Institutional Presentation 3Q16

Transcription

1 Institutional Presentation 3Q16

2 Disclaimer This presentation may include references and statements, planned synergies, estimates, projections of results, and future strategy for Banco do Brasil, its Associated and Affiliated Companies, and Subsidiaries. Although these references and statements reflect the management s belief, they also involve estimates and unforeseen risks. Consequently, results may differ from those anticipated and discussed here. These expectations are highly dependent on market conditions, on Brazil s economic and banking system performances, as well as on international market conditions. Banco do Brasil is not responsible for updating any estimate in this presentation.

3 Agenda 1 Company Profile 2 Banking Industry 3 Earnings Highlights 4 Macroeconomic Information

4 1 Company Profile

5 5 Founded in %1 controlled by the Federal Government 1st company listed on the stock exchange in Brazil Largest Bank in Latin America in total assets Acess to a broad spectrum of clients (1) As of Sep/2016.

6 6 Large, diversified and stable funding base Business diversification including: Banking Services Insurance Capital Market Asset Management Means of Payment International Franchise

7 Investment Highlights 7 1. Market Leadership 2. Solid Financial Performance 3. Focus on Services 4. Lowest deliquency of the Brazilian Banking Industry 5. Stable and Diversified Funding 200(+) years of solid performance

8 8 Timeline / Governance 2014 The Board of Directors of BB approved the migration of its program of American Depositary Receipt-ADR from level I to level II % Tag Along clause 2010 Follow on (primary shares) st company listed on the stock exchange in Brazil 2005 BB Shares enter the IBRX-50 portfolio BB Shares enter the ISE portfolio BB Shares enter the IBrX portfolio BB Shares enter Dow Jones Sustainability Index (DJSI) of NY stock exchange 2006 Banco do Brasil joined Novo Mercado (BOVESPA) 2003 BB Shares enter the ITAG portfolio 1996 Capitalization and Restructuring Plan Follow on (secondary shares) Conversion of preferred shares to commom shares Private offering of subscription bonus 2009 ADR 1 Launching BB Seguridade IPO

9 Ownership Structure 9 Free Float 45.6% as of Sep/2016 Free Float Breakdown (%) Others 22.4% Shares owned by the company 2.8% National Treasury 54.4% Foreign Investors 20.4% Sep/15 Dec/15 Mar/16 Jun/16 Sep/16 Foreign Investors Other

10 Global Presence 10 Banco do Brasil in the world Branches Sub-branches Representative Offices Subsidiaries and affiliates Shared Services Units Presence in 24 countries with 41 points of service

11 Presence in Brazil Our more than 64 million clients count on more than 66 thousand points of service, present in 99.7% of the Brazilian municipalities and an increasingly digital Bank. 11 NORTH 27.0% NORTHEAST 30.5% Structural data (Sep/16) Market Share 23.1% (Number of branches) Points of services 1 17,092 Branches 5,430 Clients 64,607mil Employees 109,159 (1) Own Service Network MIDWEST 26.0% SOUTH 23.9% SOUTHEAST 19.7% Brazil Total Service Network Own Service Network Branches MaisBB Network¹ Shared Service Network 2 Sep/16 17,092 5,430 13,676 36,004 Total 66,772 (1) Banking Agents and Postal Bank branches. (2) Shared Service Network: lotteries (CEF), Banco 24h e ATM (BRB+CEF).

12 12 Innovation Ourocardo ELO NOW International Digital Experience Acceptance at Discover and Diners networks. The Banco do Brasil App is 5th main App in Brazilian s everyday life.¹ Available in more than 39 millions places in 185 countries. 1.7 million ATM s for withdrawals abroad BB Estilo Digital e BB Exclusivo 1. WhatsApp Profitability increase in about 20% to 44%. 2. Facebook 3. Google 4. Instagram 5. Banco do Brasil 35% of efficiency growth. Estilo customers satisfaction and loyalty (NPS)* is 16% higher. Clients Sep/16 Estilo Digital 1.1 milion Estilo 200 thousand Personalizado 2,948 thousand Estimated 2016 Estilo / Estilo Digital/ 5 million Personalizado / Exclusivo Exclusivo 152 thousand (1) Source: emarketer Sep/2016. *NPS Net Promoter Score 12

13 Innovation 13 Ourocard APP Cards Block/Unblock function Expenses in Timeline format Function New at the Market Allows questioning unrecognized purchases Tap and pay payment agility Authorization for abroad usage Automated Service Channels - Transactions Ourocard-e +250 thousand virtual cards, 108% growth compared to 2Q million transactions since launch in Aug/14 R$160 million total turnover in the last 12 months BB Digital Mobile (million transactions) Internet 26.9% Mobile 40.3% ATM¹ 16.7% Sep/16 In Branches 2.0% Others 3Q % +49.0% 1,870 3Q16 2,786 (1) Owned by BB. 13

14 Customer Segmentation 14 Companies Individuals Industry Services > R$ 1.5bn > R$ 2bn Large Corporate Private > R$ 2mm > R$ 400mm < R$ 1.5bn > R$ 120mm < R$ 400mm > R$ 600mm < R$ 2bn > R$ 200mm < R$ 600mm Corporate Empresarial Upper Middle Estilo / Estilo Digital > R$ 8k > R$ 25mm < R$ 120mm > R$ 25mm < R$ 200mm Empresarial Middle Personalizado / Exclusivo¹ > R$ 4k < R$ 8k > R$ 5mm < R$ 25mm Empresa > R$ 1mm < R$ 5mm Pequena Empresa Varejo > R$ 1.5k < R$ 4k < R$ 1mm Microempresa Mercado Emergente < R$ 1.5k (1) Digital service only.

