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Santander Brasil
Finance
May 26th,2010
2
This presentation was prepared by Banco Santander (Brasil) S.A. It is provided forThis presentation was prepared by Banco Santander (Brasil) S.A. It is provided forinformational purposes only and does not constitute an offer to sell or a solicitationto buy any security. It may contain forecasts about future events. Thesepredictions/estimates evidently involve risks and uncertainties, whether foreseen ornot by the Company. Therefore, the future results of the Company may differ fromnot by the Company. Therefore, the future results of the Company may differ fromcurrent expectations. Past performance and/or these predictions are not guaranteeof future performance. The Company is not obliged to update the presentation/suchforecasts in light of new events or circumstances.© 2010 by Banco Santander (Brasil) S.A.. All Rights Reserved.© 2010 by Banco Santander (Brasil) S.A.. All Rights Reserved.
3Highlights
Net profit of R$ 1,763 MM in 1Q10, up 112% YoY and 11% vs. 4Q09
Net profit increase driven by revenue growth and cost control
Performance Ratios improved
Efficiency Ratio¹: 33.1%, drop of 4.4 p.p. YoY and 4.1 p.p. QoQ
Recurrence²: 61.1%, increase of 8.3 p.p. YoY and 3.5 p.p. QoQ
ROAE³: 18.0%, increase of 2.6 p.p. YoY and 0.1 p.p. QoQ
Sound Balance Sheet Metrics
BIS Ratio³: 24.4% in mar/10
Coverage: 102.8% in mar/10
Equity³ of R$ R$ 42,417 MM
1. General Expenses excluding amortization / Total Revenue excluding Cayman hedge2. Net Fee/General Expenses excluding amortization 3. Excludes Goodwill on acquired companies (Banco Real and Real Seguros Vida e Previdência)
4Net profit evolutionR$ MM
Net profit growth is accelerating
76%
112%
11%
1,591 1,5911,763
906 832
4Q08 4Q09 1Q09 4Q09 1Q10
5Results by Segment¹
Net Profit before tax
847
Global Wholesale Banking
0.9xR$ MM
Global 1 204
Commercial Banking
2.1x
847 758
1Q09 1Q10
R$ MM
56%36%
Commercial Banking
Global WholesaleBanking 575
1,204
1Q09 1Q10
1Q09 1Q10
Asset Management and Insurance 56%
8%
Asset Management
1Q09 1Q10
59
1622.7x
R$ MM
Asset Management and Insurance
59
1Q09 1Q10
1. Does not consider the fiscal effect of Cayman hedge
6Gross Revenue vs General Expenses
Gross Revenue¹ and General Expenses²R$ MM 1Q10 x 1Q109
7,288 7,471 7,598 7,776 8,03210.2%
3 0
2 731 2 649 2 674 2 893 2 655-2.8 %
2.7 3.0
2,731 2,649 2,674 2,893 2,655
1Q09 2Q09 3Q09 4Q09 1Q10
General ExpensesGross Revenue
1. Gross Revenue = Total Income excluding Cayman Hedge. Including Cayman Hedge 1Q10/1Q09 grows 7.6%2. Excludes amortization
7Total Revenues
8 032
3.3%
R$ MM10.2%
1,443 1,573 1,556 1,666 1,622673 409 386 260 5777,288 7,471 7,598 7,776 8,032
1Q10 1Q09Y-o-YVar.
Net Interest Income 5,833 5,172 12.8%
Net Fees 1 622 1 443 12 4%
5,172 5,489 5,656 5,850 5,833
Net Fees 1,622 1,443 12.4%
Subtotal 7,455 6,615 12.7%
Others¹ 577 673 -14.3%
1Q09 2Q09 3Q09 4Q09 1Q10
Others¹ Net Fees Net Interest Income
Total Revenues 8,032 7,288 10.2%
1. Result from Financial Operations excluding the fiscal effect of Cayman hedge + Others
8Net Fees
R$ MM
1Q10 1Q09Y-o-YVar.
Banking fees 588 549 7 1%-2.6%
12.4%
Banking fees 588 549 7.1%
Insurance 342 259 32.2%
Asset Management 201 171 17.6%1,443 1,573 1,556 1,666 1,622
Credit and Debit Cards 213 171 24.9%
Collection services 125 121 2.8%
Capital Markets 108 64 68 1%Capital Markets 108 64 68.1%
Trade (COMEX) 102 101 1.3%
Others¹ (56) 8 n.a.
1Q09 2Q09 3Q09 4Q09 1Q10
Total 1,622 1,443 12.4%
1. Includes taxes and others
9
R$ MM
General Expenses and Amortization
6 9%
-3.5%
Variation
317 328 339 265 286
1Q10 1Q09 Y-o-Y Q-o-Q
Other General Expenses 1,300 1,371 -5.2% -8.6%
-6.9%
2,977 3,0133,048 3,158 2,941
Variation
2,731 2,649 2,674 2,893 2,655
Personnel Expenses 1,355 1,360 -0.4% -7.8%
Depreciation and Amortization 286 317 -9.8% 7.9%
1Q09 2Q09 3Q09 4Q09 1Q10
Depreciation and Amortization General Expenses
Total 2,941 3,048 -3.5% -6.9%
10Non-recurrent events
Value (R$ Million)Value (R$ Million)
Sale of Assets 64
Provision for contingencies (28)
Total (after tax) 37Total (after tax) 37
11Managerial Loan Portfolio¹ - IFRS
R$ Billion
1.1% Variation
2.0%
1Q10 1Q09 Y-o-Y Q-o-Q
Individuals 43,992 40,503 8.6% 1.8%
Consumer Financing 25,509 24,511 4.1% 1.6%
R$ Million137.1 134.2 132.9 138.4 139.9
SMEs 30,811 33,027 -6.7% -2.0%
Corporate 39,597 39,076 1.3% 2.5%mar.09 jun.09 sep.09 dec.09 mar.10
Total IFRS 139,910 137,117 2.0% 1.1%
Individuals31%
Corporate29%
Consumer Finance
SMEs22%
18%
1. Loans for the year 2009 have been reclassified for comparison purposes with the current period, due to re-segmentation of clients occurred in 2010
12
R$ Billion
Managerial Loan Portfolio - BR GAAP¹
3.6%
1Q10 1Q09 Y-o-Y Q-o-Q1.5%
R$ Million
Variation
139.1 137.3 136.2 142.0 144.1 Individuals 46,439 41,349 12.3% 3.5%
Consumer Financing 27,842 26,224 6.2% 1.9%
mar.09 jun.09 sep.09 dec.09 mar.10
SMEs 30,811 33,027 -6.7% -2.0%
Corporate 39,031 38,497 1.4% 1.7%
Total BR GAAP 144,124 139,097 3.6% 1.5%
5 9%
>15%
Annualized growth rate
3.6%5.9%
1Q10/ 1Q10/ mar 10/1Q10/ 1Q09
1Q10/ 4Q09
mar.10/ feb.10
1. The portfolio in BR GAAP is higher than in IFRS because includes portfolios acquired from other banks and portfolio of the partnership Aymoré
13
R$ Billion
Deposits and Assets Under Management
1Q10 1Q09 Y-o-Y Q-o-Q
0.3%R$ Million
Variation
6.7%
240 3235 7 243 1 239 5
80.1 85.5 93.1 98.4 106.6
Demand 13,699 12,356 10.9% -9.5%
Savings 25,781 20,447 26.1% 2.2%
Time 68 252 87 954 -22 4% -9 9%
225.2 240.3235.7 243.1 239.5
145.1 150.2 150.0 141.1 133.8
mar.09 jun.09 sep.09 dec.09 mar.10
Time 68,252 87,954 22.4% 9.9%
Others¹ 26,025 24,333 7.0% 4.3%
Funding from Clients 133,757 145,090 -7.8% -5.2%Funds (AUM) Funding from Clients¹ Clients
Funds (AUM) 106,572 80,125 33.0% 8.3%
Total 240,329 225,215 6.7% 0.3%
Funds (AUM) Funding from Clients
Demand6%
Savings11%
Funds
Time28%
Funds44%
Others¹11%
1. Repurchase commitments backed on Debentures, Real Estate Credit Notes (LCI) and Agribusiness Credit Notes (LCA)
14Performance Ratios
Efficiency Ratio¹ (%) Recurrence² (%) ROAE (adjusted)³ (%)
8.3 p.p.
