Earnings Presentation 2 nd Quarter, 2014 Disclaimer: This - - PowerPoint PPT Presentation

Earnings Presentation

2nd 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$ 140M in 2Q14 and R$ 292M in 1H14

In 2H14, BV will keep working to consolidate net profit

Executive summary

Profit of R$ 140M in 2Q14

Net income of R$ 140M in 2Q14 – third consecutive quarter of positive results, with net profit in each of the last nine months In 1H14, net income totaled R$ 292M (R$-474M in 1H13)

Consistent revenue generation

Net Interest Income increased 4.8% in 2Q14/1Q14 and 4.7% in 1H14/1H13, despite the reduction in the expanded credit portfolio, reflecting the focus on profitability (vs. growth) Net Interest Margin¹ (NIM) of 5.4% p.y. – improvement of 0.5 p.p. vs. 1Q14 and 1.1 p.p. vs. 2Q13

Maintained asset quality

BV has been originating auto finance with quality and scale for more than 30 months

• Better quality vintages reached 81% of the managed auto finance loan portfolio (62% in June/13)

Consumer Finance’s 90-day NPL at 6.6%, stable compared to Mar/14 and 0.5 p.p. below June/13

Reduced credit provisions

ALL expenses² dropped by 26.7% in 2Q14/1Q14 and 33.1% (R$ 611M) in 1H14/1H13

• Expenses with credit provisions in 2Q14 (R$ 523M) were the lowest since 1Q11

90-day Coverage Ratio reached 118% in June/14 (June/13: 111%; Sept/11³: 78%)

Reduction in the cost base

Personnel and Administrative expenses reduced 13.0% in 2Q14/1Q14 and 10.6% in 1H14/1H13

• Administrative expenses dropped almost 25% (R$ 177M) in the 1H14/1H13 comparison

Efficiency Ratio for the last 12 months reached 36.0% (Mar/14: 37.9%; June/13: 46.3%)

Highlights of 2Q14 results

• 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

3

Banco Votorantim – Overview 2Q14 Results Appendix

Agenda

4

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 Mar/14¹ - Total Assets (R$B)

...and also in terms of loan portfolio

105 125 132 167 503 765 791 910

Votorantim

BTG Pactual Safra HSBC Santander BNDES Bradesco CEF Itaú 1,034 Banco do Brasil 1,281

10 largest banks in Mar/14¹ – Loan Portfolio² (R$B)

Público Estrangeiro Brasileiro e privado 26 46 54 194 285 296 353 512 592 54 HSBC Banrisul Safra

Votorantim

Santander BNDES Bradesco Itaú CEF Banco do Brasil Estrangeiro Brasileiro e privado Público

1.June/14 Central Bank (“Bacen”) data unavailable by the preparation of this presentation; 2. On-balance portfolio according to Bacen’s Res. 2,682

10th 8th

Equal representation

• f each

shareholder

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

5

Diversified business portfolio

Focus on expanding business profitability, operating efficiency and synergies with BB

Shareholders Pillars

Banco do Brasil Votorantim Group

+

R$ 68.2B Expanded credit portfolio²

Off-balance portfolio¹

R$ 2.8B R$ 0.4B Assigned to BB Assigned to FIDCs

Strategy

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$ 35.9B R$ 29.6B R$ 6.3B

Wealth

• Mgmt. & BVEP

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

Wealth Mgmt. Corporate & IB (CIB)

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

• Long-term relationships
• Capturing synergies in the
• rigination and structuring of

integrated financial solutions

• Efficient management of

capital allocation and expenses

Wholesale R$ 32.3B

• 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

• n strengthening the product portfolio

Wholesale Businesses

Large companies Medium companies June/14 32.3 25.7 6.6 Mar/14 32.7 25.8 6.9 June/13 37.0 28.2 8.8 Expanded credit portfolio¹ (R$B)

• 4.3%
• 0.4%

∆June14 /Mar14

• 1.2%

Disciplined approach to capital usage

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

– Portfolio in June/14: R$ 1.3B (Mar/14: R$ 1.8B) Increased relevance of BV to its target clients

• Strengthening of the product portfolio
• Enhancing international distribution (NY and London)

Focus on capturing synergies in the origination and structuring of Credit, Capital Markets, Derivatives and FX operations

