Earnings Presentation 1 st Quarter, 2014 Disclaimer: This - - PowerPoint PPT Presentation

Earnings Presentation

1st Quarter, 2014

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.

2

Net income of R$ 152M in 1Q14

Second consecutive quarter of positive results, maintaining the trajectory of gradual improvement

R$ 152M net income

Net income of R$ 152M, exceeding both 4Q13 (R$ 121M) and 1Q13 (R$-278M) results In 2014, Banco Votorantim shall consolidate the return to profitability Net Interest Income (NII) increased 1.7% vs. 1Q13, totaling R$ 1,142M, despite 6.7% decrease in the expanded credit portfolio in the last 12 months (focus on profitability) Net Interest Margin¹ (NIM) of 4.9% p.y. – improvement of 0.7 p.p. on 1Q13 90-day NPL ratio of 6.2% in Mar/14, practically stable compared to Mar/13

• Excluding a specific Wholesale case, NPL 90 would have been 5.2%, 0.1 p.p. above Dec/13

BV has been originating quality auto finance portfolios for nearly 30 months Expenses with credit provisions² reduced 43.6% vs. 4Q13 and 19.7% over 1Q13, totaling R$ 714M

• Better quality vintages reached 77% of the managed auto finance loan portfolio (57% in Mar/13)

90-day coverage ratio reached 124% in Mar/14 (Mar/13: 106%; Sept/11³: 78%) Administrative and personnel expenses reduced 9.1% over 1Q13 (vs. 6.2% inflation – IPCA) Efficiency Ratio for the last 12 months reached 40.7% (Dec/13: 43.6%; Mar/13: 51.5%)

1Q14 Highlights

Executive summary

Consistent revenue generation Cost base under control Maintained asset quality

• 1. Ratio between Net Interest Income and Average Interest-Earning Assets; 2. Net of income from recovery of written-off loans; includes ALL expenses of the portfolios

assigned with recourse; 3. Beginning of the restructuring process

Reduced credit provisions

3

Banco Votorantim – Overview 1Q14 Results Annexes

Agenda

4

10 largest banks in Dec/13 – Total Assets (R$B)¹

106 116 130 160 495 763 777 858

Votorantim

BTG Pactual Safra HSBC Santander BNDES Bradesco CEF Itaú 1,027 Banco do Brasil 1,219 State-owned Foreign National privately-held 25 46 54 55 195 281 291 351 485 583 Banrisul Safra HSBC

Votorantim

Santander BNDES Bradesco Itaú CEF Banco do Brasil State-owned National privately-held Foreign

10th 7th

Banco Votorantim is one of the leading banks in Brazil

“Top 10” in total assets, with robust and committed shareholders (Votorantim Group and BB)

Banco Votorantim – Overview

Banco Votorantim is one of the largest privately-held Brazilian banks in total assets… ...and also in terms of loan portfolio

10 largest banks in Dec/13 – Loan Portfolio² (R$B)¹

• 1. Mar/14 information unavailable by the preparation of this presentation; 2. On-balance portfolio according to Bacen’s Res. 2,682

Equal representation

• f each

shareholder

Board of Directors Executive Committee Fiscal Council Audit Committee Compensation & HR Committee Statutory Products & Marketing Committee Finance Committee Operating Committes & Commissions

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

Votorantim Group Banco do Brasil Ownership Structure Governance Structure

Shareholder 50% Total

5

Diversified business portfolio

Focus on profitability and on increasing operating efficiency and synergies with BB

Shareholders Pillars

Banco do Brasil Votorantim Group

+

R$ 69.2B Expanded credit portfolio²

Off-balance portfolio¹

R$ 3.6B R$ 0.5B Assigned to BB Assigned to FIDCs

Strategy

Unification of the CIB and Middle Market structures, with efficiency gains

Consumer Finance Auto Finance

To originate portfolios with quality, scale and profitability To focus on used auto finance (multi-brand dealers) To advance in new auto finance origination in partnership with BB (new car dealers)

Other Businesses

In Payroll loans, focus on INSS (retirees and pensioners) and refinancing To expand synergic businesses (credit cards, insurance sales) To explore new opportunities together with BB (e.g. syndicated loans, real estate, “Mais BB”)

