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Conclusion of the cycle of changes started in April 2011
Capital increase of up to R$92 million and additional allowance for
loans granted under the previous credit concession criteria
BI&P - Banco Indusval & Partners is a commercial bank with 45 years of experience in the financial market, focusing on local and foreign
currency, fixed income and corporate finance for companies. BI&P relies on a network of 11 branches strategically located in economically
relevant Brazilian regions, including an offshore branch in Cayman Islands, its brokerage firm operating at the São Paulo Stock, Commodities
and Futures Exchange - BM&FBOVESPA and Serglobal Cereais, acquired in April 2011, which originates agricultural bonds.
Highlights
 This quarter we completed a cycle that begun in April 2011 with
the entry of a new management team and new shareholders
including the private equity fund Warburg Pincus. It was two
years of restructuring of the Bank as a whole, adoption of a new Vision,
change in the operating segment (migration to bigger companies with
lower risk), changes to the credit granting criteria, expansion and
sophistication of the product offering, renewal of nearly 80% of the
sales team, structuring of the derivatives and agricultural bonds desk, a
more active treasury area, acquisition of an investment banking team
(Voga), structuring and distribution of fixed income products and
establishment of new strategic alliances in Brazil and abroad. Today, all
the teams, processes and strategies are fully operational.
 During the period, we recycled our loan portfolio by acquiring
new customers and through credit exit from poor quality loans.
 To conclude this first cycle and to ensure that the future Bank results
are not contaminated, in 1Q13 we decided to strengthen the
allowance for loan losses (ALL). Of the total ALL expenses of
R$133.4 million in the quarter, R$126.5 million pertain exclusively to the
loans originated before April 2011. With this, the allowance coverage
for loans classified between D and H increased from 47.3% in December
2012 to 96.4% in March 2013, reflecting a more conservative approach
by the current management. As a result of this allowance, we recorded
a loss of R$91.4 million in the quarter.
 On a parallel note, we announced on this date a capital increase of up
to R$92 million, of which the private equity fund Warburg Pincus and
the controlling shareholders have already committed to subscribed to
R$82 million, which underlines the confidence of all the parties in
laying the solid foundation for a differentiated bank in the
market.
 After the approval by Brazilian Central Bank in April 17, we also
announced on this date the closing of the acquisition process of Voga
Empreendimentos e Participações Ltda, which is fully integrated
into BI&P activities and working together with the sales team to identify
new business opportunities.
IDVL4: R$7.24 per share
Closing: May 14, 2013
Outstanding Shares: 62,371,178
Market Cap: R$451.6 million
Price/Book Value: 0.91
Conference Call / Webcasts
May 15, 2013
In English
11 a.m. (US EST) / 12 p.m. (Brasília)
Connections
Brazil: +55 11 4688-6361
USA: +1 786 924-6977
Code: BI&P
In Portuguese
10 a.m. (US EST) / 11 a.m. (Brasília)
Number: +55 11 4688-6361
Code: BI&P
Website
www.bip.b.br/ir
2/20
Summary
Message from the Management .............................................................................................3
Macroeconomic Environment .................................................................................................4
Key Indicators .....................................................................................................................5
Operating Performance .........................................................................................................6
Credit Portfolio ....................................................................................................................9
Funding ............................................................................................................................ 14
Free Cash ......................................................................................................................... 15
Capital Adequacy ............................................................................................................... 15
Risk Ratings ...................................................................................................................... 15
Capital Markets.................................................................................................................. 16
Balance Sheet ................................................................................................................... 18
Income Statement ............................................................................................................ 20
3/20
Message from Management
Since April 2011, we have been working on broadly restructuring Banco BI&P, on expanding our operations, on
reviewing the credit granting criteria, on expanding the product offering and on strengthening the teams. This
restructuring was concluded in the first quarter of 2013 and the most significant changes are:
 New Vision and new management team, with a team of renowned professionals;
 New sales team: around 80% of the team was renewed, with the entry of professionals better qualified for
our multiple product offering;
 Repositioning of our target market to focus on bigger companies with lower risk;
 New lending criteria, with more conservative risk and diversification criteria;
 Reconstruction of the expanded credit portfolio within the new parameters, and portfolio growth of 52.8%
since March 2011;
 Expansion of the product and service offering for the purpose of cross selling to the customer base;
 Structuring of the derivatives and agricultural bonds desk and an active treasury area in all the markets;
 Investment banking team from Voga and fixed income structuring and distribution team already integrated
with the Bank’s operations, working jointly with the sales team to identify new business opportunities;
 Broadening of the funding mix, with diversification of funding sources and reduction of funding cost.
