2q03 earnings banco do brasil.... 1- credit operations, leasing operations and other credits,...
TRANSCRIPT
2Q03 Earnings
Banco do Brasil...
1- Credit operations, Leasing operations and other credits, according Res. 2682/992 - Demand, Time, Savings and Interbank3 - Net Income included4 - Annualized
HighlightsR$ millions
2Q02 1Q03 2Q03 s/2Q02 s/1Q03
Total Assets 169,910 209,240 205,762 21.1 -1.7
Credit Operations 1
57,031 65,715 68,662 20.4
4.5
Security Portfolio 68,591 75,631 72,746 6.1 -3.8
Deposits 2
79,710 98,130 99,881 25.3 1.8
Asset Management - R$ bi 63.6 78.0 83.2 30.8 6.7
Shareholders’ Equity 3
7,984 10,164 10,872 36.2 7.0
Market Capitalization 5,866 7,708 9,582 63.4 24.3
Net Income 474 479 600 26.5 25.2
ROE % 4
24.12 21.31 24.84
Earnings Per Share - R$ 0.67 0.65 0.82
Change %
efficiency reflected in numbersefficiency reflected in numbers
24.1
32.9 30.2
21.3
Return On Equity %
2Q02 3Q02 4Q02 1Q03 2Q03
24.8
474
605
600
479
600
Profit and Return On EquityR$ millions
1.07
9
1.20
5
823
1H02 2H02 1H03
20.6
1H03 Profit and ROE %R$ millions 30.0
22.7
1H01 77.0
2H01 188.3
1H02 307.4
2H02 272.1
1H03 321.9
Dividends / Interests on Legal Capital
R$ millions
adding value to shareholders...adding value to shareholders...
Income Statements
2Q02 1Q03 2Q03 s/2Q02 1H02 1H03 s/1H02
Gross Financial Margin 2,876 3,917 3,524 22.5 5,680 7,441 31.0
Provision for NPL -591 -636 -853 44.3 -1,184 -1,489 25.8
Net Financial Margin 2,285 3,281 2,671 16.9 4,496 5,952 32.4
Service Fees 1,138 1,218 1,343 18.0 2,167 2,561 18.2
Administrative Expenses -2,288 -2,709 -2,466 7.8 -4,499 -5,175 15.0
Income before Profit Sh,Taxes&Ext.Items 764 1,295 1,058 38.4 1,565 2,353 50.4
Profit Sharing -77 -20 -49 -36.5 -77 -68 -10.9
Net Income 474 479 600 26.5 823 1,079 31.1
Change% Change.%
Turnover Tax Expenses -152 -232 -241 59.1 -318 -473 48.9
Contribution Margin 3,272 4,267 3,773 15.3 6,346 8,040 26.7
Commercial Income 983 1,558 1,307 32.9 1,847 2,865 55.1
Operating Income 753 1,244 1,016 34.9 1,523 2,261 48.5
Income Tax and Social Contribution -195 -687 -409 109.4 -532 -1,096 105.9
Recurrent Result 492 589 600 21.9 956 1,189
Extraordinary Items -18 -110 0 0 -132 -110
24.4
-17.1
R$ millions
Including Reallocations
solid results...solid results...
Analysis of Volume and Spread
Gain to volume increase
The contribution of spread in the Margin
decreased to 3.44% in 2Q03 from 30.83% in
1Q03.
