Finance House holds Annual and Extraordinary General Meeting

A quorum of 80.14% was reported for the meeting. Statements from the company's chairman, Mohammed Alqubasi, and details of the company's financial performance are included below.

2005 Highlights
• AED 190.5 million Net Profit
• Earning Per Share of AED 0.95 in first financial year

Mr. Mohammed Alqubaisi, Chairman of Finance House:

"We have closed 2005 by achieving significantly more than our financial goals forecasted at the time of our establishment in our prospectus. Even more pleasing is that this performance has been achieved in an increasingly competitive market while we were going through the process of establishment and development. Finance House has skillfully managed the challenges and leveraged every opportunity which contributed towards highly successful financial results. The cautious yet innovative approach adopted by Finance House has led to an overall improvement in asset and improved financial strength of Finance House."

Finance House's management succeeded in their aim to support and develop the Shareholders' Fund. By the end of 2005, the Shareholders' Funds reached the level of AED 808.2 million, giving Finance House a strong and competitive financial position and opened great opportunities to develop, invest and fulfill the needs our valued customers.

Booming economic conditions have fuelled demand for credit. This has contributed towards growth in advances. Keeping with the approach of optimisation, deposits reached to AED 203.6 million and the advances to deposits ratio stands at 81.4%.

In spite of the robust growth in assets, the capital adequacy ratio is very comfortable at 70.4%.

Finance House's assets reached AED 1.1 billion, reflecting success and reflected a rise in shareholder's equity to AED 808.2 million. Increasing the equity was part of Finance House's strategy to expand our business and operations.

During the period, net profit earned was AED 190.5 million. In line with our strategy, we continued to manage expenses closely by emphasising on improved productivity and enhanced automation. In this context, operating expenses to assets ratio of 7.9% reflects efficiency and productivity. We have record price earning ratio of 19.26 for the first reporting period. Return on assets and capital is 17.99% and 95.23% respectively.

Our profits reached in the first reporting period equal the ten year projections that were made while starting Finance House.

Financial Highlights of 2005:

Assets AED 1.1 billion
Shareholder Equity: AED 808.2 million
Net Profits: AED 190.5 million
Earning Per Share: AED 0.95
Expenses to Assets Ratio: 7.9%
Capital Adequacy Ratio: 70.4%
Advances to Deposits: 81.4%

Industry and Finance House outlook for 2006:
All economic indicators in the UAE are pointing towards robust economic growth in the foreseeable future. The positive forecast for the future of operating environment coupled with the company's outstanding success in 2005 has set a solid base for an ambitious growth plan. We have drawn a strategy and detailed business plan with the ambition to boost the values of Finance House. Performance of the next year would be critical as that will set the pace for accomplishment of our target and will demonstrate the effectiveness of our plan.

We have identified a number of strategic initiatives for high quality revenue growth, further enhancement of risk management practices and improved customer service quality. Implementation plans have been drawn and the required resources are allocated to ensure effective deployment of our strategy.

Appointment to the Board of Directors

We are pleased to welcome Mr Eisa Saif Alqubaisi as a Member to the Board of Directors. He replaces Mr Khaled Abdullah Mohammed Al Mass who resigned at the Annual General Meeting. We thank Mr Khaled for his invaluable contribution to the succes of Finance House in its first year.

"Finance House Holding"

Finance House will be transformed from a pure finance company to a holding company, to be named 'Finance House Holding' which in turn shall own finance companies within the UAE and elsewhere.

This new holding company structure is more in line with our aspirations and strategies and reflects more accurately Finance House's diverging activities. The new holding company is a more suitable platform to ensure future growth, and provide the flexibility required to meet increasing challenges.

Expansion Plans

The long term profitability of the company in its business activities can only be achieved through the continued efforts to find more efficient ways to conduct our business activities and through the profitable expansion of our current businesses. To maintain this profitability in future, Finance House has planned to open more branches in United Arab Emirates by the end of year 2006. Expansion plans also include aggressive targets to grow our retail and commercial portfolios, in addition to focusing on investment opportunities that provide profitability with proven and acceptable risk profiles.

Our objectives for 2006 include driving consistent growth in the revenue stream, retaining prudent risk measures and expanding financing operations offering comprehensive financial products and services that meet our customer needs. We will take opportunity and focus on delivering products and services that help the economic progress and suit customer requirements. We will continue to be dynamic and progressive in our thinking and planning. In addition to our growth plans, we will continue raising our standards of services and ensure customer satisfaction. We will focus on investing in technology, systems and people to give us that competitive edge in the market.