In addition to all the efforts and investments made in processes and technology, we have worked in building a
highly qualified team that is aligned with our values. During this period, we conducted organizational climate
surveys, 360-degree feedback, force curve analysis, and constant training programs. We also placed emphasis on
the trainee and intern program since we believe that by laying a solid foundation will we become a sustainable
bank in the long run.
To conclude this first cycle and to ensure that the future results of the Bank do not get tainted for
loan losses, in 1Q13 we decided to strengthen the allowance for loan losses (ALL). Of the total ALL
expenses of R$133.4 million in this quarter, R$126.5 million pertain exclusively to the loans originated before
April 2011, of which R$110.7 million are the additional provisions. With this, we substantially improved coverage
for loans classified between D and H, which increased from 47.3% in December 2012 to 96.4% in March 2013,
reflecting a more conservative approach by the current management. As a result of this allowance, we recorded
a loss of R$91.4 million in the quarter.
At the same time, to maintain shareholders' equity at the same level as at the end of 2012, we
announced on this date a capital increase of up to R$92 million, of which the private equity fund
Warburg Pincus and the controlling shareholders have already committed to subscribe R$82 million, which
underlines the confidence of all the parties in laying the solid foundation for a differentiated bank in the market.
Had this capital increase taken place at the end of March 2013, it would have raised our Basel Index from the
current 14.2% to 16.8%.
And why create an additional provision now? As mentioned already, this quarter we concluded the whole process
of building a new BI&P, with the most recent step being the acquisition of Voga and the arrival of a strong
investment banking team. With this reinforcement to our allowance, we plan to eliminate possible problems from
the past that could impact our future results. Our focus now is to gain scale in terms of assets and accelerate the
generation of fee revenue in order to deliver an adequate result for our shareholders.
4/20
Macroeconomic Scenario
Despite the recent volatility of economic data - with strong growth in January and a slowdown in February - the
Brazilian economy is showing more consistent signs of recovery in the first quarter, especially in terms of
investments. The country’s GDP will probably show that the economy grew at the best pace since 2010, with
industry recovering. Another sector worthy of highlighting is agriculture which, in the first quarter, did not suffer
from the unusual climatic conditions such as in the beginning of 2012 in south Brazil and should register a new
gain production record during the harvest in the first half of this year.
In a scenario of improved economic data and continuously high inflation, the Central Bank of Brazil started a
monetary tightening cycle, yet maintained a cautious approach on account of the deep uncertainties surrounding
the global economy, notably the weak economic growth in Europe and the recent slowdown of the Chinese
economy, indicating that the increase in interest rates should be less intense.
In the foreign exchange market, the higher volatility seen at the end of 2012 continued in the beginning of this
year and the Central Bank once again intervened by using exchange derivatives several times during the quarter
to maintain the exchange rate within the range of R$1.95 and R$2.05. These interventions make it clear that the
Central Bank wants to avoid inflationary pressures resulting from the devaluation of the Real as it happened in
2012.
Credit volume in the national financial system grew 2.5% in the quarter to reach R$2.43 trillion. Credit volume in
12 months increased by 17%, with the average loan term increasing to 75 months in March 2012 to 86 months
in the first quarter of 2013. As a percentage of GDP, credit volume increased from 53.8% in the fourth quarter of
2012 to 53.9% in March 2013, well above the 49.3% in the same period last year.
Default in the individuals segment dropped from 8.0% in the last quarter of 2012 to 7.6% now, while corporate
default remained practically stable at 3.6%. The slight improvement in default indicators is in line with the more
selective approach to lending adopted by banks and the gradual improvement of the economy, which has kept
unemployment rates at close to historic lows.