-4.4 p.p. 2.6 p.p.
19 357.0 52 861.1
36.3 37.533.1
19.3
15.418.0
52.8
2009 1Q09 1Q10 2009 1Q09 1Q102009 1Q09 1Q10
1.General Expenses excluding amortization / Total Revenue excluding Cayman hedge2. Net Fee/General Expenses excluding amortization 3. Excludes Goodwill on acquired companies (Banco Real and Real Seguros Vida e Previdência)
15
R$ MM
Allowance for Loan Losses¹ - IFRS
1.8%
11 9%
Y-o-Y
11.9%
2,360 2,467 2,148
2,403 500
3,008
1Q10 1Q09 Var.
Allowance for loan losses 2,403 2,360 1.8%
2,508
1Q09 2Q09 3Q09 4Q09 1Q10
Additional Provision
1. Includes recoveries of written-off credits
16Quality of Loan Portfolio - IFRS
Coverage²Deliquency¹ (%)
8.6 8.89.7 9.3 8.8
7.07.7
7.2 7.0107%
97% 101% 102% 103%
4.2
5.7 6.15.3 5.3
6.0
1Q09 2Q09 3Q09 4Q09 1Q10
Individuals Corporate Total
1Q09 2Q09 3Q09 4Q09 1Q10
1. Nonperforming loans for over 90 days + performing loans with high delinquency risk / total loans managerial2. Allowance for Loan Losses / nonperforming loans for over 90 days + performing loans with high delinquency risk
17Quality of Loan Portfolio – BR GAAP
Delinquency Over 90¹ (%) NPL Over 60² (%) Coverage Ratio Over 90³
7.2 7.47.9 7.8
7.2
6.2 6.55.9 114% 108% 113% 120%
8.9 9.2 9.4 9.28.7
6.2
7.6 7.76.8 6.4
3.2
5.1 5.3
4.23.7
5.0 5.4 97% 108%
4.0
6.2 6.1
4.7 4.4
1Q09 2Q09 3Q09 4Q09 1Q10
Individuals Corporate Total
1Q09 2Q09 3Q09 4Q09 1Q101Q09 2Q09 3Q09 4Q09 1Q10
Individuals Corporate Totalp p
1) Nonperforming loans for over 90 days / total loans BR GAAP2) Nonperforming loans for over 60 days / total loans BR GAAP3) Allowance for Loan Losses / nonperforming loans for over 90 days + performing loans with high delinquency risk
18ConclusionIntegration is evolving as scheduled
A ti iti
• Credit card platform integration concluded in the 1Q10 and final tests for branch networkintegration• Costs controlled and synergies obtainedActivities• Loan book growth is accellerating
• Commercial re-alignment to cacht up loan activity in corporate loans
• L hi f “C t I t d ” d t f i SME
Well behaved results
• Launching of “Conta Integrada” product focusing SMEs
• Balanced betweenRevenues
Improved asset quality
Balanced between
• Gross jaws increased by 13 p.p.
Costs
Net income jumped 112% YoY and 11% QoQ
• Both NPLs over 60 and 90 days continue its declining trend
• Increased coverage
Net income jumped 112% YoY and 11% QoQ
19
ANNEXES
Income Statement
Balance Sheet
20Adjusted Allowance for Loan Losses¹ - BR GAAP
R$ MM$
-9.6%
-11.4%
2,413 2,490 2,462569419 157
2,403 2,181 1Q10 1Q09 Y-o-Y Q-o-Q
Adjusted Allowance for Loan Losses² 2,181 2,413 -9.6% -11.4%
Variation
1Q09 2Q09 3Q09 4Q09 1Q10for Loan Losses
Increase in Additional Provision
Decrease in Additional Provision
1.Excluding recoveries of written-off credits2.Allowance for Loan Losses adjusted by the increase/decrease in additional provision
21Quarterly Results ManagerialR$ MM
Income Statements 1Q09 2Q09 3Q09 4Q09 1Q10 - Interest and Similar Income 9,996 9,775 9,731 9,841 9,278 - Interest Expense and Similar (4,824) (4,286) (4,075) (3,991) (3,445)Interest Income 5,172 5,489 5,656 5,850 5,833 Income from Equity Instruments 7 8 7 8 4 Income from Companies Accounted for by the Equity Method 205 52 33 5 10 Net Fee 1,443 1,573 1,556 1,666 1,622 - Fee and Commission Income 1,664 1,799 1,797 1,888 1,841 - Fee and Commission Expense (221) (226) (241) (222) (219) Gains/Losses on Financial Assets and Liabilities and Exchange Diferences 514 459 240 306 608Gains/Losses on Financial Assets and Liabilities and Exchange Diferences 514 459 240 306 608 Other Operation Income (Expenses) (53) (110) 106 (59) (45) Total Income 7,288 7,471 7,598 7,776 8,032 General Expenses (2,731) (2,649) (2,674) (2,893) (2,655) - Administrative Expenses (1,371) (1,297) (1,345) (1,423) (1,300)
P l (1 360) (1 352) (1 329) (1 470) (1 355)- Personnel espenses (1,360) (1,352) (1,329) (1,470) (1,355) Depreciation and Amortization (317) (328) (339) (265) (286) Provisions (net)¹ (559) (1,250) (1,190) (482) (629) Impairment Losses on Financial Assets (net) (2,381) (2,518) (3,844) (2,125) (2,407) - Allowance for Loan Losses² (2,360) (2,467) (3,008) (2,148) (2,403) - Impairment Losses on Other Financial Assets (net) (21) (51) (836) 23 (4) Net Gains on Disposal of Assets 49 1,040 2,280 34 117 Net Profit before taxes 1,349 1,766 1,831 2,045 2,172 Income Taxes (517) (153) (359) (454) (409) Net Profit 832 1,613 1,472 1,591 1,763Net Profit 832 1,613 1,472 1,591 1,763
1. Includes provision for tax contingencies and legal obligations2. Includes recovery of credits written off as losses
22
I S Var Y-o-Y
Income Statement ManagerialR$ MM
1Q10 1Q09 ABS % - Interest and Similar Income 9,278 9,996 (718) -7.2% - Interest Expense and Similar (3,445) (4,824) 1,379 -28.6%Interest Income 5,833 5,172 661 12.8%Income from Equity Instruments 4 7 (3) 42 9%
Income Statements Var Y o Y