R$ 36.5B R$ 30.0B R$ 6.5B

Wealth

• Mgmt. & BVEP

Asset: 10th largest in the market, with innovative products R$ 40.6B AuM³ Increase synergies with BB Private: focus on estate management through custom-made solutions BVEP: investments in real estate projects

Wealth Mgmt. Corporate & IB (CIB)

To be the best wholesale bank to our target clients, with:

• Long-term relationships
• Focus on capturing

synergies in the origination and structuring of integrated financial solutions

• Efficient management of

capital allocation and expenses

Wholesale R$ 32.7B

• 1. Securitization with substantial risk retention before entry in force of Bacen’s Res. 3,533; 2. Includes guarantees provided and private securities

6

Highlights Corporate & Investment Bank (CIB)

Wholesale: continued focus on return on capital and on strengthening the product portfolio

Wholesale Businesses

Large companies Medium companies Mar/14 32.7 25.8 6.9 Dec/13 35.1 27.5 7.6 Mar/13 36.5 27.3 9.2 Expanded credit portfolio¹ (R$B)

• 9.4%
• 6.1%

∆Mar14 /Dec13

• 6.8%

Disciplined approach to capital allocation

• Credit selectivity
• Focus on products with low capital consumption (FX, IB)
• Accurate asset pricing
• Active management of the credit portfolio
• Reduced exposure to the “lower middle market”

Unification of the CIB and Middle Market structures, with gains in operating efficiency Increased relevance of BV to its target clients

• Strengthening the portfolio of products
• Enhancing international distribution (NY and London)
• Agile relationships, with long-term vision and industry

knowledge Focus on capturing synergies in the origination and structuring of Credit, Capital Markets, Derivatives and FX Thorough monitoring of key credits in “financial distress”, with focus on restructuring

Wholesale Businesses

Guarantees provided 9.9 12.0 11.1

• 1. Includes guarantees provided and private securities

7

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

Payroll Loans Auto Finance Consumer Finance Businesses

Managed loan portfolio (R$B) Managed loan portfolio (R$B)

• 2.1%

On- balance 30.0 33.0 Mar/14 Off- balance

3.1

Dec/13 33.7 29.9

3.8

Mar/13 37.2 29.9

7.3

On- balance Off- balance Mar/14 7.1

6.0 1.1

Dec/13 7.6

6.3 1.3

Mar/13 9.5

7.4 2.1

Used/ Total¹ 76% 71% INSS/ Total 63% 57%

Consumer Finance Businesses

Among market leaders in auto financing Operates as an extension of Banco do Brasil in auto finance outside the branch network Continuous improvement of credit processes

• 72%² automated credit decisions in Mar/14 (Dec/13:

65%; Jan/12: 28%)

• 1. Only on-balance loan portfolio; 2. Refers to light vehicles; 3. Banco Votorantim estimate; 4. Banking correspondents

7th largest player in the payroll loan market³ Focus on INSS (retirees and pensioners) Focus on refinancing (vs. growth) Selective operation in private and public payroll loans 4,292 Resolution (May/14): Credit portability 4,294 Resolution (Jan/15): Deferred Cobans4 payment

• 20.3%

0.3% ∆Mar14 /Dec13

• 17.6%
• 4.4%

∆Mar14 /Dec13

8

Highlights Wealth Management & Services

Wealth Management: Asset with focus on high value-added products and Private with focus on estate management

Assets under Management¹ (R$B) +3.2% Mar/14 40.6 Dec/13 39.4 Mar/13 41.1 Asset Management

• Focus on high value-added structured products
• Top 10 in ANBIMA’s ranking of managers
• Continuous expansion of synergies with BB – volume of

partnership funds reached R$ 4.3B

• Partnership with Allianz Global Investors in order to better

serve institutional investors Private Bank

• Focus on High and Ultra High clients (AuM > R$ 25M)
• Integrated estate management, through differentiated and

custom-made solutions

• ISO 9001:08 certification covering activities of Relationship,

Estate Management and Advisory BVEP – BV Empreendimentos e Participações

• Focus on real estate, residential, commercial

and logistic projects

• Operates in SP, RJ, MG and DF

Wealth Management Businesses

Wealth Management Businesses

• 1. Includes onshore funds (ANBIMA criteria) and private clients resources; 2. Ranking of Managers