Macroeconomic Data 1Q13 4Q12 1Q12 2013e
Real GBP Growth (Q/Previous Q) 1.0%(e) 0.6% 0.1% 2.9%
Inflation (IPCA - IBGE) – quarterly change 1.94% 1.99% 1.22% 6.00%
Inflation (IPCA - IBGE) – annual change 6.59% 5.84% 5.24% 6.00%
FX (US$/R$) – quarterly change -1.45% 0.64% -2.86% 5.50%
Interest Rate (Selic) 7.25% 7.25% 9.75% 8.50%
e= expectation
5/20
Key Indicators
The financial and operating information presented in this report are based on consolidated financials prepared in
millions of Real (local currency), according to Brazilian GAAP (BRGAAP), except were otherwise stated.
Results 1Q13 4Q12 1Q13/4Q12 1Q12 1Q13/1Q12
Result from Financial Int. before ALL adjusted 1
44.8 44.3 1.2% 51.6 -13.1%
Effects of hedge accounting and discounts 1
(22.1) 4.3 -618.9% (0.7) n.c.
Result from Financial Int. before ALL 22.8 48.5 -53.1% 50.8 -55.2%
ALL Expenses 2
(133.4) (7.9) 1598.1% (14.4) 826.4%
Result from Financial Intermediation (110.6) 40.7 -371.9% 36.4 -403.7%
Net Operating Expenses (33.9) (33.8) 0.2% (27.2) 24.8%
Operating Result (144.5) 6.9 n.c. 9.3 n.c.
Net Profit (Loss) (91.4) 3.6 n.c. 5.0 n.c.
Assets & Liabilities 1Q13 4Q12 1Q13/4Q12 1Q12 1Q13/1Q12
Loan Portfolio 2,522.7 2,624.3 -3.9% 2,385.6 5.7%
Expanded Loan Portfolio 3
3,047.5 3,067.9 -0.7% 2,759.1 10.5%
Cash & Short Term Investments 611.3 447.8 36.5% 642.3 -4.8%
Securities and Derivatives 769.7 731.3 5.2% 1,309.8 -41.2%
Securities excl. Agro Sec. & Private Credit Bonds 4
417.4 445.9 -6.4% 1,100.1 -62.1%
Total Assets 4,259.1 4,022.0 5.9% 4,583.0 -7.1%
Total Deposits 2,451.3 2,274.6 7.8% 2,087.8 17.4%
Open Market 193.2 241.9 -20.1% 1,058.4 -81.7%
Foreign Borrowings 396.4 388.6 2.0% 407.8 -2.8%
Domestic Onlending 322.1 335.5 -4.0% 240.2 34.1%
Shareholders’ Equity 498.4 587.2 -15.1% 590.5 -15.6%
Performance 1Q13 4Q12 1Q13/4Q12 1Q12 1Q13/1Q12
Free Cash 760.1 571.1 33.1% 643.6 18.1%
NPL 60 days/ Loan portfolio 2.3% 1.5% 0.8 p.p. 3.2% -0.8 p.p.
NPL 90 days/ Loan portfolio 2.2% 1.2% 1.0 p.p. 2.7% -0.6 p.p.
Basel Index 4
14.2% 14.9% -0.7 p.p. 17.5% -3.4 p.p.
ROAE -52.2% 2.5% -54.7 p.p. 3.5% -55.7 p.p.
Adjusted Net Interest Margin (NIMa) 5
5.4% 5.2% 0.2 p.p. 6,7% -1.3 p.p.
Efficiency Ratio 155.3% 78.4% 76.8 p.p. 67.6% 87.7 p.p.
Other Information 1Q13 4Q12 1Q13/4Q12 1Q12 1Q13/1Q12
Number of Corporate Clients 811 851 -4.7% 775 4.6%
Number of Employees 449 436 3.0% 426 5.4%
BI&P Employees 397 401 -1.0% 394 0.8%
Brokerage house and Serglobal Employees 52 35 48.6% 32 62.5%
Details in the respective sections of this report:
1
Excluding (i) effects of the discontinuance of the treatment of hedge accounting, adopted in 2Q12, for booking hedges of cash flows, which
continue to be protected by hedge, and (ii) discounts granted in operations renegotiated in the period. More details in the Profitability section
of this report.
2
Including additional provisions.
3
Including Guarantees issued, Private Credit Bonds (PNs and Debentures) and agro securities (CDCA, CDA/WA and CPR).