15 Assets and Market Share * R$ Billion 1, , , , , , % Loans 35.4% Available Funds, Short-Term Interbank Investments, Interbank and Intrabank Accounts Sep/15 Dec/15 Mar/16 Jun/16 Sep/16 Assets Market Share¹ (%) Part. % Sep/16 8.7% 13.5% 2.2% Securities and Financial Derivatives Other Permanent Assets (1) Source: Central Bank of Brazil (*) Sep/2016

16 Loan Portfolio Broad Concept¹ 16 R$ Billion % % % % % on Sep/ % % % on Sep/ % 43.2% Sep/15 Dec/15 Mar/16 Jun/16 Sep/16 Corporates Individuals Agribusiness Offshore Market Share² - % (1) It includes private securities and guarantees provided. (2) It considers the classified loan portfolio.

17 Total Loan Portfolio - Risk Level¹ 17 R$ Million Sep/15 Jun/16 Sep/16 Balance Provision Share % Balance Provision Share % Balance Provision Share % AA 397, , , A 117, , , B 126,287 1, ,082 1, ,194 1, C 29, ,567 1, ,678 1, D 5, , , E 10,255 3, ,443 4, ,845 5, F 3,758 1, ,161 2, ,535 2, G 3,340 2, ,537 3, ,186 2, H 17,646 17, ,684 22, ,864 22, Total 710,612 28, ,067 36, ,225 37, AA-C 670,122 2, ,778 3, ,484 2, D-H 40,490 25, ,289 33, ,741 34, (1) BB Classified Loan Portfolio. 17

18 Loans to Individuals¹ 18 R$ Million Sep/15 Jun/16 Sep/16 Payroll 61,758 62,959 62,838 Mortgage 35,188 39,706 41, % 75.8% 76.0% Salary Loans 19,425 20,482 20,348 Auto Loans 8,842 7,333 6,799 Credit Cards 21,537 22,906 22,844 Consumer Finance 6,888 7,392 7,010 Overdraft 2,564 2,775 2,830 Renegociated 4,427 6,876 7,236 Microcredit Other 1, TOTAL 162, , ,617 (1) It considers the organic loan portfolio.

19 Growth in lower risk lines¹ 19 Mortgages Payroll² R$ Billion % Sep/15 Jun/16 Sep/16 Mortgages with Companies Mortgages with Individuals Mortgage NPL +90 days (%) % % 3.2% 3.1% 7.5% 8.3% 8.6% 88.9% 88.6% 88.5% Sep/15 Jun/16 Sep/16 Private Sector Employees INSS Retirees and Pensioners Civil Servants Payroll NPL +90 days (%)¹ Salary Loans Auto Loans % Total -18.3% Auto Loans Auto Loans NPL +90 days (%) Salary Loans NPL +90 days (%) Sep/15 Jun/16 Sep/16 Sep/15 Jun/16 Sep/16 (1) Classified Loan Portfolio (2) Organic Loan Portfolio

20 Relationship 20 Individuals Portfolio¹ Individuals Portfolio Profile² Time of Relationship 4.6% 3.9% 3.4% 7.9% 8.0% 8.1% 20.9% 19.9% 19.7% Direct Consumer Credit + Auto Loans 7.2% 7.7% 7.8% 13.6% 12.9% 12.5% 66.6% 68.2% 68.8% 79.2% 79.4% 79.6% Sep/15 Jun/16 Sep/16 More than 10 years From 5 to 10 years From 2 to 5 years Up to 2 years Sep/15 Jun/16 Sep/16 Civil Servants Private Sector Employees INSS Retirees and Pensioners (1) Classified Loan Portfolio (2) Organic Loan Portfolio

21 Loans to Companies Broad Concept¹ % R$ Billion Sep/15 Jun/16 Sep/16 Working Capital² Investments + Private Securities Guarantees Trade Finance³ Other Corporate Portfolio by Size % on Sep/ % on Sep/16 Sep/15 Jun/16 Sep/16 Middle Market, Corporate and Government⁴ Very Small and Small Companies (1) It includes private securities and guarantees provided. (2) It includes Working Capital, Receivables, Credit Card and Overdraft Account. (3) It Includes FEC/ACE and BNDES Exim. (4) Companies with annual revenues up to R$ 25 million.

22 Very Small and Small Companies Portfolio¹ 22 Relationship Time of Relationship 3.9% 2.4% 1.8% 20.1% 18.5% 18.5% 34.0% 34.3% 34.7% Amount Distribution by Time of Company Foundation Very Small and Small Companies Portfolio (R$ bn) Total Amount R$74.9bn % 44.8% 46.3% 1.4 Sep/15 Jun/16 Sep/16 Up to 2 years From 2 to 5 years From 5 to 10 years From 10 to 20 years More than 20 years More than 10 years From 5 to 10 years From 2 to 5 years Up to 2 years (1) BB Classified Loan Portfolio - Companies with annual revenues up to R$ 25 million.

23 Carteira Companies PJ por Portfolio setor by Macro-sector¹ 23 R$ Million Sep/15 Share % Jun/16 Share % Sep/16 Share % Oil and Gas 49, % 42, % 43, % Government 40, % 37, % 38, % Mining and Metallurgy 43, % 38, % 37, % Eletricity 40, % 38, % 37, % Foodstuffs of Vegetable Origin 37, % 33, % 30, % Transportation 34, % 27, % 27, % Automotive 28, % 23, % 20, % Services 25, % 21, % 19, % Real Estate Agents 21, % 20, % 20, % Retail Trade 19, % 17, % 16, % Specific Activities of Construction 15, % 13, % 13, % Foodstuffs of Animal Origin 14, % 16, % 15, % Financials Institutions 13, % 16, % 16, % Textile and Clothing 12, % 10, % 9, % Agricultural Inputs 11, % 10, % 9, % Pulp and Paper 10, % 8, % 8, % Electrical and Electronic Goods 10, % 8, % 7, % Chemicals 9, % 7, % 6, % Heavy Construction 8, % 7, % 7, % Telecommunication 7, % 5, % 5, % Wholesale and Various Industries 6, % 6, % 6, % Woodworking and Furniture 6, % 5, % 5, % Leather and Shoes 3, % 2, % 2, % Beverages 1, % 1, % 1, % Other Activities % % % Total 472, % 421, % 407, % (1) Included Companies and Agro Companies Portfolio.