Spread %
Volume - R$ millions
2Q03 1.777417 %2Q02 1.763765 %
2Q
02
16
3,0
72
2Q
03
19
8,2
67
2,876
22
621
5
Gain to rating Increase Gain due to rate
and volume increase
Gross Financial Margin 2,876 3,917 3,524 22.5
Assets (-) Permanent * 163,072 204,076 198,267
Spread Annualized 7.24 7.90 7.30
* average balance
21.6
2Q02 1Q03 2Q03 s/2Q02
Change.%R$millions
ready to a new environmentready to a new environment
assets quality preservedassets quality preserved
NPL /Total Credit Portfolio
Overdue more than 15 days/Total Credit Portfolio
Overdue more than 60 days/Total Credit Portfolio
5.66.2 6.0
5.65.3
5.5 5.8 5.95.5
5.1
3.5 3.5 3.3 3.0 3.2
2Q02 3Q02 4Q02 1Q03 2Q03
2Q02 1Q03 2Q03Total Credit Portfolio 57,031 65,715 68,662
Overdue Loans 3,202 3,681
Overdue more than 15 days 3,126 3,631
Overdue more than 60 days 1,973 1,984
Write-offs 554 528
Credit Recovery 171 169
Losses Balance 383 359
Losses Balance/Total Credit Portfolio - % 2.22.0
3,610
3,497
2,228
574
207
367
2.2
R$ millions
%
593
591
834
855
636 85
3
1.2% 1.1%
1.4% 1.4%
1.0%
1.3%
0
1Q02 2Q02 3Q02 4Q02 1Q03 2Q03
0
0
0
0
NPL Expenses Expenses Portfolio R$ millions
Gross Financial Margin 2,876 3,917 3,524 22.5
2Q02 1Q03 2Q03 s/2Q02Change.%
Provision for NPL 591 636 853
Net Financial Margin 2,285 3,281 2,671
44.3
16.9
R$ millions
Asset Management
63.6 56.0 66.2 78.0 83.2
17.2
15.7
17.4
18.6 18.7
2Q02 3Q02 4Q02 1Q03 2Q03
Asset Management Market Share %
... customers fidelity and assets management leadership... customers fidelity and assets management leadership
R$ billionsCustomers Basein Thousands
13.6 14.0 14.4 14.9 15.6
0.9 1.0 1.0 1.0 1.1
2Q02 3Q02 4Q02 1Q03 2Q03
Companies Individuals
2Q02 1Q03 2Q03Change. %
s/ 2Q02 Service Fees 1,138 1,218 1,343 18.0 Customer Relationship Fees 330 387 402 22.0 Management of Investment Funds. 200 167 183 -8.6 Loan Operations 95 111 137 44.4 Collection 100 107 120 20.1 Services to Related Companies 81 87 95 17.1 Credit Cards 88 107 115 31.2 Others 245 253 291 18.8
Net Financial Margin 2,285 3,281 2,671 16.9
2Q02 1Q03 2Q03 s/2Q02Change.%
Service Fees 1,138 1,218 1,343
Turnover Tax Expenses -152 -232 -241
18.0
59.1
Contribution Margin 3,272 4,267 3,773 15.3
R$ millionsR$ millions
Contribution Margin 3,272 4,267 3,773 15.32Q02 1Q03 2Q03 s/2Q02
Change.%
Administrative Expenses -2,288 -2,709 -2,466
Commercial Income 983 1,558 1,307
7.8
32.9
Change.%2Q02 1Q03 2Q03 s/ 2Q02
Personnel Expenses -1,324 -1,509 -1,481 11.8
Salaries -799 -818 -831 4.0
Social Charges and benefits -384 -423 -459 19.6
Training -8 -5 -8 2.8
Labor claims -81 -191 -108 33.3
Others -53 -72 -76 43.4
Other Adm. Expenses -964 -1,200 -985 2,2
Administrative Expenses -2,288 -2,709 -2,466 7.8
Midwest 1,431 11.2
Northeast 3,080 24.1
North 890 7.0
Southeast 4,769 37.4
South 2,585 20.3
Total 12,755 100.0
share %
Municipalities Presence = 2,829
8.5 9.0 9.2 9.4 9.6
3.1 3.1 3.2 3.2 3.2
2Q02 3Q02 4Q02 1Q03 2Q03
Branches Others
11.6 12.2 12.3 12.5 12.8Points of Service
78.0 78.0 78.6 79.5 79.5
10.810.69.510.310.2
2Q02 3Q02 4Q02 1Q03 2Q03
Employees Interns
