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Investor Relations | 1 Investor Relations Consolidated Earnings 3 rd Quarter 2006 November 10 th , 2006 Unibanco and Unibanco Holdings, S.A.

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Page 1: Investor Relations | 1 Investor Relations Consolidated Earnings 3 rd Quarter 2006 November 10 th, 2006 Unibanco and Unibanco Holdings, S.A

Investor Relations | 1

Investor Relations

Consolidated Earnings

3rd Quarter 2006

November 10th, 2006

Unibanco and Unibanco Holdings, S.A.

Page 2: Investor Relations | 1 Investor Relations Consolidated Earnings 3 rd Quarter 2006 November 10 th, 2006 Unibanco and Unibanco Holdings, S.A

Investor Relations | 2

Annualized ROAE (%) Stockholders’ Equity (R$ Bln)

Performance

9.8

2Q06

9.0

3Q053Q04

7.9

10.1(1)

3Q06 9M05 9M069M04

R$ Millions

9.0

7.9

21.3%

16.4%

23.1%

Net Income(1)

Operating Income

24.7%

23.3%

17.8%

24.8%

+ 19%

+ 19%

3Q06/3Q053Q06

566

906

9M06

1,634

2,609

+ 23%

+ 21%

9M06/9M05

10.1(1)

(1) Before the extraordinary event

Page 3: Investor Relations | 1 Investor Relations Consolidated Earnings 3 rd Quarter 2006 November 10 th, 2006 Unibanco and Unibanco Holdings, S.A

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• Interest on Capital Stock/Dividends of 2006 will disregard the extraordinary effect of the goodwill amortization

Goodwill Amortization

5 years

10 years

Goodwill amortization

period:

Before Extraordinary Event

Extraordinary Result

After Extraordinary Event

• R$460 million accounted as an Extraordinary Result

3Q06

566

(460)

106

10,070

(460)

9,610

9M06

ROAE9M06

23.1%

16.9%

1,634

(460)

1,174

Stockholders´Equity

Net Income

R$ Millions

Page 4: Investor Relations | 1 Investor Relations Consolidated Earnings 3 rd Quarter 2006 November 10 th, 2006 Unibanco and Unibanco Holdings, S.A

Investor Relations | 4

1,062

598

Former Criteria - 10 years

New Criteria - 5 years

GoodwillBalance Sep-06

GoodwillBalance Sep-06

Amortization

Amortization

Goodwill Amortization Expenses

• R$(464) million - Impact in net income due to reduction in the

goodwill amortization period from 10 to 5 years.

R$ Millions

(46) (176) (169) (113) (76) (18)

4Q06 2007 2008 2009 2010 2011

(37)

2012to

2016

4Q06 2007 2008 2009 2010 2011

-

2012to

2016

(156) (167) (171) (175) (86) (270)

• The R$(464) million does not consider the goodwill amortization related to the 3Q06.

Therefore, the net income of R$566 million was impacted by a goodwill

amortization expense of R$ 33 million related to this quarter.

Page 5: Investor Relations | 1 Investor Relations Consolidated Earnings 3 rd Quarter 2006 November 10 th, 2006 Unibanco and Unibanco Holdings, S.A

Investor Relations | 5

Extraordinary Result in 3Q06

Net Income before the extraordinary event 566

Extraordinary Result in the Period (460)

Extraordinary Goodwill Amortization (464)

Fiscal Effect of Goodwill Amortization 158

Additional Provision for Loan Losses (net of taxes) (50)

Provision for Fiscal and Labor Contingencies (net of taxes) (108)

Minority Interest 4

Net Income after the extraordinary event 106

Extraordinary Result

R$ Millions

Page 6: Investor Relations | 1 Investor Relations Consolidated Earnings 3 rd Quarter 2006 November 10 th, 2006 Unibanco and Unibanco Holdings, S.A

Investor Relations | 6

Destaques

Loan Portfolio

Improvement of loan portfolio quality 3.3% growth in the quarter Up 17.5% in 12 months. Highlight: 30.2% growth in credit card portfolio

Assets Unibanco total assets surpassed the mark of R$100 billion in 3Q06

Reduction of 13.3%, 3Q06 versus 2Q06Provision for

loan losses

Results

23% net income growth, 9M06 versus 9M05 (21% growth in operating income)

Financial Margin (before provisions for loan losses) grew to 10.4% in 9M06, vis-a-vis 10.0% in 9M05 – despite declining interest rates

Highlights

Page 7: Investor Relations | 1 Investor Relations Consolidated Earnings 3 rd Quarter 2006 November 10 th, 2006 Unibanco and Unibanco Holdings, S.A

Investor Relations | 7

Highlights

Units

UBBR11

Efficiency

15% gain in 3Q06, while the Ibovespa stayed flat

Larger weighting in the Ibovespa index: 1.935% (0.984% in May, 2005)

