Loans and advances, net

(Unaudited) 29,038,542 85,877,097 786,119 115,701,758 2,005,709 117,707,467 (2,420,832) 115,286,635

(Audited) 25,549,643 86,796,826 745,616 113,092,085 1,879,223 114,971,308 (1,998,544) 112,972,764

(Unaudited) 24,382,684 87,532,324 791,201 112,706,209 1,811,245 114,517,454 (2,378,315) 112,139,139

7. CUSTOMER DEPOSITS Customer deposits are comprised of the following:

SAR 000' Demand Saving Time Other Total

(Unaudited) 57,014,109 303,100 70,671,418 6,938,963 134,927,590

(Audited) 58,123,709 305,148 75,615,429 5,778,214 139,822,500

(Unaudited) 54,995,126 306,610 72,346,870 4,686,136 132,334,742

8. DEBT SECURITIES IN ISSUE During April 2006, the Bank issued USD 500 million (SAR 1,875 million) Floating Euro Medium Term Note (EMTN), as the first tranche of the Notes issuance programme amounting to USD 1,600 million. These matured on April 26, 2011.

RIYAD BANK
NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) For the nine months period ended 30 September 2012 & 2011
9. DERIVATIVES The table below sets out the positive and negative fair values of derivative financial instruments, together with their notional amounts. The notional amounts, which provide an indication of the volumes of the transactions outstanding at the end of the period, do not necessarily reflect the amounts of future cash flows involved. These notional amounts, therefore, are neither indicative of the Group's exposure to credit risk, which is generally limited to the positive fair value of the derivatives, nor to market risk. 30 September 2012 31 December 2011 30 September 2011 (Unaudited) (Unaudited) (Audited) Notional Positive Negative Notional Positive fair Negative fair amount Positive Negative Notional SAR 000' fair value fair value amount total fair value fair value amount total value value total Held for trading: 637 (839) 673,608 937,066 2,544 (1,690) 1,360,162 2,607 (2,748) Special commission rate swaps and futures 2,312,482 (168,891) 75,352,696 2,886,658 95,827,008 (89,222) 93,510,641 2,871,878 (310,034) Forward foreign exchange contracts 31,909 (31,949) 36,990,110 20,024,395 27,978 (27,331) 15,805,052 129,138 (129,844) Currency options 169,831 17,301 (17,301) 80,160 12,027 (12,027) Commodity options Held as fair value hedges: 500,000 (3,871) 500,000 (6,052) Special commission rate swaps Held as cash flow hedges: 2,660 100,000 1,368,000 24,389 1,098,000 40,531 Special commission rate swaps 2,347,688 (201,679) 113,116,414 2,958,870 (139,415) 112,354,015 118,826,300 3,056,181 (460,705) Total 10. CREDIT RELATED COMMITMENTS AND CONTINGENCIES AND OTHERS a) The Groups credit related commitments and contingencies are as follows:
SAR 000' Letters of credit Letters of guarantee Acceptances Irrevocable commitments to extend credit Total
30 September 2012 31 December 2011

(Unaudited) 13,914,161 54,806,795 2,745,615 12,689,697 84,156,268

(Audited) 15,548,618 55,418,199 2,350,751 9,225,937 82,543,505

30 September 2011

(Unaudited) 14,178,846 55,240,814 2,332,569 9,330,035 81,082,264

b) Others During the period ended 30 September 2012, the Bank has received notices from the Department of Zakat and Income Tax (DZIT) requiring revision in Zakat returns for years 2010 and 2011 applying the same basis used by DZIT in their assessments issued for 2008 and 2009. As at September 30, 2012, the Banks position with respect to its stance on 2008 and 2009 assessments and consequently on the above mentioned notices from DZIT, remained the same as disclosed in the Banks annual consolidated financial statements for the year ended 31 December 2011.

11. CASH AND CASH EQUIVALENTS Cash and cash equivalents included in the interim condensed consolidated statement of cash flows comprise the following:
30 September 2012 31 December 2011 30 September 2011

SAR 000' Cash and balances with SAMA excluding statutory deposit Due from banks and other financial institutions maturing within three months from date of acquisition Total

