Earnings Presentation 1 st Quarter, 2017 Disclaimer: This - - PowerPoint PPT Presentation

Earnings Presentation

1st Quarter, 2017

Disclaimer: This presentation may include references and statements on expectations, planned synergies, growth estimates, projections of results, and future strategies for Banco Votorantim, it’s associated and affiliated companies, and subsidiaries. Although these references and statements reflect the management’s belief, they also involve imprecision and risks that are highly difficult to be foreseen. Consequently, they may conduct to different results from those anticipated and discussed here. These expectations are highly dependent on market conditions, on Brazil’s economic and banking system performances, as well as on international market conditions. Banco Votorantim is not responsible for bringing up to date any estimate in this presentation.

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Net Income of R$ 127M in 1Q17

Consistent revenue generation, drop in credit provisions and cost base under control

Executive summary

Net Income

• f R$ 127M

Net income of R$ 127M in 1Q17, compared to R$ 119M in 4Q16 and R$ 86M in 1Q16 Shareholders’ equity reached R$ 8.36B in Mar/17

Consistent revenue generation

Net Interest Income increased 3.5% in 1Q17/4Q16, to R$ 1,153M

• Net Interest Margin (NIM) of 5.1%, against 4.9% in the last quarter

Net Financial Margin increased over 4Q16 and 1Q16, reflecting the drop in credit provisions

Conservative approach to credit

Expanded credit portfolio of R$ 60.0B in Mar/17 – down 1.5% in 1Q17

• Wholesale: portfolio of R$ 26.0B, down 5.2% in 1Q17
• Consumer Finance: portfolio of R$ 34.0B, an increase of 1.6% compared to Dec/16

Drop in delinquency

90-day NPL of 4.5%, 100bps lower than Dec/16

• Wholesale: 90-day NPL of 2.6% (Dec/16: 5.6%)
• Consumer Finance: 90-day NPL of 5.2% (Dec/16: 5.5%). Vehicles’ NPL dropped to 4.8% (Dec/16: 5.1%)

Effective cost management

Personnel¹ and admin. expenses reduced 22.1% against 4Q16 and 9.0% over 1Q16

• Nominal reduction of the cost base, despite inflation

Efficiency Ratio for the last 12 months reached 38.1% in Mar/17 (Mar/16: 38.8%)

Highlights of results

• 1. Includes profit sharing expenses.

3

Net Income of R$ 127M in 1Q17

Consolidated results 127 119 112 108 86

+47.8% +6.8%

1Q17 4Q16 3Q16 2Q16 1Q16

Net Income (R$M) 1Q17 profit confirms the consistency

• f Banco Votorantim’ s results

4

Net Interest Income (A) 1,273 1,114 1,153 3.5%

• 9.4%

ALL expenses¹ (B) (508) (623) (368)

• 40.9%
• 27.5%

Net Financial Margin (A+B) 765 492 785 59.7% 2.7% Operating Income/Expenses (576) (595) (506)

• 15.0%
• 12.1%

Income from Services and Banking Fees 257 321 290

• 9.8%

13.0% Personnel² and Administrative expenses (594) (693) (540)

• 22.1%
• 9.0%

Tax expenses (83) (95) (88)

• 7.1%

6.6% Income from subsidiaries 43 50 58 16.9% 36.9% Other Operating Income/(Expenses) (199) (179) (226) 26.5% 13.8% Operating Income (Loss) 189 (104) 279

• 47.8%

Non-Operating Income (Loss) (0) (8) (16)

• Income before Taxes

189 (111) 263

• 39.4%

Income Tax and Social Contribution (102) 231 (135)

• 32.3%

Net Income 86 119 127 6.8% 47.8% Var. 1Q17/1Q16 (R$ Million) 1Q16 4Q16 1Q17 Var. 1Q17/4Q16

Highlights of Results

Consistent revenue generation, drop in credit provisions and cost base under control

Consolidated results

• 1. Allowance for Loan Losses (ALL), net of revenues from recovery of written-off loans; 2. Includes profit sharing expenses.

Managerial Income Statement (R$M) Banco Votorantim continues advancing in the profitability of its businesses, operational efficiency, and revenue diversification

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Consistent revenue generation

NII grew 3.5% in relation to 4Q16, to R$ 1,153 million

• 1. Ratio between Net Interest Income and Average Interest-Earning Assets; 2. Includes guarantees provided and private securities; 3. Result of the stake in Votorantim

Corretora de Seguros (insurance brokerage) is recognized using the equity method.