• 2nd place in the 2Q14 Local Fixed Income Distribution

ranking² (3rd place in the 1H14) Thorough monitoring of key credit operations in “financial distress”, focused on debt restructuring

Wholesale Businesses

Guarantees provided 10.1 12.1 9.9

• 1. Includes on-balance portfolio (loans), guarantees provided (sureties and endorsements) and private securities; 2. “Ranking Anbima de Distribuição – Renda Fixa

Consolidado” (June/14)

Loans 17.2 18.6 17.3

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) On- balance Off- balance June/14 32.0 29.6

2.4

Mar/14 33.0 30.0

3.1

June/13 35.7 29.7

6.0

On- balance Off- balance June/14 6.6

5.8 0.9

Mar/14 7.1

6.0 1.1

June/13 8.8

7.0 1.8

Used/ Total¹ 78% 72% INSS/ Total¹ 63% 59%

Consumer Finance Businesses

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

• 72%² automated credit decisions in June/14

(Dec/13: 65%; Jan/12: 28%)

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

7th largest³ player in the payroll loan market Focus on INSS (retirees and pensioners) Focus on refinancing (vs. growth) Selective operation in private and public agreements

• Res. 4,292 (May/14): Credit portability
• Res. 4,294 (Jan/15): Deferred Cobans4 payment
• 22.8%
• 1.3%

∆June14 /Mar14

• 18.8%
• 4.2%
• 3.3%

∆June14 /Mar14

• 6.4%

8

Auto finance: origination amounted to R$ 6.6B in 1H14

Increased focus on used light vehicles and maintained conservative credit concession

Auto finance: financing of used light vehicles, BV’s focus, increased 9.0% on 1H13 BV maintained the focus on quality and profitability of originated new vintages

June/14 11.0 26.3 Mar/14 10.75 26.8 Dec/13 10.0 25.5 Dec/10 10.75 24.6

• 1. New light vehicles, trucks and motorcycles; 2. Market’s benchmark interest rate (Bacen)

Down payment Average term

Consumer Finance Businesses – Auto Finance

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

Auto finance origination (R$B) Down payment (%) and average term (months) Auto finance interest rate x Selic² rate (% p.y.)

+0.2% Used light vehicles Other vehicles¹ 1H14 6.6 5.3 (80%) 1.3 1H13 6.6 4.9 (74%) 1.8 26% 38% 39% 39% 44 44 45 52 2Q14 1Q14 4Q13 4Q10

• 24.2%

∆1H14/ 1H13 +9.0% BV Financeira (vehicles) Selic

9

Highlights Wealth Management & Services

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

Assets under Management¹ (R$B) June/14 40.6 Mar/14 40.6 June/13 42.7 Asset Management

• Focus on high value-added structured products
• “Top Gestão 2014 – Renda Fixa³”: Fixed Income award
• Continuous expansion of synergies with BB

– Volume of partnership funds: R$ 4.6B – BB Votorantim Highland Infraestrutura, infrastructure fund launched in June/14, raised R$ 300M Private Bank

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

custom-made solutions

• ISO 9001:08 certification

BVEP – BV Empreendimentos e Participações

• Focus on real estate, residential, commercial

and logistic projects (SP, RJ, MG and DF)

Wealth Management Businesses

Wealth Management Businesses

ANBIMA² ranking 10th 9th 10th

VWM&S aims at being one of the best in structuring and managing high value-added products

• 1. Includes onshore funds (ANBIMA criteria) and private clients’ assets (fixed income, equities and offshore funds); 2. Managers’ ranking; 3. Awarded by the Valor Investe

magazine, along with Standard & Poor’s, in the “largest asset managers” category

10

Banco Votorantim – Overview 2Q14 Results Appendix

Agenda

11

140 152 121

• 159
• 196
• 278

2Q14 1Q14 4Q13 3Q13 2Q13 1Q13

Net income of R$ 140M in 2Q14 and R$ 292M in the semester

Third consecutive quarter of positive results, with net profit in each of the last nine months

Consolidated results

2014 is the year of profit consolidation and 2015 will be focused on increasing ROE

Net Income evolution (R$M)

R$11,4B R$-474 R$ 292 R$+766

12

Net Interest Income (A) 1.142 1.197 4,8% 2.235 2.339 4,7% ALL expenses¹ (B) (714) (523)

• 26,7%

(1.848) (1.237)