24 24 The Agribusiness Bank in Brazil Agribusiness Portfolio R$ Billion 4.5% growth in the past 12 months 60.9%* of the total Rural Credit is at Banco do Brasil 24.5% of Banco do Brasil Credit Portfolio** *As of Sep/16 **It considers Agribusiness Broad Concept Portfolio

25 Agribusiness 25 Agribusiness Loan Portfolio by Costumer Type¹ % Use of Mitigators (Working Capital for Input Purchase) Not Insured 20.6% Harvest 16/17 (Sep/16) Sep/15 Dec/15 Mar/16 Jun/16 Sep/16 Rural Agroindustry Market Share - % 1 st 60.9 % Market Share² Insured 79.4% The total disbursement in 16/17 harvest until September, added to pre working capital for input purchase of the first half of 2016, reached R$25.9 billion, a 22.2% growth compared to 15/16 harvest disbursement in the same period (R$21.2 billion). (1) It includes Rural Product Bills and guarantees provided. (2) Source: Central Bank of Brazil Sep/16.

26 26 The Brazilian Foreign Trade Bank FEC/ACE Operating abroad for over 50 years, Banco do Brasil has supported Brazil's relations with its trading partners, being a reference point for entrepreneurs, investors, economic agents and foreign governments that maintain or wish to maintain investments in Brazil. 2,276 2,187 1,354 3Q15 2Q16 Contracted Amount (US$ million) 3Q16 Market share (%)

27 Sources 27 R$ Million Mar/15 Jun/15 Sep/15 Dec/15 Mar/16 Jun/16 Sep/16 Commercial Funding¹ 641, , , , , , ,944 Domestic Onlending 90,686 90,032 90,543 90,065 88,082 86,603 85,078 Subordinated Debt 54,956 56,260 59,951 59,936 58,049 58,648 60,027 Foreign Borrowing² 65,662 67,034 86,931 74,696 58,463 50,911 52,578 Hybrid Capital Instuments 33,854 32,604 40,082 37,342 34,806 31,068 31,825 Financial and Development Funds 12,265 12,404 14,675 15,003 14,781 13,741 14,620 Commercial Paper ³ 2,630 2, ,117 2,309 2,393 2,673 Compulsory Deposits -56,613-57,168-60,362-60,811-62,613-65,404-63,637 Sources 845, , , , , , ,107 (1) Includes part of the balances of Private Securities (Note 17c). (2) Includes Foreign Borrowing, Foreign Securities, Foreign Onlending, Subordinated Debt Abroad, Hybrid Capital Debt Instruments abroad. (3) Includes Letters of Credit and Debentures.

28 Sources 28 Commercial Funding R$ Million Mar/15 Jun/15 Sep/15 Dec/15 Mar/16 Jun/16 Sep/16 Saving Deposits 144, , , , , , ,681 Agribusiness Letters of Credits 118, , , , , , ,098 Judicial Deposits 118, , , , , , ,281 Time Deposits 93,304 82,126 89,068 90,890 88,463 85,834 84,199 Demand Deposits 73,705 64,755 66,063 66,550 62,631 62,550 61,623 Rep. Agreement with Private Securities¹ 37,848 43,965 44,678 52,142 30,471 30,415 31,621 Interbank Deposits 36,736 33,337 41,465 41,483 36,885 27,473 23,919 Mortgage Bonds² 19,067 18,526 18,474 18,121 18,681 18,066 17,521 Commercial Funding 641, , , , , , ,944 Foreign R$ Million Mar/15 Jun/15 Sep/15 Dec/15 Mar/16 Jun/16 Sep/16 Foreign Securities 31,167 34,773 44,085 33,500 22,885 18,631 20,274 Foreign Borrowing 25,133 23,074 31,236 29,617 25,178 22,763 22,812 Foreign Onlending Subordinated Debt Abroad 9,361 9,186 11,600 11,569 10,400 9,517 9,491 Foreing 65,662 67,034 86,931 74,696 58,463 50,911 52,578 (1) Includes part of the balances of Private Securities (Note 17c). (2) Includes Foreign Borrowing, Foreign Securities, Foreign Onlending, Subordinated Debt Abroad, Hybrid Capital Debt Instruments and abroad.

29 Emissões Foreign Borrowing no Exterior 29 Bonds Issued Abroad Issue Date Volume (US$ million) Currency Term in Years Maturity Coupon (%) Structure Rating (S&P / Moody s/fitch) 07/18/ BRL 10 07/18/ GMTN SR / Ba2 / SR 04/29/ USD 10 06/15/ MT100 BBB / Ba1 / SR 10/20/2009 1,500 USD Perpetual Perpetual Perpetual SR / B2 / SR 01/22/ USD 10 01/22/ GMTN BB / Ba2 / BB 10/05/ USD 10 01/15/ Subordinated SR / Ba3 / SR 05/26/2011 1,500 USD 10 01/26/ Subordinated SR / Ba3 / SR 11/23/ USD 5 01/23/ (a)2 SR / Ba2 / SR 01/20/2012 1,000 USD Perpetual Perpetual Perpetual B- / SR / SR 03/05/ USD Perpetual Perpetual Perpetual B- / SR / SR 06/19/ USD 10 01/19/ Subordinated B / Ba3 / SR 10/10/2012 1,925 USD 10 10/10/ (a)2 BB / Ba2 / BB 01/31/2013 2,000 USD Perpetual Perpetual Perpetual B- / SR / SR 07/25/ EUR 5 07/25/ GMTN BB / Ba2 / BB 12/20/ CHF /20/ GMTN BB / Ba2 / BB 03/26/ EUR 5 07/25/ GMTN BB / Ba2 / BB+ 06/18/2014 2,500 USD Perpetual Perpetual Perpetual B- / B2 / SR

