Annual financial-report-2003

His Royal Highness Crown Prince Hamzah

OUR VISION
• Enhancing the domestic and regional presence of JNB in
preparation for the challenges of globalization.
OUR VALUES
• Professionalism, innovation and creativity, honest competition,
loyalty and commitment to excellence.
OUR MISSION
• Ensuring a pioneering role in rendering comprehensive and
integrated banking services with emphasis on the consumer.
• Developing the financial ability of the organization to reduce
operational costs and achieve the optimal degree of
satisfaction to customers and employees, using modern and
latest banking systems and technology.
• Utilizing the means necessary for high standards of
performance, profitability and investing in human resources.
• Adopting accurate and flexible banking processes and
procedures.
• Contributing to the national social and economic development.

Chairman
Deputy Chairman
Rep. by H.E. Mr. Wasef Azar
Rep. by Mr. Ali Y. Bin-Ali
Rep. by Mr. Na’el Khader
Rep. by Mr. Emad Y. Muasher
Rep. by Mr. Hani Fraij
Rep. by Mr. Rafiq S. Muasher
Rep. by Mr. Alaeddin Sami
H.E. Dr. Rajai S. Muasher
Mr. Nadim Y. Muasher
Jordan Investor Center
Kuwait Investment Authority
The Social Security Corporation
Muasher Investment & Trading Co.
Mr. Anton Dababneh
Arabia S.A.L. (Holding)
Mr. Mahmoud Z. Malhas
Mr. Tawfek A. Kawar
Rajai Muasher & Brothers Co.
Mr. Rajai S. Sukkar
ZI & IME Co. (Saudi Arabia)
Board of Directors

6
Chairman's Letter
Dear Shareholders,
I cordially welcome you with my best greetings, it pleases me to present to you the
forty eighth annual report of Jordan National Bank Group, including the main
activities of the Bank during year 2003 and the future plan for year 2004, besides
the consolidated financial statements as of 31/12/2003.
Thanking God, JNB has regained the major part of its claims from the credit
facilities case, and we are still quite confident that we will be able to collect what
remained through special arrangements and mechanisms, which will be
announced when the time becomes due. By this, Jordan National Bank won the
bet and assured its trust in the justice and fairness of the Jordanian Judicial
system. This also affirmed the capability of the official parties in returning the rights
back to their owners. Solving this case within a relatively short period of time has
left positive effects on enhancing the credibility of the banks involved in the case
while also this has sustained the trustworthiness of the entire banking system.
JNB’s strong financial solvency, which was built up throughout the previous
decades, has efficiently contributed to its high ability in absorbing and containing
any negative impact that emanated as a consequence of the facilities case. On the
other side, JNB has managed to collect all the facilities granted to its customers
who exported their goods to Iraq before the war, as all due amounts were settled
via the Frozen Deposits Management Fund.
Net operating revenues rose in year 2003 by 15.8% to record an amount of JD 46
million, in contrast with about JD 39.7 million in year 2002, while total operating
expenses increased by 8.1%, mainly due to an increase by 36.4% in the provision
for credit facilities, by which the annual net profits of the Bank were somewhat
affected. Regarding the balance of customers’ deposits, it grew by 23.3% to
exceed an amount of JD 1 billion for the first time along the history of the Bank,
and this was basically due to the increased trust by customers in Jordan National
Bank. Total shareholders’ equity climbed up 13.9% to reach JD 73.1 million, while
the volume of credit facilities before provisions and interests in suspense remained
stable at the same previous level in year 2002.
JNB has accomplished advanced stages in the negotiations with a strategic partner
interested in participating in the capital increase of the Bank to JD 60 million (60
million shares), while also a large number of shareholders and investors have
expressed their willingness to subscribe in the capital increase. The board of
directors will study the feasibility of raising the capital to JD (65 or 70) million during
the second half of year 2004 to meet the request of these investors. It is worthy to
note that the purpose behind the capital increase comes in a framework of
bolstering and strengthening the financial adequacy of JNB, as well as the direction
towards expanding into the regional markets. In this regard, JNB has carried out
serious talks with one of the commercial banks in Iraq concerning JNB’s tendency
to acquire a strategic stake in this bank. The transaction shall take place by
agreeing on that JNB carries out the management of the said bank to benefit from
the cumulative experience of JNB in dealing with the Iraqi market, especially in the
domain of financing foreign trade operations between Iraq and other countries.

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Jordan National Bank implemented in the second half of 2003 a comprehensive
restructuring plan at all levels, by which the activities and operations were
reorganized through dividing them into three major sectors based on their
functions. These sectors are: The business development sectors (profit centers),
support sectors (cost centers) and the supervisory & control sectors. The focus was
poured on the importance of support sectors in providing the required assistance
for profit centers in the Bank to assure that their work is being completely and
appropriately performed, especially with respect to the centralization of operations
for all routine works and procedures of branches, which will focus on the marketing
aspect and customer service. The management looks forward to apply the principle
of “Customer First”, side-by-side with the concept of Customer Relationship
Management (CRM). In essence, helping customers realize their success and add
value to their interests represent the main goal of the Bank, as long as this is
considered part of the Bank’s interest and will ultimately credits its success.
The Bank has established two new departments represented by the Credit
Administration, Documentation and Control Department and the Risk Management
Department. The supervisory role of the first department is represented by assuring
that the granting process of credit facilities was performed in accordance with the
credit policy of the Bank and that it complies with legal instructions and regulations.
Besides of that, this department will be responsible for completing all the contracts,
documentations and required collaterals with respect to the conditions of granting in
addition to the safe custody of these documents. As well, the Risk Management
Department was established in year 2002 as a control department. This department
was able to activate its operations through installing the system of Control & Risk
Self Assessment (CRSA), where this system was completed and tested in several
central departments in the Head Office.
The practical application of the CRSA system has demonstrated its capability in
recognizing and pinpointing the weakness spots and potential risks. It also helps
determine the appropriate control procedures in order to mitigate the possible
effects of latent risks. Furthermore, the Human Resources Department was
segregated from the Personnel Affairs Department, whereby the first department
will be in charge of planning and organizing the recruitment process, training,
appraising staff performance and defining job descriptions. The second department
will be in charge of managing personnel affairs and applying human resources
policies in line with the general strategy of the Bank. Adding to that, the financial
management departments were reorganized and the supervisory & analytical role
was activated for the Bank’s different activities.
The management devoted all concerns and focused all its efforts during 2003, on
collecting, following up and remedying the outstanding due facilities, besides
enhancing the effectiveness of remedy procedures whether through reconciliation
and settlement processes or rescheduling non-performing loans and removing
them from classification. This is besides allocating a painstaking follow-up process
for special mention accounts, and activating the immediate remedy of accounts

8
case by case as well as triggering an utmost activation for execution procedures,
liquidating collaterals and accelerating legal procedures. As well, the management
seeks to shift the follow-up approach from the traditional method to new and
innovative methods for maintaining the momentum of colleting non-performing
loans. This became realizable by applying creative ideas, such as issuing bonds or
reviving defaulting companies by procuring their capital increase or fund raising.
Aiming at reducing costs, increasing productivity and assuring a suitable work
environment and the optimal size of branches, JNB has accomplished all
procedures related to the merger of some adjacent branches, while one of the cash
offices was converted into an integrated branch. As well, a study will be conducted
to assess the feasibility of shifting the location of some branches into more viable
areas.
In the world of continuously changing banking industry amid an intensive banking
competition, JNB seriously pursues to be well prepared and ready to confront and
anticipate the upcoming challenges before their occurrence. JNB will also continue
to focus on the available high growth opportunities and will foresee future trends
and the promising economic sectors, besides continuing to satisfy customers’
needs and cooperate with them in order to maximize the chances for success.
Jordan National Bank will always be keen to fulfill its strategies through organized
planning followed by the precise implementation to realize success. This will be
translated in the Bank’s performance during year 2004 and the following years.
Finally, I would like to express my thankfulness and appreciation to his Excellency
Mr. Wasef Azar, who opted to end his service at Jordan National Bank after long
years of distinctive giving, high performance and value added, which all in all has
enriched the progress of JNB and its sublimity. As well, I would like to thank the
employees of Jordan National Bank for their firm commitment and incessant
pursuance to develop their skills and for their seriousness in applying the Bank’s
strategy of devising new innovative programs and products as well as updating the
banking procedures in accordance with the best international practices. I should not
forget to forward my thanks to our dear customers and shareholders for their
ongoing support and continuous assistance to the Bank’s march. At the end, I
would like to confirm my deep appreciation to the Central Bank of Jordan (CBJ) for
being strictly careful in controlling and overseeing the entire banking system, which
in return will lead to the best interest of all.
Dr. Rajai Muasher
Chairman

9
Jordan Economic Performance During 2003
The national economy has successfully overcome the negative effects that
accompanied the war on Iraq during the first half of year 2003. During the second
half, the economy proved capable to recover the slowdown by which all the
economic sectors recessed throughout the period of the war. The Gross Domestic
Product (GDP) grew during 2003 by 3.2% in terms of basic prices, while this growth
rate outstrips the population growth rate. The incessant efforts for improvement,
which were exerted by the Kingdom along the previous years, have positively
contributed at all aspects in underpinning, fortifying and enhancing the immunity
and impregnability of the national economy against the external impacts. These
improvements succeeded in triggering the pertinent monetary and fiscal policies in
a shape that fits the prospective economic growth and controls the inflation rates.
At the same time, the foresaid improvements gave the private sector a unique
opportunity to play a pioneering role in prompting the economic activity and
development process as well as the direction towards the globalization.
The national economy continued its positive progress in realizing lower inflation
rates that meet the objectives of the economic improvement programs. The inflation
rate, measured by the percentage change in the cost of living index, an increase
not exceeding 2.3% despite the exchange rate hike of the Euro currency, where the
majority of the Kingdom’s imports are being paid by the Euro currency. Both of the
monetary policy and the fiscal policy helped maintain low paces of hike in the level
of prices, and thus maintained the purchasing power of the citizens’ income. The
official foreign exchange reserve held with the Central Bank of Jordan (CBJ)
reached an amount of US$ 4.7 billion, which covers a period of 10 months of the
Kingdom’s imports.
The deficit in the budget before grants and subsidies in 2003 increased to
represent 12% of the Gross Domestic Product (GDP), mainly due to the cease of
the oil grant from Iraq besides canceling the preferable prices of oil offered to the
importer. Nevertheless, the free oil grants from the Arab Gulf countries had
mollified the exacerbation of this deficit. As well, the government will keep
proceeding with a sage fiscal policy during the upcoming years, aiming at reducing
the debt burden to become in line with the ceilings determined by the Pubic Debt
Management Law. The package of improvement procedures for 2004, represented
by increasing the sales tax and oil prices, is expected to chip in the realization of
targeted deficit in the public budge. This is besides the government’s plans to
control the current expenditures and to focus on executing the program of
investment spending, which aspire the improvement of educational and health
Foreign Exchange Reserves at the CBJ - Million ($)

