September 7th, 2001
Brazil Day
Alfredo SetubalExecutive Vice President
Investor Relations Director
2
The main objective of the strategies which guide
Itaú’s administration has been conducted in order
to balance growth and profitability, focusing
Shareholder Valuein the long-term.
3
10.5 11.6
18.321.2 23.2
27.9 27.2
Dec-95 Dec-96 Dec-97 Dec-98 Dec-99 Dec-00 Jun-01
Highlights
(*) Balances at the end of the periods.
24.432.1
46.4 49.0 51.9
69.6 74.8
Dec-95 Dec-96 Dec-97 Dec-98 Dec-99 Dec-00 Jun-01
12.2 14.1 16.9 16.119.6
27.331.1
Dec-95
Dec-96
Dec-97
Dec-98
Dec-99
Dec-00
Jun-01
10.3 14.2 17.7 21.132.0
42.047.4
Dec-95
Dec-96
Dec-97
Dec-98
Dec-99
Dec-00
Jun-01
Total Assets Credit Operations (1)
DepositsAssets under Management
(1) Credit Operations: Loans, Leasing, Other Credits and Advances on Exchange Contracts
R$ Billion(*)
CAGR = 22.6% CAGR = 18.5%
CAGR = 32.0%CAGR = 18.9%
4
Excellent Performance
(*) End of the 1st Semester; annualized data.
57% 58%
64%
58% 58%59%
56%
1995 1996 1997 1998 1999 2000 2001*
1.41.9 1.6 1.8
3.62.6
4.5
1995 1996 1997 1998 1999 2000 2001*
Efficiency Ratio ROA (%)
R$ Billion(*)
With Banestado
10.315.4 17.2 18.9
31.6 27.7
53.9
1995 1996 1997 1998 1999 2000 2001*
ROE (%)
13.7%14.4%
21.0%21.3%
18.7%20.9%22.3%
1995 1996 1997 1998 1999 2000 J-2001
15.7%14.8%
BIS Ratio (%)
Financial ConsolidatedEconomic-Financial Consolidated
5
Evolution of Net Income
1,869 1,841
1,518
1,918
1,232
351
(77)
225
880721
592
343
-500
0
500
1,000
1,500
2,000
2,500
1995 1996 1997 1998 1999 2000 2001*
R$ MillionCAGR = 30.1%CAGR(1) = 26.2%
* 1st Semester of 2001(1) Considering the recurring income in the 1st Half of 2001.
Extraordinary Results 1,457
6
12.87
16.662.98
-0.67
7.466.04
4.95
2.88
-4.00
0.00
4.00
8.00
12.00
16.00
20.00
1995 1996 1997 1998 1999 2000 2001*
15.85 15.99
2.31 2.88 3.30
9.27
6.80
10.91
1.56
1.9912.90
R$ / thousand shares
Extraordinary Results
Recurring Income 1st Quarter
Evolution of EPS (per thousand shares)
* 1st Semester of 2001
CAGR – Net Income (%): 30.1%CAGR - EPS (%): 31.1%Number of shares (%): -1.0%
7
IntangiblesJune 30, 2001
Total R$ 6.24 billion
1 Goodwill in Acquisitions:BemgeBanco del Buen AyreBanerjItausegBFBBPI / IBTBanestadoOthers
R$ 1.86 billionR$ 0.22R$ 0.09R$ 0.02R$ 0.11R$ 0.13R$ 0.13R$ 1.15R$ 0.01
2 Excess in Provision for Loan Losses R$ 680 million
3 Difference: Market Value x Recorded Value R$ 1.48 billion
5 Brand (The most admired Btazilian Company, recognized and evaluated by Interbrand Consulting)
R$ 2.22 billion (US$ 970 million)
8
3,337
7,311
5,9076,642
4,6514,1983,842
01,000
2,0003,000
4,0005,000
6,0007,000
8,000
1995 1996 1997 1998 1999 2000 2001*
June 30, 2001Market Cap.