30 Uses 30 R$ Million Mar/15 Jun/15 Sep/15 Dec/15 Mar/16 Jun/16 Sep/16 Available Funds 142, , , , , , ,155 Net Loan Portfolio (a) = (b) + (c) + (d) 702, , , , , , ,953 Classified Loan Portfolio (b) 682, , , , , , ,225 Private Securities (c) 46,973 45,078 44,695 48,645 47,625 41,819 45,242 Allowance for Loan Losses (d) -26,862-27,575-31,926-33,577-35,398-36,968-37,514 Adjusted Net Loan Portfolio (a) - (e)* 578, , , , , , ,857 Domestic Onlending Loans (e) 124, , , , , , ,096 Uses 845, , , , , , ,107 Indicators (%) Adjusted Net Loan Portfolio* / Commercial Funding** Commercial Funding** 641, , , , , , ,944

31 Compulsório Compulsory and e Direcionamento Reserve Requirements 31 Compulsory/Reserve Requirements (%) Demand Deposits 3Q15 4Q15 1Q16 2Q16 3Q16 Reserve Requirement Additional Reserve Requirement Marked to Rural Marked to Micro Finance Unmarked Savings Deposits Rural Reserve Requirement Additional Reserve Requirement Marked Unmarked Mortgage Reserve Requirement Additional Reserve Requirement Marked Unmarked Time Deposits Reserve Requirement Additional Reserve Requirement Unmarked

32 Means of Payment Banco CBSS % 66.64% Serviços Promotora 100% 100% BB ELO Cartões 49.99% 100% 100% 100% 30% 70% \ 30% 70% 28.65% 40.95% 100% Banco do Brasil BB Banco de Investimentos 91.44% 100% 100% 100% BB Adm Cartões

33 Leadership 33 Assets (R$ billion Sep/16) Loan Portfolio (R$ billion Set/16) Deposits (R$ billion Sep/16) Assets Under Managmt.¹ (R$ billion Jun/16) 1, , % 22.8% Market Share¹ Market Share¹ 1 st 1 st 1 st Market Share¹ 1 st 1, % % Market Share BB Bank A Bank B BB Bank A Bank B BB Bank A Bank B BB Bank A Bank B (1) Source: Central Bank of Brazil - Market Share as of Jun/2016. (1) Source: Central Bank of Brazil - Market Share as of Sep/16 for domestic loan portfolio. (1) Source: Central Bank of Brazil - Market Share as of Jun/2016. (1) It does not include Banco Votorantim

34 Leadership 34 Insurance Cards Business 3Q16 Total turnover Rural 1 st Debit 1 st Pension Plan 1 st Credit 2 nd Life 1 st Premium Bonds 2 nd Vehicle 2 nd Source: Susep Sep/16 Source: Abecs Sep/16

35 Leadership in Foreign Trade 35 1 st Foreign Exchange Export Contracts 2 nd Foreign Exchange Import Contracts 22.7% 16.7% 14.0% 16.5% 16.0% 13.9% 13.8% 11.9% 8.5% 6.6% BB Bank 1 Bank 2 Bank 3 Bank 4 Bank 1 BB Bank 2 Bank 3 Bank 4 Source: Central Bank of Brazil YTD Sep/16

36 Awards and Achievements 36

37 Corporate Governance 37 Decisions at any level of the Company are made collectively. With the purpose of involving all the executives in the definition of strategies and approval of proposals for the different businesses of Banco do Brasil. Asset and Liabilities Management and Liquidity Committee 3 Higher Committees Global Risk Committee Investor Relations Executive Committee 15 Executive Committees Objective Mitigate risks, share visions, aggregate value and quality to the decision process and disseminate knowledge. Credit Risk Executive Committee Capital Management Executive Committee Credit Limit Executive Committee Products and Services Executive Committee Ethics Executive Committee Market and Liquidity Risk Executive Committee Related Companies Governance Executive Committee Internal Controls and Operational Risk Executive Commitee Prevention of Financial,Foreign Exchange Illicit and Information Security Executive Committee The Only Brazilian Bank listed since 2006, in this BM&F Bovespa segment, destined to companies that voluntarily adopt the best practices for corporate governance. Administrative and Operational Executive Committee Human Resources Executive Committee Credit Transactions Committee Credit Transactions Executive Committee Disciplinary Review Executive Committee Other Committees Resources Committee Information Technology Executive Committee Asset & Liability Management and Liquidity Executive Committee Information Technology Committee

38 Banco do Brasil: Ratings 38 Standard & Poor's Q16 Long-Term - Local Currency BBB BBB BBB- BB+ BB Long-Term - Foreign Currency BBB BBB BBB- BB+ BB Moody's Financial Strength C- C- C- - - Long-Term Debt - Foreign Currency Baa1 Baa2 Baa2 Baa3 Ba2 Long-Term Deposits - Foreign Currency Baa2 Baa2 Baa2 Baa3 Ba3 Long-Term Deposits - Local Currency A3 Baa2 Baa2 Baa3 Ba2 Fitch Ratings Long-Term - Local Currency BBB BBB BBB BB+ BB Long-Term - Foreign Currency BBB BBB BBB BB+ BB

39 2 Banking Industry

40 Concentration - % 40 Assets Loans , Jun/ Jun/16 5 Largest 10 Largest 20 Largest 5 Largest 10 Largest 20 Largest Source: Central Bank of Brazil

41 Concentration - % 41 Deposits Assets under Management Credit Card Revenue** Jun/ Q16* 2Q15 2Q16 5 Largest Banks 10 Largest Banks 20 Largest Banks 5 Largest Banks 10 Largest Banks 5 Largest Banks 10 Largest Banks Source: Central Bank of Brazil *As of Sep/16 ** Source: CardMonitor Research as of 2Q16 per issuer.