10
standards. This sort of spending stimulates the economic activity in an effective
manner and creates new job opportunities to exploit the productivity of labor
resources that serves the axial goal, represented by attaining a sustainable
development, whereto the government strives to realize.
Jordan achieved distinctive fulfillments in the area of attracting foreign investments
and preserving the local investments as long as Jordan possesses sufficient
prerequisite and potentialities sought by prospective investors. These available
prerequisites and potentialities are topped by the political, security, economic and
social stability despite of the current prevailing turmoil and turbulence in the region
besides the international rapid dramatic changes and events. Also, the suitable
infrastructure in Jordan represents a crucial factor in attracting the investments,
where holding the World Economic Forum (WEF) in Jordan during summer 2003 in
the Dead Sea has presented a best proof for the remarkable international position
enjoyed by Jordan.
On purpose to conserve these gained features, the government will continue its
endeavor towards enhancing the competitiveness of the national economy and
Jordanian products. The government will also dedicate higher exerted efforts to
extract the optimum benefit from joining and signing up a number of international,
regional and bilateral agreements by creating an opportunity for the Jordanian
product to access the international markets with preferable conditions.
The Jordan economy has succeeded in merging with the international markets and
got released from the direct dominance of the public sector, instead, it transformed
into an economy where the private sector plays a pioneering and leading role within
a free competitive environment under the umbrella of a government with a scope of
supervision, control and organizing. Thereupon, the government will work at
deepening and developing this gained posture, and will keen onward in the national
development methodology after accomplishing the current correcting program.
Jordan will start in the second half of year 2004 executing a self-program for
economic development away from the direct management span of the International
Monetary Fund (IMF), where this program relies on the principle of reducing the
budget deficit by controlling the expenditures and depending on the self-fulfillment,
although the subsidies will remain almost an essential part during the forthcoming
period.
Jordan vindicated that adopting the policy of pegging the Jordanian dinar with the
US$ was really successful, therefore there will be no inclination to reconsider it
Total Assets of Licensed Banks - Million JD’s

11
again. Hereby, the index of exports seems healthy and indicated a good growth
rate to assure the appropriateness of the pegging policy. The national exports grew
during year 2003 by 7.6% while the re-exports grew 25.2%, hence; total exports
grew by 11.2% to amount JD 2.2 billion. Moreover, the imports rose by 12.6% to
reach about JD 4 billion, whereby the deficit in the trade balance increased by
14.3% to record an amount of JD 1.8 billion.
The industrial production shrank 8.5% during year 2003 due to the circumstances
evolved from the war on Iraq. Accordingly, the manufacturing sector warded back
9.8% while the quarrying turned down 2.1%. On the other hand, the activity of the
Aqaba Gulf Port flourished strongly during 2003, wherefrom total exported and
imported goods rose by 26%. Furthermore, the construction sector continued its
remarkable upsurge throughout year 2003, where the number of issued licenses for
construction purposes increased by 5.2% to record 22,555 licenses, while areas
allocated for construction widened by approximately 11%.
Total domestic revenues and foreign grants amounted to JD 2,381.2 million during
2003 against JD 2,020.8 million during 2002, an increase by 17.8% corresponding
to JD 360.4 million. The major cause of this increase was because of the
substantial increase in foreign grants. Total foreign grants summed up during 2003
for the first time an amount of JD 682.6 million in contrast with JD 266.7 million
recorded during 2002, higher by JD 415.9 million that was mainly generated from
receiving JD 500 million during May representing part of the American grant. The
16% decline in non-tax revenues has contributed to the general shrinkage in total
domestic revenues to record JD 1,698.6 million compared with JD 1,754.1 million
during year 2002. Regarding the side of spending, total spending rose by 10.7%
translated into JD 245.9 million to accumulate JD 2,542.6 million versus JD 2,296.7
million recorded during 2002, while the capital expenditures rose during 2003 by
10.6% to state an amount of JD 485.4 million in comparison with JD 438.8 million
paid during 2002. Consequently, the financial deficit shrank to report a value of JD
161.4 million in 2003 in contrast with JD 275.9 million in 2002.
The annual figures concerning the outstanding balance of the external public debt
(total government and government-guaranteed debt) revealed that it increased by
JD 42 million to attain about JD 5,392 million at the end of year 2003, representing
76.9% of the Gross Domestic Product (GDP) in comparison with an amount of JD
5,350 million representing 80.4% of the Gross Domestic Product (GDP) for year
2002. This increased appeared although the repayments of foreign debts
National Exports ( Thousand JD’s )

12
outweighed extended debts during 2003. This could be attributed to the general
upsurge in foreign exchange rates against the Jordanian dinar, where this factor
contributed by JD 420 million of the increase in the balance of external public debt
compared with their rates at the end of year 2002.
While the net domestic debt recorded at the end of year 2003 an amount of JD
1,711 million representing 24.4% of the GDP, in comparison with JD 1,354 million
at the end of year 2002 representing 20.4% of the GDP. This increase was mainly
attributed to issuing treasuring bills and notes to finance the deficit in the budget
and the policy adopted by the Ministry of Finance in the regard of restructuring the
public debt. Accordingly, total public debt rose to about JD 7,095 million
representing 101.1% of the GDP for year 2003 against JD 6,685 million
representing 100.5% of the GDP for year 2002.
The projects listed under the socio-economic transformation program has been
continued during 2003 according to the priority and in a way that suits the amounts
received from additional grants plus the amount allocated from the privatization
proceeds for this purpose, and thus not to impair the financial and monetary
achievements and to avert increasing the deficit or the external public debt. The
privatization program witnessed a notable activity during 2003 inclusive selling
Royal Jordanian Aviation Academy to a local investor, while a 26% stake of Arab
Potash Company was privatized in addition to selling the government share in two
subsidiaries owned by the Jordan Investment Corporation represented by the
General Maintenance Company and Jordan Duty Free Shops.
Regarding the capital market performance, Amman Stock Exchange (ASE)
witnessed during 2003 an extraordinary performance, where total trading volume
hiked 96% to sum up JD 1.85 billion compared with JD 946.7 million during year
2002. As well, ASE market capitalization weighted index soared 53.8%. The value
of ASE market capitalization stated an amount of JD 7.77 billion at the end of 2003
representing 110.8% of the Gross Domestic Product (GDP), while the net
non-Jordanian investments increased by JD 81.8 million and their shareholding
formed approximately 38.8% of total listed companies.
National Imports ( Thousand JD’s )

13
Board of Directors Report for 2003
During 2003, the Bank has completed the establishment and development of the departments and
administrative units required under the new organizational structure that was designed based on the
strategic directions of top management. The new organizational chart will facilitate the restructuring of
the Bank and organize the flow of work according to the major functions performed by each
department/unit. These functions were divided into three main sectors that interact with each other to
achieve the Bank’s vision, mission and strategic objectives. These sectors are: the business
development sector, the support and technical assistance sector and the control departments sector.
First: The Business Development Sector:
This sector includes the profit-generating departments in the Bank, which aim at developing the
business, increasing profitability and diversifying the sources of income and targeting the promising
economic sectors.
1) The Credit Facilities Group:
This group encompasses four different profitability centers. It includes the corporate credit facilities, the
commercial facilities, the retail facilities (consumer loans and credit cards) and the credit remedial and
follow-up department.
A-Corporate Credit Facilities;
The top management continued its efforts during 2003 to support the corporate credit facilities
department. The establishment of this department was completed and furnished with high-caliber staff.
The concept of credit relationship management was materialized while the processes of studying and
evaluating the credit facilities applications were upgraded and streamlined. Furthermore, the new
credit policy of the Bank was accomplished and officially approved after it was revised to match up
with the latest internationally applied systems. The new policy emphasizes the principles of controlling
risks and providing all elements of the sound credit decision. The department succeeded in attracting
new customers for the Bank and managed to compensate for the reduction in the size of facilities
granted due to the decrease in dealing with Iraq as a result of the political circumstances in that
country. The corporate credit department has managed to enter promising economic sectors. It has
also succeeded in increasing the facilities size for customers dealing in the local market. This
department has also enhanced the principle of focusing on account profitability, especially from the
commissions of indirect facilities. Moreover, new techniques and instruments were adopted to increase
profitability ratios while the account managers continued to compile all the necessary information to
manage their accounts in a professional manner. The corporate credit department has also succeeded
in activating the principle of field visits to customers in order to closely examine their businesses and
provide them with the necessary requirements to serve them and meet their needs according to the
adopted credit policy.
B-Commercial Credit Facilities:
The workflow was reorganized in the commercial credit facilities department by applying and activating
the standards and principles drawn in the new credit policy. This department assumes the
responsibility of granting medium-size commercial facilities for companies and businesses in the
various economic sectors. The management of these accounts are carried out centrally from the head
office by qualified credit managers for each group of local branches and branches abroad.
C-Consumer Credit Facilities and Retail Banking Operations:
During 2003, the work procedures in the retail services department were reorganized, whereupon the
department was divided into four major units as follows:- the product development unit, the marketing
unit, the sales and customer service unit and the branches management and follow-up unit.
In line with the Bank’s directions towards reducing risks and expanding the customer’s base, the year
2003 witnessed a superior activity in the field of extending personal loans. The work of the retail credit
department (consumer loans) was fine-tuned with the new credit policy. The conditions for housing