• 33,1%

Net Financial Margin (A+B) 428 674 57,3% 386 1.102 185,2% Operating Income/Expenses (350) (510) 45,5% (1.198) (860)

• 28,2%

Income from Services and Banking Fees 244 206

• 15,7%

491 450

• 8,3%

Personnel Expenses (345) (290)

• 16,0%

(597) (634) 6,3% Other Administrative Expenses (284) (257)

• 9,3%

(718) (541)

• 24,7%

Despesas Tributárias (111) (110)

• 0,6%

(257) (220)

• 14,3%

Other Operating Income/Expenses² 144 (59)

• 140,9%

(117) 85

• Operating Income (Loss)

78 164 110,3% (811) 242

• Net Income (Loss)

152 140

• 7,9%

(474) 292

• Var. 1H14

/1H13 1Q14 2Q14

• Var. 2Q14

/1Q14 1H13 1H14 (R$ Million)

In the 2H14, BV will continue working to consolidate net profit

Managerial Income Statement

Highlights of 2Q14 results

Increase in Net Interest Income (NII), reduction in ALL expenses, and optimized cost base

Consolidated results

• 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

1 2 3

13

Consistent revenue generation

NIM increased in the last quarters, reflecting the focus on profitability of the portfolio

• 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 from sales
• r transfer of financial assets; 4. Expenses with the prepayment of credit assignments (before res. 3,533) amounted to R$42M in 1H14 (R$158M in 1H13)

Net Interest Income

Net Interest Income expanded 7.7% in 2Q14 compared to 2Q13... ...despite the 7.9% reduction in the expanded credit portfolio in the same period

Net Interest Income (R$M) and NIM¹ (% p.y.) +7.7% 2Q14 1,197 5.4% 1Q14 1,142 4.9% 2Q13 1,112 4.3%

• 7.9%

June/14 68.2 Mar/14 69.2 June/13 74.1 Expanded² credit portfolio (R$B) Growth of Consumer Finance’s loan³ revenues Reduced funding expenses Reduction in expenses with prepayment of assignments4 Focus on profitability (vs. growth) Disciplined approach to capital usage

NIM

1

Net Interest Income (NII)

14

Maintenance of the conservative approach to credit

Credit portfolio retraction associated with the focus on business profitability (vs. growth)

Expanded portfolio (interest-earning) reduced 1.4% compared to Mar/14 Reduction in off-balance securitization explains greater drop in managed portfolio

3.2 7.8 4.1

Credit portfolio by segment

• 6.4%
• 3.3%
• 0.4%

∆June14 /Mar14

• 7.9%
• 1.4%

Large Companies Medium Companies Auto Finance Payroll Loans Others¹ June/14 25.7 6.6 29.6 5.8 Mar/14 69.2 25.8 6.9 30.0 6.0 June/13 74.1 28.2 8.8 29.7 7.0 68.2 6.6 25.7 71.4 June/14

• 12.8%
• 2.6%

32.0 6.6 Mar/14 73.3 25.8 6.9 33.0 7.1 June/13 81.9 28.2 8.8 35.7 8.8

• 0.4%
• 4.2%
• 1.3%

∆June14 /Mar14

• 1. Credit cards and individual loans; 2. Reduction from R$ 1.8B in Mar/14 to R$ 1.3B in June/14

Net Interest Income increase, despite retraction of the credit portfolio

1

• 4.3%
• 4.3%

“Lower middle²” portfolio dropped by R$ 0.5B in 2Q14

Expanded credit portfolio (R$B)

(includes guarantees provided and private securities)

Expanded managed credit portfolio (R$B)

(includes off-balance securitization with substantial risk retention) CIB

Off-balance securitization (pre-Resolution 3,533)

15

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

Auto Finance: BV has been originating quality auto finance for over 30 months, focused on used light vehicles

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

Consumer Finance – Auto Finance

June09- June10 average

Growing participation of better quality vintages has contributed to reduce ALL expenses

Lower quality vintages / Managed auto finance portfolio²

19% 38% 62% June/14 June/13 Dec/11

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

• 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

16

99% 100% 101% 99% 94% 118% 124% 147% 111% 221% 201% 205% 182% June/14 Mar/14 Dec/13 Sept/13 178% 119% June/13

ALL expenses reduced 26.7% in the 2Q14 / 1Q14 comparison

• 1. Includes expenses related to credit assignments with recourse, as well as revenues from write-off recovery; 2. Includes impact of specific case that was classified in the