Revenues

NIM reached 5.1% in the 1Q17, driven by the growth of Net Interest Income Income from Services grew 1Q17/1Q16, reflecting the higher auto finance origination

Net Interest Income – NII (R$M) Income from Services, Fees and Insurance3 (R$M)

Insurance (Commission) Services and Fees +3.5%

• 9.4%

1Q17 1,153 4Q16 1,114 1Q16 1,273 257 321 290 54 64 79 +18.8%

• 4.2%

1Q17 369 4Q16 385 1Q16 311 Auto finance

• rigination (R$B)

2.9 3.8 5.3% 4.9% NIM¹ (% p.y.) Expanded Credit Porfolio² (R$B) 62.0 60.9 5.1% 60.0 3.7

• 9.8%

+24.1% ∆1Q17 /4Q16 +13.0% +46.1% ∆1Q17 /1Q16

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60.0

26.8 27.8 3.9 1.5

Jun/16 59.4

26.3 27.5 4.2 1.4

Mar/16 62.0

28.5 27.7 4.4 1.3

• 1.5%
• 3.2%

Wholesale Auto finance Payroll Credit Cards Mar/17 60.0 Sept/16

28.8 3.4 1.7

Dec/16

26.0 27.4 28.2 3.6 1.6

60.9

Maintenance of the conservative approach to credit

Expanded credit portfolio of R$ 60.0B in Mar/17, down 1.5% in 1Q17

Credit portfolio by segment

Expanded credit portfolio (R$B)

(includes guarantees provided and private securities)

• 5.2%

+2.4% ∆Mar17 /Dec16

• 5.5%

+4.1%

• 8.8%

+4.1% ∆Mar17 /Mar16

• 22.4%

+27.2%

Focus on profitability (vs. growth)

7

557 271 348 370 313 156 147 159 252 55

• 40.9%
• 27.5%

1Q17 1Q14 714 1Q15 417 1Q16 508 4Q16 623 368

Credit provision expenses reduced 40.9% compared to 4Q16

90-day Coverage Ratio reached 153% in Mar/17

Credit provision expenses – ALL¹ (R$M)

Credit provision expenses reduced 40.9% in 1Q17/4Q16 90-day CR remains in a conservative level, ending Mar/17 in 153%

Credit indicators – ALL and 90-day Coverage

90-day Coverage Ratio² (%) – Credit portfolio

• 1. Allowance for Loan Losses, net of income from recovery of written-off loans; 2. Ratio between the balance of ALL and the balance of loans past due over 90 days

153% 140% 145% 3,245 Mar/17 2,120 Dec/16 2,254 3,271 2,638 Mar/16 3,684

90-day NPL balance (R$M) Allowance for Loan Losses balance (R$M)

90-day Coverage Ratio (CR) Wholesale Consumer Finance

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5.6% 6.6% 6.8% 6.1% 6.3% 5.3% 5.3% 5.4% 5.3% 4.8% 5.2% 5.1% 5.5% 5.2% 5.5% 5.3%

Banco Votorantim

90-day NPL declined to 4.5% in Mar/17

Auto Finance: delinquency reduced 50bps against Mar/16, while market’s¹ grew 10bps

Credit indicators – Delinquency

90-day NPL ratio of the credit portfolio (%)

Wholesale

4.5% 5.5% 5.5% 4.6% 5.3% 6.5% 5.9% 6.1% 2.6% 5.6% 5.3% 2.4% 5.0% 9.0% 5.4% 5.0% Mar/14 Sept/14 Mar/15 Sept/15 Mar/16 Sept/16 Dec/16 Mar/17 Consumer Finance Auto Finance

Consumer Finance

90-day market¹ NPL increased 10bps over the last 12 months

• 1. National Financial System. 90-day NPL obtained in the historical series released on the Central Bank website

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+28% 1Q17 3.7 3.2 (85%) 0.5 4Q16 3.8 3.1 0.6 1Q16 2.9 2.4 (83%) 0.5

Auto finance: continued focus on used cars and maintenance of tight credit origination standards

Origination of auto loans (R$B)

• 1. New cars, trucks and motorcycles; 2. Average rate practiced in the last month of the quarter; 3. % of each month’s production with first installment past due over 30 days.

