Earnings Presentation 4 th Quarter, 2013 Disclaimer: This - - PowerPoint PPT Presentation

Earnings Presentation

4th Quarter, 2013

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

Banco Votorantim recorded positive results in 4Q13

Progress in the restructuring process allows resumption of profitable growth in a sustainable way

Executive summary

• 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

Return to profitability

R$ 121M Net Income in 4Q13

• 2013: net income of R$-512M, mainly impacted by Allowance for Loan Losses expenses

Consistent revenue generation

Net Interest Income (NII) increased 2.3% vs. 2012, reaching R$ 4.6B, driven by focus on profitability and improvement in asset quality

• 4.4% p.y. Net Interest Margin¹ (NIM) in 2013, an improvement of 0.2 bps vs. 2012

Improved asset quality

NPL 90 reduced to 5.1% in Dec/13 – improvement of 0.4 bps in the quarter and 1.5 bps in 12M

• Light vehicles NPL 90 reduced to 6.2% in Dec/13 – sixth consecutive quarterly reduction
• Better quality vintages reached 73% of the auto finance managed loan portfolio (53% in Dec/12)

ALL reduction²

Expenses with credit provisions reduced 23.9% vs. 2012, totaling R$ 3.9B

• In Consumer Finance, this reduction reached 47.6% (R$ 2.2B)

90-day Coverage Ratio reached 147% in Dec/13 (Dec/12: 100%; Sept/11: 78%)

Cost base under control

Personnel and Administrative expenses reduced 2.2% in 2013 (vs. IPCA 5.91%)

• Excluding expenses with labor claims (restructuring process), the reduction would have been
• f 6.9% in the period

4Q13 Highlights

3

Banco Votorantim is one of the leading banks in Brazil

“Top 10” in total assets, with a diversified business portfolio and robust shareholder base

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

Banco Votorantim – Overview

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

...and also in terms of loan portfolio...

111 120 131 163 475 725 779 859

Votorantim

BTG Pactual Safra HSBC Santander BNDES Bradesco CEF Itaú 1,011 Banco do Brasil 1,179

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

National privately-held Foreign State-owned 25 43 53 55 193 268 281 334 455 548 HSBC Banrisul Safra

Votorantim

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

• 1. Dec/13 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% Common: 49.99% Preferred: 50.01% Total: 50.00% Common: 50.01% Preferred: 49.99%

Grupo Votorantim Banco do Brasil Ownership Structure Governance Structure

Shareholder 50% Total

10th 7th

4

Diversified portfolio of Wholesale and Consumer businesses

Focus on profitability of current businesses, while deepening synergies with Banco do Brasil

Pillars

Consumer Finance Wholesale Auto Finance Other Businesses Corporate & IB (CIB) Wealth Management Middle Market

Grow among companies with annual revenues between R$ 200M and R$600M Strengthen offer of products and services (derivatives, FX, IB) Increase operating efficiency

Banco do Brasil Votorantim Group

Position itself as a relevant partner via:

• Agile and long-term

relationships

• Integrated financial

solutions (credit, derivatives, IB, FX, structured products and distribution)

+

R$ 36.6B R$ 35.1B R$ 71.8B Expanded credit portfolio²

Off-balance¹ risk portfolio

R$ 4.4B R$ 0.7B Assigned to FI Assigned to FIDC R$ 27.5B R$ 7.6 B R$ 29.9B R$ 6.7B Assets under Management R$ 39.4B

Corporate strategy

Act selectively in payroll loans, focused

• n INSS (retirees and

pensioners) Expand synergic businesses (credit cards, insurance sales) Explore new

• pportunities

(real estate, “Mais BB”) Origination with quality, scale and profitability Focus on used vehicles (multi-brand dealers) Advance in new auto finance along with BB (new car dealers) Asset: 10th largest player, with innovative products Private: focus on estate planning via customized solutions Increase synergies with BB

Shareholders

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

5

R$M % R$M % Net Interest Income (A) 1,154 1,226 73 6.3% 4,512 4,615 103 2.3% ALL expenses¹ (B) (761) (1,266) (505) 66.4% (5,092) (3,875) 1,216

• 23.9%

Net Financial Margin (A+B) 393 (40) (432)