4
Excluding Agro Securities (CPRs and CDA/WA) and Private Credit Bonds (PNs and debentures).
5
Excluding (i) repos with equivalent volumes, tenors and rates both in assets, and (ii) effects of the discontinuance of the treatment of hedge
accounting, and also discounts granted in operations renegotiated in the period.
n.c. = not comparable
6/20
Operating Performance
Financial Intermediation Result
before Allowance for Loan Losses
Net Profit
Expanded Credit Portfolio Funding
Profitability
Financial Intermediation 1Q13 4Q12 1Q13/4Q12 1Q12 1Q13/1Q12
Financial Intermediation Revenues 87.6 123.7 -29.2% 161.8 -45.9%
Credit Operations 56.0 62.3 -10.2% 70.2 -20.3%
Loans & Discounts Receivables 44.8 46.9 -4.3% 62.9 -28.7%
Financing 6.8 7.5 -9.2% 6.4 7.4%
Other 4.3 8.0 -45.8% 0.9 354.7%
Securities 19.6 28.6 -31.4% 68.6 -71.4%
Derivative Financial Instruments 2.0 15.6 -87.4% (3.7) 152.3%
FX Operations Result 10.0 17.2 -41.7% 26.7 -62.5%
Financial Intermediation Expenses 64.8 75.2 -13.8% 111.0 -41.6%
Money Market Funding 53.2 56.4 -5.7% 85.3 -37.6%
Time Deposits 40.8 40.0 2.1% 45.2 -9.8%
Repurchase Transactions 4.6 8.4 -45.2% 30.5 -84.9%
Interbank Deposits 1.3 1.6 -19.9% 3.1 -59.8%
Agro Notes (LCA), Real Estate Notes (LCI) & Bank Notes (LF) 6.5 6.5 0.5% 6.4 1.6%
Loans, Assignments & Onlending 11.6 18.8 -38.0% 25.6 -54.6%
Foreign Borrowings 6.9 14.5 -52.7% 22.2 -69.1%
Domestic Borrowings & Onlending 4.8 4.3 11.9% 3.5 37.9%
Gross Result from Financial Intermediation before ALL 22.8 48.5 -53.1% 50.8 -55.2%
Allowance for Loan Losses (ALL) (133.4) (7.9) 1598.1% (14.4) 826.4%
Gross Result from Financial Intermediation (110.6) 40.7 n.c. 36.4 n.c.
50,8
59,6
48,4 48,5
22,8
51,6
43,3 45,6 44,3 44,8
1Q12 2Q12 3Q12 4Q12 1Q13
R$million
Financial Intermediation Result before ALL
Financial Intermediation Result before ALL adjusted
5,0
2,4 3,1 3,6
1Q12 2Q12 3Q12 4Q12 1Q13
R$million
2,8 2,8 3,0 3,1 3,0
1Q12 2Q12 3Q12 4Q12 1Q13
R$billion
Private Credit Bonds (PNs and Debentures)
Agro Bonds (CPR, CDA/WA and CDCA)
Guarantees Issued
Trade Finance
Loans & Financing in Reais
2,7 2,8 2,9 3,0 3,2
1Q12 2Q12 3Q12 4Q12 1Q13
R$billion
total Trade Finance & Foreign Borrowings
Domestic Onlending Interbank & Demand Deposits
Agro Bonds, Bank and Real Estate Notes Insured Time Deposits
-91.4
10.5% 15.8%
7/20
In 1Q13, the Result from Financial Intermediation before Expenses with Allowance for Loan Losses totaled
R$22.8 million, down 53.1% from 4Q12 and 55.2% from 1Q12. This result was especially impacted: (i) in the
item Derivative Financial Instruments, by the effect of discontinuance of the designation of hedge accounting,
adopted in 2Q12, of operations to protect the cash flow, which continue to be protected by hedge operations;
and (ii) in the item Loan Operations, by the discounts granted in operations renegotiated during the period.