(Unaudited) 7,618,918 6,428,331 14,047,249

(Audited) 10,659,890 3,823,849 14,483,739

(Unaudited) 10,497,365 7,634,634 18,131,999

RIYAD BANK
NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) For the nine months period ended 30 September 2012 & 2011
12. OPERATING SEGMENTS The Bank determines and presents operating segments based on the information that is provided internally to the chief operating decision maker in order to allocate resources to the segments and to assess its performance. The operating segments are managed separately based on the Group's management and internal reporting structure. The Groups primary business is conducted in Saudi Arabia with one international branch, a representative office and an agency. However, the total assets, liabilities, commitments and results of operations of this branch, representative office and agency are not material to the Groups overall consolidated financial statements and as a result have not been separately disclosed. There are no other material items of income or expense between the operating segments. The Groups reportable segments under IFRS 8 are as follows: Retail banking Deposit, credit and investment products for individuals and small to medium sized businesses. Investment banking and brokerage Investment management services and asset management activities related to dealing, managing, arranging, advising and custody of securities. Corporate banking Principally handling corporate customers current accounts, deposits and providing loans, overdrafts and other credit facilities and derivative products. Treasury and investment Principally providing money market trading and treasury services as well as the management of the Banks investment portfolios Other Includes income on capital and unallocated costs pertaining to head office, finance division, human resources, technology services and other support departments and unallocated assets and liabilities. The Groups total assets and liabilities at 30 September 2012 and 2011 and its total operating income, total operating expenses and net income for the nine months periods then ended, by operating segments, are as follows:
30 September 2012 SAR'000 (Unaudited) Total assets Total liabilities Total operating income Net special commission income Fee and commission income, net Total operating expenses Depreciation and amortization Capital expenditure Impairment charge for credit losses, net Impairment charge for investments, net Net income Investment banking and brokerage 50,150 61,811 279,291 1,457 269,981 91,663 187,628 Investment banking and brokerage 3,307 48,666 220,702 814 212,538 96,049 124,653 Treasury and investment 57,407,608 7,815,626 909,643 563,591 (14,099) (103,738) 1,058 436 (130,000) 1,013,381

Retail 30,777,421 47,470,114 1,489,551 1,149,007 348,700 786,115 95,158 41,840 148,846 703,436

Corporate 85,496,850 88,521,894 2,216,914 1,566,839 770,253 895,788 2,774 1,802 717,861 1,321,126

Other 3,363,204 2,177,112 289,572 859,229 112,461 107,455 (569,657)

Total 177,095,233 146,046,557 5,184,971 3,280,894 1,374,835 2,529,057 211,451 151,533 866,707 (130,000) 2,655,914

30 September 2011 SAR'000 (Unaudited) Total assets Total liabilities Total operating income Net special commission income Fee and commission income, net Total operating expenses Depreciation and amortization Capital expenditure Impairment charge for credit losses, net Impairment charge for investments, net Net income

Retail 25,612,744 43,221,022 1,415,342 1,098,254 275,784 894,688 108,159 50,459 201,299 520,654

Corporate 87,450,951 90,458,521 2,132,624 1,598,579 693,481 346,596 2,689 1,532 197,397 1,786,028

Treasury and investment 64,188,999 15,166,125 807,405 416,494 (11,642) 27,300 281 33 780,105

Other 3,114,831 1,965,631 93,005 932,941 105,207 120,848 (839,936)

Total 180,370,832 150,859,965 4,669,078 3,114,141 1,170,161 2,297,574 216,336 172,872 398,696 2,371,504

RIYAD BANK
NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) For the nine months period ended 30 September 2012 & 2011
13. EARNINGS PER SHARE Basic and diluted earnings per share for the period ended 30 September, 2012 and 2011 is calculated by dividing the net income for the period by 1,500 million outstanding shares. 14. INTERIM DIVIDENDS The Board of Directors initially approved interim dividends of SAR 975 million (2011: SAR 825 million), which was finally ratified and announced on 1July 2012, resulting in dividends of SAR 0.65 per share (2011: SAR 0.55 per share) to the shareholders. Zakat will be determined and deducted from the shareholders' dividends at year-end. 15. CAPITAL ADEQUACY The Groups objectives when managing capital are, to comply with the capital requirements set by SAMA; to safeguard the Banks ability to continue as a going concern; and to maintain a strong capital base. The Group monitors the adequacy of its capital using ratios established by SAMA. The following table summarizes the Bank's Pillar-I Risk Weighted Assets, Tier I and Tier II Capital and Capital Adequacy Ratios at top consolidated level.
SAR Millions

30 September 2012

31 December 2011 30 September 2011

Risk weighted assets Credit Risk Operational Risk Market Risk Total Pillar-I risk weighted assets Eligible capital Tier I Capital Tier II Capital Total Tier I & II Capital Tier 1 Capital Adequacy Ratio % Total Capital Adequacy Ratio %

(Unaudited) 170,800 11,013 1,667 183,480

(Audited) 167,887 10,791 2,374 181,052

(Unaudited) 166,815 10,845 844 178,504

28,189 3,525 31,714 15.4% 17.3%

26,836 4,048 30,884 14.8% 17.1%

26,980 3,284 30,264 15.1% 17.0%

16. COMPARATIVE FIGURES Certain prior period figures have been reclassified to conform to current period presentation.