• 110.1%

(580) 740 1,320

• 227.5%

Operating Income/Expenses (627) (58) 569

• 90.7%

(2,505) (1,883) 622

• 24.8%

Fee/Banking Fee Income 257 282 25 9.8% 1,035 1,030 (5)

• 0.5%

Personnel Expenses (241) (292) (52) 21.4% (978) (1,011) (33) 3.4% Other Administrative Expenses (363) (400) (38) 10.3% (1,572) (1,482) 90

• 5.7%

Other Operating Income/Expenses² (280) 352 633

• 225.7%

(990) (420) 570

• 57.6%

Operating Income (Loss) (235) (98) 137

• 58.3%

(3,085) (1,144) 1,941

• 62.9%

Non-Operating Income (Loss) (14) (8) 6

• 45.6%

(139) (37) 103

• 73.8%

Taxation and Profit Sharing 89 227 137 153.5% 1,237 668 (568)

• 46.0%

Net Income (Loss) (159) 121 280

• 176.2%

(1,988) (512) 1,476

• 74.2%

2013

• Var. 2013/2012

3Q13 4Q13

• Var. 4Q13/3Q13

2012 (R$ Million)

Banco Votorantim recorded Net Income of R$121M in 4Q13

2013 / 2012: greater NII, along with reduction in ALL and administrative expenses

Consolidated results

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

1 include expenses related to credit assignments with recourse (both on and off-balance), as well as revenues from write-off recovery; 2. Includes Tax Expenses, Other Operating Income/Expenses and Equity in Income of Associated Companies and Subsidiaries

Managerial Income Statement

6

1,154 4.6% 4Q12 1,156 4.4% +6.3% 4Q13 1,226 5.0% 3Q13

Consistent Net Interest Income (NII) expansion

Net Interest Margin (NIM) reached 5.0% in 4Q13

NII increased 6.3% compared to 3Q13 and Net Interest Margin reached 5.0% Fee Income increased 9.8%

• ver 3Q13, amounting to R$282M
• 1. Ratio between Net Interest Income (before ALL) and Average Interest Earning Assets

+2.3% 4.2% 2013 4,615 4.4% 2012 4,512 Net Interest Income (R$M) and NIM¹ (% p.y.) Fee and Banking Fee Income (R$M)

NII increase reflects better portfolio quality, as well as focus on profitability (vs. growth)

282 257 286 3Q13 +9.8% 4Q13 4Q12

• 0.5%

2013 1,030 2012 1,035 Net Interest Income (NII)

7

Banco Votorantim kept its conservative position in credit

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

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

R$ Billion

• 4.5%

0.2%

• 5.9%
• 2.2%

∆Dec13 /Sept13 5.1 11.4 6.4

Credit portfolio by segment Expanded managed credit portfolio

(includes off-balance securitization with substantial risk retention)

• 6.6%
• 2.7%
• 5.9%
• 2.2%

∆Dec13 /Sept13 11.0 3.0 8.6 On-balance securitization

• 4.7%
• 1.8%

CIB Middle Market Auto Finance Others¹ Dec/13 71.8 27.5 7.6 29.9 6.7 Sept/13 73.1 28.1 8.1 29.8 7.1 Dec/12 75.3 28.6 9.3 29.9 7.5

• 11.4%
• 3.3%

Dec/13 76.9 27.5 7.6 33.7 8.0 Sept/13 79.5 28.1 8.1 34.7 8.6 Dec/12 86.7 28.6 9.3 38.8 10.0

Expanded credit portfolio

(incl. guarantees provided, private securities, and on-balance securitization)

Off-balance securitization

• 1. Payroll loans, credit cards and individual loans

Greater Net Interest Income in the period, despite reduction in the credit portfolio

Expanded portfolio (interest earning) reduced 1.8% vs. Sept/13 and 4.7% vs. Dec/12

8

7.6 Dec/13 Sept/13 8.1 Dec/12 9.3

Middle Market CIB

28.1 Dec/12 28.6 Dec/13 27.5 Sept/13

Note: expanded credit portfolio includes on-balance portfolio, guarantees provided and private securities; private securities’ criteria were revised in 3Q13, in order to be better aligned to BB’s methodology

Wholesale – Highlights and credit portfolio

Wholesale: continued focus on profitability and

• n strengthening the product offering

Wholesale businesses

Focus on clients with revenues of R$200M-R$600M/year

• R$100M-R$200M/year: selective action

Strengthen the product platform (derivatives, FX, IB) Increase operating efficiency Focus on profitability (disciplined capital allocation) Serve companies with revenues above R$600M/year Increase BV’s relevance to clients via:

• Strengthening of the product platform
• Enhancement of international distribution (NY and London)
• Agile relationships, with long-term vision and industry

knowledge Focus on profitability (disciplined capital allocation) Expanded credit portfolio (R$B) Expanded credit portfolio (R$B)

Up to R$100M/ Total

18% 32%

9

Payroll loans Auto Finance Consumer Finance businesses

7th largest player in the payroll loan market³ Focus on INSS (retirees and pensioners) Selective operation in private and public payroll loans Among market leaders in auto finance Acts as an extension of Banco do Brasil in auto finance

• utside the branch network

Continuous improvement of credit processes

• 65%² automated credit decisions in Dec/13 (Dec/12: 45%;

Jan/12: 28%) Managed loan portfolio (R$B) Managed loan portfolio (R$B)

• 2.7%

On- balance Off- balance Dec/13 33.7 29.9

3.8

29.9

8.9

34.7 29.8

4.9

Dec/12 38.8 Sept/13

1.5

Dec/12 Off- balance

• 7.0%

On- balance Dec/13 7.6

6.3 1.3

Sept/13 8.2

6.6

9.7

7.2 2.5

• 20.8%

0.2% ∆Dec13 /Sept13

• 16.5%
• 4.8%

∆Dec13 /Sept13 Used/ Total¹ 75% 68% INSS/ Total 62% 51%

Consumer Finance – Highlights and loan portfolio

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

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

10

• 35%

+21% Used light vehicles Other vehicles¹ 2013 13.8 10.2 (74%) 3.6 2012 11.4 7.8 (68%) 3.7 2011 21.1 11.4 (54%) 9.8

Auto Finance: origination increased 21% in 2013 / 2012

Focus on used light vehicles was maintained, as well as conservatism in credit concession

Origination grew 21% in 2013 / 2012, especially used light vehicles BV maintained its focus on quality and profitability of new vintages

Selic² 10.0 Dec/12 Dec/13 25.5 BVF rate 7.3 23.5 Dec/11 11.0 26.4 Dec/10 10.8 24.6

• 1. Composed of trucks, motorcycles and new light vehicles ; 2. Market’s benchmark interest rate

26% 32% 36% 38% 45 44 47 52 4Q13 4Q11 4Q10 4Q12 Down payment Average tenor ∆ 2013/ 2012

• 1.8%

31.9% ∆ 2013/ 2011

• 63.4%
• 10.0%

Banco Votorantim is one of the market leaders in auto finance

Auto Finance origination (R$B) Down payment (%) and average tenor (months) Auto finance origination interest rate x Selic rate² (% p.y.) Consumer Finance – Auto Finance

11

Dec/13 1.3 June/13 1.0 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 2 years, focused on multi-brand dealers

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

Vintages indicating lower quality

64% 71%

Multi-brand / Total origination Inad 30¹ (by vintage) Multi-brand dealers New car dealers

• 1. % of each month’s production with first installments past due over 30 days

June09- June10 average

78% 82%

Impact of strikes (post

• ffice and banks)

Quality of origination results from the continuous improvement of credit policies, processes and models

Consumer Finance – Auto Finance

12

15% 13% 11% 47% 43% 38% 33% 27% 38% 44% 52% 59% 67% 6% 8%

100%

Up to June/10 July/10 to Sept/11 After Sept/11 Dec/13 Sept/13 June/13 Mar/13 Dec/12 5.5 6.5 Jun/13 5.7 6.8 Mar/13 6.2 7.2 Dec/12 6.6 7.7

• 1.5 p.p.