Note: In Mar/17, the average ticket size was R$ 21,000, and the average vehicle age was 4.9 years (portfolio)

Banco Votorantim is one of the leading players in the auto financing market

Consumer Finance – Auto Finance

Focus on used cars, which represented 85% of 1Q17 origination Maintenance of conservative lending standards

D Cars Market:

• New: -5%
• Used: +17%

+32.2% +9.5% ∆1Q17 /1Q16 41% 41% 41% 44 45 44 1Q16 4Q16 1Q17 Down payment Average term

Down payment (%) and Average term (months)

Sept/16 1.2 Jun/16 Mar/16 1.5 1.6 1.4 Dec/16 1.4 Feb/17

First payment default by vintage³ (%)

Other Vehicles¹ Used Cars

26.4 29.8 25.6

Auto finance interest rate² Trigger (2%)

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257 304 283 304 256 245 267 247 255 237 92 75 47 134 47 Personnel - Other¹

• 9.0%
• 22.1%

Adminstrative

Labor claims

1Q17 540 4Q16 693 3Q16 576 2Q16 646 1Q16 594 Personnel and administrative expenses

Personnel¹ and administrative expenses (R$M)

• 1. Includes profit sharing expenses; 2. Excludes expenses with labor lawsuits and profit sharing expenses.

Effective cost management, with efficiency gain

Personnel¹ and administrative expenses decreased 22.1% in 1Q17/4Q16

• 15.8%
• 7.9%

∆1Q17 /4Q16

Personnel

38.1 38.8 Efficiency ratio – last 12 months² (%)

• 64.8%

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127 119 112 108 86 785 492 751 765 717 751 1Q17 4Q16 3Q16 2Q16 1Q16

NII and Income from Services¹ and Insurance

Credit provision expenses – ALL Personnel and Administrative expenses Net Income and Net Margin (post provisions)

R$ million

Consolidated results

Summary: Net Income of R$ 127M in 1Q17

Highlight to the Net Margin growth and effective cost base management

311 328 354 385 369 +1.5%

• 3.8%

1Q17 1,523 1,153 4Q16 1,500 1,114 3Q16 1,562 1,208 2Q16 1,536 1,208 1Q16 1,583 1,273 257 304 283 304 256 337 342 293 389 284

• 9.0%
• 22.1%

Admin. Personnel² 1Q17 540 4Q16 693 3Q16 576 2Q16 646 1Q16 594 348 341 313 370 313 159 116 179 252 457 492 2Q16 4Q16 623 3Q16 Wholesale 1Q17 55 368 Consumer Finance

• 40.9%
• 27.5%

508 1Q16 Net Margin Net Income Net Interest Income

Services¹ and Insurance

• 1. Income from services and banking fees; 2. Includes profit sharing expenses.

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Funding profile improved over the last years

Bills and Credit Assignments account for 52% (R$ 33.4B) of the total funding sources

Funding and Liquidity

Additionally, Banco Votorantim has a stand-by credit facility of ~R$ 7B from BB, which has never been tapped

17.2 15.7 17.9 6.9 7.9 8.1 Dec/14

72.3

16.3 (23%) 15.2 (21%) 17.4 6.2 6.7 6.6 Bills (LF, LCA and LCI) Loans securitized to Banco do Brasil Debentures (BV Leasing) Sub Debt Loans and onlendings Securities abroad Other¹ Mar/17

64.1

22.0 (34%) 11.4 (18%) 11.8 6.0 4.3 1.1 Dec/16

67.3

20.5 (30%) 13.8 (20%) 16.0 6.0 5.2 1.3 Dec/15

78.0

Depósitos a prazo (CDB) 2.4 2.2 2.5 5.2

• 1. Includes cash and interbank deposits; 2. Ratio of total high quality liquid assets (HQLA) and the total cash inflows for a 30 days period. Considers stand-by credit facility with

Banco do Brasil. Excluding it, the LCR regulatory reported the Central Bank in Mar/17 was 174% and the regulatory minimum of 80%.