Excluding the impact of the discontinuance of hedge accounting and the discounts given on renegotiations to
enable correct comparison between the quarters, the Result from Financial Intermediation before Expenses with
Allowance for Loan Losses would be R$44.8 million, up 1.2% in the quarter and down 13.1% from 1Q12, as
shown below:
Financial Interm. Result before ALL w/o effects of hedge
accounting and discounts granted in operations renegotiated
1Q13 4Q12 1Q13/4Q12 1Q12 1Q13/1Q12
A. Result from Financial Int. before ALL 22.8 48.5 -53.1% 50.8 -55.2%
B. Effect of discontinuance of the designation of hedge accounting (15.6) 6.2 -350.3% - n.m.
C. Discounts granted in operations renegotiated (6.5) (2.0) 228.6% (0.7) 771.3%
Adjusted Result from Financial Int. before ALL (A-B-C) 44.8 44.3 1.2% 51.6 -13.1%
n.m. = not measurable
Revenue from Credit Operations decreased (ROC) decreased from R$62.3 million in 4Q12 to R$56.0 million in
1Q13, basically due to the discounts granted on loans renegotiated during the period (R$6.5 million). Excluding
this amount, for correct comparison of the ROCs, the same remained practically stable, despite the fewer
business days in the period.
Income from Securities, which includes the results from the treasury’s proprietary position and CPR, CDA/WA and
debentures, with offset in funding expenses, decreased significantly during the period in proportion to the
significant reduction in the positions in the quarter.
The Result from Derivative Financial Instruments includes results from operations involving swaps, forwards,
futures and options used to hedge against exchange and interest rate exposure for funding operations indexed
to the inflation indexes, as well as foreign borrowings (non-trade related), hedging of commodity prices resulting
from CPR operations and indexers of federal government bonds held in the securities portfolio, in addition to the
proprietary position. The decrease in this item in the quarter is mainly due to the effect of discontinuance of the
designation of hedge accounting in 2Q12 of operations to protect cash flow from funding indexed to inflation
indexes IPCA and IGPM and foreign borrowings, with exposure to the risk of variation in interest and foreign
exchange rates, as detailed in notes 3(d) and 5(c) of the financial statements. Since then, the mark to market of
the hedge operations, which continue to protect these cash flows, was no longer booked in shareholders' equity
but in the income statement. The result of this in 1Q13 was a loss of R$15.8 million.
Income from Foreign Exchange Transactions and expenses with Foreign Borrowings were especially impacted by
the drop in demand from customers and the decline in spreads on these operations.
As for Expenses with Time Deposits, the increase of 2.1% in the quarter is in line with the 1.1% increase in the
average balance of Time Deposits in these periods (R$1,703.1 million in 1Q13 and R$1.684,9 million in 4Q12)
and the decrease of 9.8% in 12 months refers, in particular, to the fall of the benchmark interest rate. Similar to
these expenses, Expenses with Interbank Deposits and Agribusiness Letters of Credit, Real Estate Notes and
Bank Notes are also related to the average balances in the periods being compared.
Note that the Result from Financial Intermediation in 1Q13 was strongly impacted by expenses with allowance
for loan losses amounting to R$133.4 million. In the first quarter, as a prudential measure in light of a few loans
that are in the credit exit phase and which have longer terms, we set aside an additional allowance of R$110.7
million. With this, we strengthened our balance sheet for a possible deterioration of these loans, pertaining to
customers acquired before 2011, increasing the coverage of loans classified between D and H (ALL/Loans D-H)
from 47.3% at the end of December 2012 to 96.4% at the end of March 2013.
8/20
Net Interest Margin (NIM)
Adjusted net interest margin was 2.7% in 1Q13, down 3.1 p.p. in the quarter and 3.9 p.p. from 1Q12.
Net Interest Margin 1Q13 4Q12 1Q13/4Q12 1Q12 1Q13/1Q12
A. Result from Financial Interm. before ALL 22.8 48.5 -53.1% 50.8 -55.2%
B. Average Interest bearing Assets 3,603.6 3,891.0 -7.4% 4,234.5 -14.9%
Adjustment for non-remunerated average assets 1
(229.2) (505.2) -54.6% (1,096.9) -79.1%
B.a Adj. Average Interest bearing Assets 3,374.4 3,385.8 -0.3% 3,137.6 7.5%
Adjusted Net Interest Margin (NIMa) (Aa/Ba) 2.7% 5.9% -3.1 p.p. 6.6% -3.9 p.p.
1
Repos with equivalent volumes, tenors and rates both in assets and liabilities.