14
loans were amended to add more flexibility in terms of pricing, purchasing loans, guarantees and
repayment period. The commission received on housing loans was cancelled in order to present an
additional advantage for customers, thus leading to regain the Bank’s pioneering position in the arena
of housing loans. The Bank has also launched a new banking product called “the quick loan”, which is
a small loan extended for the employees of public and private sectors who meet certain credit
conditions. This service will help borrowers meet their urgent obligations or their emergency expenses.
This program has a unique feature with respect to the timing of its launch before certain seasons, such
as holidays and other occasions. This product was well received with a great success from the public
and JNB customers due to the numerous features provided, such as soft conditions and fast
procedures to obtain the loan. JNB was also active during 2003 in the field of extending other personal
loans for various purposes, cars purchase loans and issuing different types of MasterCard credit
cards. In March, 2003, the Bank signed an agreement with the Ministry of Finance, where the
MasterCard credit cards issued by JNB were officially accepted for collecting the general revenues of
the government, such as fees, taxes and fines at most collection centers of the Ministry of Finance.
Another agreement was signed with the Jordan Telecommunications Company and the Jordan Airport
Free Markets Company to accept MasterCard credit cards issued by JNB for payment of telephone
bills by the public and for other payments. JNB has also attracted a large number of merchants and
companies to accept MasterCard credit cards at their points of sale. The Bank managed to market a
large number of E-Commerce cards. With respect to Microfinancing, JNB has expanded its activity in
this field and has increased the size of loans granted through its subsidiary, Ahli Micro-Financing Co.,
which opened two new branches in viable commercial areas in the Kingdom in 2003.
D- Credit Remedial and Follow-up Department:
Due to the large size of provisions taken against the non-performing loans portfolio and the high
potential of regaining a substantial amount of them, the Bank’s management has given its top priority
toward organizing the work in this department. This high priority comes from the fact that
non-performing loans are considered as a source of income for the Bank . Therefore, all efforts will be
concentrated towards removing these accounts from the stumbling status. This removal will be carried
out through settlements, repayments or rescheduling of loans, and thus converting the provisions
related to these accounts to net profits. Additionally, the department started to follow up with
customers first by first through the establishment of an early alarm system at the contracts,
documentation and credit control unit. This system will assist management in detecting any signs that
might indicate a weakness in the account or signal a potential beginning of stumbling. The Bank has
set a detailed business plan to remedy the non-performing loans, where the work of this department
will be reorganized centrally at the Bank’s overall level (Jordan branches and abroad). The plan
centers upon preparing accurate studies for settlement and rescheduling transactions in order to set
the bad loans back on the right track and insure regular repayment schedules with maturity dates that
are commensurate with the nature of the customer’s business and its expected cash flows. A clear
procedure manual was enforced and activated for following up the accounts that are being remedied in
order to assure the continuity of collecting the rescheduling installments and the strict commitment of
settlements that are reached with customers. Furthermore, the execution procedures on the different
collaterals and mortgages pledged against non-performing loans were accelerated, especially with
regards to large accounts without neglecting other accounts. Among other procedures aimed at
restructuring this department, a new mechanism was set to insure the strict implementation of legal
department procedures with respect to the accounts that are, or will be brought before the courts.
These accounts are being followed up immediately through monthly reports that show the extent of
progress achieved in terms of legal procedures or execution procedures.
The credit remedial and follow-up department focused its efforts during 2003 on coordinating and
cooperating with other departments in the Bank to find comprehensive solutions and creative
techniques to remedy the problems of non-performing loans besides limiting the responsibility of
calculating provisions within the statistics unit in the head office.
2) Treasury and Financial Institutions Group:-
The treasury and financial institutions department concentrated its efforts during 2003 on studying the
best alternatives to achieve the highest possible returns on the Bank’s employment of sources of funds
within calculated risks that are aligned with required returns. The department continued to present its
services by utilizing sophisticated and flexible work procedures to meet the requirements of customers

15
and branches. A new fully integrated international treasury system was purchased and is expected to
be installed in the second half of 2004. The system is designed according to the latest international
standards, and it is expected to enhance the trading transactions in treasury operations and other
financial trading instruments rendered by the Bank to its customers. This system will enable the Bank
to issue special reports regarding risk measurement and management. Moreover, another system for
asset and liability management will also be installed.
The treasury department continued its distinguished activity in the field of foreign exchange dealing
transactions. These operations encompass a wide range of services including spot or forward buying
and selling, employment of funds, deposits, swap transactions and financial derivatives. The treasury
department follows up the execution of these operations to assure their compatibility with the
objectives and general strategies of the Bank, and with the requirements and instructions of different
monetary authorities. This department also coordinates and cooperates with treasury departments in
JNB’s branches abroad to instruct and direct them in the field of dealing in treasury instruments and
financial markets. Furthermore, this department continued to strengthen the Bank’s cooperation ties
with correspondent banks as well as managing the banking relations with them to realize JNB’s
interests and support its foreign banking operations.
3) The Investment Banking Group:
During 2003, the Bank completed the activation of the different investment banking services presented
by JNB, especially in the field of asset management and investment portfolios, primary issues
management and securities underwriting in the capital market, brokerage services, securities custody
services, and research and specialized advisory services related to the capital market and the capital
restructuring of troubled companies. The Bank accomplished during 2003 the management of the first
corporate bond issue for a private shareholding company in the amount of JD 10 million. JNB is also
expected to manage two additional corporate bond issues during 2004 for two public shareholding
companies.
The financial brokerage department continued its extraordinary activity during 2003 in terms of the
market share of trading volume, where JNB managed to occupy the second place among more than
30 brokerage offices operating at the Amman Stock Exchange. The trading volume of JNB’s brokerage
office rose significantly during the year, while the customers’ base of the Bank was expanded as a
result of the support services provided to them, such as the research reports and specialized studies
related to the capital market and traded stocks. Moreover, the brokerage department provides its
customers with a free service that enable them to review their portfolio valuations and accounts via the
Internet.
4) Branches Abroad Group:
Al-Ahli International Bank S.A.L
(A Lebanese Subsidiary of Jordan National Bank)
The year 2003 was a distinctive turning point for Al-Ahli International Bank with respect to taking the
full provisions required against doubtful loans in coordination with the Banking Supervision Committee
of the Bank of Lebanon. Therefore, the Bank (which is owned by JNB by about 85%) is expected to
start making profits after the completion of providing for all of its doubtful loans in 2003. during the
same year, AIB also completed the reformation of its capital while JNB’s ownership percentage in AIB
is expected to rise to 96.4% during 2004. Our subsidiary in Lebanon has concentrated on collecting
the non-performing loans by activating the follow-up department and the legal department. AIB has
started to take all the legal procedures that ensure collecting the highest amounts of non-performing
loans and reaching fair settlements of other accounts. Additionally, the Bank has also tightened its
policy regarding the acceleration of the execution law suits raised against the non-performing
customers.
In completion of the restructuring and reorganization processes, a new general manager was
appointed for Al-Ahli International Bank. The new director has extraordinary capabilities and has long
years of experience in the Lebanese banking sector. The modus operandi of the different bank
departments and branches was developed through the application of the centralization principle in
several activities such as centralization of checks clearing and printing besides centralizing most of the

16
work of the operations department and the facilities department. In the field of developing the Bank’s
business and intensifying marketing efforts, a large number of credible customers were attracted to
deal with the Bank, whether in terms of deposits or in terms of extending personal loans, car financing
and housing loans for customers with relatively low risk profiles. Total deposits grew by 11% during
2003 while the Bank achieved good operating profits that exceeded half a million dinars.
It is expected that AIB will support the facilities department during 2004 with qualified staff, while the
process of extending loans will be reorganized under specialized departments for personal loans and
commercial loans. The corporate accounts will be transferred from branches to the facilities
department in the head office. The Bank also plans to establish a centralized unit to review and audit
branch operations to raise efficiency of the control system and activate the risk-based internal audit
operations.
During 2004, the existing information technology systems will be developed to go in line with daily work
requirements and the Bank of Lebanon instructions. The upgrading of systems will also accommodate
the needs of top management with respect to obtaining appropriate information at the right time and
installing security systems to protect the Bank from potential risks. The systems development will also
include all necessary modifications of the current information system, automation of the reports
required by the monetary authorities and responding to other business requirements.
International Banking Unit (Lemassol Branch):-
The international banking unit in Limassol continued its growth and proved its capability of achieving
sustainable and solid profits. The unit is currently preparing for the updating of the communications
and swift systems, while the Internet banking service will also be introduced. The other banking
systems will also be developed in preparation for the joining of Cyprus in the European Union on
May1st, 2004. The Bank has also started preparations for activating the Bank’s services in the field of
dealing in foreign exchange markets as well as presenting investment services for customers,
especially with regards to dealing in options, swap operations and trading in the global capital markets.
Branches In Palestine:
JNB has taken a strategic decision to merge its branches in Palestine with the Palestine Commercial
Bank to meet the new requirements of the Palestine Monetary Authority of raising the capitals of
foreign banks branches operating in Palestine. This merger will assist JNB in enhancing its image in
the Palestinian market and reinforcing its internal position backed by a solid base of capital adequacy.
JNB has accomplished advanced steps in studying the most suitable approach to achieve the merger
according to the mutual interests of merged banks.
Despite the ongoing severe conditions of the political and security situation and the deterioration of the
state of instability, JNB’s branches in Palestine managed during 2003 to collect some bad loans. This
achievement was implemented by tightening the follow-up process of these loans and liquidating the
collaterals and mortgages pledged against them.
The hedging policy of completing the building of full provisions has succeeded in fostering the Bank’s
resilience, strength and the soundness of its financial position. The Bank plans to complete the online
connection project between all branches in Palestine as well as automating other electronic services
like ATM’s and Phone banking. The Bank also plans to restructure Al-Salam Street branch and
Shallalah Street branch in Hebron due to the closure circumstances surrounding the last branch.
Second: Support Services Sector:
This sector includes the departments which render their services to the profit-generating departments
to enable them to improve their income and the quality of services extended to customers.
1) Computer and Information Technology:-
The analysis and programming department has started to re-program and fine-tune the existing
systems to match up with the Bank’s directions towards centralizing the branches back office
operations and transferring most operations performed by branches to the central operations