42 3 Earnings Highlights

43 Highlights 9M16 / 9M15 43 Pre-Tax and Pre-Provision Earnings Increased by 9.8% Net Interest Income Grew by 15.0% Fee Income 7.0% Growth Administrative Expenses Under control (4.2% growth) Cost to income ratio Improved to 39.4%

44 Net Income and Profitability 44 Accumulated R$ Million 5,738 ROE 7.6% ROE 10.0% 8,947 (7,385) 1,155 (972) 5,424 1,646 7,070 (2,059) 9M15 Adj. Net Income NII ALL Fee Income Administrative Expenses Others 9M16 Adj. Net Income One-Off Items 9M16 Net Income Profitability Ratios 3Q15 2Q16 3Q16 9M15 9M16 ROE 15.5% 12.3% 11.1% 19.7% 11.4% Adjusted ROE 13.3% 7.7% 9.9% 13.7% 7.6% Market ROE 15.2% 9.2% 12.0% 15.4% 9.1% Shareholders ROE 17.0% 10.3% 13.4% 17.2% 10.1%

45 Pre-Tax and Pre-Provision Earnings 45 R$ Billion Quarterly change +8.0% Adjusted Annual change +9.8% Q15 2Q16 3Q16 9M15 9M16

46 Market Ratios 46 Earnings per Share (R$) Dividend Yield 1 (%) Q15 4Q15 1Q16 2Q16 3Q16 Earnings per Share Adjusted Earnings per Share 3Q15 4Q15 1Q16 2Q16 3Q16 (1) Dividends and Interest on Capital 12 months / Market Capitalization. Source: Economatica. Price/Earnings 12 months Price/Book Value Sep/15 Dec/15 Mar/16 Jun/16 Sep/16 Source: Economatica. Sep/15 Dec/15 Mar/16 Jun/16 Sep/16 Source: Economatica.

47 Vintages 47 Annual Vintage Individuals Loan Portfolio Annual Vintage Very Small and Small Companies Loan Portfolio

48 Guarantees provided and Provisions 48 R$ Million 1.6% 1.7% 1.6% 2.2% 2.7% 32,354 29,366 25,750 19,326 18, Sep/15 Dec/15 Mar/16 Jun/16 Sep/16 Guarantees Provided (balance) Provisions (balance) Provisions / Guarantees Provided

49 Loan Portfolio (by Contracted period) 49 3Q16 R$ Million 2Q16 1Q16 4Q15 3Q15 2Q15 1Q % % 44.8% Up to 2011 Sep/15 Dec/15 Mar/16 Jun/16 Sep/16

50 Delinquency Ratios¹ 50 NPL Ratio +90 days (%) Mar/15 Jun/15 Sep/15 Dec/15 Mar/16 Jun/16 Sep/16 Banking Industry Banco do Brasil Banco do Brasil² NPL Ratio +15 days (%) Mar/15 Jun/15 Sep/15 Dec/15 Mar/16 Jun/16 Sep/16 Individuals Companies Agribusiness NPL Ratio +90 days (%) Mar/15 Jun/15 Sep/15 Dec/15 Mar/16 Jun/16 Sep/16 Individuals Companies Agribusiness (1) BB Classified Loan Portfolio. (2) Simulation excluding an oil and gas specific case effect.

51 Allowance for Loan Losses 51 Coverage Ratios (%) and ALL Balance (Million) Additional (Complementary) Provision Required Allowance - R$ million Banking Industry + 90 days Banco do Brasil + 90 days Banco do Brasil + 15 days 26,862 27,575 1,380 1,405 31,926 3,705 33,577 3,228 35,398 36,968 37,514 1,209 Banco do Brasil + 90 days² 25,482 26,170 28,220 30,349 Mar/15 Jun/15 Sep/15 Dec/15 Mar/16 Jun/16 Sep/16 (1) BB Classified Portfolio. (2) Simulation excluding an oil and gas specific case effect.

52 Asset Quality¹ 52 Coverage Ratios by Segment (%) Abroad² Companies Individuals Agribusiness Mar/14 Jun/14 Sep/14 Dec/14 Mar/15 Jun/15 Sep/15 Dec/15 Mar/16 Jun/16 Sep/16 ALL by Segment³ , , ,197 1,382 1,291 1,238 1,929 2,600 2,543 2,832 3,142 3,810 3, ,806 4,174 4,301 4,890 5,654 5,191 5,835 6, ,326 4, ,145 8,277 1, ,408 1,282 4,754 5,794 1, % 6, ,411 4, Agribusiness Individuals Companies Abroad 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 (1) BB Classified Portfolio. (2) Simulation excluding an oil and gas specific case effect. (3) Quarterly ALL. It does not consider additional provision.

53 Provision Flow and Average Risk 53 Provision Flow/ Loan Portfolio (%) Individuals Companies Agribusiness Total Abroad Dec/14 Mar/15 Jun/15 Sep/15 Dec/15 Mar/16 Jun/16 Sep/16 Average Risk¹ (%) Banco do Brasil Banking Industry Banco do Brasil² Dec/14 Mar/15 Jun/15 Sep/15 Dec/15 Mar/16 Jun/16 Sep/16 (1) Required Provision / BB Classified Loan Portfolio. (2) Simulation excluding an oil and gas specific case effect.