“G” risk level in June/14, with 90% of provisioning (or R$ 541M); 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 45.5% compared to 2Q13 and 26.7%, to 1Q14 Coverage Ratio still at an appropriate level, well above Sept/11 (beginning of adjustment)

Credit indicators – ALL and Coverage

733 669 563 417 557 407 156 290 199 156 116

• 45.5%
• 26.7%

2Q14 523 1Q14 714 4Q13 1,266 849² 3Q13 761 2Q13 959 1Q13 889 Wholesale Cons. Finance

• 25.9%
• 26.9%

∆2Q14 /1Q14 Managed loan portfolio’s 90-day Coverage Ratio³ (%)

78% in Sept/114

2

CIB Total

• Cons. Finance

R$1,848 R$ 1,237 R$-611

17

In 2Q14, ALL expenses were in the lowest level since 1Q11

“ALL expenses / loan portfolio” ratio reduced to 0.9% in 2Q14

Credit indicators – ALL

523 714 761 959 889 951 950 893 426 2Q14 0.9% 1Q14 1.2% 4Q13 1,266 2.1% 3Q13 1.2% 2Q13 1.5% 1Q13 1.3% 4Q12 1.4% 3Q12 1,286 1.8% 2Q12 1,398 1.9% 1Q12 1,456 1.9% 4Q11 1,294 1.6% 3Q11 1.2% 1Q11 1.2% 2Q11 0.6%

2

ALL expenses / loan portfolio (%) ALL expenses (R$M)

ALL expenses / Managed loan portfolio (%)

Note: Managed loan portfolio includes on-balance portfolio and off-balance credit assignments with recourse (pre-Resolution 3,533)

18

1 2 3 4 5 6 7 8 9 10 % June/14 6.3% 6.5% 6.6% 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% Dec/12 2.4% 6.6% 8.3% Sept/12 2.4% 7.4% 9.4% June/12 2.0% 7.5% 9.6%

Consumer Finance delinquency remained stable in 2Q14

Consolidated 90-day NPL rate impacted by Wholesale cases, previously provisioned

• 1. Specific case that, by the end of June/14, was classified in the “G” risk level, with 90% of provisioning (R$ 541M)

Note: the % of the Wholesale portfolio classified between AA-C (Resolution 2,682) increased from 83.1% in Mar/14, to 84.1% in June/14

90-day NPL / Managed loan portfolio (%)

Wholesale Total Consumer Finance

New delinquency cases in Wholesale were provisioned in previous quarters

June/14 2.8% 5.5% Mar/14 1.6% 5.2% Dec/13 1.9% 5.1%

Excluding specific Wholesale case¹

Credit indicators – Delinquency

2

19

718 541 427 438 170 196 1H14 1,175 1H13 1,315

∆ 1H14/1H13 % R$M

351 284 257 219 222 216 123 74

• 13.0%

Administrative

Others Labor Lawsuits

2Q14 547 1Q14 628 2Q13 595 25

Reduction in the cost base

Administrative expenses dropped by 24.7% (or R$ 177M) in the 1H14/1H13 comparison

Personnel and Administrative expenses

Personnel and Administrative expenses (R$M)

Note: in the last 12 months, the inflation rates IPCA and IGP-M reached 6.52% and 6.25%, respectively

3

• 24.7%

+2.6%

• 10.6%

+15.7%

• 177

+11

• 140

+26

Cost base reduction has contributed to the improvement of BV’s operational efficiency

Personnel

20

Total Personnel¹ and Administrative expenses (A) 570 584 627 506 473

• 6.6%

Total Revenues (B) 1,291 1,354 1,859 1,531 1,344

• 12.2%

Net Interest Income (NII) 1,112 1,154 1,226 1,142 1,197 4.8% Fee/Banking Fee Income 253 257 282 244 206

• 15.7%

Equity in Income of Associated Companies and Subsidiaries 20 30 35 41 34

• 17.6%

Other Operating Income/Expenses (93) (86) 315 103 (93)

• 190.1%

Efficiency Ratio - quarter (A/B) 44.2% 43.1% 33.8% 33.1% 35.2% 2.1 p.p. Efficiency Ratio - 12 months 48.3% 46.2% 40.5% 37.9% 36.0%

• 1.9 p.p.