R$ 21,914 Million
* June 30, 2001
Stockholders’ Equity EvolutionR$ Million
Jan/95 to Jun/01Dividends R$ 2.4 BillionCapital Increase 0
9
7.57.8
7.06.96.86.76.4
5.75.2
7.07.3
3.4 3.6 3.7 3.84.1
4.6 4.7 4.9 4.95.3
5.7 5.86.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
Itaú Consolidated + BanestadoItaú ConsolidatedItaú
Customers Basis Expansion
June 30, 2001Banco Itaú: 6.0 MillionBanerj: 0.8 MillionBemge: 0.3 MillionBanestado: 0.5 MillionItaú Buen Ayre: 0.2 Million
Million
10
Evolution – Checking + Savings Accounts
0
2
4
6
8
10
12
14
16
18
20
BanestadoBemgeBanerjItaú
Quantities in Million
10.2
19.6
10.913.0
19%19.1
16.9
19%
11
154
9842 41
51
79
1111.427
1.580
284477
813
1.121
0102030405060708090
100110120130140150160
1995 1996 1997 1998 1999 2000 2001*
0
500
1.000
1.500
2.000
2.500
20 21 21 35 5170141
PC & Internet Banking ¹Number of Transactions and CustomersNumber of Transactions and Customers
* Until 06.30.2001(1) Included Bankline transactions only
Transactions (million)
Customers (thousand)Transactions in First Semesters
12
Evolution of Points of Sales
Branches CSBs ATMs * June 30, 2001
2,118 2,114
877 863
1,067 1,0601,244
1,763 1,765
835 766 726835 780
12,064 12,242
7,450 7,754
8,876
10,77111,715
0
500
1,000
1,500
2,000
2,500
1995 1996 1997 1998 1999 2000 2001*0
2,000
4,000
6,000
8,000
10,000
12,000
13
Geographical Distribution of Itaú
São PauloHead Office of Banco Itaú S.A
São Paulo
Rio de Janeiro
Minas Gerais
Rio Grande do Sul
Paraná
Others
States
Total
35.5%
11.0%
9.8%
7.7%
6.2%
28.8%
% of GDP(2)
100.0%
1
2
3
4
5
6
Rank.(1)
29%
15%
24%
3%
20%
9%
Concentration
100%
14
Included: software and hardware investments, rental and maintenance of equip., employee and infrastructure expenses, training, systems development
Expenses in Technology *
354483
571 617741
886 882
1995 1996 1997 1998 1999 2000 2001*
Total in the Period(1995 – Jun/2001):
R$ 4.1 billion
(*) 1st Semester of 2001 annualized
R$ Million
15
25.0
6.5 3.2
5.0
Depreciation
in years
Permanent Assets
2,335 1,689
246 375
25 181 681
3,197
12.31.2000
Fixed AssetsReal EstateFurnitures, Fixtures and EquipmentsData Processing and CommunicationSecurity and Transportation
DeferredInvestment
Subtotal
367Accelerated Depreciation
R$ Million
2,338 1,680
213 367 32
179 709
3,226
06.30.2001
16
Market Segmentation Structure
Large CorporationsAnnual Sales > R$ 100 Million
Public Sector
Very Small CompaniesAnnual Sales < R$ 500 th
Private(Investments > R$ 1 Million
Personnalité ItaúIncome > R$ 5,000
IndividualsIncome > R$ 2,000• Premium • Investor • Company owner
“Individual”
Specialized Structures With Account Manager Without Account Manager
Cardholder
IndividualCompanies
Small CompaniesR$ 500 th < Annual Sales < R$ 4 Million
Medium CompaniesR$ 4 Million < Annual Sales < R$ 100 Million
17
Iniciatives
•Income Growth
Credit Cards
Credit - Individuals
New Segments
Corporate
Personnalité
Small Companies
•Costs Control
18
Evolution of Credit Operations - IndividualsR$ Million
(*) Credit Operations: Loans, Leasing, Pre-export advances and Guarantees.
5,607
6,905
9,595
11,046
4,000
6,000
8,000
10,000
12,000
Dec-98 Dec-99 Dec-00 Jun-01
Credit Operations (*)
CAGR = 31.2%
19
Evolution of Number of Credit Cards
CAGR = 27.9%
* June 30, 2001
1,000 1,104
1,829 1,799
2,279
3,3213,869
0
1.000
2.000
3.000
4.000
5.000
1995 1996 1997 1998 1999 2000 2001*
In thousand
20
Credit Card – Market Share of Sales (%)
Itaucard
Credicard
Bradesco
Banco do Brasil
Unibanco
9.7%
n.a.
10.2%
8.8%
9.7%
9.4%
n.a.
9.5%
10.1%
9.2%
10.3%
14.5%
11.1%
10.5%
8.3%
11.4%
12.7%
11.5%
11.5%
8.1%
1997 1998 1999 2000
* June 30, 2001
2001*
12.4%
18.2%
10.7%
11.7%
8.6%
Market Share of Quantity
Itaú’s Equity Share in Credicard: 33%
12.2%
15.9%
10.7%
10.5%
19.6%
2001*
21
Branches
Customers (Thousand)
Year 1998
32
31.7
1999
33
36.4
2000
35
42.8
2001
55
63.0
2002
57
100.0
Personnalité
22
Focus in Companies
Dedicated Service Structure
50,000 Companies (Internal Potential) + New Customers
Significant Profitability Increase Potential, Business and Relationship
CorporateOver than R$ 50 Million
Middle MarketR$ 4 Million to 50 Million
Small CompaniesR$ 500 thousand to 4
Million
Segment with Relevant Spreads
Implanted: April of 2001
Segmentation of Specific Channel for Small Companies
Business market segmentation of Itaú (annual sales)
23
Loans – Small and Medium Size Companies
CAGR = 19.9%
R$ Million
(*) Credit Operations: Loans, Leasing, Pre-export advances and Guarantees.