Efficiency ratio of 48.5% in 9M06, a 400 b.p. improvement over 9M05 (52.5%)

0.7% variation in personnel expenses, 3Q06 versus 2Q06

Insurance

Technical Reserves: R$7.9 billion in September 2006, compared to R$6.7 billion in September 2005

94.5% combined ratio in 9M06, from 99.3% in 9M05

50.3% loss ratio in 9M06, from 53.7% in 9M05

Page 8: Investor Relations | 1 Investor Relations Consolidated Earnings 3 rd Quarter 2006 November 10 th, 2006 Unibanco and Unibanco Holdings, S.A

Investor Relations | 8

Financial Indicators

Profit from Financial Intermediation

Total Assets Loan Portfolio

Earnings per Unit (R$)

Sep-05 Dec-05 Mar-06 Jun-06 Sep-05 Dec-05 Mar-06 Jun-06Sep-06 Sep-06

3Q05 4Q05 1Q06 2Q06 3Q06 3Q05 4Q05 1Q06 2Q06 3Q06

0.33

0.37 0.36

0.380.39

2,481

2,141

2,262

2,357

2,392

88,585

91,831

93,770

98,217

101,999

36,872

39,87539,684

41,929

43,323

R$ Millions

Page 9: Investor Relations | 1 Investor Relations Consolidated Earnings 3 rd Quarter 2006 November 10 th, 2006 Unibanco and Unibanco Holdings, S.A

Investor Relations | 9

Income Statement

3Q06 2Q06 3Q05 9M06 9M05

Profit from Financial Intermediation afterProvisions for Loan Losses

(+) Fees from Services Rendered

(-) Personnel & Administrative Expenses

(+/-) Other Operating Income / Expenses

(=) Operating Income

(+/-) Non-Operating Income

(+/-) Income Tax and Social Contribution

(Effective Income Tax Rate)

(-) Profit Sharing / Minority Interest

Net Income(1)

1,724 1,638

901 847

(1,373) (1,324)

4,742

2,381

(3,744)

(1) Before the extraordinay event of goodwill amortization.

(383) (398)

869 763

1 (1)

(159) (170)

(163) (117)

548 566 475

21% 25%

(1,217)

2,162

15

(465)

(383)

1,634 1,329

24%

R$ Millions

1,902

909

(1,458)

(447)

906

(27)

(155)

(158)

21%

5,341

2,673

(4,186)

(1,219)

2,609

(29)

(461)

(485)

21%

Page 10: Investor Relations | 1 Investor Relations Consolidated Earnings 3 rd Quarter 2006 November 10 th, 2006 Unibanco and Unibanco Holdings, S.A

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9M069M05

Performance – 9M06 versus 9M05

Fee Income

Core Deposits

Loan Portfolio

Financial Margin before Provision

Provision for Loan Losses

Adm. Expenses Operating Income

Net Income

9M05 = 100

100 100

126

100

121

100

151

117

100 100

112100 100

123

112121

Page 11: Investor Relations | 1 Investor Relations Consolidated Earnings 3 rd Quarter 2006 November 10 th, 2006 Unibanco and Unibanco Holdings, S.A

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Financial Margin

Provision for Loan Losses/Financial Margin

3Q05 2Q06 3Q06 9M05 9M06

Post Provision Financial Margin Financial Margin

23.5% 27.9% 23.3% 20.8% 26.1%

10.6%10.7% 10.7%

10.4%10.0%

7.9%8.1%7.6%

8.1%7.6%

Page 12: Investor Relations | 1 Investor Relations Consolidated Earnings 3 rd Quarter 2006 November 10 th, 2006 Unibanco and Unibanco Holdings, S.A

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Provisions for Loan Losses / Financial Margin

3Q05 4Q05 1Q06 2Q06 3Q06

23.3%

23.5%

29.0%27.2% 27.9%

-20 b.p.

Page 13: Investor Relations | 1 Investor Relations Consolidated Earnings 3 rd Quarter 2006 November 10 th, 2006 Unibanco and Unibanco Holdings, S.A

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Loan Portfolio Growth

Jun-06 Sep-06Sep-05

17,995

Retail

Wholesale

17.5%

3.3%

1.7%

36,872

41,92943,323

5.5%

23,934

17,995

24,338

21,193

18,98515,679

R$ Millions

Page 14: Investor Relations | 1 Investor Relations Consolidated Earnings 3 rd Quarter 2006 November 10 th, 2006 Unibanco and Unibanco Holdings, S.A

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Loan Portfolio Growth – Individuals and Corporate