17
department in the head office. The centralization process will be studied carefully to find out the
optimal approach to execute banking operations in line with the centralization principle. This
department continued its persistent efforts in developing and implementing the new system for trade
finance services in addition to installing a new international system for treasury operations, which is
expected to be completed by the end of 2004.
All programming requirements related to the internet banking services were accomplished according to
the highest levels of security and easy use to meet the needs and requirements of customers for a fast
and comfortable service. The Bank has added another five new machines to its ATM network, which
operates around the clock. The Bank has also completed the implementation of the first online outlet
for electronic payments to execute payment transactions via the Internet using MasterCard credit cards
in cooperation with E-Dimension Company of Jordan Telecommunications Company.
During 2003, the computer department has strengthened the communication network of the Bank as
well as the safety and security systems of software programs. Furthermore, the Bank has enhanced
the infrastructure of banking systems and the support and technical assistance systems. Additionally,
the management information systems were also reinforced, so that each department will be able to
track its performance progress.
2) Operations:
The treasury operations department continued to provide its support services to treasury transactions
in all banking and investment products, such as foreign exchange dealings, margin trading and
derivatives. The trade finance operations department has implemented the new international system to
execute the various types of trade finance services operations in a centralized and automated manner
from the head office. This system will also be installed at all branches by the end of 2004.
The branches automation and operations support department continued to provide its support and
technical assistance for branches in terms of implementing the automated systems. This department
also continued its contribution in writing and defining the specifications of users’ requirements for new
products as well as meeting the different needs of branches and departments. The Bank plans to
expand the scope of this department to include the work of executing branches back office operations
after completing the implementation stage of centralization to increase efficiency and reduce costs.
3) Processes and Procedures:
The processes and procedures department has achieved a large number of work and procedures
manuals for banking services and products as well as the modus operandi of different departments.
This department has also contributed in setting the general policies of banking operations in the Bank.
It is expected that all procedures manuals will be prepared and officially adopted and completed by the
end of 2004. This department has activated the supervision process on the continuous revision of work
manuals, forms and documents of systems used in the Bank. Moreover, this department aims at
keeping, maintaining, developing and supervising the use of the above-mentioned manuals and
documents. The processes and procedures department is also responsible for insuring the good
implementation of work procedures as well as for the contribution of developing the banking, financial
and administrative procedures and systems. This department will study the available electronic
techniques to computerize the process of studying work procedures, their amendments and
documentation, and then to convey them to the end user. This automation is expected to be reflected
positively on the quality of the service provided to customers.
4) Financial and Accounting Systems:
The workflow was reorganized at the central accounting department in order to pool all the functions
related to financial matters in one department. All financial and statistical reports of branches and
departments will be developed and automated centrally by a specialized department. The accounting
department will furnish all branches and departments with any required information and reports to
improve performance, build business plans and future policies based on scientific principles and
reports. The financial and accounting department, the financial control department and the statistics
and provisions building unit were all consolidated into one unified department called the “financial
management department”. The financial control department is in charge of preparing monthly financial

18
analysis for branches, geographical areas and the overall level of the Bank compared with the banking
sector. The restructuring process will achieve substantial benefits for the Bank, such as providing top
management with precise financial information at the right time as well as providing an effective control
system on the Bank’s revenues and expenses.
5) Human Resources Management:
The human resources management has a substantial importance for JNB due to the major role played
by the human element in achieving the Bank’s objectives. The human resources also represent a key
driver in developing the Bank’s business and increasing productivity. The human resources
management department was activated by separating it from the personnel department to become a
new independent department in charge of drawing the major strategies of the human resource
management. This department will work according to objective techniques and methodologies for
appraising staff general performance. The department will also be responsible for recruiting and
employing highly qualified individuals and maintaining them through achieving job satisfaction and
creating a professional environment with high challenges.
This role will also develop a suitable work environment, which rewards the highly productive staff and
extraordinary performers based on an objective and comprehensive evaluation system. This system
depends on measuring the range of achieving the predetermined main objectives for each branch /
department and also for each employee.
The human resource management seeks to concentrate on upgrading and developing staff through
designing training courses for qualified employees. These courses will be conducted according to the
latest principles that support the concept of “comprehensive employee” without neglecting any career
specialization. Moreover, staff performance will be linked to JNB corporate culture and the distinctive
modern identity known about JNB. It should be noted here that JNB has occupied the first rank among
Jordanian banks and other financial institutions in terms of the number of participants in the training
activities of the Institute of Banking Studies for 2003. This is the fifth consecutive time that JNB
continues to be a pioneer in this regard. The number of training opportunities for JNB staff reached
585 opportunities while JNB’s participation share amounted to 12.7% of total training opportunities.
6. Marketing and Branches Management:
The Bank has achieved a comprehensive restructuring process for the marketing department, the
product development department, the sales and customer service department and the retail services
department into one division group called “marketing and retail services”. This group is completely in
charge of implementing the Bank’s strategy with respect to the retail services market. This strategy will
be realized through enhancing and upgrading the skills of providing services to customers as well as
developing the selling techniques of products and services. The Bank’s objectives in this regard will be
translated into numbers through setting achievable and specific targets for the services sales channels
in branches. The actual results and achievements of the predetermined sales objectives will be
tracked and followed up on a regular basis. The management has become actively involved in
supporting the branches’ role in becoming sales points for products and services instead of being only
traditional centers for processing banking transactions. JNB is also keen to introduce new concepts to
deal with the latest banking technology and provide channels of distribution to present services via
different electronic techniques. This move toward electronic banking will help JNB reduce its
operational costs and mitigate the burden on customers by processing their banking transactions
conveniently at the right time and the right place. Furthermore, JNB seeks to develop and introduce
new products and services and new sales channels for these products. The existing services will be
renewed and upgraded to suit current banking market needs. The Bank also plans to continuously
explore and analyze the market to identify the needs of different market segments for each community.
The Management will continue to provide its logistic and administrative support for branches to help
them achieve their objectives and build a database for the Bank’s current and prospective customers.
This information will help branches in marketing, promoting and selling JNB’s products and services
effectively and efficiently.
The Bank has managed to increase the non-interest bearing deposits related to the Goshan Certificate
Program, which entitles a lucky customer to win an apartment. New complimentary prizes linked to the

19
apartment concept were added to the monthly drawing of this program, such as home appliances and
others. The marketing and advertising campaign was intensified to further promote this service. The
Bank has re-launched its MoneyGram service for quick remittances to increase JNB’s activity in this
field. The Bank has also signed a cooperation agreement with Paymentcentric, (an electronic payment
gateway service company) where the customers or the public can benefit from the E-jaby service to
repay the different utility bills, whether in cash or by debiting their accounts at the Bank. This service
will also be presented via the ATM’s or through Al-Ahli Internet banking service.
With regards to supporting branches and increasing their financial and commercial activity, the
management has set specific and detailed plans and objectives for branches to increase the volume of
their work, increase their profits and present their services efficiently and effectively. The management
will periodically evaluate the range of achieved results and apply incentives programs for branches
with good performance. Additionally, the Bank will conduct training coursers for tellers and customer
service staff on the selling and communication skills in cooperation with specialized training firms.
These courses will help JNB in preparing font office employees for the new approach of converting
branches into sales points.
Third: Risk Management and Control Departments Sector:
This sector includes the departments, which perform the supervisory control work on business
development departments as well as the support and technical assistance departments in order to
insure that each department performs its duties in the right manner.
1) The Risk Management Department:
The risk management department, which was established in 2002, has succeeded in installing and
implementing the Control & Risk Self-Assessment System (CRSA) in several departments of the Bank.
This system aimes at controlling and mitigating risks to the minimum possible level within an
appropriate control environment. The acceptable risk levels will be determined in coordination with the
concerned department managers, top management and the risk management department.
The functions of the risk management department comprise of identifying the risks of business centers
and determining their relevant control procedures. Compliance tests are then designed and followed
up while risk management reports are prepared and reported to the chairman of the Board of
Directors, the chief executive officer, the auditing committee of the Board and the respective
departments managers. The risks and control procedures are identified and determined in special
workshops conducted for the relevant departments in the presence of a team from the internal auditing
department. Finally, compliance tests are designed to measure risk levels and then manage those
risks.
2) The Credit Administration, Documentation and Control Department:
This department was established to control the soundness of credit decisions taken after the issuance
of those decisions. The contract documentation and credit control unit works side by side with the
credit administration unit under the umbrella of this department. The functions of the first unit include
the auditing of contracts, deeds, documents and collaterals pledged against facilities. The auditing is
conducted with respect to all types of legal and credit aspects. Furthermore, this unit insures that all
legal documentations are in line with the limits, authorities and policies defined by top management,
and with the instructions of the Central Bank of Jordan. These auditing producers are made before
authorizing the disbursement of facilities. Moreover, this unit performs the duties of safe-custody of all
documents, deeds and contracts related to the facilities in addition to monitoring and controlling the
accounts that need special mention and surveillance.
The credit administration unit fixes and activates credit limits and manages the central information data
bank of black listed customers. This unit also manages the banking risks centrally from the head office
and prepares credit concentration reports and other types of reports.

20
The Future Plan for Year 2004
A New strategic plan was set for the years (2004 – 2006), where it was prepared
according to the existing resources and capabilities and in compliance with the
latest international banking practices. This plan was formed to fit smoothly with the
ambitions of our esteemed shareholders and to make their hopes realizable. The
main highlights of the future plan for 2004 were derived from the mid-term strategic
directions of Jordan National Bank, which are included in the new comprehensive
plan that focused on achieving the following targets and programs:
Business Development and Profitability Enhancement:-
(1) Improving the quality of the credit facilities portfolio and increasing its size in
terms of credit-worthy companies and customers. As well, JNB aims at
reducing the ratio of non-performing debts to reach acceptable levels through
intensifying the efforts in remedying and following up non-performing loans in
order to turn them into performing debts whether through settlements and/or
repayments and/or reschedulings.
(2) Reducing the general & administrative expenses through restructuring branches
and merging adjacent ones and/or converting some branches to cash offices or
the opposite, or moving the locations of some branches to new viable
commercial areas.
(3) Intensifying the marketing efforts and field visits to current and prospective
customers to increase the market share of the Bank in the different areas, in
addition to focusing on cross-selling operations.
(4) Deepening the role of JNB as a regional bank after assuring that JNB adheres
to all required financial ratios set by monetary authorities in the countries
where JNB operates, especially with respect to expanding in the neighboring
countries.
(5) Providing new banking and investment products and services, which satisfy the
needs, requirements and expectations of current and prospective customers.
Support and Technical Assistance:-
(1) Rearranging, organizing and consolidating the accounting work methods and
procedures, besides computerizing all financial reports whether those issued
for internal purposes or for external purposes. As well, the Bank plans to
activate and reorganize the central accounting processes for branches and
other business centers.
(2) Completing the study, development, documentation and upgrading of working
procedures for all departments and banking activities, in addition to preparing
a comprehensive manual that encompasses all working processes and
methods as well as the banking general policies. Moreover, the manner of
providing services shall be standardized in all different outlets and channels of
distribution.
(3) Activating and automating the centralization of branch back office operations,
whereupon those operations will be executed through a centralized approach
from the head office, and thus the operational efficiency shall get improved
associated with lower expenses. Consequently, the branches’ staff will be