Human Resources in Thousands
cost structure suitable with businesses generationcost structure suitable with businesses generation
R$ millionsR$ millions
productivity equation completed by technology productivity equation completed by technology
Efficiency Ratio (%)(Administrative Expenses/Operating Income)
60.9
57.7 58.056.7
54.1
2Q02 3Q02 4Q02 1Q03 2Q03
Coverage Ratio (%)Service Income/Personnel Expenses
86.0
79.377.1
80.7
90.7
2Q02 3Q02 4Q02 1Q03 2Q03
82.5 82.4
84.184.6
85.0
Electronic Transactions / Total Transactions - %
Jun/02 Sep/02 Dec/02 Jan/03 Mar/03
ATM
Cashier Financial ManagerInternet Others
53.8 52.5
17.5 15.0
14.0 15.0
8.0 11.16.7 6.4
jun/02 jun/03Automatization
Change.% Jun/02 Mar/03 Jun/03 s/jun/02 s/mar/03
Total Assets 169,910 209,240 205,762 21.1 -1.7
Liquid Assets 72,245 88,366 79,381 9.9 -10.2
Loans & Leasing Operations 46,542 53,475 56,686 21.8 6.0 Tax Credit 11,832 10,927 10,433 -11.8 -4.5
Other Assets 39,290 56,473 59,261 50.8 4.9 Total Liabilities 169,910 209,240 205,762 21.1 -1.7
Deposits 79,710 98,130 99,881 25.3 1.8 Other Liabilities 82,216 100,946 95,009 15.6 -5.9 Stockholders Equity 7,984 10,164 10,872 36.2 7.0
R$ millions
BB - the bank that invests more in BrazilBB - the bank that invests more in Brazil
25.4 27.4 24.1 25.2 25.6 27.5
43.3 42.5 44.2 44.2 42.2 38.6
28.827.024.925.923.124.2
5.15.25.85.87.07.1
mar/02 jun/02 sep/02 dec/02 mar/03 jun/03Other Assets Tax Credit
Credit Operations Liquidity Assets
Assets Composition (%)
5.2183 22.6
33.6 37.5
117.2
5.2
21.0 26.845.0 49.6
147.7
5.4
21.2 26.4
46.8 41.5
141.3
InterbankDeposits
Demand Deposits
SavingsDeposits
Time
Deposits
OpenMarket Funds
Total
jun/02 mar/03 jun/03
Market Funding – R$ billions
Jan/28 Mar/17 Mar/19 Apr/25
Global Medium Term Notes 6.375% a.a.
2 years
US$ 75 MMUS$ 120 MM
MT-100
7.26% a.a.
7 years
Global MediumTerm Notes
6.25% a.a.1 year
US$ 100 MM
07/ Jul02/Jul
US$ 689 millions* funded in 2003
€ 150 MM
Global Medium Term Notes
4.5% a.s.1 year
US$ 223 MMVISANET
Securitization of receivable
flows
investors confidence...investors confidence...
US$ 35 MM
Bladex
1 year
Loan
* Without Bladex Loan
well balanced credit portfoliowell balanced credit portfolio
Credit Portfolio Profile
Jun/02 - R$ 57.0 billions - R$ 68.7 billionsJun/03
Retail Commercial Agribusiness International Abroad Others
20.8%
21.8%
31.3%
11.0%
12.3%2.8%
21.4%
23.9%
22.9%
12.6%
16.8%
2.3%
Retail Portfolio HighlightsR$ billions
strong position in retail portfolio strong position in retail portfolio
Consumer Credit
jun/02 sep/02 dec/02 mar/03 jun/03
6.97.2
2.0 2.3
1.42.1
Overdraft Accounts Working Capital
Credit Card operations
increased 59.6%,
reaching
R$ 1.5 billion.
Retail Portfolio increased
17.2%,
to R$ 14.3 billions
from R$ 12.2 billions
(jun/03 - jun/02)
Products for CompaniesR$ billions
... at all times with companies... at all times with companies
Receivables BB Guaranteed accountInvestment
5.87.0
2.0 2.1
2.6 2.7
jun/02 sep/02 dec/02 mar/03 jun/03
Receivables
are responsable for 47%
of companies operations.