LF: R$19.4B LCA and LCI: R$2.6B

Funding evolution (R$B)

High Quality Liquidity Assets (HQLA) (R$B) 13.2 12.3 251% 270% Liquidity Coverage Ratio (LCR) – Pro Forma²

13 Total Capital 9,742 9,219 8,010 Tier I Capital 6,587 6,837 6,164 Common Equity Tier I 6,587 6,837 6,164 Additional Tier I

• Tier II Capital

3,155 2,382 1,846 Risk Weighted Assets (RWA) 67,714 61,207 60,872 Credit risk 59,714 55,922 54,358 Market risk 1,984 670 1,363 Operational risk 6,016 4,615 5,151 Minimum Capital Requirement 7,449 6,044 5,631 Basel Ratio (Capital/RWA) 14.4% 15.1% 13.2% Tier I Capital Ratio 9.7% 11.2% 10.1% Common Equity Tier I Ratio 9.7% 11.2% 10.1% Additional Tier I Ratio

• Tier II Capital Ratio

4.7% 3.9% 3.0% Dec.16 Mar.17 BASEL RATIO (R$ Million) Mar.16

Basel Ratio of 13.2% in Mar/17

Tier I Capital ratio of 10.1%, entirely composed of Common Equity

Capital structure

Note: In 2017, the minimum capital requirement is 10.5%. For Tier I Capital, it is 7.25% and 5.75% for Common Equity Tier I.

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Appendix

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Banco Votorantim is one of the leading banks in Brazil

“Top 10” in total assets, with strong shareholders and shared governance

Banco Votorantim is one of the largest privately-held Brazilian banks in total assets...

Banco Votorantim – Overview

Shareholder 50% Total

10 largest Banks in Dec/16 - Total Assets (R$B)

...and also in terms of loan portfolio

72 103 143 148 705 868 1,437 Banco do Brasil 1,332 Itaú 1,256 CEF 1,081 Bradesco BNDES Santander Safra Safra Votorantim Citibank

10 largest Banks in Dec/16 – Loan Portfolio¹ (R$B)

State-owned Foreign National privately-held 20 29 47 52 256 343 439 538 635 694 Safra CEF Banco do Brasil Itaú Bradesco BNDES Santander Votorantim Banrisul Citibank State-owned Foreign National privately-held

1.On-balance loan portfolio according to Bacen’s Resolution 2,682.

Equal representation

• f each

shareholder

Board of Directors Executive board Fiscal Council Audit Committee Compensation & HR Committee Products & Marketing Committee Finance Committee

Total: 50.00% Voting: 49.99% Non-voting: 50.01% Total: 50.00% Voting: 50.01% Non-voting: 49.99%

Votorantim S.A. Banco do Brasil Ownership Structure Corporate Governance Structure

8th 9th

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Banco do Brasil Votorantim S.A.

+

R$ 60.0B XX

Auto Finance

To originate portfolios with quality, scale and profitability To focus on used auto finance (multi-brand dealers), where BV has a history of leadership and expertise

R$ 28.8B

Other Businesses

Payroll loans: to focus on INSS (portfolio refinancing) and Private (portfolio growth) Credit Card, Insurance, Student and Individual loans and CrediCasa (home equity): to leverage the existing client base and diversify revenues Other synergies with BB: Promotiva, consortium, etc

R$ 5.2B

Consumer Finance

R$ 34.0B

Corporate Bank

Corporate bank: growth

• Leverage customer base
• Increase spread and cross-sell

Large Corporate: profitability Capital discipline

• Active portfolio management

Business approach focused on long-term relationships

• Agility to serve

Wealth Management

Asset: 9th largest in the market, with innovative products and growing synergies with BB R$ 55.3B in AuM¹ Private: tailor-made solutions

Wholesale

R$ 26.0B

Strategy

Diversified business portfolio

Focus on increasing business profitability, operating efficiency and diversifying revenues

Shareholders Pillars

• 1. Assets under management 2. Includes guarantees provided by the Bank and private securities

Expanded² credit portfolio

17

Consumer Finance: increased focus on used auto finance and INSS payroll loans (retirees and pensioners)

Payroll Loans Auto finance Consumer Finance Businesses

Loan portfolio (R$B) Loan portfolio (R$B)

Consumer Finance businesses

Mar/17 New Used 28.8 25.5 (89%) 3.3 Dec/16 28.2 24.7 (88%) 3.4 Mar/16 27.7 23.9 (86%) 3.8 Mar/16

0.6 (14%)

4.4 3.0 0.8 INSS Private Public Mar/17 3.4 2.3 0.8

0.4 (11%)

Dec/16 3.6 2.4 0.8

0.4

Among market leaders in auto financing, with the following advantages:

• Capillarity: presence in ~12,000 car dealerships nationwide
• Agility: 83% of proposals with automatic credit decision
• Expertise: continuous improvement of management tools

(pricing, credit, collection etc.)