21
dedicated to carry out the marketing activities, and this role would help in
converting JNB’s branches into centers and points of sale for the banking
products and services.
(4) Completing the computerization and automation for all banking operations and
services, in addition to developing and updating the technological programs,
which were designed to expedite the workflow besides providing a full support
for the business development departments according to their requirements and
needs.
(5) Developing and updating the human resources policies in addition to setting
deliberate programs for different career paths and successive planning. In the
same regard, the plan includes the design of internal training courses that
focus on real world practical and applied aspects.
Control and Risk Management: -
(1) Establishing a new department during the first half of year 2004. This
department deals with the credit administration, documentation and control,
wherefore the department will comprise two units:- The credit control &
contracts documentation unit and the credit administration unit. The main
purpose behind this division is to curtail the credit risks and to verify the
activation of the central supervision and control on credit operations, which are
being executed through branches. Additionally, the department will be in
charge of assuring that the processes of granting, renewing, amending,
following up and documenting facilities are being conducted in line with the
general credit policy of the Bank and adhere to the instructions imposed by the
monetary authorities under which the Bank submits in Jordan and abroad.
Moreover, this department will report directly to the Chief Executive Officer due
to its supervisory role, which therefore should enjoy a managerial
independency from the credit facilities departments.
(2) Expanding the scope of applying the Control & Risk Self Assessment system
(CRSA) to encompass all central departments. The main goal is to complete
the building of the Risk Management System, which was established in year
2003 in order to spread the culture of self and automatic risk management
among the employees of JNB at all levels, and thus help top management
determine, measure, supervise and control their operational risks.
(3) Preparing to apply the new standards of Basel 2 accords and also adhering to
the instructions imposed by the Central Bank of Jordan pertaining to these new
standards as well as the application of the corporate governance standards in
financial institutions.
(4) Activating the financial control on the performance of branches and central
departments through conducting a monthly financial analysis regarding the
results of operations for business centers in addition to evaluating the
realization of their projected budgets and the range of compliance of
performance with the constructed business plans. These consequential actions
aim at focusing on correcting deviations and eliminating their causes to attain
both of the financial and non-financial objectives and thus leading to the
achievement of JNB’s strategic goals.

22
Financial Ratios 2003
The following are details of the main items of changes in assets, liabilities, and
contra accounts :
Assets
1 - The Balance Sheet total (excluding contra accounts) amounted to
JD1,302,400,125 as at Dec.31st,2003, compared with JD1,384,867,553 as at
Dec. 31st,2002 - a decrease of JD82,467,428. With the inclusion of contra
accounts, the 2003 total would amount to JD2,131,148,232 compared with
JD2,177,559,644 - a decrease of JD46,411,412 over the preceding period.
2 - Cash in hand and at banks amounted to JD634,789,441 at the end of 2003,
compared with JD679,282,682 at the end of 2002 - a decrease of
JD44,493,241.
3 - The value of securities and investments amounted to JD135,323,629 at the end
of 2003 compared to JD144,132,987 at the end of 2002.This amount includes
JD103,524,582 of Jordan government bonds and various other government
guaranteed bonds, and corporate bonds issued by public institutions and
companies, compared to JD116,912,600 at the end of 2002.
4 - The balance of credit facilities (before provisions and interest in suspense)
amounted to JD583,177,507 at the end of 2003, compared with JD585,225,260
at the end of 2002 - a decrease of JD2,047,753 over the preceding year. This
amount includes discounted commercial bills amounting to JD55,837,005 in
addition to outstanding overdraft accounts amounted to JD166,087,592, credit
cards, loans and advances amounting to JD361,252,910.
5 - The net book value of real estate, machinery and equipment, and furniture
(after depreciation) amounted to JD52,439,879 at the end of 2003, compared
with JD54,138,823 at the end of 2002.
Liabilities
1 - The balance of current and call accounts, savings, term and bank deposits
amounted to JD1,055,803,514 at the end of 2003, compared with
JD1,037,363,255 at the end of 2002 - an increase of JD18,440,259.
2 - The balance of reserves and various provisions amounted to JD27,362,928 at
December 31st, 2003, compared with JD27,749,214 at the end of 2002.
Contra Accounts
1 - The balance of documentary credits increased to JD601,249,505 at the end of
2003, compared with JD466,369,170 at the end of 2002.
2 - The balance of guarantees increased to JD766,872,724 at the end of 2003,
compared with JD701,396,934 at the end of 2002.
3- The balance of acceptances for customers' accounts decreased to JD27,854,245
at the end of 2003, compared with JD62,264,669 at the end of 2002.

23
49,10%
33,10%
10,40%
3,90%
3,50%
100,00%
weight 20022003 2002
48,70%
32,90%
10,40%
4,00%
3,90%
100,00%
weight 2003% change
Weight 2003
634,789,441
429,047,089
135,323,629
52,439,879
50,800,087
1,302,400,125
679,282,682
459,004,146
144,132,987
54,138,823
48,308,915
1,384,867,553
-6,60%
-6,50%
-6,10%
-3,10%
5,20%
-6,00%
Weight 2003
Weight 2003
Assets
Cash, Balances, and deposits at banks and other institutions
Credit facilities - net
Investment portfolio
Fixed assets - net
Deferred tax assets and other assets
Total assets
97,60%
0,80%
0,20%
1,40%
100,00%
weight 20022003 2002
97,10%
0,80%
0,20%
1,90%
100,00%
weight 2003% change
1,192,888,470
10,097,561
2,870,262
22,826,099
1,228,682,392
1,287,688,409
10,471,189
3,256,548
18,581,294
1,319,997,440
-7,40%
-3,60%
-11,90%
22,80%
-6,90%
Liabilities
Deposits of customers, banks, & other
institutions & cash Margins
Borrowed Funds
Various Provisions
Other liabilities and income Tax Provision
Total Liabilities
16,90%
63,70%
19,40%
100,00%
weight 20022003 2002
3,70%
84,80%
11,50%
100,00%
weight 2003% change
44,696,799
1,011,106,715
137,084,956
1,192,888,470
217,635,002
819,728,253
250,325,154
1,287,688,409
-79,50%
23,30%
-45,20%
-7,40%
Deposits and Borrowed Funds
Deposits of Banks and other Financial
Institutions
Customers' Deposits
Borrowed Funds
Total Deposits and Borrowed Funds

24
Weight 2003
Weight 2003
36,20%
21,40%
11,80%
29,60%
1,00%
100,00%
weight 20022003 2002
33,20%
16,90%
11,40%
37,40%
1,20%
100,00%
weight 2003% change
15,106,077
7,867,975
5,209,774
17,028,394
526,501
45,558,721
15,236,742
9,026,471
4,975,309
12,486,457
418,885
42,146,864
-0,90%
-14,90%
4,70%
36,40%
25,70%
8,10%
Expenses
Employees expenses
Other operating expenses
Depreciation and amortization
Provision for credit facilities
Other various provisions
Total Operating Expenses
58,20%
35,10%
6,70%
100,00%
weight 20022003 2002
57,50%
24,00%
18,60%
100,00%
weight 2003% change
26,408,387
11,027,238
8,529,694
45,965,319
23,102,731
13,917,739
2,673,844
39,694,314
14,30%
-20,80%
219,00%
15,80%
Non-interest and
Non-Commission Income
Net interest Income
Net Commission Income
Total Non-interest and Non-Commission
Income
Net Operating Income

25
AUDITORS’ REPORT
To The Shareholders of Jordan National Bank
CONSOLIDATED BALANCE SHEET
AS AT DECEMBER 31ST. , 2003 AND 2002
CONSOLIDATED STATEMENT OF INCOME
CONSOLIDATED CASH FLOW STATEMENT
FOR THE TWO YEARS ENDED DECEMBER 31ST. , 2003 AND 2002

26
AUDITORS’ REPORT
To The Shareholders of Jordan National Bank
Amman - Jordan
We have audited the accompanying consolidated balance sheet of Jordan National
Bank (a public shareholding limited company) as of December 31, 2003 and the
related consolidated statements of income, changes in shareholders' equity and
cash flows for the year then ended.
These financial statements are the responsibility of the Bank's management. Our
responsibility is to express an opinion on these financial statements based on our
audit. We have obtained the information and explanations which to the best of our
knowledge and belief were necessary for the purpose of our audit.
We conducted our audit in accordance with International Standards on Auditing.
Those Standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management as well as evaluating the overall financial statements presentation.
We believe that our audit provides a reasonable basis for our opinion.
1. As stated in note (8) to financial statements, credit facilities at the end of the year
2003 include about JD 26.5 million (i.e.6.16% of net credit facilities) that represent
the net value of non-performing doubtful loans net of amounts collected through the
legal authorities, interest in suspense, provisions and amounts pending collection of
approximately JD 3 million (to be paid to the Bank after being collected). No
provision has been taken for the remaining balance of approximately JD 26.5
million as required by International Financial Reporting Standards. Management
informed us that it is in the process of taking the legal measures at hand to recover
these debts.
In our opinion, except for the effect of what is stated in paragraph (1) above, the
accompanying consolidated financial statements present fairly, in all material
respects, the financial position of Jordan National Bank as of December 31, 2003
and the results of its operations and its cash flows for the year then ended, in
conformity with the Law and with International Financial Reporting Standards. We
recommend that the General Assembly take what is stated in paragraph (1) above
into consideration upon approving these financial statements.

