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Statements of Income - 1999. 1st. 2nd. 3rd. 4th. Year. R$ Million. Net Interest Margin. 1,213. 1,202. 1,094. 1,120. 4,629. Provision for Loan Losses. (299). (235). (146). (134). (814). Banking Service Fees. 697. 740. 744. 978. 3,159. Administrative Expenses. (1,050). - PowerPoint PPT Presentation
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Net Interest Margin
Provision forLoan Losses
Banking ServiceFees
AdministrativeExpenses
Extraordinary Result
Others
Statements of Income - 1999R$ Million
Net Income
1,213
(299)
697
(1,050)
535
(335)
761
1,202
(235)
740
(1,172)
-
(202)
333
1,094
(146)
744
(1,161)
(77)
(94)
360
1,120
(134)
978
(1,228)
(107)
(214)
415
4,629
(814)
3,159
(4,611)
351
(845)
1,869
1st 2nd 3rd 4th Year
Extraordinary Result - 1999
Full amortization of premiums
on the purchase of
shares of BPI and IBT.
Due to permanent assets abroad (US$ 1,483 million).
R$ 154 million
R$ 535 million
Total for 1999: R$ 351 million
Investment in acquisitions since 95: US$ 2 billion
Full amortization of premiums (Itaú Consolidated): US$ 811 million
Consistent Evolution
3,8424,198
4,651
5,907
592 721 880
1,869
1996 1997 1998 1999
Stockholders' EquityNet Income
R$ Million
Risk Management Policy
Credit
•Risk Quality : 65% Good, Very Good and Excellent
•Default Ratio : Lowest in 5 Years
•For the 10th consecutive year : 100% provisioning of the credits fallen due and unpaid over 60 days.
Quality of credit concession + Stable Scenario
Expansion of the Credit Portfolio with Liquidity
Market
•Evolution in the Techniques for the control of market risks (interest rates, foreign currency, shares)
Significant Results
Low Level of Risk
Compliance
• Implementation of a new and detailed systematic of internal controls and compliance
To Limit and Reduce the Operational Risks in the Whole Structure
Credit Operations
912 14
17 1620
94 95 96 97 98 99
3.2%
15.2%
5.7% 4.5% 3.2% 2.0%
94 95 96 97 98 99
0.4 0.5 0.51.0 1.0
0.6 0.6 0.6
0.10.2
0.30.3
94 95 96 97 98 99
0.2
1.2 1.00.7
1.00.8
94 95 96 97 98 99
Credit OperationsR$ Billion
Ratio Default (%)
Provisions Outstanding(*) R$ Billion Provisions ExpensesR$ Billion
0.31.0 1.1 1.1
1.3 1.3
+25%
-20%
(*) Overdue Credits and General Provision
Individuals6.5 million active customers
3.7 million with pre-approved credit, and 65.5% of these indeed using it.
The pulverization of credit, combined with the approval models, has insured a good liquidity to the portfolios.
Credit Cards 2.2
Insurance Contracts 1.1
Private Pension Plans 0.3
Million•Outstanding Personal / Overdraft / Vehicles Loans: R$ 2.5 billion 110.2% increase over 1998;
•70% of the transactions performed by our customers are through self-service.
Small and Middle Market Business
Itaú has retaken with priority the growth of the credit offer for this segment:
Growth of 48% in the 2nd semester of 1999
200 thousand client companies
Outstanding working capital loan portfolio:
R$ 1.1 billion in Dec.99
In 2000 the continued growth of the portfolio is expected, although probably at a lower pace.
CorporateIncorporation of the operational
structures of BFB and IBT
Reinforcement in products and team management area
Agility of the the new business board
Structuring of Solutions
Foreign currency
Project finance
Investment banking
Business and Operations Expansion
Record Result
Positive Perspectives due to:•Privatization•Economic Growth
Internet (Home Banking)Huge Opportunity: Increase of Clients, Offer other Services and Reduce Costs
1 million of clients in 99 (+34% over 98)
10.9 million transactions in Dec. 99 (+39% over 98)
Evaluation of partnerships to offer
other financial services:B2B, B2C, Portals, E-Commerce, etc.
Adoption of Web interface between branches and
back office.
Strong Development to
offer all the services:
Home Broker, Credit Cards, Bankline for
Middle Market, etc.
ersonal
inancial
ervices
P F SP F S
The Consolidation of the Brazilian Financial Sector Hasn’t Finished Yet
1. The consolidation should become faster.
2. Besides Banespa and Banestado, 10 more banks should be privatized.
4. After Banco do Brasil and Caixa Econômica Federal, approximately 90% of the whole banking sector should be concentrated with a few institutions.
5. There will be many opportunities to acquire state and small banks.
3. Banco do Brasil and Caixa Econômica Federal, together, represent 35% of assets, 45% of deposits and 50% of Loans of the whole Financial System.
472 - Itaú
186-Bovespa
0
100
200
300
400
500
94 95 96 97 98 99
Mexican Crisis Asian CrisisRussian Crisis
Real Devaluation
Preferred Shares - AppreciationEvolution of US$ 100 Invested in December of 1994
Annual AppreciationAnnual Appreciation. 10 years (average) 40.83%. 10 years (average) 40.83%. 5 years (average) 31.18%. 5 years (average) 31.18%. 1999 88.66% . 1999 88.66%
Annual AppreciationAnnual Appreciation. 10 years (average) 40.83%. 10 years (average) 40.83%. 5 years (average) 31.18%. 5 years (average) 31.18%. 1999 88.66% . 1999 88.66%
Stock Price 12.31.1999Stock Price 12.31.1999. P/E. P/E 9.43 9.43. P/BV. P/BV 315.04% 315.04%. Cash Yield. Cash Yield 1.94% 1.94%
Stock Price 12.31.1999Stock Price 12.31.1999. P/E. P/E 9.43 9.43. P/BV. P/BV 315.04% 315.04%. Cash Yield. Cash Yield 1.94% 1.94%
US$
ITAU4 : US$ 86.6 ITAU4 : US$ 86.6 per thousand sharesper thousand shares
Create Value to the Shareholders
US$ 9,969 millionThe Largest Market
Capitalization among the Latin American Banks
Highlights 1999Consolidated Balance SheetTotal Assets
Loan and Leasing Portfolio + ACC
Sureties, Endorsements and Guarantees
51,911
16,890
2,706Securities + Interbank Accounts 18,070Stockholders’ Equity 5,907
Statements of IncomeNet Income Recurring
Net Income Extraordinary
Net Income
1,518
351
1,869Financial Margin 4,629Net Income from Financial Operations 3,814
Banking Service Fees 3,159Performance Ratios (%)ROE Recurring
ROE Extraordinary
ROE
25.7%
5.9%
31.6%ROA 3.6%BIS Ratio 21.0%
Eficiency Ratio 58.0%
Relevant Data
Assets under Management
Employees
Active Customers (million)
31,994
39,011
6.9Branches 1,765CSBs 780ATMs 11,715
Amounts in R$ Million