• Long-term relationship: first access to customer record

Focus on refinancing the INSS payroll loan portfolio (retirees and pensioners)… ...and on increasing the private payroll loan portfolio Selective operation in public payroll agreements Continuous improvement of management tools (pricing, credit, collection etc.)

18 8.2 8.0 5.1 3.2 0.6 0.8

Highlights and strategy Corporate Bank

Wholesale: continued focus on improving return on capital

Leverage Corporate customer base, increasing spread and cross-sell

Wholesale Business (CIB)

Expanded credit portfolio (R$B and %)

Wholesale business

• 1. Includes debentures and promissory notes; 2. Includes export credit notes, working capital and Loan Offshore; 3. Rural Financing e Advances on Exchange Contracts;

Corporate bank (R$ 300M to R$ 1,500M): portfolio growth

• Increase and leverage the customer base
• Increase spread and cross-sell (FX, derivatives, DCM, M&A)
• Deconcentrate risk

Large Corporate (> R$ 1,500M): increase profitability

• Focus on unfunded products (guarantees) and BNDES onlendings

Discipline in capital allocation

• Risk x return management
• Active portfolio management
• Officers with responsibility for credit

Business approach focused on long-term relationships

• Agility to serve clients

Explore competitive advantages (e.g.: DCM)

Loans2 Onlending (BNDES) Financ Export / Import Other3 Guarantees provided Private Securities1 Expanded credit portfolio

R$ 26.0B

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Balance Sheet

Balance Sheet

Mar.17/Dec.16 Mar.17/Mar.16 CURRENT AND LONG-TERM ASSETS 108,890 102,338 103,613 1.2 (4.8) Cash and cash equivalents 210 184 170 (7.4) (19.0) Interbank funds applied 17,030 17,116 17,932 4.8 5.3 Securities and derivative financial instruments 31,117 28,480 27,012 (5.2) (13.2) Derivative financial instruments 2,929 2,685 4,211 56.8 43.8 Interbank accounts or relations 442 341 107 (68.6) (75.8) Loan Operations, Leases and Others receivables 48,359 47,398 46,644 (1.6) (3.5) Alow ance for loan losses (3,042) (3,668) (3,223) (12.1) 5.9 Tax credit 7,273 7,411 7,486 1.0 2.9 Others 4,572 2,391 3,274 36.9 (28.4) NON-CURRENTS 417 660 552 (16.3) 32.5 Investments 216 456 338 (25.8) 56.6 Fixed assets 98 98 95 (3.1) (3.1) Intangible and deferred charges 103 106 119 12.0 15.7 TOTAL ASSETS 109,307 102,998 104,166 1.1 (4.7) Mar.17/Dec.16 Mar.17/Mar.16 CURRENT AND LONG-TERM LIABILITIES 101,186 94,535 95,778 1.3 (5.3) Deposits 4,491 4,578 7,429 62.3 65.4 Demand deposits 78 88 77 (13.0) (1.4) Interbank deposits 2,086 1,997 2,151 7.7 3.1 Time deposits 2,327 2,492 5,202 108.7 123.6 Money market borrow ings 36,653 35,673 33,563 (5.9) (8.4) Acceptances and endorsements 20,860 21,802 23,154 6.2 11.0 Interbank accounts 35 100 53 (47.2) 51.4 Borrow ings and onlendings 7,032 5,203 4,304 (17.3) (38.8) Derivative financial instruments 2,776 2,708 4,341 60.3 56.4 Others obligations 29,339 24,471 22,933 (6.3) (21.8) Subordinated debts 6,648 6,046 5,987 (1.0) (9.9) Credit transactions subject to assignment 16,538 13,756 11,438 (16.9) (30.8) Others obligations 6,153 4,669 5,508 18.0 (10.5) DEFERRED INCOME 41 38 30 (19.4) (26.6) SHAREHOLDERS’ EQUITY 8,080 8,426 8,358 (0.8) 3.4 TOTAL LIABILITIES 109,307 102,998 104,166 1.1 (4.7) BALANCE SHEET | Liabilities (R$ Million) Mar.16 Dec.16 Mar.17 Variation % BALANCE SHEET | Assets (R$ Million) Mar.16 Variation % Dec.16 Mar.17