Corporate

Individuals

Sep-05 Jun-06 Sep-06

Main Highligths Quarter Year

Sep-05 Jun-06 Sep-06

R$ Millions

R$ Millions

Branch Network

Credit Cards

Car Loans

Consumer Finance Companies

SMEs

Large Corporate

2.1%

14,434

16,04816,383

13.5%

20.1%

22,438

4.1%

25,88126,940

-5.7%

-18.1%

5.2%

0.9%

5.5%

4.4%

2.6%

-41.7%

30.2%

17.7%

21.1%

20.4%

5.3%11.9%

Motorcycle Financing

Page 15: Investor Relations | 1 Investor Relations Consolidated Earnings 3 rd Quarter 2006 November 10 th, 2006 Unibanco and Unibanco Holdings, S.A

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Credit Cards

Jun-04 Dec-04 Jun-05 Dec-05 Jun-06

Total Cards

9.7

Credit Cards

19.0

28.7

5.0

10.0

15.0

20.0

25.0

Private Label Cards

30.0

Sep-06

In millions of cards

Page 16: Investor Relations | 1 Investor Relations Consolidated Earnings 3 rd Quarter 2006 November 10 th, 2006 Unibanco and Unibanco Holdings, S.A

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114%

109%112%

Coverage

Sep-05 Jun-06 Sep-06

E-H Portfolio

D-H Portfolio 87%

81%

66%

Sep-05 Jun-06 Sep-06

Loan Portfolio, by risk level

93.1% 93.3%

Sep-05 Jun-06 Sep-06

AA-C92.7%

6.7% D-H7.3% 6.9%

Loan Portfolio Quality

Page 17: Investor Relations | 1 Investor Relations Consolidated Earnings 3 rd Quarter 2006 November 10 th, 2006 Unibanco and Unibanco Holdings, S.A

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Sep-05 Jun-06 Sep-06

389

548

597

+53.5%

Additional Allowance for Loan Losses

+8.9%

R$ Millions

Page 18: Investor Relations | 1 Investor Relations Consolidated Earnings 3 rd Quarter 2006 November 10 th, 2006 Unibanco and Unibanco Holdings, S.A

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Loan Portfolio Coverage

Sep-06 Jun-06 Sep-05

Allowance for Loan Losses / Loan Portfolio

Consumer Finance Companies

Credit Cards

Commercial Bank - Individuals

Auto Financing

SMEs

Retail

Wholesale

Unibanco Consolidated

12.4%

9.8%

9.4%

4.6%

6.6%

7.9%

3.4%

5.8%

11.0%

8.5%

8.8%

4.8%

5.7%

7.2%

3.6%

5.6%

10.0%

5.2%

8.1%

3.3%

4.2%

5.6%

3.9%

4.9%

Page 19: Investor Relations | 1 Investor Relations Consolidated Earnings 3 rd Quarter 2006 November 10 th, 2006 Unibanco and Unibanco Holdings, S.A

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Deposits and Assets under Management

Sep-06 Jun-06 Sep-05

Demand Deposits

Savings Deposits

Core Time Deposits

Core Deposits

Time Deposits

Assets Under Management (B)

Total Deposits + Debentures + AUM (A+B)

Total Deposits + Debentures (A)

Debentures

Core Deposits / Total Deposits

4,4054,469 3,505

5,1875,558 5,524

4,2014,648 2,628

13,79314,675 11,657

24,98422,096 22,897

84,92386,280 72,937

5,065 7,034 2,683

43,84243,805 37,237

41,08142,475 35,700

40% 36% 34%

R$ Millions

Page 20: Investor Relations | 1 Investor Relations Consolidated Earnings 3 rd Quarter 2006 November 10 th, 2006 Unibanco and Unibanco Holdings, S.A

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Core Deposits Growth

Core Deposits(1)Source: Brazilian Central Bank, preliminary data

Brazilian Financial System (1)

Core Deposits Evolution

Sep 06vs

Sep 05

Core Time Deposits

Sep 06vs

Jun 06

R$ Millions

Sep-04 Sep-05 Sep-06

Sep 06vs

Sep 04

Brazilian Financial System Unibanco

Credit Core Deposits Core/Credit

25.9%

10.8%

6.4%

4.5%

1,030

2,628

4,648

39.3%

18.5%

Mar-06Dec-05 Jun-06 Sep-06

Dec-05=100Dec-05=100

118

109

31%

34%

Mar-06Dec-05 Jun-06 Sep-06

102

112

42%

38%

Page 21: Investor Relations | 1 Investor Relations Consolidated Earnings 3 rd Quarter 2006 November 10 th, 2006 Unibanco and Unibanco Holdings, S.A

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Personnel and Administrative Expenses