Income from Equity Instruments 4 7 (3) -42.9%Income from Companies Accounted for by the Equity Method 10 205 (195) -95.1%Net Fee 1,622 1,443 179 12.4%- Fee and Commission Income 1,841 1,664 177 10.6%- Fee and Commission Expense (219) (221) 2 -0.9%Gains/Losses on Financial Assets and Liabilities and Exchange Diferences 608 514 94 18.3%Other Operation Income (Expenses) (45) (53) 8 -15.1%Total Income 8,032 7,288 744 10.2%General Expenses (2,655) (2,731) 76 -2.8%- Administrative Expenses (1,300) (1,371) 71 -5.2%p ( ) ( )- Personnel espenses (1,355) (1,360) 5 -0.4%Depreciation and Amortization (286) (317) 31 -9.8%Provisions (net)¹ (629) (559) (70) 12.5%Impairment Losses on Financial Assets (net) (2,407) (2,381) (26) 1.1%
Allowance for Loan Losses² (2 403) (2 360) (43) 1 8%- Allowance for Loan Losses (2,403) (2,360) (43) 1.8%- Impairment Losses on Other Financial Assets (net) (4) (21) 17 -81.0%Net Gains on Disposal of Assets 117 49 68 n.aNet Profit before taxes 2,172 1,349 823 61.0%Income Taxes (409) (517) 108 -20.9%Net Profit 1,763 832 931 111.9%
1. Includes provision for tax contingencies and legal obligations2. Includes recovery of credits written off as losses
23
Assets mar/09 jun/09 sep/09 dec/09 mar/10
Balance Sheet - AssetsR$ MM
Assets mar/09 jun/09 sep/09 dec/09 mar/10
Cash and Balances with the Brazilian Central Bank 23,317 24,813 21,261 27,269 36,835
Financial Assets Held for Trading 22,347 15,809 19,261 20,116 23,133
Other Financial Assets at Fair Value Through Profit or Loss 6,462 6,068 16,986 16,294 15,873
Available - for- Sale Financial Assets 27,294 30,593 44,763 46,406 37,183
Loans and Receivables 159,356 161,645 149,973 152,163 150,003
- Loans and advances to credit institutions 30,977 31,993 27,932 24,228 20,330
- Loans and advances to credit customers 137,227 138,811 132,343 138,005 139,678
- Impairment losses (8,848) (9,159) (10,302) (10,070) (10,005)99 178 157 163 133Hedging derivatives 99 178 157 163 133
Non-current assets held for sale 120 58 53 171 41
Investments in associates 460 502 417 419 423
Tangible Assets 3,742 3,600 3,682 3,702 3,835
Intangible Assets: 30,534 30,589 30,982 31,618 31,587Intangible Assets: , , , , ,
- Goodwill 27,190 27,263 28,312 28,312 28,312
- Others 3,344 3,326 2,670 3,306 3,275
Tax Assets 12,798 13,386 15,058 15,779 14,834
Other Assets 3,170 1,637 3,642 1,872 2,169Total Assets 289,699 288,878 306,235 315,972 316,049
24
Liabilities mar/09 jun/09 sep/09 dec/09 mar/10
Balance Sheet - LiabilitiesR$ MM
Liabilities mar/09 jun/09 sep/09 dec/09 mar/10
Financial Liabilities Held for Trading 8,268 4,887 5,316 4,435 4,505
Other Financial Liabilities at Fair Value Through Profit or Loss 257 363 2 2 2
Financial liabilities at amortized cost 208,267 207,644 205,801 203,567 203,499
- Deposits from the Brazilian Central Bank 1,049 870 562 240 117 p- Deposits from credit institutions 23,435 21,793 18,754 20,956 24,092
- Customer deposits 155,231 154,922 154,548 149,440 147,287
- Marketable debt securities 11,535 11,299 10,945 11,439 11,271
- Subordinated liabilities 10,938 10,996 11,149 11,304 9,855 6 079 7 764 9 843 10 188 10 877- Other financial liabilities 6,079 7,764 9,843 10,188 10,877
Liabilities for Insurance Contracts - - 13,812 15,527 16,102
Provisions1 9,749 10,203 11,555 9,480 9,881
Tax Liabilities 6,402 7,352 9,287 9,457 8,516
Other Liabilities² 6,084 6,624 4,796 4,238 2,815 Other Liabilities , , , , ,Total Liabilities 239,027 237,073 250,569 246,706 245,320
Equity Shareholders' Equity 50,148 51,135 55,079 68,706 70,069
Minority Interests 5 5 5 1 1
Valuation Adjustments 519 665 582 559 659 Total Equity 50,672 51,805 55,666 69,266 70,729 Total Liabilities and Equity 289,699 288,878 306,235 315,972 316,049
1. Includes provision for pension and contingencies2. Includes other financial liabilities at fair value in income and derivatives used as hedge
25Reconciliation IFRS x BRGAAP
1Q10R$ MM
1Q10
BR GAAP Net Profit 1,015
- Reversal of Goodwill amortization / Others 832
PPA ti ti (58)- PPA amortization (58)
- Others (26)
IFRS Net profit 1,763
Investor RelationsJuscelino Kubitschek Avenue 2,235 10th floor
São Paulo | SP | Brazil | 04543-011T l ( 11) 3 3 3300Tel. (55 11) 3553-3300
e-mail: [email protected]
Santander Brasil
Wholesale BankingWholesale Banking
May 26th, 2010
2
This presentation was prepared by Banco Santander (Brasil) S.A. It is provided forp p p y ( ) pinformational purposes only and does not constitute an offer to sell or a solicitationto buy any security. It may contain forecasts about future events. Thesepredictions/estimates evidently involve risks and uncertainties, whether foreseen ornot by the Company. Therefore, the future results of the Company may differ fromy p y p y ycurrent expectations. Past performance and/or these predictions are not guaranteeof future performance. The Company is not obliged to update the presentation/suchforecasts in light of new events or circumstances.© 2010 by Banco Santander (Brasil) S.A.. All Rights Reserved.y ( ) g
3
Agenda
Market Overview
Santander Wholesale Banking
Santander Wholesale Banking Growth StrategySantander Wholesale Banking Growth Strategy
4
Market Overview – Credit to Corporate
Credit (YoY Growth%) Spreads (%)
46%
40%
50%
500
60019,0
1 117,5
20,0
33%
1% 4%
10%
20%
