Investor Relations 1 BANCO DO BRASIL 3Q05 Results

Investor RelationsInvestor Relations 1Investor RelationsInvestor Relations

BANCO DO BRASILBANCO DO BRASIL

3Q05 Results3Q05 Results

Investor RelationsInvestor Relations 2

3Q04 2Q05 3Q05 %3Q04 %2Q05 9M04 9M05 %9M04

Net Income 833 1,014 1,438 72.7 41.9 2,253 3,417 51.6

EPS - R$ 1.14 1.27 1.80 58.2 41.9 3.08 4.27 27.8

Net Interest Income 3,919 4,146 4,199 7.2 1.3 11,674 12,436 6.5

Services Revenues 1,717 1,929 1,952 13.7 1.2 4,912 5,648 15.0

Other Income ¹ 536 723 845 57.6 16.9 1,529 2,308 51.0

Total Revenues 6,172 6,798 6,997 13.4 2.9 18,114 20,392 12.6

Provisions Expenses for NPL (856) (1,002) (966) 12.9 -3.7 (2,660) (3,029) 13.9

Personnel Expenses (1,603) (1,687) (1,709) 6.6 1.3 (4,609) (5,034) 9.2

Other Administrative Expenses (1,265) (1,314) (1,362) 7.7 3.6 (3,605) (3,991) 10.7

Other Expenses ² (1,193) (1,055) (1,369) 14.7 29.7 (3,754) (3,726) -0.7

Total Expenses (4,917) (5,059) (5,405) 9.9 6.8 (14,628) (15,781) 7.9

Non-operating Income 80 21 64 -21.0 205.2 135 182 34.7

Taxes and Profit Sharing (612) (746) (782) 27.8 4.9 (1,211) (2,089) 72.6

Recurring Income 724 1,014 873 20.7 -13.9 2,411 2,704 8.6

Non-recurring Items 109 - 565 - - (157) 713 -

HighlightsHighlights

(1) Equity Income + Other Operating Income(2) Taxes on Revenues + Other Tax Expenses + Other Operating Expenses + Legal Risk

R$ million


Sep/04 Jun/05 Sep/05 %Sep/04 %Jun/05Total Assets 235,599 233,793 245,511 4.2 5.0Loan Portfolio 84,148 96,129 94,685 12.5 -1.5Allowance for Loan Losses 5,374 5,893 5,955 10.8 1.1Securities Portfolio 71,120 68,973 68,610 -3.5 -0.5Deposits 115,079 117,952 122,672 6.6 4.0Asset under Management 122,471 144,802 150,378 22.8 3.9Shareholders' Equity 13,771 15,393 16,826 22.2 9.3

HighlightsHighlights

R$ million

(1) Past Due Loans + 60 days(2) Annualized

3Q04 2Q05 3Q05 9M04 9M05Spread - % 8.8 9.0 9.0 8.6 8.8Deliquency ¹ - % 3.2 3.1 3.9 3.2 3.9Efficiency 56.8 49.6 54.8 56.7 53.5ROE ² - % 27.5 29.6 40.8 24.5 31.4ROE Recurrent ² - % 23.6 29.6 23.5 25.5 24.0ROA ² - % 1.4 1.7 2.4 1.3 1.9BIS Ratio - % 15.7 15.9 17.4 15.7 17.4


Net Income Changes - R$ million

Result ChangesResult Changes

NetIncome2Q05

NetIncome3Q05

Non-Recurring Effects

Others

NII + Service Revenues

Profit Sharing

Allowance for Loan Losses

Taxes

Administrative Expenses

Legal Risk

1,014

565

113 76 60 37

(67) (70)

1,438

(290)