54 NPL Formation New NPL¹, Write Off and NPL Formation Rate ² New NPL (R$ billion) Write Off (R$ billion) New NPL / Loan Portfolio³ (%) Quarterly ALL/New NPL (%) New NPL / Loan Portfolio² (%) Quarterly ALL/New NPL² (%) 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 New NPL¹, Write Off and NPL Formation Rate including the Past Due Renegotiated loan Portfolio⁴ ² From the total contracts in the 3Q16 in the renegotiated loan portfolio, 15.5% were past due over 90 days. 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 New NPL with Past due Credits Portfolio (R$ million) Write Off (R$ billion) New NPL with Past due Credits Portfolio /Loan Portfolio³ (%) Quarterly ALL/New NPL (%) New NPL / Loan Portfolio² (%) Quarterly ALL/New NPL² (%) (1) Quarterly change in the balance of past due for over 90 days operations + current quarter write-off. (2) Simulation excluding an oil and gas specific case effect. (3) It considers the Classified Loan Portfolio of the previous quarter. (4) Estimated flow of the Renegotiated loan portfolio contracts of past due for over 90 days operations.

55 Renegotiated Overdue Loan Portfolio¹ 3Q15 2Q16 3Q16 Renegotiated Overdue Loan Portfolio - Changes Initial Balance 12,701 22,038 25,050 Contracts 3,783 5,026 2,758 Payments received minus capitalized interest (461) (979) (744) Write Off (503) (1,036) (1,370) Final Balance 15,520 25,050 25,694 Allowance for Loan Losses Balance 7,464 10,369 10,784 NPL + 90 days 2,469 5,642 6,370 Indicators - % ALL for Loan Losses / Loan Portfolio NPL + 90 days / Loan Portfolio ALL for Loan Losses Balance/NPL + 90 days Credits Renegotiated/Classified Loan Portfolio (1) Table according Explanatory Notes 10.k New NPL¹, Write Off and NPL Formation Rate Sep/15 Balance Share % AA A B 1, C 1, D E 2, F 1, G H 4, Total 15, AA-C 4, D-H 11, R$ Million New NPL - Renegotiated Overdue Loan Portfolio (R$ billion) Write Off (R$ billion) New NPL/Past due Renegotiated Portfolio² ALL Balance/NPL + 90 days Sep/16 Balance Share % AA A 1, B 3, C 3, D 1, E 5, F 2, G 2, H 6, Total 25, AA-C 8, D-H 17, Mar/15 Jun/15 Sep/15 Dec/15 Mar/16 Jun/16 Sep/16 (1) Quarterly change in the balance of past-due for over 90 days operations + current quarter write off. (2) It considers the classified loan portfolio of the previous quarter.

56 Renegotiated Loan Portfolio ,112 8,585 7,414 7,464 BB x Peers¹ ,369 10,73410,784 9,495 9,760 8,563 Peers Average - ALL Balance BB - ALL Balance Peers Average - Renegotiated Portfolio NPL +90 days (%) BB - Renegotiated Portfolio NPL +90 days (%) R$ Million Sep/15 Dec/15 Mar/16 Jun/16 Sep/16 Renegotiated Loan Portfolio 3Q Renegotiated Loan Portfolio 25,694 20,559 Renegotiated Loan Portfolio/Classified Loan Portfolio (%) BB Peers Average¹ (1) It corresponds to two large Brazilian private banks.

57 Allowance for Loan Losses (ALL) and Loan Portfolio 57 R$ Billion Allowance for Loan Losses (12 months) / Loan Portfolio , , , , ,090 Allowance for Loan Losses (Quarterly) / Loan Portfolio , , , , ,447 21,571 23,671 27,161 30,248 31,056 3Q15 4Q15 1Q16 2Q16 3Q16 Loan Portfolio¹ Allowance for Loan Losses ALL / Loan Portfolio (%)² 5,835 6,991 9,145 8,277 6,644 3Q15 4Q15 1Q16 2Q16 3Q16 Loan Portfolio³ Allowance for Loan Losses ALL / Loan Portfolio (%)⁴ Classified Loan Portfolio Growth by Risk Level 710,612 (57,638) 3,820 6,590 1, , , % in 12 months Sep/15 AA-C D E F G H Sep/16 (1) Average Classified Loan Portfolio 12 months. (2) ALL expenses accumulated in 12 months / 12 months Average Loan Portfolio. (3) 3 months Average Loan Portfolio. (4) Quarterly ALL Expenses / 3 months Average Loan Portfolio.

58 Write-off Percentage of the Classified Loan Portfolio¹ Sep/15 Dec/15 Mar/16 Jun/16 Sep/16 Banco do Brasil Peers Average² (1) Write-offs to losses accumulated in 12 months / average balance of the classified credit portfolio in 12 months. (2) It corresponds to the three largest Brazilian private banks.

59 ALL Balance Current and Past Due Operations 59 R$ Billion Q15 4Q15 1Q16 2Q16 3Q16 Additional (Complementary) Provision Current (Generic) Past Due (Specific) Total

60 Net Interest Income 60 3Q15 2Q16 3Q16 Change % Global Spread (%)³ Spread by Portfolio (%)³ 9M15 9M16 Change % R$ million on 3Q15 on 2Q16 on 9M15 Net Interest Income 13,251 14,633 15, ,270 44, Loan Operations Income 24,840 25,311 26, ,417 76, Funding Expenses (11,616) (11,034) (11,366) (2.2) 3.0 (31,234) (33,330) 6.7 Institutional Funding Costs¹ (3,792) (3,785) (3,737) (1.5) (1.3) (10,483) (11,255) 7.4 Recovery of Write-offs Loans 719 1, (30.1) 2,470 3, Treasury Income² 3,100 2,758 3, ,100 8, Q15 4Q15 1Q16 2Q16 3Q16 3Q15 4Q15 1Q16 2Q16 3Q16 NIM Risk Adjusted NIM Loan Operations NIM Individuals NIM Companies NIM⁴ Agribusiness NIM (1) It Includes senior debt, subordinated debt and hybrid capital instrument (HCDI). (2) It includes interest income, tax hedge, derivatives and other financial instruments that compensate the exchange rate variation in the result. (3) Annualized data. (4) It does not include loans with government sector.