30%
100
200
300
400
13,6
17,1
10 0
12,5
15,0
,
Average Tenor (days) Delinquency
%0%0
Jan-
08
Mar
-08
May
-08
Jul-0
8
Sep
-08
Nov
-08
Jan-
09
Mar
-09
May
-09
Jul-0
9
Sep
-09
Nov
-09
Jan-
10
Mar
-10
Credit to Corporate (Volume - BRL bln) Credit to Corporate (YoY Growth %)
10,0
Jun-
05
Sep
-05
Dec
-05
Mar
-06
Jun-
06
Sep
-06
Dec
-06
Mar
-07
Jun-
07
Sep
-07
Dec
-07
Mar
-08
Jun-
08
Sep
-08
Dec
-08
Mar
-09
Jun-
09
Sep
-09
Dec
-09
Mar
-10
Average Tenor (days) Delinquency
310
287300
350
3,6
3,0
4,0
5,0
195
150
200
250
5 5 5 6 6 6 6 7 7 7 7 8 8 8 8 9 9 9 9 0
1,7
0,0
1,0
2,0 5 5 5 6 6 6 6 7 7 7 7 8 8 8 8 9 9 9 9 0
Source: Brazilian Central Bank
Jun-
05
Sep
-05
Dec
-05
Mar
-06
Jun-
06
Sep
-06
Dec
-06
Mar
-07
Jun-
07
Sep
-07
Dec
-07
Mar
-08
Jun-
08
Sep
-08
Dec
-08
Mar
-09
Jun-
09
Sep
-09
Dec
-09
Mar
-10
Jun-
05
Sep
-05
Dec
-05
Mar
-06
Jun-
06
Sep
-06
Dec
-06
Mar
-07
Jun-
07
Sep
-07
Dec
-07
Mar
-08
Jun-
08
Sep
-08
Dec
-08
Mar
-09
Jun-
09
Sep
-09
Dec
-09
Mar
-10
5
Market Overview – Capital Markets (ECM & DCM)
ECM Evolution – Volume & Number of DealsECM Evolution – Volume & Number of Deals DCM Evolution – Volume & Number of DealsDCM Evolution – Volume & Number of Deals
+34.2%
Volume = BRL MM; N = Number of Deals Volume (BRL MM)
-5.5% -6.4%
N=12
N 3N=64
+335%
N=11N=19 N=3N=64
N=4 N=5 N=5N=1
+9.2%Number of DealsForeign Investors Participation – YTD Feb10
Source: ANBIMA
6
Market Overview – Capital Markets (M&A)
Volume = BRL billion; N = Number of Deals
M&A Evolution – Volume & Number of Deals*
N 40
N=65 N=134
N=91N=86
N=1N=1
N=2
N=2
N=40N=14 N=10 N=15 N=10 N=9
Announced Deals by Value
Number of Deals Volume
Announced Deals by Value Capital Source (2009)
Source: ANBIMA
(*) – Source: ANBIMA. Megadeals include operations with volume greater than BRL 3.0 billion
7
Agenda
Market Overview
Santander Wholesale Banking
Santander Wholesale Banking Growth StrategySantander Wholesale Banking Growth Strategy
8
Santander Wholesale Banking Client Segmentation
Revenue Classification CriteriaRevenue Classification Criteria Client DistributionClient Distribution
GB&M
~530 *GB&M
Client List
Corporate
Corporate
~650 (13%)
(10%)
BRL 250MM and above
Empresas
Empresas **
~3900 (77%)
BRL 30MM-250MM
(*) Includes MRG model clients only( ) Includes MRG model clients only
(**) Annual revenues greater than BRL 20K
9
Santander Global Wholesale Banking* Overview – (IFRS Criteria)
Profit Before Tax (% / Total)Profit Before Tax (% / Total)
Total Revenues = BRL 931 MMTotal Revenues = BRL 931 MM
Profit Before Tax (% / Total) Profit Before Tax (% / Total)
3M10
3M10
Costs = BRL 167 MMCosts = BRL 167 MM
Profit Before Tax = BRL 758 MMProfit Before Tax = BRL 758 MM
Source: Santander Financial Statements (IFRS)
(*) GB&M only
10
Santander Wholesale Banking – Credit Evolution & League Tables
Credit Evolution (Large Corporates) *Credit Evolution (Large Corporates) *
BRL MM
League TablesLeague Tables
M&A (Announced Transactions – Value)1st ( )Bloomberg - 2009
Project Finance (Fin. Advisor & Structuring) Anbima - 2009
1st
1st
1.3%
DCM (External Issues)*Bond Radar - 2009
1st
DCM (Domestic Issues)Anbima - 2009
ECM (Closed Deals)
4th
1 t ECM (Closed Deals)Thomson Financial and Bloomberg - 2009
FXBanco Central de Brasil - 2009
1st
3rd
Source: Managerial Information 1Q10
(*) Does not include Empresas. Volumes do not include guarantees and other collaterals
11
Agenda
Market Overview
Santander Wholesale Banking
Santander Wholesale Banking Growth StrategySantander Wholesale Banking Growth Strategy
12
Santander Wholesale Banking Growth Strategy
Empresas(BRL 30-
Empresas(BRL 30-
General Strategy…
Focus on clients relationship
Increase share of wallet cross-selling and lead strategic transactions/loans with(BRL 30-250MM)
~3,900 activeclients
(BRL 30-250MM)
~3,900 activeclients
Increase share of wallet, cross-selling and lead strategic transactions/loans with the existents key clients
Expand market penetration with new clients and clients with unexplored potential
Cross-selling to individual clients
Com
pani
esC
ompa
nies
General Strategy…
Cross-selling to individual clients
Explore value chain and sector opportunities with large companies
CC
Corporate(BRL 250MMand above)
Corporate(BRL 250MMand above)
General Strategy…
Increase cross-selling and diversification
Expand use of our wholesale and Investment Banking product platforms
~650 clients~650 clients Increase share of wallet
Continuous active NPL management (recovery and prevention)
Cross selling to individual clientsCross-selling to individual clients
13
GB&M Growth Strategy
Become the top relationship bank for the main players of sectors with high growth perspectives, like Energy, Mining, Construction, Infrastructure and Agribusiness.
11
Take advantage of our global capabilities and support local clients who intends to become international. 22
The concept of one-stop shop and the first option for share of mind products.33 p p p p p
Santander is well positioned in Investment Banking products and intends to take advantage of the good perspectives for M&A, ECM and DCM markets.