Spread by Credit Portfolio - %

Net Interest IncomeNet Interest Income

Agribusiness Commercial Retail

3Q04 4Q04 1Q05 2Q05 3Q05

(1) Net Interest Margin - Related to Earning Assets

3Q04 4Q04 1Q05 2Q05 3Q05

Net Interest Income - R$ million

NIM¹ Annualized - %

5.8 7.0 5.8 6.0 6.1

8.7 8.3 8.0 7.9 7.6

40.4 38.135.9 35.5

33.4

3,919 4,086 4,090 4,146 4,199

8.8 8.7 8.49.0 9.0


Volume¹ and Spread AnalysisVolume¹ and Spread Analysis

190

86 4

3,919

3Q05 - 2.1841

3Q04 - 2.1370

3Q05 - 192,275

3Q04 - 183,393

Volume - R$ million

Spread - %

Gain due to Volume

Gain due to Spread

Gain due to Volume and Spread

(1) Earning Assets


3Q04 2Q05 3Q05 %3Q04 %2Q05

Loan Portfolio 84,148 96,129 94,685 12.5 -1.5

Domestic 74,132 86,967 86,146 16.2 -0.9

Individuals 16,092 17,863 18,510 15.0 3.6

Payroll Loans 1,198 2,558 3,286 174.3 28.5

SMEs 12,643 14,405 15,006 18.7 4.2

Businesses 19,731 22,528 21,383 8.4 -5.1

Agribusiness 25,666 32,171 31,247 21.7 -2.9

Abroad 10,016 9,162 8,539 -14.7 -6.8

R$ million

3Q04 - % 2Q05 - % 3Q05 - %

Loan PortfolioLoan Portfolio

Individuals SMEs Businesses Agribusiness Abroad

19.1

15.0

23.4

30.5

11.9 19.5

15.8

22.6

33.0

9.018.6

15.0

23.4

33.5

9.5


Delinquency and Provision for Credit RiskDelinquency and Provision for Credit Risk

(1) Average Portfolio - 12 months and Annualized Expenses

3Q04 4Q04 1Q05 2Q05 3Q05

Allowance for loan losses / Loan Portfolio - %Past Due Loans + 15 days / Loan Portfolio - %Past Due Loans + 60 days / Loan Portfolio - %

Quarterly Provision Expenses - R$ million

Provision Expenses / Loan Portfolio¹ - %

3Q04 4Q04 1Q05 2Q05 3Q056.4

6.1 6.1 6.1 6.3

5.4 4.75.1

4.65.9

3.2 3.3 3.1 3.1

3.9

856 868

1,0611,002 966

4.4 4.3 4.3 4.2 4.2


BB

87.2 87.5

12.512.8

Retail

94.8 95.0

5.05.2

Commercial

94.0 88.7

11.36.0

Agribusiness

97.9 99.4

2.1 0.6

ForeignTrade

98.0 98.1

2.0 1.9

Abroad

91.5 89.5 89.8 89.6

10.2 10.410.58.5

AA-C D-HAA-C D-H

2Q05 3Q05

Credit Risk - %Credit Risk - %

BankingIndustry¹

(1) Source: Brazilian Central Bank


3Q04 2Q05 3Q05 %3Q04 %2Q05 9M04 9M05 %9M04Service Revenues 1,717 1,929 1,952 13.7 1.2 4,912 5,648 15.0

Customer Relationship Fees 514 639 637 23.9 -0.4 1,505 1,866 23.9Investment Fund Manag. Fees 270 304 321 18.8 5.6 746 909 21.8Credit Cards 137 166 186 35.7 12.3 407 514 26.4Collection 158 183 185 17.3 1.4 465 536 15.5Credit Operations 161 176 164 1.3 -7.0 469 489 4.1Funds Transfers 112 123 137 22.4 11.5 321 377 17.5Others 364 339 322 -11.6 -4.9 999 957 -4.2