1,5701,371
2,441 2,469
0
1,000
2,000
3,000
4,000
Dec-98 Dec-99 Dec-00 Jun-01
Credit Operations *
Strong Potential Growth
24
Corporate Loans
11,729
15,216
17,584
8,946
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
18,000
20,000
22,000
Dec-98 Dec-99 Dec-00 Jun-01
Credit Operations (1)
CAGR = 31.0%
R$ Million
(1) Credit Operations: Loans, Leasing, Pre-export advances and Guarantees.
25
Cost Reduction Program
– 2001 and 2002
Lay-offs: 50%
Synergic Integration of Data Processing Systems
Total Reduction at Year Ended of 2002: 35%
Committee of Cost and Process Rationalization (CRPC)
Support of Specialized Consulting Company
Significant Investments in Automation
?} 5 – 10%Ex-Growth
Incorporation/Branches Closed : 20%
26
Itaú - AOL – Strategic Differencial
Largest Internet provider in the World
Winner in Brazil
Technologic Competence (future steps)
Reinforce customer and Bank relationship with a delivery of differentiated services
27
Partnerhips and Corporate Governance
Leverages State Street's Expertise and Banco Itaú's Strong Local Presence To Meet New Investment Demands of Brazil's and U.S.'s Multinational Corporations, Global Investment Managers, Global Insurance Companies and Pension Funds.
Operation of Itaú’s corporate telecommunications network by Telefónica generated a net effect of R$ 450 million in the 2001 result and a 24% reduction (R$ 16 million per year) in expenditures for the present volume of services, besides enabling access to the state-of-the-art technology of Telefónica.
Level I ADR traded at OTC since July 2001
Bovespa´s Level I of Corporate Governance
New Independent Members in the Board
28
External Issuing of Subordinated LoanAugust, 2001August, 2001
• Issuing placed in the American, European and Asiatic markets, with a tranche in US Dollars and another in Yens;
• 10 years term, with payment of the principal at the end; half-yearly interest payments;
• The average coupon for the investor is 9.95% per year, fixed for the total term (478 basis points over US treasury).
• Approximately US$ 343 million (R$ 855 million);• Unparalell transaction: 1st emission Tier 2 by a Brazilian bank, 1st issuing of
this nature abroad, the longest-term private issue by a Brazilian company, the longest-term private issuing in Yens from Latin America;
• Placed at 455 Yield b.ps. below the curve of Brazil for an equivalent term;• Rated A3 by Moody's.
Highlights of the Operation:
29
2000
1st2nd3rd4th5th6th6th7th8th9th10th
1999
1st9th4th3rd7th2nd17th6th10th29th10th
• Top 10 - General
• Microsoft• Natura• Nestlé• Coca-Cola• McDonald´s• TAM • GE-Dako• Votorantim• GM• Itaú• Pão de Açúcar
Source: InterScience
The Most Admired Companies
30
In US$ million
970697667308303196187179177153128110
In relation to annual income(%)
17 728 2 913 812 6281028
• Itaú• Bradesco• Ambev• Banco do Brasil• Unibanco• Embraer• Varig• Multibras• Embratel• Gradiente• Sadia• Tigre
Source: Interbrand (published on Gazeta Mercantil)
• Ranking of More Valuable Brands
The Most Admired Companies
Most valuableBrazilian brandMost valuable
Brazilian brand
31
Itaú is Part of Dow Jones - SAM Group Index
Banco Itaú was, for the first time, chosen as a member of the Dow Jones Sustainability Group Index (DJSGI), along with 236 other companies, of which only two are Brazilian.
Corporate Sustainability
Ability to Create Value to the Shareholder in the Long-Term
Social, Cultural and Environmental Consciousness
Quality of Management
Basic requirements of the DJSGI companies:
DJSGI became, since its creation, in January 1999, an important reference to investors and foreign portfolio managers, who analyze
its evolution to take their investment decisions.
32
0
1.000
2.000
3.000
91 92 93 94 95 96 97 98 99 00 01
Annual Appreciation. 10 years (average) 36.74%. 5 years (average) 21.43%. 12 months (average) 2.76%. 2001 -6.80%
US$
2,291
530
100
BovespaBanco Itaú *
Preferred Shares Appreciation *Evolution of US$ 100 Invested in June 1991
* Without reinvestment of dividends
Real Plan
Rusian CrisisAsian Crisis
Mexican Crisis
Real Devaluation
“Second Largest Market Capitalization among all Brazilian companies”
“Largest Market Capitalization among Latin American Banks”
33
0
50
100
150
200
250
0,0
1,0
2,0
3,0
4,0
5,0
6,0
7,0
Closing (R$/thousand shares)
Recurring Net Income(R$/thousand shares)
Correlation Between EPS and Preferred Share Quotation - Quarterlyuarterly
Linear Positive Correlation: 95.532422%
Linear Positive Correlation: 95.532422%
September 7th, 2001
Brazil Day
Alfredo SetubalExecutive Vice President
Investor Relations Director
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