27
Without further qualifying our opinion, the Bank's operations and ability to generate
profits in the future are impacted by the matters stated in note (49) to the financial
statements. This requires that the Bank's management continue its efforts to
achieve the plan and objectives mentioned in the above note, particularly to adhere
to the requirements of the regulatory authorities and improve the quality of its
assets so as to achieve profits in the future through increasing revenue - generating
assets and reducing non-revenue generating assets.
The Bank maintains proper accounting records, and the accompanying financial
statements are in agreement therewith. Furthermore, the financial data presented
by the Board of Directors are in agreement with these records.
Saba & Co.
Amman - Jordan
May3,2004

28
250,959,069
418,000,653
10,322,960
50,577,674
459,004,146
52,686,916
40,868,397
-
54,138,823
42,872,949
5,435,966
1,384,867,553
CONSOLIDATED BALANCE SHEET
AS AT DECEMBER 31ST. , 2003 AND 2002
4
5
6
7
8
9
10
11
12
13
14
ASSETS Note
No.
December
2002
JD
387,951,208
244,293,770
2,544,463
32,353,494
429,047,089
48,011,588
50,523,477
4,435,070
52,439,879
46,668,421
4,131,666
1,302,400,125
December
2003
JD
Cash and balances at Central Banks
Cash at Banks and other Financial Institutions
Deposits at Banks and other financial institutions
Trading Financial assets
Credit Facilities - Net
Available for Sale Financial Assets
Held to Maturity Investments - Net
Investments in an affiliate company
Fixed Assets - Net
Other Assets
Deferred Tax Assets
Total Assets

29
44,696,799
1,011,106,715
137,084,956
10,097,561
2,870,262
22,416,009
410,090
1,228,682,392
651,204
49,411,259
17,184,142
2,407,260
4,550,000
213,054
138,210
18,000
508,616
(1,364,012)
73,066,529
1,302,400,125
15
16
17
18
19
20
21
22
23
24
25
217,635,002
819,728,253
250,325,154
10,471,189
3,256,548
18,268,185
313,109
1,319,997,440
740,982
43,320,331
17,184,142
2,407,260
4,550,000
213,054
138,210
18,000
(2,389,909)
(1,311,957)
64,129,131
1,384,867,553
LIABILITIES & SHAREHOLDERS’ EQUITY
The accompanying notes constitute an integral part of these statements
Deposits of Banks’ and other Financial Institutions
Customers’ Deposits
Cash margins
Borrowed Funds
Various Provisions
Other Liabilities
Provision for Income Tax
Total Liabilities
Minority Interest
SHAREHOLDERS’ EQUITY
Paid-up Capital
Statutory Reserve
Voluntary Reserve
Foreign Branches Reserve
Other Reserves
Reserve at Subsidiaries
Translation Adjustments for Foreign Currencies
Cumulative Change in Fair Value
(Accumulated Losses)
Total Shareholders’ Equity
Total Liabilities and Shareholders’ Equity
Note
No.
December
2002
JD
December
2003
JD

30
61,920,004
38,817,273
23,102,731
13,917,739
37,020,470
(2,079,729)
(320,242)
5,073,815
2,673,844
39,694,314
15,236,742
9,029,471
4,975,309
12,486,457
418,885
42,146,864
(2,452,550)
(1,267,650)
(3,720,200)
352,354
6,894
8
(4,079,456)
321,141
(3,758,315)
(0.088)
42,660,166
55,759,875
29,351,488
26,408,387
11,027,238
37,435,625
837,855
2,281,773
5,410,066
8,529,694
45,965,319
15,106,077
7,687,975
5,209,774
17,028,394
526,501
45,558,721
406,598
(266,217)
140,381
599,774
-
-
(459,393)
451,080
(8,313)
-
47,992,350
CONSOLIDATED STATEMENT OF INCOME
FOR THE TWO YEARS ENDED DECEMBER 31ST. , 2003 AND 2002
December
2002
JD
26
27
28
29
30
31
32
43
33
34
21
35
Note
No.
December
2003
JD
Interest Income
Interest Expense
Net Interest Income
Commission Income - Net
Net Interest and Commissions Income
Non-Interest and Non-Commissions Income
Banks’ Share in Affiliate Companies’ Profits (Losses)
Income (Loss) from Financial Assets and Instruments
Other Operating Income
Total of Non-Interest and Non-Commission Income
Net Operating Income
Expenses :
Employees expenses
Other operating expenses
Other various provisions
Total Operating Expenses
Net Operating Income (Loss)
Non-operating revenues (expenses)
Net (Loss) before Tax and Fees and Minority Interest
Less : Income tax provisions
Income tax previous years
Educational council, vocational, and technical training fees
Net (Loss) after Tax and Fees and before Minority Interest
Add : Share of minority interest from subsidiaries’ net losses
Net (Loss) for the year
(Loss) per Share (Note-35) - JD
Weighted Average Number of Shares

31
CONSOLIDATEDSTATEMENTOFCHANGESIN
SHAREHOLDERS’EQUITY(INJORDANIANDINARS)
FORTHETWOYEARSENDEDDECEMBER31ST.,2003AND2002
Theaccompanyingnotesconstituteanintegralpartofthesestatements
-PartofaccumulatedLossesasofDecember31,2003isanamountofJD4,131,666restrictedasrequiredbytheCentralBankofJordan
againstdeferredtaxassetsofwhichJD2,095,816hasbeenusedtooffsetaccumulatedlossesasofyear-end2000andanamountofJD
366,851representingtheeffectofimplementingIAS(39)asofthebeginningoftheyear2001.

32
2002
JD
CONSOLIDATED CASH FLOW STATEMENT
FOR THE TWO YEARS ENDED DECEMBER 31ST.,2003. AND 2002
(459,393)
5,209,774
17,028,394
215,771
(105,075)
(1,860,634)
269,104
(837,855)
(2,458,536)
213,488
17,215,038
7,778,497
20,084,814
12,659,559
(4,011,243)
2,000,000
191,378,462
(113,240,198)
4,147,824
138,012,753
(502,793)
137,509,960
(3,597,215)
7,635,186
(9,655,080)
(2,206,530)
(7,823,639)
(373,628)
6,090,928
361,302
6,078,602
2,458,536
138,223,459
451,324,720
589,548,179
(4,079,456)
4,975,309
12,486,457
654,691
995,438
(100,985)
1,726,541
1,301,876
(2,826,436)
(1,141,733)
13,991,702
(10,322,960)
15,264,349
67,264,916
9,060,881
-
(37,927,964)
4,144,017
(3,576,744)
57,898,197
-
57,898,197
6,084,036
(7,848,956)
(24,231,347)
(2,010,419)
(28,006,686)
1,829,840
1,320,331
78,015
3,228,186
2,826,436
35,946,133
415,378,587
451,324,720
CASH FLOWS FROM OPERATING ACTIVITIES :
Net (loss) before tax and fees and minority interest
Adjustments:
Impairment Loss of Real Estate
(income) Loss on sale of available-for-sale financial assets
(Income) on sale of trading financial assets
Debts written off
Bank’s share in affiliates’ losses (profits)
Effect of exchange rate fluctuations on cash and cash equivalents
Various provisions
Total
Changes in Assets and Liabilities :
Decrease (Increase) in deposits at banks and other financial institutions
Decrease in trading financial assets
Decrease in direct credit facilities
Decrease (increase)in other assets
Increase in Banks & other financial institutions Deposits that
mature after more than 3 months
(Decrease) increase in customers’ deposits
(Decrease) Increase in cash margins
(Decrease) increase in other liabilities
Net Cash flows from operating Activities before tax
Income tax paid
Net cash flows from operating Activities
CASH FLOWS FROM INVESTING ACTIVITIES :
Decrease (increase) in investment in affiliate
Sale (Purchase) of available-for-sale financial assets
(Purchase) Sale of held-to-maturity investments
Net (increase) in fixed assets
Net Cash flows (used in) Investing Activities
CASH FLOWS FROM FINANCING ACTIVITIES:
(Decrease) Increase in borrowed funds
Increase in paid-up capital
Increase in minority interest
Net Cash flows from Financing Activities
Effect of exchange rate fluctuations on cash and cash equivalents
Net Increase in Cash and Cash Equivalents
Cash and Cash equivalents-beginning of the year (Note 36)
Cash and Cash Equivalents-End of the Year (Note 36)
2003
JD

33
1. General
A. Jordan National Bank (JNB) was established in 1955 as a Jordanian public
shareholding limited company in accordance with the Companies Law for the year
1927. The Bank has its head office in Amman - Jordan and operates through its
branches in Jordan, Cyprus and Palestine as well as through its subsidiary in Lebanon.
Furthermore Business Bank, a Jordanian bank, merged with JNB on December 1,
1996.
B. The number of the Bank's employees was (1498) as of December 31, 2003 (1508 as of
December 31, 2002).
C. The consolidated financial statements were approved by the Bank's Board of Directors
in its meeting No(1) held on March 8, 2004.
2. Basis of Consolidation
a.
- The accompanying consolidated financial statements include the financial statements
of the Bank's local branches in Jordan and abroad and the following subsidiary
companies after eliminating inter-branch transactions and balances:
- Al-Ahli International Bank-Lebanon.
- The National Real Estate Investment Co.
- Zarqa National College.
- Ahli Micro Finance Company.
Transactions in transit are shown under "other assets" or "other liabilities" in the
consolidated balance sheet.
- Al-Ahli International Bank in Lebanon is a subsidiary 85% owned by Jordan National
Bank (JNB). Moreover, JNB branches in Lebanon have been sold to the Bank of
Lebanon and Kuwait. Banque du Liban, the central bank of Lebanon, approved the
sale in its letter No. 204/mm/17 dated May 26, 2001, after agreeing to change the
name of the Bank of Lebanon and Kuwait to Al-Ahli International Bank in its letter
No. 179/mm/17 dated May 18,2001. The capital of the bank is equivalent to JD
846,567. Its total assets amounted to JD 176,141,314 and total liabilities to JD
166,243,786 as of December 31, 2003, while its total revenues amounted to JD
15,271,749, and total expenses to JD 18,381,143 for the year ended December 31,
2003. During the year 2003, an amount equivalent to JD 4,812,184 representing a
deposit transferred by the Bank was used to re-make up the capital of the Bank in
Lebanon.
Al Ahli International Bank is subject to the prevailing laws in Lebanon including the
Banking Confidentiality Law.
- The National Real Estate Investment Company is a subsidiary wholly owned by
Jordan National Bank. This Company is engaged in the acquisition of real-estate as
well as in dealing and investing in the moveable and immoveable assets. Its capital
amounted to JD 7 million, total assets to JD 7,278,026, and total liabilities to
JD 350,850 as of December 31, 2003. Its total revenues amounted to JD 36,998
and total expenses to JD 109,822 for the year ended December 31. 2003.
- Zarqa National College is a subsidiary wholly owned by Jordan National Bank. Its
activities include establishing colleges for higher academic education as well as
schools and kindergartens in Jordan. Its capital amounted to JD 700 thousand, total
assets to JD 737,478 and total liabilities to JD 14,163 as December 31, 2003. Its
total revenues amounted to JD 129,123 and total expenses to JD 119,365 for the
year ended December 31, 2003.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