Dec/13 5.1 6.2 Sept/13 73%

Growing participation of better quality vintages has contributed to reduce delinquency rates

Better quality vintages reached 73% of the auto finance portfolio in Dec/13... ...contributing to the continuous improvement

• n delinquency, that fell to 5.1% in Dec/13

Auto finance managed portfolio¹ by vintage (%)

53% Quality vintages/ Total (%) Light vehicles Total

Managed loan portfolio’s¹ NPL 90 (%)

6th consecutive quarterly reduction

Delinquency

• 1. Includes on-balance loan portfolio according to Bacen’s Res. 2,682, and off-balance credits assigned with substantial risk retention until Dec/11, before entry in force of

Bacen’s Res. 3,533

13

Managed Loan Portfolio (A) 76,775 74,185 71,481 68,169 65,923 63,546 61,281 60,006 NPL 90 Balance 5,390 5,539 5,276 4,520 4,056 3,616 3,373 3,081 NPL 90 Quarterly Variation (B) 793 149 (262) (756) (465) (439) (244) (292) Write-off (C) 693 1,079 1,269 1,434 1,149 1,339 902 869 New NPL (D=B+C) 1,486 1,228 1,007 678 684 900 659 578 New NPL Rate¹ (D/A) 1.88% 1.60% 1.36% 0.95% 1.00% 1.36% 1.04% 0.94% NEW NPL (R$ Million) 1Q12 4Q13 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13

“New NPL” rate presented new reduction in 4Q13

90-day NPL formation decreased to R$ 578M in 4Q13, vs. R$ 659M in 3Q13

0.94% 1.04% 1.36% 1.00% 0.95% 1.36% 1.60% 1.88%

New NPL rate

1.01 2Q12 1.08 1.23 1Q12 0.69 1.49 0.68 4Q12 1.43 0.68 3Q12 1.27 0.66 2Q13 1.34 0.90 1Q13 1.15 4Q13 0.87 0.58 3Q13 0.90 Write-off (R$B) New NPL (R$B) Delinquency – New NPL

• 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

14

ALL expenses decreased 23.9% in 2013 / 2012

90-day Coverage Ratio reached 147% in Dec/13 (vs. 100% in Dec/12)

Expenses with credit provisions (R$M)

• 23.9%

2013 3,875 2,382 1,494 2012 5,092 4,545 546

Consumer Finance’s ALL expenses reduced 47.6% in 2013 / 2012 Coverage Ratio reached 147% in Dec/13, compared to 100% in Dec/12

770 563 417 181 199 849 4Q13 1,266 3Q13 761 4Q12 951 147% 119% 100% Managed loan portfolio¹’s 90-day Coverage Ratio²

NPL 90 Balance (R$M) ALL Balance (R$M)

3,081 4,514 Sept/13 3,373 4,003 Dec/12 4,520 4,518 Dec/13 ∆ 2013/ 2012 173.5%

• 47.6%

7th consecutive quarterly reduction

ALL expenses and 90-day Coverage Ratio

R$ Million

• 1. Includes on-balance loan portfolio according to Bacen’s Res. 2,682, and off-balance credits assigned with substantial risk retention until Dec/11, before entry in force of

Bacen’s Res. 3,533; 2. Ratio between ALL balance and balance of operations past due over 90 days Note: ALL expenses include expenses related to credit assignments with recourse (both on and off-balance), as well as revenues from write-off recovery

Wholesale Consumer Finance Mainly specific Wholesale client

15

Others Labor claims

2013 1,011 875 136 2012 978 961 17

Banco Votorantim has also improved cost management

Personnel and Administrative expenses decreased 2.2% in 2013, vs. 5.9%¹ IPCA

Personnel and Administrative expenses reduced 2.2% in 2013 / 2012 Excluding labor claims, Personnel expenses would have reduced 8.9% in 2013

Personnel and Administrative expenses (R$M) 443 363 400 279 241 292

Admin. Person.

4Q13 693 3Q13 604 4Q12 721 2013

• 2.2%

2,493 1,482 1,011 2012 2,550 1,572 978 ∆ 2013/ 2012 3.4%

• 5.7%

∆ 2013/ 2012

• Personnel expenses (R$M)

Related to restructuring process

Cost base reduction results from a set of implemented initiatives for efficiency gains

• 8.9%
• 1. IPCA (Índice de Preços ao Consumidor Amplo) 5.91% in 2013

Source: IBGE

Excluding labor claims, reduction would be of 6.9%

Personnel and Administrative Expenses

16

121

• 159
• 428

4Q13 3Q13 4Q12

Summary: BV recorded positive results in 4Q13

2013 / 2012: increase in revenues and reduction in expenses

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

Consolidated results

4Q13 1,509 3Q13 1,411 4Q12 1,443

+1.8%

2013 5,645 2012 5,547

• 23.9%

2013 3,875

2,382 1,494

2012 5,092

4,545 546 443 363 400 279 241 292

4Q13 693 3Q13 604 4Q12 721

978

• 2.2%

Admin. Personnel

2013 2,493

1,482 1,011

2012 2,550

1,572

2013

• 512

740 2012

• 1,988
• 580

770 417 563 849

• Cons. Finance

Wholesale

4Q13 1,266 3Q13 761

199

4Q12 951

181

• 1. Includes Banking Fee Income

Net financial margin (post provision) Net income (R$M)