61 Net Interest Income 61 Revenue from Loans Q14 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 Revenue from Loans Accumulated Selic (% accumulated in 12 months)¹ Funding Costs Q14 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 Funding Expenses Institutional Funding Expenses Accumulated Selic (% accumulated in 12 months)¹ Funding Expenses % Selic (1) Source: Central Bank of Brazil

62 Fee Income 3Q15 2Q16 3Q16 Change % Change % 9M15 9M16 on 3Q15 on 2Q16 on 9M15 Fee Income 5,691 6,063 6, (0.7) 16,488 17, Account Fees 1,373 1,534 1, ,488 4, Asset Management Fees , ,623 2, Insurance, Pension and Premium Bonds (10.1) 2,166 2, Collections (2.6) 0.5 1,279 1,264 (1.2) Loan Fees (19.0) (15.7) 1,511 1,179 (22.0) Credit / Debit Cards (13.1) 1.0 1,359 1,009 (25.8) Billings (1.4) (1.5) Interbank (6.3) Consortium Fiduciary Services Capital Market (18.6) Other (3.3) 1.9 1,675 1, R$ Million Adjusted Fee Income¹ 9M15 9M16 Change % on 9M15 Fee Income 16,080 17, Credit / Debit Cards 951 1, (1) It excludes interchange revenues in Jan/15 and Feb/15 that migrated to Cateno from Mar/15.

63 BB Seguridade 63 Adjusted Net Income (R$ million) +3.4% 2,931 3, , Q15 2Q16 3Q16 9M15 9M16

64 Banco Votorantim 64 Net Income (R$ million) Q15 4Q15 1Q16 2Q16 3Q16 Delinquency and Risk Level 5.3% 5.7% 4.6% 4.6% 5.5% 10.3% 11.2% 9.4% 9.8% 9.8% 89.7% 88.8% 90.6% 90.2% 90.2% Sep/15 Dec/15 Mar/16 Jun/16 Sep/16 AA-C D-H NPL + 90 days / Loan Portfolio

65 Administrative Expenses and Cost to Income Ratio¹ R$ Billion Q15 2Q16 3Q16 Personnel Expenses Other Expenses Cost to Income Ratio (%)¹ - 12 months 9M15 Cost to Income Ratio (%) 9M16 Disregarding the lump-sum bonus granted to employees, Personnel Expenses would reach R$4.9 billion in the 3Q16 and R$14.6 billion in the 9M16. (1) Cost to Income Ratio: Administrative Expenses / Operating Revenues. Data from the Income Statement with Reallocations. OBS: Disregarding the lump-sum bonus granted to employees, the cost to income ratio would be 39.3% in the 3Q16 and 38.8% in the 9M16.

66 BIS Ratio % Tier I 12.18% Sep/15 Dec/15 Mar/16 Jun/16 Sep/16 Core Capital Additional Tier I Tier 2

67 Full application of Basel III rules 67 BIS Ratio (0.85) (0.29) 0.87 Tier 1 BIS Ratio Deductions Schedule Anticipation BIS Ratio with full deductions RWA Rules Anticipation BIS Ratio with Fully Loaded Basel III Rules Use of Tax Credits Simulated BIS Ratio under complete Basel III Rules (0.98) (0.20) 0.84 Tier 1 Deductions Schedule Anticipation Tier 1 with full deductions RWA Rules Anticipation Tier 1 with Fully Loaded Basel III Rules Use of Tax Credits Simulated Tier 1 under complete Basel III Rules

68 BIS III Capital Requirements % 68 Implementation Schedule Common Equity Tier I (CET1) Tier Brazilian BIS Ratio Capital Conservation Buffer Additional CET1 Countercyclical Buffer (superior limit) 0.625¹ Additional CET1 Systemic (D-SIB) Buffer CET1 + Buffers 5.125¹ Tier 1 + Buffers 6.625¹ Brazilian BIS Ratio + Buffers ¹ (1) The Additional CET1 Countercyclical Buffer was not activated by the Central Bank in 2016, according to Central Bank Circular 3,769/15.

69 Guidance Guidance 2016 Performance 2016 Guidance Revised Adjusted Return on Equity¹ 9 to to 10 Net Interest Income 11 to Unchanged Domestic Loan Portfolio² - Broad Concept -2 to to -6 Individuals 5 to to 4 Companies -10 to to -16 Agribusiness 6 to to 7 Allowance for Loan Losses³ 4.0 to Unchanged Fee Income 7 to Unchanged Administrative Expenses 5 to to 6 (1) Adjusted ROE estimated for 2016 uses estimated adjusted shareholders equity, free from the effects of: (i) the restatement of actuarial assets and liabilities arising from the Deliberation CVM/695; and (ii) minority interests in controlled companies. (2) It includes private securities and guarantees provided. (3) Allowance for Loan Losses expenses of the last twelve months / Average Classified loan portfolio for the same period.

70 4 Macroeconomic Information

71 Inflation and Selic Rate Q15 2Q16 3Q IPCA IBGE (% accumulated in 12 months) Selic (% - end of the period) Real Interest Rate¹ Source: Central Bank of Brazil and IBGE. Projection for 2016 and 2017, according to Boletim Focus as of 28/10/2016. (1) Real Interest Rate = Selic - IPCA

72 GDP Q15 2Q16 3Q16 Credit/GDP (% YTD in 12 months) PSND (% GDP) GDP (% YTD in 12 months) Primary Surplus (%GDP in 12 months) Source: Central Bank of Brazil.