34
- Ahli Micro Finance Company is a subsidiary wholly owned by Jordan National Bank.
The company's objectives are to grant loans to limited income individuals. Its capital
amounted to JD 750,000, total assets to JD 2,262,649, and total liabilities to 241,580
as of December 31, 2003. Its total revenues amounted to JD 442,931 and total
expenses to JD 518,958 for the year ended December 31, 2003.
b. The assets and liabilities of subsidiary outside Jordan are translated to Jordanian Dinar
for consolidation purposes at the exchange rates prevailing at year-end. The net
investment in the subsidiary outside Jordan is translated at the historical exchange
rates. Gains and losses resulting from the translation of financial statements are
reported as currency translation adjustments under shareholders' equity in the
consolidated balance sheet.
3. Significant Accounting Policies :
The consolidated financial statements have been prepared in accordance with the forms
determined by the Central Bank of Jordan, and the laws and regulations of the Central
Bank of Jordan and the banking regulations prescribed by the regulatory authorities in the
countries in which the Bank operates. The significant accounting policies are as follows :
a. Basis of preparation :
The consolidated financial statements have been prepared in accordance with
International Financial Reporting Standards and related interpretations and on the
historical cost basis, except financial assets and financial liabilities according to
International Financial Reporting Standards (39) have been stated at fair value.
b. Financial assets sale and purchase transactions are recognized using commitment
dates.
c. Trading financial assets :
Financial assets for trading are initially recognized at cost and remeasured at their fair
values at year-end. Gains or losses resulting there from are taken to the statement of
income when incurred.
d. Available-for-sale financial assets :
Available-for-sale financial assets are initially recognized at cost and remeasured at
their fair values at year-end. Gains or losses resulting therefrom are taken to a
separate account within shareholders' equity, until the investments are sold, disposed
of or determined to be impaired. At that time, the cumulative gain or loss previously
recognized in equity is included in the statement of income for the period.
e. Held-to-maturity investments :
Held-to-maturity investments are initially recognized at cost less any impairment losses.
Premiums and discounts 'if any' are amortized using the effective interest rate method.
f. Investment in the associate company is initially recorded at cost and the carrying
amount is revalued using the equity method. Net income or loss is recognized in the
statement of income.
g. Credit Facilities :
1. Credit facilities are stated at cost, net of provisions and interest and commissions in
suspense.
2. A specific provision for non-performing credit facilities is taken when it is evident to
management that these facilities cannot be recovered in part or in full. The resultant
provision is recorded in the statement of income.
3. Interest and commission in suspense on non-performing direct credit facilities are
computed in accordance with the regulations of the Central Bank of Jordan.
4. A general provision for other direct and indirect credit facilities against unforeseen future
losses is computed in accordance with the instructions of the Central Bank of Jordan.

35
5. Loans and advances which cannot be recovered are written-off and charged against
the provision for losses. Any surplus in the provision is credited to the statement of
income. Recovery of debts previously written-off is taken to the statement of income.
Collected bad debts previously written-off are credited to the statement of income.
h. Fair value :
The fair value of a listed financial asset is based on its quoted closing price in the
financial markets. For an unlisted financial asset, which does not have a quoted market
price, fair value is estimated by comparing it to another financial asset with similar
terms and conditions, using the discounted cash flow technique or alternative pricing
models. Financial assets, for which the fair value cannot be reliably determined, are
stated at cost/amortized cost, impairment loss, if any, is taken to consolidated profit
and loss.
i. Revenue and expenses recognition :
Revenue and expenses are accounted for according to the accrual basis, except for
commission and companies dividends, which are recognized when realized. Interest
and commissions on non-performing loans are recognized as interest and
commissions in suspense and recorded as revenue when received.
j. Fixed Assets :
1. Fixed assets are stated at cost or on the basis of the revaluation of fixed assets
conducted during the year 1996 net of accumulated depreciation. Depreciation
expense is computed (except for land) according to the straight-line method at annual
rates ranging from 2% to 20% based on their useful life.
2. When the recoverable amount of a fixed assets is less than its carrying amount, the
carrying amount of the asset is reduced to its recoverable amount, and the impairment
loss is taken to the statement of income.
k. Income Tax :
The provision for income tax is computed according to the laws, regulations and
prevalent banking practices either in Jordan or in the countries where the Bank's
branche or subsidiries operate. Deferred taxes are computed and recorded in
accordance with IAS (12). The provision for income tax is taken based on the expected
future tax liabilities.
l. Assets Foreclosed by the Bank :
Assets Foreclosed by the bank are stated at their detained values under other assets
in accordance with the instructions of the Central Bank of Jordan. A provision is taken,
on an individual basis, in case the market value is lower than the book value, while any
increase in value is not recorded as income.
m. Provision for Staff Indemnity :
A provision for staff indemnity is charged to the statement of income for commitments
resulting from the termination of the employees' services who was hired before 1980.
Staff indemnities paid to employees who resigned are booked against the related
provision account when paid.
n. Foreign Currency Transactions :
- Transactions in foreign currency are recorded at the exchange rates prevailing at the
transaction date. Assets and liabilities denominated in foreign currencies are
translated to Jordanian Dinar according to the average selling and buying exchange
rates published by the Central Bank of Jordan and prevailing at year-end. Exchange
gains and losses resulting therefrom are taken to the statement on income.
- Foreign currency forward contracts are translated to Jordanian Dinar using the
average exchange rates published by the Central Bank of Jordan and prevailing at

36
year-end. Exchange gains and losses resulting therefrom are taken to the statement
of income.
- In translating the assets and liabilities of the bank's branches and the subsidiary
companies for incorporation in the consolidated financial statements, the year-end
exchange rates published by the Central Bank of Jordan are used. Income and
expenses denominated in foreign currencies are translated using the average
exchange rates prevailing during the year. Translation differences (if any) resulting
therefrom are taken to seperate account in shareholders' equity.
o. Derivatives :
Derivatives held for trading :
Derivatives held for trading (such as fx forward contract, interest rates, futures and
SWAP contracts) are initially recorded at cost as other assets/liabilities in the balance
sheet and subsequently carried at fair value. Fair value is determined according to the
market price (if available). Gains or losses resulting thereform are taken to the
statement of income.
p. Account managed on behalf of others, the account mamaged on behalf of others don’t
appear among the items of assets or liabilities in the consolidated balance sheet at the
bonle.
q. Cash and Cash Equivalents:
Cash and cash equivalents consist of cash on hand and balances held with banks and
other financial institutions with maturities of 3 months or less (including balances with
the Central Bank of Jordan), less banks and financial institutions deposits due within 3
months.
r. The good will, which is represented by the difference from evaluating the subsidiary in
lebanon, is a percentage of 5% annually based on the straight-line method.

37
9,245,575
239,274
9,484,849
13,048,820
391,921,984
3,545,000
408,515,804
418,000,653
447,708
7,090,000
7,537,708
7,916,542
225,294,520
3,545,000
236,756,062
244,293,770
14,751,864
14,964,727
12,641,769
72,200,709
136,400,000
236,207,205
250,959,069
18,420,723
14,913,921
101,228,622
87,337,859
166,050,083
369,530,485
387,951,208
2002
JD
2003
JD
2002
JD
Restricted balances except for Statutory Reserve amounted to JD 4,727,038 as at
Dec. 31, 2003 compared with JD 4,727,038 as at Dec. 31, 2002.
Cash on Hand
Cash at Central Banks:
Current Accounts
Time & Notice Deposits
Statutory Reserve
Certificates of Deposit
Total Balances at Central Banks
Total
(4)Cash and Balances at Central Banks
Non-Interest Bearing Balances at Banks and other Financial Institutions amounted
to JD 846,427 at Dec. 31, 2003 compared to JD 476,540 as at Dec. 31, 2002.
Local Banks and Financial Institutions:
Current Accounts
Deposit Accounts (3 months & less)
Sub-Total
External Banks and Financial Institutions:
Current Accounts
Deposit Accounts (3 months & less)
Certificates of Deposit
Sub-Total
Total
(5) Cash at Banks and other Financial Institutions
2003
JD
9,322,960
-
1,000,000
10,322,960
70,900
-
1,000,000
1,070,900
709,000
-
-
709,000
9,252,060
-
-
9,252,060
709,000
1,835,463
-
2,544,463
Maturity Period
From 3 months to 6 months
More than a year
Certificates of deposit
6- Deposits at Banks and other Financial Institutions
-
1,835,463
-
1,835,463
Local Banks & Financial
Institutions
2002
JD
2002
JD
2003
JD
2003
JD
2002
JD
2003
JD
TotalBanks & Financial
Institutions Abroad
December 31This item consists of the following
December 31
This item consists of the following
December 31 December 31