As described in the section on Profitability, considering the effects on the Result from Financial Intermediation
from the discontinuance of the designation of hedge accounting and discounts granted during renegotiations, of
-R$15.8 million and R$6.5 million, respectively, in the quarter, NIM would increase to 5.4% in 1Q13, as the
following table shows:
Net Interest Margin w/o effects of hedge accounting
and discounts granted in operations renegotiated
1Q13 4Q12 1Q13/4Q12 1Q12 1Q13/1Q12
A. Result from Financial Interm. before ALL 45.0 43.1 4.3% 51.6 -12.7%
B. Average Interest bearing Assets 3,603.6 3,891.0 -7.4% 4,234.5 -14.9%
Adjustment for non-remunerated average assets 1
(229.2) (505.2) -54.6% (1,096.9) -79.1%
B.a Adjusted Average Interest bearing Assets 3,374.4 3.385,8 -0.3% 3,137.6 7.5%
Adjusted Net Interest Margin (NIMa) (Aa/Ba) 2
5.4% 5.2% 0.2 p.p. 6,7% -1.3 p.p.
1
Repos with equivalent volumes, tenors and rates both in assets and liabilities
2
Excluding (i) effects of the discontinuance of the treatment of hedge accounting, adopted in 2Q12, for booking hedges of cash flows, which
continue to be protected by hedge, and (ii) discounts granted in operations renegotiated in the period.
Efficiency
The efficiency ratio was 115.3% in 1Q13, -76.8 p.p. in the quarter and -87.7 p.p. when compared to 1Q12.
Efficiency Ratio 1Q13 4Q12 1Q13/4Q12 1Q12 1Q13/1Q12
Personnel Expenses 26.4 23.7 11.3% 22.7 16.0%
Contributions and Profit-sharing 5.4 1.8 196.6% 2.1 153.9%
Administrative Expenses 13.4 13.3 0.3% 13.1 1.9%
Taxes 3.6 4.3 -16.8% 3.7 -2.8%
A- Total Operating Expenses 48.8 43.2 12.9% 41.7 17.0%
Gross Income Financial Intermediation (w/o ALL) 22.8 48.5 -53.1% 50.8 -55.2%
Income from Services Rendered 6.5 6.7 -4.4% 6.6 -2.1%
Income from Banking Tariffs 0.2 0.2 -10.9% 0.2 -13.6%
Other Net Operating Income (*) 2.0 (0.4) n.c. 4.1 -49.9%
B- Total Operating Income 31.4 55.1 -43.0% 61.7 -49.1%
Efficiency Ratio (A/B) 155.3% 78.4% 76.8 p.p. 67.6% 87.7 p.p.
(*) Net of other Operating Expenses to offset the cost of acquisition and income on sale of commodities in the activity of Serglobal Cereais.
Net Profit
The operating income of -R$144,5 million in 1Q13, after (i) the non-operating loss from the sale of properties and
non-operating assets of the R$669 thousand, (ii) taxes and contributions of the R$59,2 million, and (iii) profit
sharing of the R$5,4 million, resulted in a loss of R$91.4 million.
9/20
Credit Portfolio
Expanded Credit Portfolio
The Expanded Credit Portfolio remained practically stable in the quarter but grew 10.5% in 12 months. The
Expanded Credit Portfolio includes loan and financing operations in Brazilian Real and trade finance operations,
both detailed in note 6(a) to the financial statements, as well as: (i) guarantees issued (sureties, guarantees and
letters of credit), (ii) agribusiness bonds originated from the absorption of the operations of Serglobal Cereais
(CPR and CDA/WA); and (iii) private credit bonds (promissory notes and debentures). Items (ii) and (ii) were
both booked under Securities as per Central Bank regulations.