R$ million

Account Holders - million Asset Under Management - R$ billion

Service RevenuesService Revenues

(1) 12 month average

3Q04 4Q04 1Q05 2Q05 3Q05 3Q04 4Q04 1Q05 2Q05 3Q05

(Fees + NII) per account holder¹ - R$ Market Share - %

20.6 21.1 21.2 21.9 22.3

286 286 282 295 284

122.5 124.0138.2 144.8 150.4

20.0 19.7 20.8 21.3 20.9


3Q04 2Q05 3Q05 %3Q04 %2Q05 9M04 9M05 %9M04

Administrative Expenses (2,908) (3,035) (3,106) 6.8 2.3 (8,326) (9,133) 9.7

Personnel Expenses (1,603) (1,687) (1,709) 6.6 1.3 (4,609) (5,034) 9.2

Other Administrative Expenses (1,265) (1,314) (1,362) 7.7 3.6 (3,605) (3,991) 10.7

Telecom. and Data Processing (315) (337) (375) 19.0 11.3 (933) (1,052) 12.8

Amortization and Depreciation (131) (146) (157) 19.5 7.0 (384) (477) 24.1

Security, Guard and Transp. Serv. (173) (178) (177) 2.4 -0.7 (514) (543) 5.5

Exp. with Premises and Equipment (145) (173) (172) 18.9 -0.4 (450) (521) 15.8

Marketing and Public Relations (132) (121) (114) -13.3 -5.1 (291) (319) 9.6

Exp. with Outsourced Services (127) (138) (129) 1.2 -6.8 (351) (404) 15.0

Other Administrative Expenses (241) (221) (238) -1.4 7.5 (681) (676) -0.8

Other Tax Expenses (41) (34) (36) -12.2 5.4 (112) (108) -3.7

Legal Risk (221) 22 (268) 21.3 - (630) (503) -20.2

Legal Claims (79) (52) (40) -50.1 -23.6 (246) (183) -25.4

Labor Claims (141) 74 (228) 61.4 - (384) (320) -16.8

R$ million

Administrative ExpensesAdministrative Expenses


2Q05 3Q05 ChangeAdmin. Exp. and Legal Risk (3,013) (3,373) 5.9Operational Revenues 6,070 6,155 -0.7Combined Ratio -0.1Efficiency Ratio 49.6% 54.8% 5.2

Coverage Ratio¹ - % YTD

R$ million

(1) Service Revenues / Personnel Expenses(2) Administrative Expenses / Operating Income

Productivity RatiosProductivity Ratios

Efficiency Ratio ChangeEfficiency Ratio² - % YTD

98.4 96.8 97.9108.2 105.5

3Q04 4Q04 1Q05 2Q05 3Q05

56.7 58.2 56.1 52.8 53.5

3Q04 4Q04 1Q05 2Q05 3Q05


Income Tax and Social ContributionIncome Tax and Social Contribution

Tax Rate - %Pretax Income - R$ million Taxes - R$ million

1,445

1,083

1,6011,760

2,533

545

187

559 570

979

3Q04 4Q04 1Q05 2Q05 3Q05

37.7

17.3

34.932.4

38.6


Positive Outlooks

• 1.3% growth in the net interest income;

• 28.5% increase in the payroll loans - 15.5% market share (13.6% - 2Q05);

• 9% NIM at the level of second quarter 2005.

Negative Outlooks

• 1.5% reduction in the loan portfolio, against 4.3% growth in the banking industry;

• Foreseen rise in the credit risk, especially in the agribusiness portfolio (risk D - H from 6.0% to 11.3%);

• Bigger Legal Risk Expenses due to the absence of the reversal accounted in the 2Q05;

• Taxes expenses higher 16.9% due to the foreign exchange variation and the lack of tax benefits from interest on own capital accounted in the 2Q05.

Summing the 3Q05 Results upSumming the 3Q05 Results up

Numbers compared to the 2Q05

R$ 1.4 billion Net Income above market consensus, as a result of non-recurring R$ 565 million revenue of undue taxes recovery.


Investor Relations DivisionSBS - Quadra 1 - Bloco C - Ed. Sede III - 17° floor

70073-901 - Brasília (DF)Phone: 55 (61) 3310.5920

Fax: 55 (61) 3310.3735

[email protected]

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.

For further information access www.bb.com.br/ri

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Investor Relations 1 BANCO DO BRASIL 3Q05 Results