ANBIMA² ranking 10th 9th 10th

9

Banco Votorantim – Overview 1Q14 Results Annexes

Agenda

10

152 121

• 159
• 196
• 278
• 428
• 459
• 505
• 596
• 643

156 385

• 85

3Q11 1Q14 1Q12 +26% 4Q13 3Q13 2Q13 1Q13 4Q12 3Q12 2Q12 4Q11 2Q11 1Q11

Net Income of R$152M in 1Q14

Second consecutive quarter of positive results, maintaining the trajectory of gradual improvement Focus of 2014 is on consolidating profitability. In 2015, the focus will be on increasing ROE.

Net Income evolution (R$M)

• 187
• 1,988
• 512

Consolidated results

11

Net Interest Income (A) 1,123 1,226 1,142

• 6.9%

1.7% ALL Expenses¹ (B) (889) (1,266) (714)

• 43.6%
• 19.7%

Net Financial Margin (A+B) 234 (40) 428

• 83.3%

Operating Income/Expenses (669) (58) (350)

• 47.6%

Fee/Banking Fee Income 239 282 244

• 13.5%

2.4% Personnel Expenses (228) (292) (257)

• 12.0%

13.0% Other Administrative Expenses (367) (400) (284)

• 29.2%
• 22.8%

Tax Expenses (124) (115) (111)

• 4.2%
• 11.1%

Other Operating Income/Expenses² (188) 468 57

• 87.8%
• 130.3%

Net Income (Loss) (278) 121 152 25.6%

• 154.7%

(R$ Million)

• Var. 1Q14

/4Q13

• Var. 1Q14

/1Q13 1Q13 4Q13 1Q14

Results have confirmed, once again, the progress in Banco Votorantim’s restructuring process

Managerial Income Statement

Highlights of 1Q14 results

Increased Net Financial Margin and reduced cost base

• 1. Includes expenses related to credit assignments with recourse (both on and off-balance), as well as revenues from write-off recovery; 2. Includes Other Operating

Income/Expenses, as well as Equity in Income of Associated Companies and Subsidiaries

Consolidated results

12

Consistent revenue generation

NII increased 1.7% in 1Q14 / 1Q13, despite retraction of the credit portfolio in the last 12 months

• 1. Ratio between Net Interest Income and Average Interest-Earning Assets; 2. Includes guarantees provided and private securities; 3. Sum of income from loans and

irom sales or transfer of financial assets; 4. Expenses with the prepayment of credit assignments (before res. 3,533) amounted to R$ 23M in 1Q14 (R$ 80M in 1Q13)

Net Interest Income increased 1.7% compared to 1Q13... ...despite reduction of 6.7% in the expanded credit portfolio² in the period

Net Interest Income (R$M) and NIM¹ (% p.y.) +1.7% 1Q14 1,142 4.9% 4Q13 1,226 5.0% 1Q13 1,123 4.2%

• 6.7%

Mar/14 69.2 Dec/13 71.8 Mar/13 74.2 Expanded credit portfolio² (R$B) Growth of Consumer Finance’s loan³ revenues

• Reduced delinquency and increased interest rate

Reduction in expenses with the prepayment of assigned portfolios4 Conservative position on credit concession Focus on profitability (vs. growth) Revision of Wholesale’s activity Net Interest Income (NII)

13

Expanded portfolio (interest-earning) reduced 3.6% vs. Dec/13

4.1 9.4 5.1

Expanded credit portfolio (R$B)

(includes guarantees provided and private securities)

• 6.6%
• 2.1%
• 9.4%
• 6.1%

∆Mar14 /Dec13

• 6.7%
• 3.6%

Large Companies Medium Companies Auto Finance Others¹ Mar/14 69.2 25.8 6.9 30.0 6.0 Dec/13 71.8 27.5 7.6 29.9 6.3 Mar/13 74.2 27.3 9.2 29.9 7.4 Payroll Loans