44
Increase our client’s satisfaction, generating value to the Bank.55
Leverage Retail opportunities through our origination capacity.66
Increase net profit, ensuring full costs control and preserving a low risk profile.77
Investor RelationsJuscelino Kubitschek Avenue 2,235 10th floor
São Paulo | SP | Brazil | 04543-011T l ( 11) 3 3 3300Tel. (55 11) 3553-3300
e-mail: [email protected]
Santander BrasilSantander Brasil
Santander Cards BusinessSantander Cards Business
May 26th, 2010
2
This presentation was prepared by Banco Santander (Brasil) S.A. It is provided forp p p y ( ) pinformational purposes only and does not constitute an offer to sell or a solicitationto buy any security. It may contain forecasts about future events. Thesepredictions/estimates evidently involve risks and uncertainties, whether foreseen ornot by the Company. Therefore, the future results of the Company may differ fromy p y p y ycurrent expectations. Past performance and/or these predictions are not guaranteeof future performance. The Company is not obliged to update the presentation/suchforecasts in light of new events or circumstances.© 2010 by Banco Santander (Brasil) S.A.. All Rights Reserved.y ( ) g
3
Agenda
Overview of Brazilian Cards Industry
Santander Cards IssuerSantander Cards Issuer
Santander Cards Acquirer
4Overview of Brazilian Cards IndustryCards industry continues to show substantial growth rates, even considering the competitive scenario consolidation and recent regulation changes
600
Total industry debit + credit cards and spend
400
500
200
30018.8% a.a.
23.7% a.a.
0
100
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
# cards (MM) Total Spend (R$ bn)
Source: ABECS. Prepared by Ferrés Consultoria.
5Overview of Brazilian Cards IndustryCards transactions have been strongly replacing checks transactions last 10 years
In billions transactions (cards include debit + credit)
7
4
5
6
21% a.a.
2
3
4
‐8.1% a.a.
0
1
2
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Cards Checks
Source: ABECS and BCB. Prepared by Ferrés Consultoria.
6Overview of Brazilian Cards IndustryLower income population’s tool as formal payment means and bank services inclusion
Total AB C DEEconomic classes
For classes D/E the ratio of card holder is higher than check account holders
Card holders (% of pop.)Cards 67% 81% 64% 36%Credit Cards 45% 61% 38% 20%Credit Cards 45% 61% 38% 20%Debit Cards 53% 70% 49% 19%
Check accounts holders (% of pop ) 67% 82% 64% 33%Check accounts holders (% of pop.) 67% 82% 64% 33%
Source: Researches Abecs. Survey on 11 metropolitan areas.
7Overview of Brazilian Cards IndustryThe relative lower participation as a mean of payment shows a relevant up side opportunity for Brazilian Cards Industry
(1)Higher utilization of cards in private consumption (1)
12.4% 14.0% 15.8% 17.1% 19.1% 21.4%
2003 2004 2005 2006 2007 2008
...but below developed countries (2)
2X
(1) Source : ABECS and IBGE
(2) Source: ABECS, Bank of International Settlements, United Nations, IBGE
8
Card penetration, average ticket and transactions per card are still low in BrazilOverview of Brazilian Cards Industry
628
Number of cards (MM)
~ 15 MM credit cards / year
104 124 136 153201 217 233 249147 173 196 225
453514 565
628
2007 2008 2009 2010 (e)
Spend (R$ Bn) Average Ticket (R$ per transaction)
Credit Debit Private Label Total
93 98 100 104
68 71 73 75215 256
309302375
444535
CAGR: 21.1% CAGR: 3.7%
48 51 53 5553 52 52 51
2007 2008 2009 2010 (e)
174 215
83 107 129 15845 53 60 68
2007 2008 2009 2010 (e)Credit Debit Private Label Total Credit Debit Private Label Total
Source: ABECS (Associação Brasileira das Empresas de Cartões de Crédito e Serviços)
99
Agenda
Overview of Brazilian Cards Industry
S t d C d ISantander Cards Issuer
Santander Cards Acquirerq
10Santander Cards Issuer – Role in the Value ChainSets rules for issuers and
Issues credit and
acquirers
Card Brands
Captures and processes transactions
Issues credit and debit cards
Issuers Acquirers
Use credit and debit cards
Merchants
cards
Clients
11Santander Cards Issuer – our approachTo be the world’s best integrated cards monoliner within a retail bank…
Retail BankMonoliner Retail Bank
Access to customers’ base
Product focus
Specialized
Monoliner
pcapabilities
Direct channels: Telemarketing / Mailings Brand
Traditional channels: branches / agents
Mailings
Global specialized systems
Economies of scale
Brand
… contributing to improving our local banks’ performance
12Santander Cards Issuer – our model Is based on managing all levers along the product lifecycle …
PORTFOLIO MANAGEMENTACQUISITION
Acquisition Activation RetentionSpending OutstandingsProduct innovation and…
Activation RetentionSpending
r rel
atio
nshi
p Outstandings
PlatinumUnlimited
h of
cus
tom
er
VALUE
Cancellation
Light
FreeReward
Mini Card
Time
Dep
th VALUELight
Flex
Mini Card
Launch strategies
Multichannel management
Specialized risk managementTime
Profitability
… supported by an end-to-end view of RISKS and TECHNOLOGY
13Santander Cards Issuer – our model The Business expansion will be held in two dimensions: Customer Base and Profitability per Account
Increase the profitability by using Card Accountsprofitability by using
the card’s platforms as a distribution channel
for other banking products and services 1Q10
e
Card Accounts
per A
ccou
nt
S i
Personal Loan
Insurance
1Q09
7%
Net
inco
me
Δ P
rofit
abilit
y
Payment Services
Savings Insurance
1Q09 1Q10
10%
Continuous product innovation as a growth
lever
(1) Source: Internal data
lever
14Santander Cards – market positionIn Brazil, where our model is already well established, our market share has improved significantly
Other Banks BANK “A”
Market Share end of 1Q10 increases to
Rev
BANK A
BANK “D”
increases to 9.9%25.30
15 107.10
23.40
3.6 9.4
volving Ba
BANK “C”
BANK “B”
15.10
19.70
9.4
3.52.3
3.6 9.4 alance %
2005 Organic Growth
Santander
Banco Real
Acquisition
Current Dec/2009
%
Note 1: Competitor data as of December, 09, source Competitor Quarter Reports, BCB and internal analysis. Santander´s current Market Share as of December, 09
Note 2: Include non interest bearing due to unpaid balances
15Santander Cards Issuer – continuous growthThe Credit market continues to show substantial growth rates, even considering the competitive scenario consolidation and recent regulation changes
C d (MM) Market SantanderCAGR (06 09)Cards (MM)
Key Observations
~80% of the Cards Market is
Market
136124104
826853
+21%+18%
(04~09)
SantanderCAGR (06~09)
Total Spend (R$ Bi)
~80% of the Cards Market is concentrated at the top 4 Banks (Banco do Brasil, Itaú, Bradesco and Santander)
10875
20090807060504
256
+22%
There is an important opportunity for cards revolving growth
R l t l ti h
256215
17414211595
33261914
+22%+22%
33%
(04~09)
Revolving Balance (R$ Bi)
Relevant regulation changes are being implemented, representing significant opportunities for issuers and
261914
0504 2009080706
25.722 1
+33%
new acquiring business players
22.117.2
13.411.38.22.42.11.71.2
+27% +24%
+26%
(04~09)
Note 1: Source Banco Central do Brasil, including +360 days balance