2Q06 3Q053Q06 9M059M06

Personnel Expenses 548

Other Administrative Expenses 910

Total 1,458

518

806

1,324

544

829

1,373

1,634

2,552

4,186

1,431

2,313

3,744

3Q06/2Q06 3Q06/3Q05 9M06/9M05

Total

Accounting reclassification in Redecard´s operations

134

36

85

36

442

36

Subtotal 9849 406

Organic growth

Others

6815 220

3034 186

Variations

R$ Millions

Page 22: Investor Relations | 1 Investor Relations Consolidated Earnings 3 rd Quarter 2006 November 10 th, 2006 Unibanco and Unibanco Holdings, S.A

Investor Relations | 22

Efficiency Ratio

Efficiency Ratio Evolution

RevenuesEfficiency Ratio Expenses

47.5%

51.4%

61.2%

3Q04 3Q05 2Q06

49.8%

3Q06

2,1362,576

2,891

1,308 1,3241,373

2,930

1,458

7,125

3,744

8,636

4,186

9M05 9M06

52.5%

48.5%

R$ Millions

Page 23: Investor Relations | 1 Investor Relations Consolidated Earnings 3 rd Quarter 2006 November 10 th, 2006 Unibanco and Unibanco Holdings, S.A

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Insurance and Private Pension Plans

3Q05 2Q06 3Q06

3Q05 2Q06 3Q06

Sep-05 Jun-06 Sep-06

Technical ReservesPremiums Earned

Combined Ratio Extended Combined Ratio

Private Pension Plans

Insurance

3Q05 2Q06 3Q06

95.6%94.0%

99.5%

87.1%

85.7%86.3%

435

487

52620.9%

4,9755,864 6,027

1,703

1,729 1,8296,678

7,8567,593

17.6%

R$ Millions

Page 24: Investor Relations | 1 Investor Relations Consolidated Earnings 3 rd Quarter 2006 November 10 th, 2006 Unibanco and Unibanco Holdings, S.A

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Traditional Products Private label and co-branded Ipiranga credit cards

New Products Personal credit Consumer credit Insurance

Place and Target Markets 4,200 service centers Retail consumer network Retailers

Partnerships – Unibanco and Ipiranga

Page 25: Investor Relations | 1 Investor Relations Consolidated Earnings 3 rd Quarter 2006 November 10 th, 2006 Unibanco and Unibanco Holdings, S.A

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Partnerships – Unibanco and VR

Cartão Smart VR Refeição (Smart VR Meal Card) Cartão Smart VR Alimentação (Smart VR Supermarket Card) Cartão Smart VR Auto (Smart VR Auto Card) VR Delivery VR Boas Compras (VR Shopping) Posto de Benefícios (Benefit Store) Payroll Loan Credit Card Credit Card Receivable Account Group Life Insurance Payroll Payroll Loans Overdraft Facilities Tarifa Zero (No Fees) Pension Plans Credit Lines

Page 26: Investor Relations | 1 Investor Relations Consolidated Earnings 3 rd Quarter 2006 November 10 th, 2006 Unibanco and Unibanco Holdings, S.A

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Development of a Joint Venture in the segment of payroll loan segment

Establishment of a financial company to operate as a partnership, combining Unibanco’s scale, products and services with Banco Cruzeiro do Sul’s expertise in managing alternative distribution channels

Operating agreement to grant funding to Banco Cruzeiro do Sul

Partnerships – Unibanco and Banco Cruzeiro do Sul

Page 27: Investor Relations | 1 Investor Relations Consolidated Earnings 3 rd Quarter 2006 November 10 th, 2006 Unibanco and Unibanco Holdings, S.A

Investor Relations | 27

Save the date

Presence of Unibanco´s main executives

Date: November 23rd, 2006

Time: 3:30 p.m.

Location: Hotel Unique – Av. Brigadeiro Luis Antonio, 4,700

APIMEC Public Analyst Meeting

Page 28: Investor Relations | 1 Investor Relations Consolidated Earnings 3 rd Quarter 2006 November 10 th, 2006 Unibanco and Unibanco Holdings, S.A

Investor Relations | 28

Investor Relationsphone: 5511-3097-1980

fax: 5511-3097-1585email: [email protected]

site: www.ir.unibanco.com

This presentation contains forward-looking statements regarding Unibanco, its subsidiaries and affiliates - anticipated synergies, growth plans, projected results and future strategies. Although these forward-looking statements reflect management’s good faith beliefs, they involve known and unknown risks and uncertainties that may cause the Company’s actual results or outcomes to be materially different from those anticipated and discussed herein. These risks and uncertainties include, but are not limited to. our ability to realize the amount of the projected synergies and the timetable projected, as well as economic. Competitive, governmental and technological factors affecting Unibanco’s operations, Junkets, products and prices, and other factors detailed in Unibanco’s filings with the Securities and Exchange Commission which readers are urged to read carefully in assessing the forward-looking statements contained herein. Unibanco undertakes no duty to update any of the projections contained herein.