• 4.6%
• 12.3%

73.3 Mar/14 25.8 6.9 33.0 7.1 Dec/13 76.9 27.5 7.6 33.7 7.6 Mar/13 83.6 27.3 9.2 37.2 9.5

• 9.4%
• 6.1%
• 4.4%

0.3% ∆Mar14 /Dec13

CIB

• 1. Credit cards and individual loans

Consistent revenue generation, despite retraction

• f the credit portfolio in the last 12 months

Maintenance of the conservative approach in credit

Credit portfolio retraction associated with the focus on business profitability

Credit portfolio by segment Expanded managed credit portfolio (R$B)

(includes off-balance securitization with substantial risk retention)

Reduction in off-balance securitization explains greater drop in managed portfolio

Off-balance securitization

14

Auto Finance: origination amounted to R$ 3.4B in 1Q14

Increased focus on used light vehicles and maintained conservative credit concession

Auto finance: origination amounted to R$ 3.4B in 1Q14, with emphasis on used light vehicles

Mar/14 10.75³ 26.8 Dec/13 10.0 25.5 Dec/12 7.3 23.5 Dec/11 11.0 26.4 Dec/10 10.75 24.6

Auto finance origination rate x Selic² rate (% p.y.)

+4% Used light vehicles Other vehicles¹ 1Q14 3.4 2.7 (80%) 0.7 1Q13 3.3 2.5 (74%) 0.9 1Q12 2.7 1.7 (62%) 1.0 1Q11 5.1 2.7 (53%) 2.4 26% 32% 36% 38% 39% 44 45 44 47 52 1Q14 4Q13 4Q12 4Q11 4Q10

• 19%

∆1Q14 /1Q13 12% BV Financeira (auto) Selic

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

Consumer Finance – Auto Finance

BV maintained the focus on quality and profitability of new vintages

Auto Finance origination (R$B) Down payment (%) and average tenor (months)

Down payment Average tenor

• 1. Composed of trucks, motorcycles and new light vehicles; 2. Market’s benchmark interest rate; 3. Increased to 11.0% on Apr/14

15

Consumer Finance – Auto Finance

June/12 Dec/11 1.0 June/11 Dec/10 2.1 June/10 Dec/09 1.5 June/09 Mar/14 0.9 Dec/13 1.3 June/13 Dec/12 1.1

Auto finance: BV has been originating quality auto finance for 30 months, focused on multi-brand dealers (used cars)

Vintages indicating lower quality Inad 30¹ (by vintage) Multi-brand dealers New car dealers

• 1. % of each month’s production with first installments past due over 30 days; 2. Includes securitization with substantial risk retention before Bacen’s Res. 3,533

June09- June10 average

Participation of lower quality vintages reduced to less than ¼ of the managed auto finance portfolio

Lower quality vintages / Managed auto finance portfolio²

23% 27% 62% Mar/14 Dec/13 Dec/11

Light vehicles – Origination by channel (R$B) and 1st payment default¹ (%)

16

100% 101% 93% 124% 147% 106% Consumer Finance’s 90-day Coverage Ratio³ (%)

ALL expenses decreased in 1Q14

90-day Coverage Ratio increased in the last 12 months

• 1. Includes expenses related to credit assignments with recourse, as well as revenues from write-off recovery; 2. Specific case that was classified in the “G” risk level in

Mar/14, with 80% of provisioning (or R$ 481M); 3. Ratio between ALL balance and balance of operations past due over 90 days Note: the consolidated and Consumer Finance 90-day Coverage Ratios were 78% and 68%, respectively in Sept/11 (beginning of the adjustment process)

Expenses¹ with credit provisions (R$M)

ALL expenses reduced 19.7% vs. 1Q13 and 43.6% vs. 4Q13 Coverage Ratio increased compared to Mar/13 and Sept/11 (beginning of adjustment process)

669 563 417 557 156 290 199 849 156 733

• 43.6%
• 19.7%

1Q14 714 4Q13 1,266 3Q13 761 2Q13 959 1Q13 889

• 81.6%

33.5% ∆1Q14 /4Q13

Mar/14 2,692 2,684 Dec/13 2,741 2,777 Mar/13 3,627 3,384 NPL 90 Balance (R$M) ALL Balance (R$M)

Specific Wholesale case²

Managed loan portfolio’s 90-day Coverage Ratio³ (%) 3,563 Mar/14 4,421 Dec/13 3,081 4,514 Mar/13 4,056 4,313