Note 2: Source ABECs – Brazilian Cards Association
20090807060504
16Santander Cards Issuer – 1Q10 performanceThe business growth is leveraged by Cards Accounts expansion…
Cards Accounts (MM) Key NotesCards (MM)
Cards Accounts has presented sustainable growth,
+13%
+16%
10 0427 890
+20%
+14%
year over year
Cards Accounts growth rate has continuously
9.7458.67410.0427.8907.5426.916
continuously increased quarter over last quarter, reflecting our strategy
1Q104Q091Q091Q104Q091Q09
strategy
YoY growth
Quarter annualized growth
17Santander Cards Issuer – 1Q10 performance… generating relevant revenue increase
Net Fee (R$ MM)
213+25% 213
171
+25%
1Q101Q09
Source: Santander Income Statement 1Q10
181818
Agenda
Overview of Brazilian Cards Industry
Santander Cards Issuer
Santander Cards AcquirerSantander Cards Acquirer
19Santander as Issuer and AcquirerSets rules for issuers and
Issues credit and
acquirers
Captures and processesCard Brand
Issues credit and debit cards
Captures and processes transactions
Issuers Acquirers
Uses credit and debit cards
Merchant
debit cards
Clients
20Santander’s Experience in Other Countries
Sovereign
Puerto RicoUK
Mexico
Colombia
Totta
S i
SantanderArgentina
SpainPortugal
Santander + Acquiring Partners
21New Model: Santander (Acquiring + Financial Services)
rs
Innovative value offerProducts and Services + Acquiring +
Acq
uire
r
Other POS Capturing Services
ACQUIRERSERVICES
FINANCIALSERVICESSERVICES SERVICES
Banks
FINANCIAL SERVICES + ACQUIRING - packaged in a suitable value offer to corporate clients
22Partnership Santander & GetNet
Creation of a Partnership leveraged by GetNet’s p g ytechnological expertise and POS network
Brand
MASTERCARDLicense
Investment in Capturing Network and
License
Integrated value offer – Acquiring and Banking
Business
gProcessing Platform
Other POS Capturing Ser ices
Partnership
Business
Commercial Model –Distribution/Pricing
Communication and
Services
165 POS (Capturing Terminals - 2009)Communication and
Media
Terminals 2009)“Time To Market”
23GetNet Tecnologia
Entrance in the Acquirer industry through a technologicalpartner - GetNet Tecnologia
Technological Platform for capturing, authorizing and the processing of
GETNET TECNOLOGIACampo Bom – RS
CORREA DA SILVA GROUP
transactions
165 thousand POS
Services at Capturing Terminals:
Domestic Capital
N&SP – Network and Service Provider
Customized solutions for capturing, authorization and processing of transactions and information Services at Capturing Terminals:
- Mobile Recharge- “Vale Transporte” (transportation ticket)Recharge - “PAT Alimentação e Refeição” (meal ticket)
transactions and information
Main Clients: Goodcard, Banco BNG, Serasa, Microsoft, Base Card, Wal-Mart, Brasil Telecom, Claro, Tim, Vivo, Telefonica, Oi, Embratel, CTBC, Amazonia Celular, Banco Matone, etc.
PAT Alimentação e Refeição (meal ticket)- “Cartão Convênio” / Private Label / CobrandOver 800 employees
Annual turnover of R$ 2,29 Bn (2009)
24Santander Conta Integrada: Innovative value proposeSantander (Acquiring + Financial Services) & Getnet = Capillarity Synergy and corporate client base + technological knowledge
SECUNDARY BENEFITS:A “Win-win” Relationship: the bank recognizes the
financial volume of the client in transactions made with
Synergy and corporate client base + technological knowledge
Competitive rates for prepayment of receivables
Prepayment of receivables through
financial volume of the client in transactions made with MASTERCARD brand credit card:
Reduction of up to 100% of checking account fee for financial transaction volume over R$ 3 Prepayment of receivables through
POS (pioneer in the market)
Call center support to merchants24hours / 7 days
thousand/month in each POS
5 days without interest rate charge by using overdraft
24hours / 7 days
Mobile Recharge
Guarateed Account or Working Capital limits based on financial transaction volume multiples
negotiated in the POS
SERASA / RECHEQUE* consultancy
Regional cards capture
Corporate current account with integrated bank domicile
POS connection using both dial-up and/or broadband.
* Credit Bureau
25Santander Conta Integrada: products offering engine for companies
Besides seizing the value of a high profitability business, it also provides:
Higher transaction financial volume from corporate clients.p
Loan portfolio growth mitigating the risks.
Increase of corporate client base and improvement of the competitive market position.
Improvement on the relationship with corporate customers and, consequently, increase
of number of products and services per clientof number of products and services per client.
Be the first bank of our corporate client.
GOALS FOR 2012150,000 new current accounts originated via the acquiring business
300,000 new affiliated merchants
A share of 10% in the financial transaction volume of the card market
26Conclusion
S t d i th i i l hi thi i i d l iSantander is the pioneer in launching this acquiring model in Brazil
fThe partnership provides the bank access to a network of more than 160,000 merchants and to GetNet’s know how
The credit card industry is expected to grow around ~20% p.y. and double its size in 4 years
This strategy focuses on strengthening the relationship with SME clients – main competitors are banks
Santander Conta Integrada – “Win-Win” relationship between the bank and small and middle market companies (SMEs)
Investor RelationsJuscelino Kubitschek Avenue 2,235 10th floor
São Paulo | SP | Brazil | 04543-011T l ( 11) 3 3 3300Tel. (55 11) 3553-3300
e-mail: [email protected]
Santander Brasil
Real Estate Finance&Real Estate Finance&Mortgage in Brazil
May 26th,2010
2
This presentation was prepared by Banco Santander (Brasil) S.A. It is provided forp p p y ( ) pinformational purposes only and does not constitute an offer to sell or a solicitationto buy any security. It may contain forecasts about future events. Thesepredictions/estimates evidently involve risks and uncertainties, whether foreseen ornot by the Company. Therefore, the future results of the Company may differ fromy p y , p y ycurrent expectations. Past performance and/or these predictions are not guaranteeof future performance. The Company is not obliged to update the presentation/suchforecasts in light of new events or circumstances.© 2010 by Banco Santander (Brasil) S.A.. All Rights Reserved.y ( ) g
3
Main Topics
I. Macro Conditions
II. Market PotentialII. Market Potential
III. Loans Evolution
IV. Builders: Offer and Demand
V. Funding
VI. Final Remarks
4Supportive Macro Backdrop
Interest rates are at historical low levels.
Resilient job market, supportive for the housing sector.
In our view, these are tailwinds for the Brazilian real estate sector.
Brazilian Interest Rate (2003 2011E) Brazil’s Job Market (2005-2011E)Brazilian Interest Rate (2003- 2011E) Brazil s Job Market (2005-2011E)
9
10
11
8
10
12
Rat
e (%
)
Payr
oll (
%)
20
25
30
Nominal Selic Real Selic
2
7
7
8
9
2
4
6
Une
mpl
oym
ent
Rea
l Gro
wth
in P
12
5
10
15
7
Source: BACEN and Santander.Source: BACEN and Santander.