R$ Million

17

3,875 6.1% 2012 5,092 6.9% 2011 3,507 4.6% 2013

Prepayment expenses of credit assignments³ Still high ALL expenses Non-recurring expenses related to the restructuring process²

2 3 1

2013 results were still impacted by three factors

Consolidated results

2014 results are going to be better, despite impacts from the past that still persist

• 1. Refers to the period’s average managed loan portfolio; 2. Includes labor claims, provisions for labor contingencies, rescission expenses and others; 3. Credits

assigned with recourse until Dec/11 (before Res. 3,533)

136 17 11 2013 2012 2011 266 394 726 2012 2013 2011

Revenues recognized by the time of the assignment Off-balance securitiz. ALL expenses (R$M) Example: Labor claims (R$M) Early settlement of assignments (R$M) ALL expenses/Loan portfolio¹ (p.y.)

15.4 9.1 4.4

18

In this context, BV has improved its funding profile

Participation of long-term instruments (e.g. LF, Securitization) increased, while CDs reduced

Funding evolution (R$B)

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

Funding Dec/13 75.6 16.1 5.8 15.7 6.7 7.4 6.9 12.8 4.3 Sept/13 73.9 16.3 5.1 15.0 7.7 7.1 7.2 10.4 5.1 Dec/12 80.7 20.2 12.8 13.3 10.2 7.0 8.0 3.5 5.7

• 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

25% 21% 16% 8% 16% 21% 13% 9% 9% 10% 6% 9% 10% 17% 7%

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

Dec/13 75.6 Dec/12 80.7 4%

R$3.9B funding in 4Q13 through the assignment

• f R$3.4B in loans

19

Capital (PR) 12,111 11,430 10,794 10,728 11,218 Tier I 7,875 7,595 7,401 7,338 7,101 Tier II 4,236 3,835 3,393 3,390 4,117 Capital Requirement (PRE) 9,310 9,245 8,541 8,481 8,654 Credit risk 8,721 8,494 7,991 7,846 8,069 Market risk 294 469 268 234 185 Operational risk 296 282 282 400 400 Excess Capital 2,800 2,185 2,253 2,247 2,564 Basel Ratio (PR/(PRE/0,11)) 14.3% 13.6% 13.9% 13.9% 14.3% Tier I 9.3% 9.0% 9.5% 9.5% 9.0% Common Equity Tier I

• 9.0%

Additional Tier I Capital

• Tier II

5.0% 4.6% 4.4% 4.4% 5.2% Sept.13 Dec.13 BASEL RATIO (R$ Million) Dec.12 Mar.13 June.13

Banco Votorantim ended Dec/13 with a 14.3% Basel Ratio

Tier I ended 4Q13 at 9.0%, composed only of Core Capital

Capital structure

Shareholders are committed to maintain BV’s capital structure at adequate levels

Note: as of Oct/13, came into force some of the new Basel III rules, which considers, among other measures: (i) removal of the subordinated debt limit authorized to integrate Tier II capital, and (ii) 10% decay of subordinated debt that do not fit the new Basel III requirements

20

Annexes

21

Dec/13 39.4 Sept/13 42.7 June/13 42.7 Mar/13 41.1 Dec/12 47.3

Total assets Assets under management¹ On-balance loan portfolio

Dec/13 105.5 Sept/13 110.7 June/13 111.9 Mar/13 119.7 Dec/12 121.8

Financial highlights

On-balance loan portfolio stable in 4Q13 / 3Q13

Shareholders’ Equity

Dec/13 7.1 11.2 4.0 Sept/13 10.7 7.1 3.6 June/13 10.8 7.1 3.6 Mar/13 11.4 7.7 3.8 Dec/12 12.1 8.2 3.9 Mar/13 37.1 18.6 56.5 18.9 Dec/12 37.7 19.3 54.9