4Q13 1Q14 2Q14

• Var. 2Q14

/1Q14 2Q13 3Q13 EFFICIENCY RATIO (ER) (R$ Million)

Efficiency Ratio (12 months) reached 36.0% in 2Q14, benefited by the reduction in the cost base

Efficiency Ratio 2Q14 36.0² 1Q14 37.9 4Q13 40.5 3Q13 46.2 2Q13 46.3

• 1. Personnel Expenses exclude expenses with Labor Lawsuits; 2. Considering expenses with Labor Lawsuits in the ratio’s numerator, 2Q14 Efficiency Ratio (12 months)

would be of 40.0%

Evolution of the Efficiency Ratio – 12 months (%)

3

21

1H14 292 1,102 1H13

• 474

386 140 152

• 196

674 428 153 2Q14 1Q14 2Q13

Summary: Net income of R$ 140M in 2Q14

Consistent revenue generation and reduction in both ALL expenses and the cost base

Net Interest Income (NII) Expenses with credit provisions (ALL) Personnel and Administrative expenses Net Income and Net Financial Margin

R$ Million

Consolidated Results

4.8% 2Q14 1,197 1Q14 1,142 2Q13 1,112 351 284 257 244 345 290

• 13.0%

Admin. Personnel

2Q14 547 1Q14 628 2Q13 595 669 557 407 290

• 26.7%

Cons. Finance Wholesale 2Q14 523 116 1Q14 714 156 2Q13 959 Net Margin (post provisions) Net Income +4.7% 1H14 2,339 1H13 2,235

• 33.1%

1,402 1H14 1,237 965 272 1H13 1,848 446

• 10.6%

634 1H14 1H13 1,175 541 1,315 718 597

• 39.1%
• 31.2%

∆1H14 /1H13

22

Funding profile improved over the past 12 months

Bills and Credit Assignments represent 40% of total funding (33% in June/13)

Funding 13.2 7.7 5.7 6.1 3.7 3.7 Mar/14 74.7 16.7 15.9 13.9 7.5 6.1 6.0

• 4.1%

4.3 June/13 76.1 16.4 14.3 10.3 7.0 8.5 7.5 6.9 5.3 June/14 71.7 15.8 15.8 4.3 19% 22% 14% 18% 9% 11% 11% 8% 10% 9% 9% 7% 5% 5% June/13 76.1 21%

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

June/14 71.7 22%

Funding evolution in R$ billions Funding evolution in % share

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

Total Capital 10,793 10,770 11,052 Tier I Capital 7,400 7,029 7,256 Common Equity Tier I 7,400 7,029 7,256 Additional Tier I

• Tier II Capital

3,393 3,741 3,796 Risk Wighted Assets (RWA) 77,653 74,299 73,119 Credit risk 72,654 68,624 66,709 Market risk 2,435 1,513 2,248 Operational risk 2,565 4,162 4,162 Minimum Capital Requirement 8,542 8,173 8,043 Basel Ratio (Capital/RWA) 13.9% 14.5% 15.1% Tier I Capital Ratio 9.5% 9.5% 9.9% Common Equity Tier I Ratio

• 9.5%

9.9% Additional Tier I Ratio

• Tier II Capital Ratio

4.4% 5.0% 5.2% June/14 Mar/14 BASEL RATIO (R$ Million) June/13

Basel Ratio ended June/14 in 15.1%

Tier I Capital of 9.9% by the end of 2Q14, composed entirely by Common Equity

Capital structure

24

Banco Votorantim – Overview 2Q14 Results Appendix

Agenda

25

June/14 40.6 Mar/14 40.6 Dec/13 39.4 Sept/13 42.7 June/13 42.7

Total Assets Assets under Management¹ On-balance loan portfolio

June/14 96.3 Mar/14 104.6 Dec/13 105.5 Sept/13 110.7 June/13 112.0

Financial highlights

• 1.4%

Cons. Finance CIB

June/14 53.1 35.9 17.2 Mar/14 53.8 36.5 17.3 Dec/13 54.9 36.6 18.2 Sept/13 54.9 36.9 18.0 June/13 55.7 37.1 18.6 Appendix

R$ billion

Shareholders’ Equity

Mar/14 +3.4% June/14 7.59 7.34 Dec/13 7.14 Sept/13 7.10 June/13 7.13

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

26

Net Interest Income (A) 1,112 1,142 1,197 4.8% 2,235 2,339 4.7% Average Interest-Earning Assets (B) 105,840 95,872 91,065