Portfolio for companies
increased 10.3%,
to R$ 15.0 billions
from R$ 13.6 billions
(jun/03 - jun/02).
Agribusiness ProductsR$ billions
jun/02 sep/02 dec/02 mar/03jun/03
2.4
3.0
3.1
5.2
2.3
5.4
MCR 6,2 Saving Proger/Pronaf
BB contributes to brazilian agribusiness growth BB contributes to brazilian agribusiness growth
Leadership in brazilian
agribusiness.
Market share: 65%.
Rural portfolio increased 64.6%
from R$ 13.1 billions to R$ 21.5 billions
(jun/02 - jun/03)
5.7
6.8
1.50.6
ACC(Pre-shipment export financing)
Import Financing
jun/02 sep/02 dec/02 mar/03 jun/03
foreign trade becomes strongerforeign trade becomes stronger
Foreign Exchange ProductsR$ billions
Leadership in Foreing Exchange - export operations
Market share: 29.6%
Foreing Exchange
Portfolio increased
to R$ 7.6 billions
from R$ 7.2 billions
(jun/03 - jun/02)
82.2
6.7
11.1
81.5
14.7
3.8
88.2 87.8
9.0 10.32.7 1.8
Retail Commercial AgribusinessInternational
BB NFS
85.3 76.3
9.715.1
5.0 8.7
E, F, G e H C e D AA, A e B
Credit Portfolios by Risk Level
Participation % - jun/03
evolution with responsibility...evolution with responsibility...
... in a conservative way... in a conservative way
Non Performing LoansR$ millions
3,374
517
3,1243,1422,8522,6612,712
449469364
317170
2,882 2,978
3,368 3,506 3,593 3,823
1Q/02 2Q/02 3Q/02 4Q/02 1Q/03 2Q/03
Minimun Provision Additional Provision Total Provision
ability to increase businesses with customersability to increase businesses with customers
9.3 7.8 7.4 8.4 9.3 9.7
13.8 13.4 12.2
10.9 11.6 13.1
1Q/02 2Q/02 3Q/02 4Q/02 1Q/03 2Q/03
Level I Level II
11.0
2Q02 1Q03 2Q03Risk weighted assets 95,374 104,043 105,974
PLE 11,179 11,941 12,350
Required s/ weighted assets 10,491 11,445 11,657
Required s/ Swap 114 154 166
Required s/exchange exp 0 0 0
Required.s/ Interest rate exp 573 343 528
Required Shareholders’ Equity 11,780 14,545 15,479
Level I 7,949 10,139 10,847
Social Capital and other items 9,620 10,762 11,041
Adjustment do market value -1,670 -623 -194
Level II 3,830 4,406 4,632
Shareholders’ Equity surplus/deficit 601 2.604 3.128
Laverage surplus / deficit 5,468 23,674 28,439
K Coefficient% 11.6 13.4 13.8
BIS Ratio -%
Capital AdequacyR$ millions
commitment with transparencycommitment with transparency
Meetings with analists
August 25th - APIMEC Centro Oeste, in Brasília (DF)begin: 06h00 pm (Brazilian time)
September 03th - ABAMEC Rio de Janeiro (RJ)begin: 05h00 pm (Brazilian time)
September 04th - APIMEC São Paulo (SP)begin: 04h00 (Brazilian time)
Investor Relations DivisionSBS - Quadra 1 - Bloco C - Ed. Sede III - 17° andar
70073-901 - Brasília (DF)Phone: (61) 310.5920
Fax: (61) 310.3735
DisclaimerDisclaimer - This presentation contains references and statements, planned synergies, increasing 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, it also involves imprecision and high difficult risks to be foreseen, consequently, it may conduct to a different result than the one anticipated here. These expectations are highly depended on market conditions, on the Brazilian economic performance, on the sector and the international market. Banco do Brasil is not responsible for bringing up to date any estimate in this presentation.