Consumer Finance

37.4 June/13 55.7 36.9 18.0 Sept/13 54.9 36.6 18.2 Dec/13

Wholesale

56.7 Financial highlights

R$ Billion

Capital

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

22

Net Interest Income (A) 1,154 1,226 6.3 4,512 4,612 2.2 Average Interest-Earning Assets (B) 102,260 99,754 (2.5) 106,331 104,272 (1.9) Compulsory Reserves (Bacen) 200 113 (43.5) 3,067 477 (84.4) Interbanks Funds Applied 15,374 13,821 (10.1) 15,026 15,077 0.3 Securities 31,360 30,924 (1.4) 29,965 32,913 9.8 Loan Portfolio 55,326 54,896 (0.8) 58,273 55,805 (4.2) NIM (A/B) 4.6% 5.0% 0.4 p.p. 4.2% 4.4% 0.2 p.p.

NET INTEREST MARGIN (NIM)

(R$ Million) 2012 2013

• Var. 2013

/2012 (%) 3Q13 4Q13

• Var. 4Q13

/3Q13 (%)

Net Interest Margin (NIM)

NIM reached 5.0% in 4Q13, reflecting continuous improvement of portfolio quality and focus on profitability

Financial highlights - NIM

23

Managed loan portfolio’s quality indicators

NPL 90 / Managed loan portfolio (%) NPL 60 / Managed loan portfolio (%)

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% Wholesale Total Consumer Finance Dec/12 3.1% 8.2% 10.3% Dec/13 2.4% 6.4% 8.2% Sept/13 2.6% 6.9% 8.6% June/13 2.8% 7.2% 9.0% Mar/13 2.9% 7.7% 9.7% Wholesale Total Consumer Finance

Financial highlights - Credit

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

24

Falling due Dec/13 16.749 86% Past due 14% Sept/13 17.875 86% 14% Jun/13 16.928 84% 16% Mar/13 15.273 79% 21% Dec/12 12.751 76% 24% Sept/12 10.285 70% 30% Jun/12 8.905 63% 37% Mar/12 9.141 58% 42%

Total Past due Falling due Total Past due Falling due Total Past due Falling due AA 7,855

• 7,855

5,244

• 5,244

4,828

• 4,828

A 30,060

• 30,060

26,285

• 26,285

27,139

• 27,139

B 7,955 1,625 6,330 10,062 1,125 8,936 9,198 988 8,210 C 4,796 1,403 3,393 7,814 1,303 6,511 7,551 1,273 6,278 D 1,371 820 551 1,198 678 521 1,268 603 665 E 1,014 531 483 1,180 469 711 682 432 249 F 477 399 78 461 379 82 681 361 320 G 536 448 88 498 358 140 1,311 883 428 H 2,674 2,550 124 2,162 2,035 127 2,233 1,969 263 TOTAL 56,739 7,776 48,963 54,903 6,347 48,557 54,889 6,510 48,379 B-C 12,751 3,028 9,723 17,875 2,428 15,447 16,749 2,261 14,488 B-C/Total 22.5% 38.9% 19.9% 32.6% 38.3% 31.8% 30.5% 34.7% 29.9% RISK (R$ Million) Dec.12 Sept.13 Dec.13

On-balance loan portfolio classified as levels B and C (R$M) Financial highlights – Credit

On-balance loan portfolio by risk level

Greater B-C portfolio due to the adoption of a more conservative “departure rating” policy since 2Q12

B-C portfolio increased due to greater initial allowance % for vehicles financed since 2Q12 (“departure rating”)

25

Total Personnel and Administrative Expenses (A) 721 595 601 604 693 Personnel Expenses 279 228 250 241 292 Other Administrative Expenses 443 367 351 363 400 Total Revenues (B) 1,177 1,193 1,297 1,273 1,977 Net Interest Income (NII) 1,156 1,123 1,112 1,154 1,226 Fee/Banking Fee Income 286 239 253 257 282 Equity in Income of Associated Companies and Subsidiaries 22 24 20 30 35 Other Operating Income/Expenses (288) (193) (87) (168) 433 Efficiency Ratio (A/B) - Last 12 Months 50.6% 51.3% 51.0% 51.0% 43.4% 2Q13 3Q13 EFFICIENCY RATIO (ER) (R$ Million) 4Q13 4Q12 1Q13

Efficiency Ratio (ER)

Financial highlights – Efficiency Ratio