78% in Sept/11 Wholesale Consumer Finance

Credit indicators – ALL expenses and 90-day Coverage Ratio

17

1 2 3 4 5 6 7 8 9 10 Dec/13 1.9% 5.1% 6.6% Sept/13 2.1% 5.5% 6.2% Mar/14 5.0% 6.2% 6.3% 2.3% 6.9% June/13 2.4% % 7.7% Dec/12 2.4% 6.6% 8.3% Sept/12 2.4% 7.4% 9.4% June/12 2.0% 7.5% 9.6% Mar/12 1.8% 7.0% 8.9% 6.6% 7.1% 5.7% Mar/13

Delinquency increased in 1Q14, mainly due to a specific Wholesale case that became overdue

• 1. Specific case that was classified in the “G” risk level in Mar/14, with 80% of provisioning (or R$ 481M)

NPL 90 / Managed loan portfolio (%)

Consumer Finance Total Light Vehicles Wholesale

Excluding this Wholesale case¹, NPL 90 would have ended Mar/14 at 5.2%

5.1% Dec/13 1.9% Mar/14 1.6% 5.2%

Excluding specific Wholesale case¹

Credit indicators – Delinquency

18 Managed Loan Portfolio (A) 76,775 74,185 71,481 68,169 65,923 63,546 61,281 60,006 57,925 NPL 90 Balance 5,390 5,539 5,276 4,520 4,056 3,616 3,373 3,081 3,563 NPL 90 Quarterly Variation (B) 793 149 (262) (756) (465) (439) (244) (292) 482 Write-off (C) 693 1,079 1,269 1,439 1,144 1,339 902 869 832 New NPL (D=B+C) 1,486 1,228 1,007 683 680 900 659 578 1,314 New NPL Rate¹ (D/A) 1.88% 1.60% 1.36% 0.95% 1.00% 1.36% 1.04% 0.94% 2.19% 1Q12 3Q12 4Q12 1Q13 2Q13 3Q13 NEW NPL (R$ Million) 4Q13 1Q14 2Q12

1.20% 2.19% 0.94% 0.94% 1.04% 1.36% 1.00% 0.95% 1.36% 1.60% 1.88% 0.83 1.31 4Q13 0.87 0.58 3Q13 0.90 0.66 2Q13 1.34 0.90 1Q13 1.15 0.68 4Q12 1.43 0.68 3Q12 1.27 1.01 2Q12 1.08 1.23 1Q12 0.69 1.49 1Q14

Impact of the specific Wholesale case is also seen in the New NPL rate

• 1. Variation in the balance of NPL 90 + loans written-off to loss in the quarter, divided by loan portfolio by the end of the immediately preceding quarter; 2.Specific

case that was classified in the “G” risk level in Mar/14, with 80% of provisioning (or R$ 481M)

New NPL rate

New NPL (R$B) Write-off (R$B)

Excluding specific case²

Credit indicators – New NPL

19

BV continues to improve in cost management

Personnel and administrative expenses reduced 9.1% in 1Q14 / 1Q13

Personnel and Administrative expenses reduced 9% vs. 4Q13 and 22% vs. 1Q13 1Q14 personnel expenses benefited from the reduction in expenses with labor claims

Note: in the last 12 months, the inflation rates IPCA and IGP-M reached 6,2% and 7,3%, respectively

• 1. Administrative expenses in 4Q13 were impacted by expenses related to restructuring process

Personnel and Administrative Expenses Personnel and Administrative expenses (R$M) Personnel expenses (R$M)

367 284 228 292 257

• 9.1%

Administrative Personnel 1Q14 541 4Q13 693 400¹ 1Q13 595 208 227 222 20 65 35 Labor claims 1Q14 292 257 4Q13 Others 1Q13 228 ∆ 1Q14/ 4Q13

• 2.0%
• 46.5%
• 12.0%

∆ 1Q14/ 4Q13

• 12.0%
• 29.2%
• 21.9%

20 Total Personnel and Administrative Expenses (A) 595 601 604 693 541

• 21.9%
• 9.1%

Total Revenues (B) 1,173 1,297 1,273 1,977 1,443

• 27.0%

23.0% Net Interest Income (NII) 1,123 1,112 1,154 1,226 1,142

• 6.9%

1.7% Fee/Banking Fee Income 239 253 257 282 244

• 13.5%

2.4% Equity in Income of Associated Companies and Subsidiaries 24 20 30 35 41 16.9% 69.1% Other Operating Income/Expenses (213) (87) (168) 433 16

• 96.4%
• 107.4%

Efficiency Ratio (A/B) - Quarter 50.7% 46.4% 47.4% 35.1% 37.5% 2.4 p.p.