73 Loans/GDP 73 Loans/GDP (%) and Evolution of Loan Portfolio of Banking Industry 2, , , , , , Q15 3Q16 Credit/GDP (% YTD in 12 months) Loan Portfolio Banking Industry (R$ billion) Source: Central Bank of Brazil.

74 Unemployment * * Q15 3Q16 May-15 Aug-15 Nov-15 Feb-16 May-16 Aug-16 Industrial Production (% accumulated in 12 months) Unemployment Rate (% accumulated in 12 months) Consumer Expectations (INEC) Business Confidence (ICEI) Source: IBGE and Confederação Nacional da Indústria *As of Jun/16.

75 Trade Balance 75 US$ Billion Q15 2Q16 3Q Source: MDIC. Projection for 2016 and 2017, according to Boletim Focus as of 28/10/2016.

76 International Reserves * Q16 Gross Foreign Debt (R$ billion) International Reserves (US$ billion) Source: Central Bank of Brazil. *As of Jun/2016

77 Sustainable Growth Brazil has the ideal conditions for sustainable growth Only a few countries have the same potential as Brazil 77 Planting Area > 140 million ha* Australia Canada Germany GDP > US$ 1 trillion* UK Argentina France Brazil Korea Kasakhstan Italy China Russia USA Mexico Spain India Japan Urban Population > 80 million people (2011) Indonesia Source: World Bank and FAO

78 Main Pilars of Brazilian Growth 78 Agriculture Infrastructure Foreign Trade

79 Brazilian Agribusiness: Overview 79 Overview Area 8.5 million Km² Population (2015) 204 million GDP (2Q16)* -4.9% Agribusiness GDP (2Q16)* -2.4% Brazil s Unique Advantages Greater availability of low cost arable land in the world Easy access to clean water supplies Competitive prices for land Excellent climate Rich soil Source: Agriculture Ministry and IBGE * Change on 12 months.

80 Brazilian Agribusiness: Area X Production 80 Planted Area (thousand Ha) vs Production (thousand Tons) 188, , , , , , , ,135 47,674 47,416 49,873 50,885 53,563 57,060 57,915 59,666 CAGR 6.0% CAGR 2.8% 2008/ / / / / / / /17 E Planted Area Production Source: CONAB

81 Brazilian Agribusiness: Undisputable Leadership 81 Brazil: World Commodities Ranking Production Export Coffee 1 st 1 st Orange Juice 1 st 1 st Sugar 1 st 1 st Soybean 2 nd 1 st Poultry 2 nd 1 st Beef 2 nd 2 nd Corn 3 rd 3 rd Source: USDA PSD online as of Sep/16.

82 Infrastructure: Crescer Project First part of the national priority assets 82 Crescer Project 35 Projects and/or Auctions rounds Highways 2 Projects Railroads 3 Projects Airports 4 Projects Ports 3 Projects Oil and Gas 4 Auctions rounds Sanitation 3 Projects Eletricity 12 Projects Mining 4 Projects Source: PPI Secretary.

83 Brazilian Foreign Trade Balance: Overview 83 Brazilian Foreign Trade Balance Evolution (US$ billion) Sep/15 Sep/16 Exports (US$ billion - year accumulated) Imports (US$ billion - year accumulated) Trade Balance (US$ billion year accumulated) Source: Ministry of Development, Industry and Foreign Trade.

84 Summary Table 84 Annual Collected Data Quarterly Data Q15 2Q16 3Q16 Economic Activity GDP (% YTD in 12 months) Family Consumption Government Consumption Gross Fixed Capital Formation Exports Imports Use of Installed Capacity (%) Economically active population - PEA (% YTD in 12 months) Unemployment Rate (% YTD in 12 months) Formal employment net creation in 12 m (thousand jobs) 1, , , , Industrial Production (% YTD in 12 months) External Sector Current Transactions (% GDP in 12 months) Direct Foreign Investment (US$ billion - year accumulated) International Reserves (US$ billion end of period) Sovereign Risk (basis points EOP) Trade Balance (US$ billion year accumulated) Exports (US$ billion year accumulated) Imports (US$ billion year accumulated) Trade Balance (US$ billion quarterly accumulated) Exports (US$ billion quarterly accumulated) Imports (US$ billion quarterly accumulated) Ptax Dollar Rate (EOP) R$ Ptax Dollar Rate (% YTD in 12 months) All indicators were obtained from official sources such as Central Bank of Brazil, FGV( Getúlio Vargas Foundation), IBGE, etc.

85 Summary Table 85 Annual Collected Data Quarterly Data Q16 2Q16 3Q16 Monetary Ratios IGP-DI FGV (% YTD in 12 months) IGP-M FGV (% YTD in 12 months) IPCA IBGE (% YTD in 12 months) Selic (EOP %) Accumulated Selic (% YTD in 12 months) Accumulated TR (exbtn) (% YTD in 12 months) TJLP - IBGE (EOP %) Libor (EOP %) Public Finance Primary Surplus (% GDP 12 months accumulated) Public Sector Gross Debt (% GDP) Public Sector Net Debt (% GDP) Credit Indicators Banking Industry Loan Portfolio (R$ billion) 2, , , , , , , ,109.9 Individuals (R$ billion) , , , , , , ,540.9 Companies (R$ billion) 1, , , , , , , ,569.0 Credit/GDP (% YTD in 12 months) Household Debt (%) Total Default (% past due loans over 90 days) All indicators were obtained from official sources such as Central Bank of Brazil, FGV( Getúlio Vargas Foundation), IBGE, etc.

86 86 The largest bank in Latin America Av. Paulista 2163, 2nd Floor Cerqueira César São Paulo/SP - Brazil ri@bb.com.br +55 (11)