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Brazil Summit 2010

Brazil Summit 2010. April 2010. DISCLAIMER.

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Brazil Summit 2010

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  1. Brazil Summit 2010 April 2010

  2. DISCLAIMER This presentation may include references and statements, planned synergies, increased estimates, projections of results and future strategy for Banco do Brasil, it’s Associated and Affiliated Companies and Subsidiaries. Although these references and statements reflect the management’s belief, they also involve imprecision and highly difficult risks to be foreseen, consequently, they may lead to a different result than the one anticipated here. These expectations are highly dependent on market conditions, on Brazil’s economic and banking system performance, as well as on international market one. Banco do Brasil is not responsible for update any estimate in this presentation. Banco do Brasil has announced that its Board of Directors has decided to submit to the Shareholders’ Meetings a proposal to raise capital through a public offer of new shares. Concomitantly, the controlling shareholders will promote a secondary public offering to allow the achievement of the 25% minimum free float. Any further decision related to this matter will be promptly communicated to the market. In case of any offering, before investing in stocks issued by Banco do Brasil, read carefully the Offering Memorandum, especially the “Risk Factors” section.

  3. Brazil’s Main Figures Federative Republic of Brazil • • Composed of 26 federal states and one federal district, split into 5,565 municipalities. • • Area: 8.51 million square kilometers. • • Population: Approximately 193 million inhabitants (82% of which living in urban areas and 18% in rural areas). • • GDP: R$ 3.143 trillion (US$ 2.327 trillion) - in current values/2009, distributed as follows: Services: R$ 1.8 trillion, Industry: R$ 0.6 trillion, Agribusiness: R$ 0.16 trillion and Taxes R$ 0.44 trillion. • Oil and natural gas: 2.5 million barrels a day in oil equivalent (boed). Forecast: 3.5 million boed by 2015. Considering the pre-salt exploration – above 4 million boed. • Automobile manufacturing: 2.5 million units – 2009 (1.26% bigger than 2008) and 826.7 thousand units – 1Q10 (24.4% more than in 2009). Source: IBGE

  4. Brazil’s Main Figures Brazil’s Strengths • • Self-sufficient in the production of food and third largest world exporter. • Self-sufficient in the production of oil. • • Diversity of energy sources, including a significant share of renewable energy. • • Availability of fresh water and great amount of arable land. • • Expectations of huge investments in infrastructure: • a) Federal Growth Acceleration Program PAC2: USD 550 Billion for the period from 2011 to 2014. • b) Soccer World Cup 2014 – USD 79.4 Billion; • c) Rio de Janeiro 2016 Olympic Games – USD 50 Billion.

  5. Brazil’s Main Figures Economic and Financial Scenario in Brazil • Resumption of economic growth – The main surveys report that the Brazilian GDP will grow between 5% and 7% per annum in the period between 2010 and 2016. 2010 – near 5%. • The ratio credit/GDP will reach approximately 70% by 2014 according to a BNDES study. This index was 45.9% in December 2009 and 37.4% in 2008. • Brazil was granted investment grade by the three largest rating agencies (Standard & Poor's, Moody's & Fitch Ratings). • Jobs created in Brazil: . 2008: 1.4 million . 2009: 1.0 million . 2010: forecast of 1.6 million. Sources: Federal, State and Municipal Governements, and Infraero-Brazilian Airports

  6. 21.5 20.9 20.0 19.3 18.7 18.5 17.4 16.7 16.4 16.4 16.1 15.9 15.3 2002 2003 2004 2005 2006 2007 2008 2009 2010* 2011* 2012* 2013* 2014* Brazil’s Main Figures Sustainable Growth: an increase in the investment rate Gross formation of fixed capital as % of GDP * Ministry of Finance estimates Source: IBGE

  7. In US$ billions Brazil’s Main Figures International Reserves - Brazil Reserve (IMF Loans NET) IMF Loans . * As of feb/2010 Source: Brazilian Central Bank

  8. Crop 2009 Forecast 2010 Growth Potential % Brazil’s Main Figures Brazilian Agricultural Production 141 134 5.2% Production (million ton.) • Planted Area: • Actual: 153.2 million of acres • 2022 Estimates: 227.3 million of acres of planted area (land dedicated to livestock, without causing deforestation or environmental damage*). Source: IBGE, * Statement by the former Minister of Agriculture – Roberto Rodrigues