20

Mar/17 55.3 Dec/16 53.8 Sept/16 53.1 Jun/16 51.2 Mar/16 51.2

Total Assets Assets under Management¹ Loan portfolio

Mar/17 104.2 Dec/16 103.0 Sept/16 103.8 Jun/16 108.0 Mar/16 109.3

Financial highlights

Consumer Finance Wholesale

Mar/17 46.9 34.0 12.9 Dec/16 47.6 33.5 14.2 Sept/16 47.0 33.2 13.8 Jun/16 46.9 33.1 13.7 Mar/16 48.7 33.5 15.2 Financial highlights

R$ Billion

Shareholders’ Equity

• 1. Includes onshore funds (ANBIMA criteria) and private clients resources.

Mar/17 8.36 Dec/16 8.43 Sept/16 8.42 Jun/16 8.28 Mar/16 8.08

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Net Interest Income (A) 1,273 1,114 1,153 3.5% Average Interest-Earning Assets (B) 97,909 93,112 92,769

• 0.4%

Compulsory Deposits (Bacen) 206 335 224

• 33.3%

Interbanks Funds Applied 17,109 17,105 17,524 2.5% Securities 30,771 28,352 27,746

• 2.1%

Loan Portfolio 49,823 47,319 47,275

• 0.1%

NIM (A/B) 5.3% 4.9% 5.1% 0.2 p.p. NET INTEREST MARGIN (NIM) (R$ Million) 4Q16 1Q16 1Q17 Var. 1Q17/4Q16

Net Interest Margin (NIM)

Financial highlights – NIM

22

Efficiency Ratio

• 1. Excludes labor lawsuits and profit sharing expenses.

Total Personnel¹ and Administrative expenses (A) 464 541 454

• 16.0%

Total Revenues (B) 1,373 1,307 1,276

• 2.4%

Net Interest Income (NII) 1,273 1,114 1,153 3.5% Income from Services and Banking Fees 257 321 290

• 9.8%

Income from subsidiaries 43 50 58 16.9% Other Operating Income/Expenses (199) (179) (226) 26.5% Efficiency Ratio (A/B) - period 33.8% 41.4% 35.6%

• 5.8 p.p.

Efficiency Ratio - last 12 months 38.8% 37.6% 38.1% 0.5 p.p. EFFICIENCY RATIO (ER) (R$ Million) 1Q16 4Q16 1Q17 Var. 1Q17/4Q16

Financial highlights - ER

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Mar/17

3,245 6.9% 3,223 21

Dec/16

3,684 7.7% 3,671 13

Sept/16

3,267 6.9% 3,069 198

Jun/16

3,221 6.9% 2,989 232

Mar/16

3,271 6.7% 3,046 225 All balance / Managed loan portfolio Specific + Additional Generic²

ALL Balance (R$M) Managed loan portfolio rated by risk level¹ (%)

• 1. According to Bacen’s Resolution 2,682; 2. Considers credit provisions recognized as Liabilities in the "Other“ line (see Note #18d of Financial Statements)

Credit quality indicators

Credit portfolio quality

AA-C D-H Mar/17

89.2% 10.8%

Dec/16

88.3% 11.7%

Sept/16

90.2% 9.8%

Jun/16

90.2% 9.8%

Mar/16

90.6% 9.4% 141 140 176 262 121 926 469 624 639

1Q17 4Q16 3Q16 2Q16 1Q16

1,215

Credit Recovery (R$M) Net Loss (R$M)