• 13.2 p.p.

Efficiency Ratio - 12 months 51.5% 51.2% 51.2% 43.6% 40.7%

• 2.9 p.p.
• 10.8 p.p.

4Q13 1Q14

• Var. 1Q14

/4Q13

• Var. 1Q14

/1Q13 1Q13 2Q13 3Q13 EFFICIENCY RATIO (R$ Million)

12 months Quarter 1Q14 40.7 37.5 4Q13 43.6 35.1 3Q13 51.2 47.4 2Q13 51.2 46.4 1Q13 51.5 50.7 Efficiency Ratio evolution (%)

Efficiency Ratio continued to improve in 1Q14, reflecting the progress in cost management

Efficiency Ratio

21

152 121

• 159
• 196
• 278

428

• 40

393 153 234 1Q14 4Q13 3Q13 2Q13 1Q13

Summary: Net Income of R$ 152M in 1Q14

Consistent revenue generation, reduction in ALL expenses and cost base under control

Net Interest Income + Fee Income¹ Credit provision expenses - ALL Personnel and Administrative Expenses Net income and Net financial margin

+1.8% 1Q14 1,386 4Q13 1,509 3Q13 1,411 2Q13 1,364 1Q13 1,361 367 351 363 400 284 228 250 241 292 257

• 9.1%

Admin. Person. 1Q14 541 4Q13 693 3Q13 604 2Q13 601 1Q13 595

733 669 563 417 557 290 199 849

• 19.7%
• Cons. Finance

Wholesale

1Q14 714

156

4Q13 1,266 3Q13 761 2Q13 959 1Q13 889

156 Net financial margin (post provisions) Net income

• 12.0%
• 29.2%

∆1Q14 /4Q13

• 81.6%

33.5% ∆1Q14 /4Q13

• 43.6%
• 21.9%

Consolidated results

• 1. Includes Banking Fee Income

R$ Million

22

Funding: continuous improvement of the funding profile

Funding from Credit Assignments and Financing Bills represent 40% of total funding

Funding

• 1.2%

Mar/14 74.7 16.7 15.9 13.9 7.5 6.1 6.0 4.3 4.3 Dec/13 75.6 16.1 15.7 12.8 7.4 6.7 6.9 5.8 4.3 Mar/13 82.5 20.3 14.1 9.7 6.7 9.7 7.0 9.4 5.6 25% 22% 17% 21% 12% 19% 8% 10% 12% 8% 8% 8% 7% 11% 6%

Debentures (repos) Bills (LF, LCA e LCI) Credit Assignments² Subordinated debt Loans and onlendings Private securities Time deposits (CD) Others¹

Mar/14 74.7 6% Mar/13 82.5

Funding evolution (R$B)

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

• 1. Includes other deposits, debenture issuances, and box of options; 2. Credits assigned with substantial risk retention to FIDCs e to other FI, under Res. 3,533 (i.e. does not

include off-balance credit assignments) Note: International funding is 100% swapped for BRL

23

Basel Ratio of 14.5% in Mar/14, stable vs. Dec/13

Tier I Capital ended 1Q14 in 9.5%, composed entirely by Common Equity

• 1. Dec/13 Basel Ratio revised from 14.3% to 14.5% due to the refinement of the Capital Requirement (Credit risk) calculation methodology Source: Finance

Capital structure

Capital (PR) 11,430 11,217 10,770 Tier I 7,595 7,100 7,029 Common Equity Tier I 7,595 7,100 7,029 Additional Tier I Capital