38
11,104,140
71,819,781
69,479,485
214,438,575
12,241,724
22,234,375
41,589,495
60,565,700
901,208
18,833,097
31,107,024
4,741,298
24,121,605
583,177,507
13,566,414
77,137,569
74,934,737
229,727,957
13,508,247
38,178,311
19,244,697
51,231,092
1,031,662
16,444,328
20,483,635
8,280,865
21,455,746
585,225,260
2003
JD
2002
JD
b. credit facilities include approximately an amount of JD 26.5 million (6.16% of net credit facilities) as of
December 31,2003, represents the net balance of non-performing doubtful loans after deducting
amounts collected through the legal authorities, interest in suspense, provisions and amounts
pending collection totaling approximately JD 3 million (to be paid to the Bank after being collected).
No provision for the remaining balance of approximately JD 26.5 million has been taken in the
financial statements. Management of the bank stated that it is in the process of taking the legal
measures at hand to recover these debts.
c. There are dispute amounts of about JD 921 thousands resulting from suspected operations in the
movement of some of the clients' accounts and others related to those clients at one of the Bank's
subsidary's branches in Lebanon during the year 2003. this was through the direct interference and
collusion of the above - mentioned branche's manager and other employees. At present, no
prediction can be made of the final results of operations against the Bank as of December 31, 2003
Agriculture
Industry and Mining
Construction
General Trade
Transport Services
Tourism, Hotels and Restaurants
Services and Public Utilities
Financial Services
Purchase of Stocks
Real Estate Financing
Cars Financing
Consumer Goods Financing
Other Purposes
Total
2,363,444
48,214,230
50,577,674
3,590,598
28,762,896
32,353,494
2002
JD
Investments Listed in Financial Markets
Bonds & Debentures Listed in Financial Markets
Total
(7) Trading Financial Assets
74,388,043
160,932,460
345,460,608
4,444,149
585,225,260
78,517,378
47,703,736
126,221,114
459,004,146
55,837,005
166,087,592
355,713,805
5,539,105
583,177,507
91,206,950
62,923,468
154,130,418
429,047,089
2002
JD
Notes & Bills Discounted
Overdraft Accounts
Utilized Advances and Loans
Credit Cards
Total
Less : Provision for Credit Facilities
Less : Interest & Commissions in Suspense
Total Deductions
Net Credit Facilities
(8) Credit Facilities - Net
2003
JD
2003
JD
a. Credit Facilities distributed over the following sectors:
December 31
December 31
December 31

39
Specific
Provision
General
Provision
Total
Specific
Provision
General
Provision
Total
Provision balance-beginning
of the year
Transfer from interest in
suspens
Net deductions from
revenues during the year
Used from provision during
the year (debts written-off)
Transfers between the
general & special provision
Foreign currencies revaluation
differences branches abroad
Recovered provision from
Lebanon,Palestine Branch,
and cumulative in Jordan*
Transfers from restricted
deposits to cover shortage
in doubtful Debts provision
Provision Balance - End of
the year
6,899,249
-
(597,548)
-
(56,674)
-
-
-
6,245,027
78,517,378
59,167
17,028,394
(3,763,368)
-
143,232
(777,853)
-
91,206,950
60,017,659
-
13,264,310
(2,062,005)
213,720
(28,255)
-
212,700
71,618,129
7,112,969
-
-
-
(213,720)
-
-
-
6,899,249
67,130,628
-
13,264,310
(2,062,005)
-
(28,255)
-
212,700
78,517,378
71,618,129
59,167
17,625,942
(3,763,368)
56,674
143,232
(777,853)
-
84,961,923
2003 2002
and / or any other additional liabilities even though a resolution by the special investigation
committee of Banque du Liban was issued. According to the resolution, holders of the above -
mentioned accounts were considered complacent with the afore- mentioned branch's manager
regarding suspected dealing that led the embezzlement of the Bank's money and its incurrence of
huge losses. The holders of the above-mentioned accounts have filed lawsuits in the form of
personal claims against the Bank represented by its predecessor general manager and some
employees of the branch. As informed by the Bank's lawyer in Lebanon, the lawsuit is still in its first
stages. No provision in the financial statements has been taken against the above-mentioned
balances or any other liabilities because the Bank's management expects to collect the amounts and
claims from the related insurance company.
d. As per the regulations of the Central Bank of Jordan, non-performing credit facilities, excluding
suspended interest and commissions, amounted to JD 194,634,048 - i.e. 37.41% if total credit
facilities as of December 31,2003, compared to JD 222,488,556
i.e. 41.39% of total credit facilities as of December 31,2002.
e. As per the regulations of the Central Bank of Jordan, total non-performing facilities including interest
and commissions in suspense amounted to JD257,639,965 - i.e. 44.18% of total credit facilities as of
December 31,2003, against JD 270,192,292 - i.e. 46.17% of total credit facilities as of December
31,2002.
f. Credit Facilities granted to and guaranteed by the Government amounted to JD9,033,442 as of
December 31,2003, compared to JD 9,327,394 as of December 31,2002.
g. Interest and commissions on non-performing debts are suspended and included in interest and
commissions in suspense but not taken to revenue.
h. The movement on the credit facilities provision has been as follows:
For the year ended December 31 For the year ended December 31

40
- There are unquoted available for sale These Financial Assets the fair value of
which cannot be practically determined. These Financial Assets are shown at
cost/amortized cost at an amount of JD 12,233,045 as at Dec. 31, 2003.
31,023,840
24,817,894
-
1,131,986
7,006,012
-
47,703,736
2003
JD
2002
JD
Balance-beginning of the year
Add : Interest suspended during the year
Forign exchange diffirences
Less: Suspended interest transferred to revenue
Suspended interest written-off
Transferred to provisions
Balance-End of the year
47,703,736
22,826,164
19,093
2,528,828
5,037,530
59,167
62,923,468
(9) Available for Sale Financial Assets
Total
JD
Unquoted
JD
12,379,173
-
12,379,173
23,773,379
24,238,209
48,011,588
Quoted
JD
Total
JD
Unquoted
JD
Quoted
JD
Shares
Bonds
Total
24,856,943
27,829,973
52,686,916
12,477,770
27,829,973
40,307,743
12,233,045
-
12,233,045
11,540,334
24,238,209
35,778,543
December 31, 2002December 31, 2003
* This item includes an amount recorded in 2002 representing additional provisions
required to cover the deficit in the credit facilities provision of the Bank's branch in
Palestine and the subsidiary Company in Lebanon. During the year 2002 This
amount had been included in the income statement within the Bank's share of
associate and subsidiary companies and branches (losses).
i. Provisions no longer needed, due to settlements or debt repayments, amounted to
JD 15,136,194 as of December 31, 2003, and JD 5,451,593 as of December 31,
2002.
j. Al-Ahli International Bank in Lebanon transfered the amount of JD 2,069,386 and
their full provisions from Bad Debts computed in accordance with the laws and
regulations in lebanon, outside the balance sheet.
k. The fair value of the credit facilities guarantees amounted to JD 506,016,063 as of
December 31, 2003, and JD 505,770,738 as of December 31, 2002.
l. The movement on interest in suspense has been as follows :
For the year ended December 31
The detail of this item are as follows

41
calculation
Method
15,877,504
24,990,893
-
40,868,397
4,330,000
44,404,046
1,789,431
50,523,477
44.351
48.28
Resources for Qualified
Industrial Zones Co.
Arab Printing Press
Jordan
Jordan
Company Name Established
in
Ownership
Percentage
%
2003
JD
2002
JD
(10) Held to Maturity Investments
Treasury Bills
Government Bonds or Bonds Guaranteed by the
Government
Companies Bonds & debentures
Total
(11) Investments in an Affiliates Company
-
-
-
4,435,070
-
4,435,070
2003
JD
2002
JD
31/12/03
-
Qualified
Zones
Advertising
Nature of
Business
Equity Method
Equity Method
44.351
-
Bank's
Share of
Profit %
Date of
financial
statements
For the year ended December 31, 2003
(12) Fixed Assets - Net
24,131,566
1,476,110
1,641,889
16,477,515
7,488,272
12,270,801
543,816
-
-
12,814,617
418,082
33,152
-
-
451,234
34,476,104
5,247
85,686
3,023,242
31,372,423
1,035,925
175,738
181,292
717,038
313,333
72,332,478
2,234,063
1,908,867
20,217,795
52,439,879
Balance-Begining of the year
Additions
Deductions
Accumulated Depreciation
Balance-end of the year
Furniture, Fixtures
& Equipments
Land Others
For the year ended December 31, 2002
Buildings Vehicles Total
23,115,224
2,377,449
1,361,107
15,083,752
9,047,814
12,759,533
-
488,732
-
12,270,801
393,580
24,502
-
-
418,082
34,368,972
368,467
261,335
2,351,165
32,124,939
1,015,911
56,788
36,774
758,738
277,187
71,653,220
2,827,206
2,147,948
18,193,655
54,138,823
Balance-Begining of the year
Additions
Deductions
Accumulated Depreciation
Balance-end of the year
Furniture, Fixtures
& Equipments
Land OthersBuildings Vehicles Total

42
(13) Other Assets
2003
JD
2002
JD
Real Estate foreclosed by the Bank to settle accrued debts
Real Estate for Sale
Inter-Branch Balances
Subsidiaries Balances
Prepaid Interest
Accrued Inetrest & Commision
Revaluation Differences*
Prepaid Income Tax**
Compensation of Merger Costs ***
Other Accounts Receivables ****
Sold foreclosed real state
Advances to Employees
Revenue Stamps
Advances
Refundable Deposits
Prepaid Expenses
Prepaid Rent
Other
Rent Receivable
Cheques & Transfers Under Collection
Total
11,758,952
11,124,374
795,790
194,228
9,186
4,594,861
3,766,178
1,432,715
-
2,817,303
323,773
94,018
110,677
91,576
102,635
1,623,739
234,575
-
750
7,593,091
46,668,421
12,051,255
5,509,037
4,223,544
-
-
4,214,127
3,696,620
1,432,715
842,411
1,397,661
-
133,855
112,544
115,424
110,274
1,558,429
231,696
151,137
15,507
7,076,713
42,872,949
* This item represents the revaluation difference upon the acquisition of Lebanon &
Kuwait Bank. This amount is being amortized for 20 years starting July 1,2001.
** This item represents the amount paid on account of income tax for 2001, Jordan
branches.
*** This item represents the compensation approved for JNB by the Central Bank of
Jordan against merger incentives, as per letter No. (10/3995) dated Feb. 28th, 2001.
This compensation is recovered by monthly installments starting from July 1st, 2001
over 22 months, so as the total present value for the said compensation equals JD 5
million as at January 1st. 2001. It should be mentioned that the whole amount was
received during the year 2003.
**** This item includes JD 500 thousand, being the deficit in the cash of the Bank's branch
in the West Bank. This is due to the fact that one of the Bank's West Bank branches
was exposed to theft for an amount of approximately JD 563 thousand during the
year 2003 while in transit. A provision of JD 63,000 was taken due to the availability
of an insurance policy that covers transit risk up to JD 500 thousand. The Bank has
claimed the above amount from the insurance company as per the related insurance
policy.

Annual financial-report-2003

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Annual financial-report-2003