  9. Brazil’s Main Figures Brazil’s Capital Markets IPO and Follow-On Offerings in Brazil 53 52.0 10.0 7.0 7 6.0 5 4 2007 2008 2009 2010 Companies R$ (billion) Source: BMF&BOVESPA

  10. 2008 2009 Assets¹ 17.2 21.5 Domestic Loan Portfolio 17.1 20.1 Total Funding¹ 20.7 25.8 Total Deposits¹ 22.2 25.8 Demand Deposits¹ 31.6 33.2 Savings Deposits¹ 20.3 24.1 Time Deposits¹ 19.4 24.8 Assets Under Management 20.7 21.1 ACC/ACE 28.2 34.7 Foreign Exchange Exports 27.9 31.4 (1) Posição em Setembro 2009 Foreign Exchange Imports 24.7 25.4 Total Revenues from Cards 17.6 18.7 Banco do Brasil’s Leadership Market Share - % (1) As of September/09 Source: Site BB – IR 4Q09

  11. . . . . . . . . . . . . . . . . . . . . . Banco do Brasil’s Highlights • Financial Institution, 202 years old and the country’s largest bank. • Net Income: R$ 10.15 Billions in 2009. • Best Results among Brazilian banks Source: Site BB – IR 4Q09

  12. 708.5 300.8 521.3 224.8 367.2 160.7 296.4 133.2 253.0 101.8 2005 2006 2007 2008 2009 2005 2006 2007 2008 2009 91.8 337.6 270.8 48.8 188.3 158.8 137.7 32.0 24.0 18.4 2005 2006 2007 2008 2009 2005 2006 2007 2008 2009 Banco do Brasil at a glance • Leadership in Assets Assets Loan Portfolio R$ billions R$ billions = 33.8% = 35.9% Deposits Individual Loan Portfolio R$ billions R$ billions = 88.1% = 24.6%

  13. Competitive Advantages • Regionalized Branch Networks; • Tailor-made products and services; • Teams segmented by industry; • Multidisciplinary team in the implementation of projects; • Specialists in overseas markets, foreign trade and agribusiness; • Wide range of products and services • Structured operations (project and corporate finance) in the domestic and foreign markets.

  14. Structured Operations Segmentation by Industry Agribusiness Automotive Energy Others Agribusiness, Leather and Textile Automotive, Auto parts Energy Civil and Heavy-duty construction Commerce, Food and Drink Capital goods Oil and Natural Gas Concessionaires and PPPs Paper, Pulp and Furniture Steelmaking, Metallurgy and Mining Telecom and Electronics Petrochemical Perfume, Cosmetics and Chemical Transport and Logistics Sanitation

  15. Structured Operations BB’s Multiple Roles Adviser Funding Arranger Administrative Agent Co-arranger Trustee “Syndicated Loan”

  16. Financing Sources • Banco do Brasil and other Commercial Banks • National Bank for Economic and Social Development (BNDES) • Specialized Funds(Middle-West Region Fund and the Mercantile Marine Fund) • Fixed Income Capital Market: Promissory Notes, Debentures, FIDC, CRI. • Equity Market: IPO, Follow On offerings. • Foreign fundraising (Bonds, Eurobonds, Ag. Mult: IFC, CAF etc...) • Private Equity for Institutional Investors

  17. Amount Disbursed by BB (2009) Business Credit BNDES System FCO 1st place R$ 125.3 billion R$ 10.9 billion R$ 12.3 billion 131,363 transactions 64.6 thousand transactions Mercantile Marine Fund (FMM) Oil and Gas R$ 0.927 billion R$ 0.4 billion 13 projects 4 Pre-Salt Plataforms

  18. Project Finance - Highlights Hydroelectric Power Plant of Santo Antônio Total investment: R$ 13.2 Billion Amount financed: R$ 8.6 Billion BB’s on-lending: R$ 558 Million (BNDES-FINEM) and R$ 390 Million (Bank guarantee). Sponsors: Odebrecht, Furnas, Cemig, Andrade Gutierrez, FIP Amazonia Energia (Banif and FI-FGTS- CEF) Position in 2009