• Tier II

3,835 4,117 3,741 Risk-Weighted Assets (RWA) 84,043 77,309 74,299 Credit risk 77,219 71,990 68,624 Market risk 4,260 1,678 1,513 Operational risk 2,565 3,641 4,162 Minimum Capital Requirement 9,245 8,504 8,173 Basel Ratio (PR/RWA) 13.6% 14.5% 14.5% Tier I Capital 9.0% 9.2% 9.5% Common Equity Tier I

• 9.2%

9.5% Additional Tier I Capital

• Tier II Capital

4.6% 5.3% 5.0% Mar.13 Dec.13¹ Mar.14 BASEL RATIO (R$ Million)

24

Banco Votorantim – Overview 1Q14 Results Annexes

Agenda

25

+3,2% Mar/14 40,6 Dec/13 39,4 Sept/13 42,7 June/13 42,7 Mar/13 41,1 Mar/14 104.6 Dec/13 105.5 Sept/13 110.7 June/13 111.9 Mar/13 119.7 37,7 37,1 36,9 36,6 36,5 18,9 18,6 18,0 18,2 17,3

• 2,0%

Consumer Finance Wholesale

Mar/14 53,8 Dec/13 54,9 Sept/13 54,9 June/13 55,7 Mar/13 56,5 Dec/13 Mar/14 7.34 7.14 Sept/13 7.10 June/13 7.13 Mar/13 7.67

Financial highlights

Financial highlights

Total assets Assets under management¹ On-balance loan portfolio Shareholders’ Equity

R$ Billion

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

26

Net Interest Income (A) 1,123 1,112 1,154 1,226 1,142

• 6.9%

1.7% ALL Expenses (889) (959) (761) (1,266) (714)

• 43.6%
• 19.7%

Net Financial Margin 234 153 393 (40) 428

• 83.3%

Average Interest-Earning Assets (B) 109,414 105,840 102,260 99,754 95,872

• 3.9%
• 12.4%

Compulsory Reserves (Bacen) 929 491 200 113 94

• 16.8%
• 89.9%

Interbanks Funds Applied 16,466 15,492 15,374 13,821 11,860

• 14.2%
• 28.0%

Securities 35,278 33,719 31,360 30,924 29,568

• 4.4%
• 16.2%

Loan Portfolio 56,742 56,138 55,326 54,896 54,350

• 1.0%
• 4.2%

NIM (A/B) - Quarter 4.2% 4.3% 4.6% 5.0% 4.9%

• 0.1 p.p.

0.7 p.p.

NET INTEREST MARGIN (NIM)

(R$ Million) 1Q13 2Q13 3Q13 4Q13 1Q14

• Var. 1Q14

/4Q13

• Var. 1Q14

/1Q13

Net Interest Margin (NIM)

NIM evolution in last quarters reflects the focus on profitability (vs. growth) and the improved asset quality

Financial highlights - NIM

27 Mar/14 7.6% 4,421 Dec/13 7.5% 4,514 Sept/13 6.5% 4,003 June/13 6.3% 3,996 Mar/13 6.5% 4,313 124% 147% 119% 111% 106% Mar/14 3,563 Dec/13 3,081 Sept/13 3,373 June/13 3,616 Mar/13 4,056

ALL Balance (R$M) 90-day Coverage ratio¹ (%) NPL 90 / Managed loan portfolio (%) NPL 90 / Credit loan portfolio (%)

ALL Balance/Managed loan portfolio ALL Balance (R$M) Mar/14 5.0% 6.2% 6.6% Dec/13 1.9% 5.1% 6.6% Sept/13 2.1% 5.5% 6.9% June/13 2.4% 5.7% 7.1% Mar/13 2.3% 6.2% 7.7% Mar/14 5.0% 6.3% 6.9% Dec/13 1.9% 5.2% 6.9% Sept/13 2.1% 5.7% 7.4% June/13 2.4% 5.9% 7.6% Mar/13 2.3% 6.4% 8.5% Wholesale Total Consumer Finance NPL 90 Balance (R$M) 90-day Coverage Ratio Wholesale Consumer Finance Total

Credit quality indicators

Financial highlights - Credit

• 1. Ratio between ALL balance and balance of operations past due over 90 days

Note: refers to managed loan portfolio (includes credits assigned with substantial risk retention until Dec/11 (before Res. 3,533))