6 -2005 2006 2007 2008 2009E 2010E 2011E
Real Growth in Payroll Unemployment Rate
0
J-03
M-0
3S-
03J-
04M
-04
S-04
J-05
M-0
5S-
05J-
06M
-06
S-06
J-07
M-0
7S-
07J-
08M
-08
S-08
J-09
M-0
9S-
09J-
10M
-10
S-10
J-11
M-1
1S-
11
5Favorable Macro Conditions
Monthly Houses Housing
High Housing Deficit Brazil´s main Real Estate drivers
Reduction of interest rates
.
18%
12%A/B
C
> 10 minimum wages
5 – 10 minimum wages
WagesHouses g
Deficit Regulatory Framework0.1 million
0.3 million
Loans tenor extension
28%
42%
D
E
3 - 5 minimum wages
< 3 minimum wages
0.7 million
4.5 million
Source: IBGE 2006, CBCI e GV Consult.
Favorable Demographic Pyramid
Construction and consumer credit availability (Earmarked resources)
54 million 5.7 million
Income growth50
60
70
80
Housing Deficit (5.7 million)
0
10
20
30
40
Government support ( “Minha Casa, Minha Vida” )
Source: IBGE and Santander. 0
6Brazilian Mortgage Market PotentialMortgage as % of GDP (2008)
99%
81% 80%
63% 62%
Source: Associação Hipotecária Espanhola, ABECIP e BACEN (2008 )
16% 15% 11%3%
Holanda Reino Unido Irlanda Portugal Espanha Polônia Chile México Brasil
* Brazil includes FGTS e SBPE
*
ç p p , ( )
GlobalBrazilCredit Distribution: Santander Brazil vs. Santander Global
6 4%6.4%Mortgages
68%
32%Others
93.6%Others
68%Mortgages
Source: Financial Statements 2009 - Santander Brazil Source : Annual Report 2009 – Santander Group (Distribution of credit risk)
7Mortgage Loans Evolution
O th t th B ili id ti l t k t
R$ Billion
68
Over the past years the Brazilian residential mortgage market has shown strong growth.
51
68
34
50CAGR: +47%
Private and Public Banks
25
40
17 1859
18
30
1016
25
Mainly public banks operates FGTS
5 7 7 10175
2005 2006 2007 2008 2009 2010E
(1)FGTS SBPE
Source: ABECIP – Brazilian Association of Real State Loan and Savings
SBPE: Brazilian System of Savings and LoansFGTS: Guarantee Fund for length of Service
(1)(1)
8Mortgage Market Overview 2010Mortgage Origination – 1Q10 Outstanding balance Jan/2010
45
36%75%
Number of units(thousands units)
Amount (R$ billion)
Santander Group leads the market among private banks
6.2 Total market: R$ 103.2 billion
33
453.5
Other Banks
6.9%5.4%
Banco A
Banco C
Mar/10
Construction Loan Origination – 1Q10
1Q09 1Q09 1Q10
Number of units Amount8.9%
8.5%1Q10
Banco ABanco B
Number of units(thousands units)
Amount (R$ billion) 70.3 %
32
67%3.8
2 0
79%
FGTS outstanding is about R$ 40 bn
Santander market share without FGTS is 15%
Mar/10Mar/09 Mar/09 Mar/10
19
2.0
1Q09 1Q10 1Q09 1Q10
Source: ABECIP, BACEN and Santander
Mar/10Mar/09 Mar/09 Mar/101Q09 1Q10 1Q09 1Q10
9Sales vs. Inventories
Housing market seems pretty healthy in terms of inventory (less than 6 months of sales and below 2007 levels in absolute terms).
Market rebound coupled with conservative launching have boosted sales speed (VSO).
( ff )
Inventories in SP below Sep/08 Level
Rebound was lead by smaller segment (more affordable).
16 25.000
10
12
14
15.000
20.000
le (3
-MM
A)
of U
nits
4
6
8
5 000
10.000
Mon
ths
of S
al
Stoc
k o
-
2
-
5.000
A-06
M-0
6J-
06J-
06A-
06S-
06O
-06
N-0
6D
-06
J-07
F-07
M-0
7A-
07M
-07
J-07
J-07
A-07
S-07
O-0
7N
-07
D-0
7J-
08F-
08M
-08
A-08
M-0
8J-
08J-
08A-
08S-
08O
-08
N-0
8D
-08
J-09
F-09
M-0
9A-
09M
-09
J-09
J-09
A-09
S-09
O-0
9N
-09
D-0
9J-
10F-
10
Source: Secovi and elaborated by Santander
Inventory (LHS) Sales (LHS) Months of Sale (RHS)
10Government’s Housing Package: “Minha Casa,Minha Vida”
Government program created to reduce the housing deficit and support the sector.p g g pp
Construction of 1.0 million homes for families with monthly income of up to 10 minimum wages.
Package totaling R$34 0 billionPackage totaling R$34.0 billion.
In 2010 Minha Casa, Minha Vida (MCMV) is running at a rate of 600,000 units per year.
723 5800
595.7
723.5
408.7500
600
700
nd
170.0
352.0
104.6
231.7
408.7
100
200
300
400
thou
san
5.6 0
100
2Q09 3Q09 4Q09 1Q10Contracts Submitted (accum.) Contracts Signed (accum.) Annualized Rate
Source: CEF and elaborated by Santander
11
10 000
Sales Regaining “pre-Lehman” levelsSales from Listed Co’s (R$MM) Close to Sep/08
1,750 1,616
2,602
2,110 3,088 3,332 3,131
6,392 5,916
8,286
6,186
4 142 3 912
6,620 7,577 7,563
5.000
6.000
7.000
8.000
9.000
10.000
Sales in the mid-high income
R$ MM
4,642 4,300 5,684
4,076 2,842 2,221
3,532 4,245 4,432
1,300 1,691
4,142 3,912
-
1.000
2.000
3.000
4.000
4Q07 1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09
Sales in the mid high income segment are still some 20-30% bellow pre-crisis levels.
Affordable segment is offsetting th d li4Q07 1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09
Mid-High Total Brokerage Co's
Source: Listed Constructions and Properties Agency’s Reports ‐ Elaborated by Santander
the decline.
Listed companies are selling at an annualized rate of 200,000 units/year.Sales Speed VSO from Listed Co’s coming back to 30%’s units/year.
Sales speed (VSO) is coming back to 30%’s.
Sales Speed VSO from Listed Co s coming back to 30% s
28%26%
30%
23%
15% 15%
24%27%
30%
15% 15%
4Q07 1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09Source: Listed Constructions and Properties Agency’s Reports ‐ Elaborated by Santander
12
S
Brazilian Saving Accounts and Mortgage system
52%
SourcesUses
Individual mortgages
100%
Saving
65%
Individual mortgages
and construction
g gProperties up to
R$ 500,000
Construction loans Average loan per unit up to
R$ 500,000
Saving Accounts(R$ billion)
Saving AccountsDeposits
Cost of TR+ 6.17% aa
construction loans
13%Properties over R$ 500,000
R$ 500,00019 % 256.6
30%Compulsory
Deposits215.8Monthly average
or last 12 months
average (the lower
jan‐09 jan‐10
5%Free Usage
(amount)
Source: BACEN
13Funding Analysis (SBPE) (1)
Scenario Jan’10Mortgage
outstanding 2013R$ Billion
R$ 169 bn
Scenario Jan 10 outstanding 2013
Sources UsesWith 40% of annual growth in mortgage and 10% in saving
R$ 169 bn
230 Remaining (3)
and 10% in saving accounts, the funding will finish in 4 years.