• 5.0%

107,284 93,380

• 13.0%

Compulsory Reserves (Bacen) 491 94 62

• 34.0%

720 84

• 88.3%

Interbanks Funds Applied 15,492 11,860 9,287

• 21.7%

15,915 10,093

• 36.6%

Securities 33,719 29,568 28,283

• 4.3%

34,239 29,285

• 14.5%

Loan Portfolio 56,138 54,350 53,433

• 1.7%

56,410 53,918

• 4.4%

NIM (A/B) - quarter 4.3% 4.9% 5.4% 0.5 p.p. 4.2% 5.1% 0.9 p.p.

NET INTEREST MARGIN (NIM)

(R$ Million)

• Var. 1H14

/1H13 2Q13 1Q14 2Q14

• Var. 2Q14

/1Q14 1H13 1H14

Net Interest Margin (NIM)

Appendix

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

27 7.5% 4,514 Sept/13 6.5% 4,003 June/13 6.3% 3,996 June/14 7.7% 4,308 Mar/14 7.6% 4,421 Dec/13 118% 124% 147% 119% 111% June/14 3,662 Mar/14 3,563 Dec/13 3,081 Sept/13 3,373 June/13 3,616 ALL balance / Managed portfolio ALL balance (R$M) June/14 6.2% 6.5% 6.6% Mar/14 5.0% 6.2% 6.6% Dec/13 1.9% 5.1% 6.6% Sept/13 2.1% 5.5% 6.9% June/13 2.4% 5.7% 7.1% June/13 2.4% 5.9% 7.6% June/14 6.2% 6.7% 6.9% Mar/14 5.0% 6.3% 6.9% Dec/13 1.9% 5.2% 6.9% Sept/13 2.1% 5.7% 7.4% NPL Balance (R$M) Coverage Ratio Wholesale Total

• Cons. Finance

Credit quality indicators

Appendix

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

• 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))

• Cons. Finance

Total Wholesale

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Managed Loan Portfolio (A) 76,775 74,185 71,481 68,169 65,923 63,546 61,281 60,006 57,925 56,273 NPL 90 Balance 5,390 5,539 5,276 4,520 4,056 3,616 3,373 3,081 3,563 3,662 NPL 90 Quarterly Variation (B) 793 149 (262) (756) (465) (439) (244) (292) 482 99 Write-off (C) 693 1,079 1,269 1,439 1,144 1,339 902 869 832 860 New NPL (D=B+C) 1,486 1,228 1,007 683 680 900 659 578 1,314 959 New NPL Rate¹ (D/A) 1.88% 1.60% 1.36% 0.95% 1.00% 1.36% 1.04% 0.94% 2.19% 1.65% 3Q13 NEW NPL (R$ Million) 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 4Q13 1Q14 2Q14

1.65% 2.19% 1.36% 1.60% 1.88% 0.94% 1.04% 1.36% 1.00% 0.95% 1Q12 0.69 1.49 3Q13 1.27 1.01 2Q12 1.08 1.23 2Q14 0.86 0.96 1Q14 0.83 1.31 4Q13 0.87 0.58 0.90 0.66 2Q13 1.34 0.90 1Q13 1.15 0.68 4Q12 1.43 0.68 3Q12

New NPL rate

New NPL rate

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

• 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 June/14, with 90% of provisioning (or R$ 541M)

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Banco Votorantim’s main ratings

Appendix RATING AGENCIES International National Long-Term Short-Term Long-Term Short-Term Long-Term Short-Term Fitch Ratings Local Currency Foreign Currency National BBB- F3 BBB- F3 AA+(bra) F1+(bra) Moody’s Local Currency Deposits Foreign Currency Deposits National Baa2 P-2 Baa2 P-2 Aaa.Br BR-1 Standard & Poor's Local Currency Foreign Currency National BB+ B BB+ B brAA+ braA-1

Banco Votorantim is rated Investment Grade by Fitch & Moody’s

Note: in Mar/14, S&P downgraded Brazil’s sovereign rating from “BBB” to “BBB-”. Next, S&P revised Brazil’s BICRA (Banking Industry Country Risk Assessment) from “4” to “5”, which impacted the ratings of several financial institutions. In May/14, S&P revised Banco Votorantim’s rating from “BBB-” to “BB+”, with a stable outlook)