500 448 804 207

1Q17

7.0%

4Q16

1.7%

3Q16

3.9%

2Q16

4.3%

1Q16

9.1% 1,074 Net Loss/Managed loan portfolio Net Loss Write-off Credit Recovery

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Managed Loan Portfolio (A) 58,281 56,806 55,712 55,231 55,422 52,505 51,576 51,250 48,799 46,925 47,031 47,620 46,931 90-day NPL Balance 3,563 3,662 3,273 3,154 3,628 2,727 2,712 2,923 2,254 2,174 2,567 2,638 2,120 90-day NPL Quarterly Variation (B) 482 99 (388) (119) 474 (902) (14) 211 (669) (80) 393 71 (518) Write-off (C) 874 857 771 666 578 834 838 693 1,215 639 624 469 926 New NPL (D=B+C) 1,356 955 383 547 1,052 (67) 823 903 546 560 1,017 540 408 New NPL Rate¹ (D/A) 2.24% 1.64% 0.67% 0.98% 1.90%

• 0.12%

1.57% 1.75% 1.07% 1.15% 2.17% 1.15% 0.86% 4Q15 1Q17 4Q16 2Q14 NEW NPL (R$ Million) 1Q14 3Q16 1Q16 2Q16 3Q14 4Q14 1Q15 2Q15 3Q15

0.86% 1.15% 2.17% 1.15% 1.07% 1.75% 1.57%

• 0.12%

1.90% 0.98% 0.67% 1.64% 2.24%

1Q17

0.93 0.41

4Q16

0.47 0.54

3Q16

0.62 1.02

2Q16

0.64 0.56

1Q16

1.22 0.55

4Q15

0.69 0.90

3Q15

0.84 0.82

2Q15

0.83

• 0.07

1Q15

0.58 1.05

4Q14

0.67 0.55

3Q14

0.77 0.38

2Q14

0.86 0.96

1Q14

0.87 1.36

New NPL rate

• 1. Variation in the balance of 90-day NPL balance + loans written-off to loss in the quarter, divided by loan portfolio by the end of the immediately preceding quarter

New NPL rate¹

Write-off (R$B) New NPL (R$B) Credit portfolio quality

25

R$M Part.(%) R$M Part.(%) R$M Part.(%) Financial Institutions 3,800 17.3% 4,523 21.9% 4,445 22.4% Sugar and Ethanol 2,033 9.2% 1,831 8.9% 1,996 10.1% Telecom 1,568 7.1% 1,633 7.9% 1,670 8.4% Petrochemical 1,558 7.1% 1,395 6.8% 1,541 7.8% Mining 889 4.0% 891 4.3% 914 4.6% Retail 1,440 6.5% 1,332 6.5% 911 4.6% Railways 810 3.7% 723 3.5% 706 3.6% Agribusiness 908 4.1% 710 3.4% 685 3.5% Automotive 391 1.8% 539 2.6% 548 2.8% Eletricity Generation 751 3.4% 542 2.6% 537 2.7% Government 616 2.8% 525 2.5% 471 2.4% Oil & Gas 401 1.8% 401 1.9% 401 2.0% Residential Construction 462 2.1% 416 2.0% 388 2.0% Electricity Distribution 448 2.0% 419 2.0% 336 1.7% Pulp and Paper 606 2.8% 355 1.7% 326 1.6% Road Cargo Transportation 527 2.4% 372 1.8% 306 1.5% Steel industry 83 0.4% 311 1.5% 289 1.5% Car rental 221 1.0% 227 1.1% 256 1.3% Slaughterhouses 292 1.3% 258 1.3% 255 1.3% Food industry 423 1.9% 245 1.2% 230 1.2% Other sectors 3,779 17.2% 2,962 14.4% 2,590 13.1% Total¹ 22,005 100.0% 20,614 100.0% 19,801 100.0% Wholesale Sectorial concentration Mar.16 Dec.16 Mar.17

Wholesale has a diversified credit portfolio

Top 20 sectors account for 87% of the Wholesale credit exposure

• 1. Numbers exclude private securities and are net of credit provisions.

Note: Does not consider application of Credit Conversion Factor of 50% in transactions relating to some specific guarantees provided.

Credit portfolio

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Banco Votorantim’ s main ratings

Ratings

RATING AGENCIES International National

Local Foreign Local

Moody’s

Long-term

Ba2 Ba3 Aa3.br

Short-term

NP NP BR-1

Standard & Poor’s

Long-term

BB brA+

Short-term

B brA-1

Brazil

Sovereign rating

Ba2 BB