LCIs, LHs (2)
86
20
Earmarked resources
Committed Loans
Mortgage outstanding
63
20 149
Scenario Mortgage Outstanding
Savings Oustandings
Mortgage Outstanding (R$ Bi)
Month / Year
1 60% 20% 262 Jan-13
2 40% 10% 230 Nov-133 40% 17% 331 Dec-144 20% 0% 167 May-15y
(1) SBPE (Brazilian System of Savings and Loans) Not included FGTS.(2) Real estate credit bills (LCI’s) and Mortgages Notes (LH).(3) FCVS (Compensation Fund Wage Variation) , default and multipliers.
14Securitization in Brazil: CRI market
T l I R$ 13 8 b
CRI Issuance (R$ billions)
Total Issuance : R$ 13.8 bn
CRI1 Issuance (R$ billion) Share (%)
CIBRASEC32%
WALTER TORRE
ALTERE5%
OTHERS9%5
6
(R$ billions)
BRC
WALTER TORRE5%
2
3
4
BRAZILIAN SECURITIES
26%
RIO BRAVO17%
6%
0
1
2
1 2 2 2 2 2 2 2 2 2 226%
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
Source: CIBRASEC – Brazilian Securitization Company
1. CRI: Mortgage Backed Securities
15Pension Funds Investment Profile in Brazil
55% f h i f d’ i i fi d i d55% of the pension fund’s investments are in fixed income products.
Biggest Pension FundsInvestment distribution
Mortgage0,5% Others
# Pension FundsInvestment (Billion R$)
1 Previ 137.75
2 Petros 40.55
3 F f 32 98
Total: R$ 447 bn
Mortgage0.5%
InvestmentFunds
Stocks20%
,9% 3 Funcef 32.98
4 Fundação Cesp 15.21
5 Valia 10.37
6 ItauBanco 9.49
7 Sistel 9 46(Fixed Income)40%
Investment
7 Sistel 9.46
8 Centrus 9.09
9 Banesprev 8.67
10 Forluz 6.92
Public Bonds15%
Investment Funds
(Equities)16% 2% of fixed income investment shifted to
CRIs would represent around R$ 5.0 bn.
Source: CIBRASEC – Brazilian Securitization Company
16Final Remarks
Mortgage growth will reduce the funding availability to the Real Estate financing.
Other funding alternatives will be required(Debentures,Notes,IPO’s)
Construction cycle shortening will be important to reduce companies’ short term funding liabilities, and to deliver affordable segment houses(lack of savings)
Mortgage will be available earlier in the process to speed up the cashMortgage will be available earlier in the process, to speed up the cash management ,new product development (PIP)
Inflation Hedge will be provided to avoid industry mismatch.
Investor RelationsJuscelino Kubitschek Avenue 2,235 10th floor
São Paulo | SP | Brazil | 04543-011Tel. (55 11) 3553-3300
e-mail: [email protected]
Santander Brazil
Aymoré FinanciamentosAymoré Financiamentos
May 26th, 2010
2
This presentation was prepared by Banco Santander (Brasil) S.A. It is provided forThis presentation was prepared by Banco Santander (Brasil) S.A. It is provided forinformational purposes only and does not constitute an offer to sell or a solicitationto buy any security. It may contain forecasts about future events. Thesepredictions/estimates evidently involve risks and uncertainties, whether foreseen ornot by the Company. Therefore, the future results of the Company may differ fromnot by the Company. Therefore, the future results of the Company may differ fromcurrent expectations. Past performance and/or these predictions are not guaranteeof future performance. The Company is not obliged to update the presentation/suchforecasts in light of new events or circumstances.© 2010 by Banco Santander (Brasil) S.A.. All Rights Reserved.© 2010 by Banco Santander (Brasil) S.A.. All Rights Reserved.
Aymoré Financiamentos
47 years M t l
3
47 yearsin the financing market
New and Used Vehicles
Motorcycle
2.3 millionactive clients
Used New
Partnership
8,000active dealers
~
152sales offices
active dealersLargeConsumer Credit
Trucks, buses and machinery
sales offices
1,500~Furniture
TourismNautical
sales officers
4Portfolio Distribution: focused on auto loans: ~84% of the business
Active Portfolio: R$ 25.5 Bn Contracts: # 2,280,191
0.7%
8.6%
0 4%
80.5%
18.3%
0.4%
83.8%
7.2%
0.4%
OthersConsumer Credit LargeVehicles & Motorcycles
Vehicles (Cars, Motorcycles and 40% Renault); Large Vehicles (Finame included); Others: Clubcard
Note: Data as of March, 2010 (IFRS numbers)
Market Share - Consumer portfolio 5
Vehicles – Individual
A
Santander14.6%
Others12.8%
16.1%14.7% 14.6%
A33.2%
B
C*19.8%
Other Assets Financing – Individual
19.6%
* Data from “C” are designed according to the portfolio published by the bank.
2008 2009 1Q10
12.0%
15.1% 15.3%
Source: Central Bank of Brazil (Bacen) and public information from other banks.Concept : Vehicle refers to Bacen line procurement of goods : Vehicles (Consumer Credit + Leasing).Other Assets Financing refers to Bacen line procurement of goods; Others.
2008 2009 1Q10
C i lC i l
Aymoré’s Strategy is based on 4 pillars
Ri kRi k P d t &P d t &
6
Commercial Strategy
Commercial Strategy
Risk Management
Risk Management
Products & OperationsProducts & Operations
InstitutionalInstitutional
Committees to manage the business: Risk, Pricing, Expenses, Operations Human
Products portfolio and operational processes review
Processes and
Automatic credit analysis response level increase
New products
New sales force distribution
New remuneration program Operations, Human
Resources, Audit, Fraud
Itinerant
Processes and tools available to customers review
New products/services
New products, collection processes and sustainable criteria on analysis
program
Investments in sales force training
Implementation of Committees
Council Staff
products/services
Operational procedures under sales force responsibility review
Focus on formalization and better controls to Risk Management
pa segmentation strategy to dealers
Commercial Platform responsibility review
Formalization and collected vehicles management
WebMotors 7
www.webmotors.com.brwww.webmotors.com.brWebsite Leader at Brazilian Internet Automotive Sector
Opportunities:
Keeping leadership and relevant position on the automobileKeeping leadership and relevant position on the automobile market:
– Attracting audienceAttracting audience
– Offering the most qualified advertisement stock
Sell finance products through the websiteSell finance products through the website
Offering integrated financial solution to dealers
Investor RelationsJuscelino Kubitschek Avenue 2,235 10th floor
São Paulo | SP | Brazil | 04543-011T l ( 11) 3 3 3300Tel. (55 11) 3553-3300
e-mail: [email protected]