  19. Corporate Finance - Highlights The Telemar Group Acquisition of Brasil Telecom Total amount: R$ 16 billion BB’s Investment: R$ 4.3 billion Mode: Long-Term Working Capital InBev Total amount: R$ 2 billion Mode: Issuance of debentures (term of 03 years) Position in 2009

  20. Other Highlights Issue of Debentures Issue of Debentures Issue of Debentures Issue of Debentures Issue of Debentures Lead Manager Working Capital Position in 2009

  21. Posição em 2009 Other Operations - Highlights IPO Issue of Debentures Promissory Notes IPO Coordinator Contracted IPO Promissory Notes Coordinator Acquisition of Receivables IPO IPO Position in 2009

  22. Other Operations - Highlights Provision of Securities Working Capital IPO Promissory Notes Working Capital Issue of Debentures Promissory Notes IPO Position in 2009

  23. Capital Market – 2009 Transactions Fixed Income Position in 2009

  24. Co-Lead Joint Bookrunner Joint Lead Bookrunner Follow-on Follow-on IPO R$ 1,308 millions R$ 5,290 millions R$ 8,397 millions 2009 2009 2009 Capital Market – 2009 Transactions Equity Position in 2009

  25. R$ 227,000,000 FIDC Lead Manager and Disbutor July/2009 FIDC – 2009 Issues R$ 245,000,000 FIDC Lead Manager and Disbutor July/2009 R$ 150,000,000 FIDC Lead Manager, Disbutor and Custodian June/2009 Position in 2009

  26. Foreign Network Service Points 45 Service Points in 23 countries • 05 Subsidiaries • 15 Branches • 10 Sub-branches • 12 Offices • 01 Service Unit NORTH AMERICA Londres EUROPE BB Securities Gifu ASIA Viena BB Securities LLC Paris Nagoia Porto Frankfurt Nova Iorque Gunma Lisboa Madri Tóquio Milão Cascais Washington Nagano Roma Parque das Nações Seul Hamamatsu Miami Ibaraki Dubai Xangai AFRICA Cidade do México Grand Cayman Hong Kong Panama BAMB BB Leasing Caracas Luanda LATIN AMERICA Lima Santa Cruz de La Sierra La Paz Assunção Cidade do Leste Santiago Montevidéu Buenos Aires

  27. Brazilian Companies – More Internationalized than ever 1970 1980 1990 2000 2009 l..........................l........................l...........................l...........................l

  28. Brazilian Companies around the World 1999 2003 2009 l..........................l..........................l

  29. Where to invest in Brazil? • Several investment opportunities, particularly in the infrastructure industry. • There are projects in progress and others to be installed involving a budget of approximately US$ 1 trillion. • The current IRR of the analyzed projects is around 15% on average. PRÉ-SAL

  30. PAC 2 – Preliminary Estimate of the Government Investment R$ billion PAC 2011-2014 AFTER 2014 TOTAL PAC “BETTER CITY” 57.1 - 57.1 PAC “CIVIL COMMUNITY” 23.0 - 23.0 PAC “MY HOME, MY LIFE” 278.2 - 278.2 PAC “WATER AND ENERGY FOR ALL” 30.6 - 30.6 PAC “TRANSPORTATION” 104.5 4.5 109.0 PAC “ENERGY” 465.5 627.1 1,092.6 TOTAL 958.9 631.6 1,590.5 PAC “Energy”– Considering PRE-SALT PROJECT 8 Source: www.brasil.gov.br/pac/pac2

  31. Soccer World Cup - 2014 • • 500 Thousand foreign tourists expected; • • Investments may exceed R$ 100 billion in various sectors; • • 6 Stadiums will be built and 6 renovated; • • 47 Public Transportation Projects; • 1,100 Projects, considering the renovation and construction of hotels and inns; • Expansion and modernization of the hotel network, adding 93 thousand beds by 2014. The present capacity will increase from 295 thousand to 387 thousand beds.

  32. Rio de Janeiro 2016 Olympic Games • U$ 50 Billion in investments for Rio. • Several construction works involving transport, sanitation, energy, security, facilities, olympic villages and press center. • Expansion and modernization of the hotel network from 28 thousand to 50 thousand beds by 2016.

  33. Do you want to invest in Brazil? BB is ready to serve you.

  34. Thank You ! Banco do Brasil Ivan de Souza Monteiro CFO www.bb.com.br phone: 55 (61) 3310-5353

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