Expanded Credit Portfolio by Product Group 1Q13 4Q12 1Q13/4Q12 1Q12 1Q13/1Q12
Loans & Financing in Real 2,019.8 2,080.6 -2.9% 1,861.3 8.5%
Trade Finance (ACC/ACE/IMPFIN) 415.4 426.0 -2.5% 442.8 -6.2%
Guarantees Issued (LGs & L/Cs) 172.5 158.2 9.0% 163.8 5.3%
Agro Bonds (Securities: CPRs & CDA/WA; Credit: CDCAs) 370.9 327.1 13.4% 229.7 61.5%
Private Credit Bonds (Securities: PNs & Debentures) 41.1 40.1 2.5% 25.5 60.9%
Other 27.8 35.9 -22.5% 35.9 -22.5%
TOTAL 3,047.5 3,067.9 -0.7% 2,759.1 10.5%
The Middle Market segment comprises customers with
annual revenue between R$40 million and R$400 million
and Corporate segment includes companies with annual
revenue between R$400 million and R$2 billion. The
Other segment basically refers to Consumer Credit
operations for Used Vehicles and financing of non-
operating assets.
Loans and financing operations in Real, which include loans, bills discounted, acquisition of client receivables and
BNDES onlendings, represented 66.3% of the Expanded Credit Portfolio. The highest growth was in loans and
discounted receivables, up 10.2% in 12 month and down 2.6% in the quarter, and BNDES onlending, up 38.2%
in 12 months and down 4.8% in the quarter.
Trade Finance operations correspond to 13.6% of the Expanded Credit Portfolio and include import financing,
which account for 27.5% of Trade Finance operations, and export financing, which account for 72.5%. Though
we maintained our credit lines with foreign banks, the Trade Finance portfolio was negatively impacted, mainly
due to the adverse external scenario.
Guarantees issued (sureties, guarantees and import letters of credit) correspond to 5.7% of the Expanded Credit
Portfolio, up 9.0% from 4Q12 and 5.3% from 1Q12. This growth reflects the higher share of Corporate segment
customers since these operations have greater demand in this segment.
Though the portfolio of agribusiness bonds and private credit bonds represent credit exposure, it is classified
under “held for sale” marketable securities in the balance sheet, in accordance with Brazilian Central Bank
regulations due to its tradability, and has been growing consistently in recent quarters. The private bonds
portfolio grew 2.5% in the quarter and 60.9% in 12 months.
51% 51% 42% 39% 47%
48% 48% 56% 59% 51%
2% 2% 2% 2% 1%
1Q12 2Q12 3Q12 4Q12 1Q13
Expanded Credit Porfolio
Middle Market Corporate Others
10/20
The agribusiness bonds portfolio continues to increase its share of the Expanded Credit Portfolio, accounting for
12.2% in 1Q13.
Agro Bonds Portfolio 1Q13 4Q12 1Q13/4Q12 1Q12 1Q13/1Q12
Booked under Securities 311.2 245.3 26.9% 184.1 69.0%
Warrants - CDA/WA 7.1 8.0 -10.6% 7.2 -1.8%
Agro Product Certificate - CPR 304.1 237.4 28.1% 176.9 71.9%
Booked under Credit Portfolio - Loans & Financing 59.7 81.8 -27.0% 45.6 31.1%
Agro Credit Rights Certificate - CDCA 59.7 81.8 -27.0% 45.6 31.1%
AGRICULTURAL BONDS 370.9 327.1 13.4% 229.7 61.5%
Our Expanded Credit Portfolio breakdown is as follows:
By Economic Activity By Region By Customer Segment
By Economic Sector By Product
Industry
49%
Commerce
28%
Other
Services
20%
Individuals
2%
Financial
Institution
1%
North
1%
Northeast
2%
South
19%
Midwest
21%
Southeast
57%
Corporate
52%
Middle
Market
47%
Others
1%
7,0%
1,0%
1,4%
1,6%
1,7%
1,7%
1,8%
2,5%
2,9%
3,0%
3,0%
3,0%
3,1%
3,3%
3,9%
4,2%
5,7%
13,0%
13,4%
22,8%
Other sectors (% lower than 1%)
Individuals
Financial institutions
Power Generation & Distribution
Machinery and Equipments
Electronics
Financial Services
Education
Advertising & Publishing
Commerce - Retail & Wholesale
Oil & Biofuel
Metal Industry
Textile, apparel & Leather
Pulp & Paper
Chemical & Pharmaceutical
Transportation & Logistics
Automotive
Construction
Food & Beverage
Agribusiness
Loans &
Discounts
56%
BNDES
Onlending
10%
Trade
Finance
14%
Agro Bonds
12% Guarantees
Issued
6%
Debentures
1%
Other
1%
11/20
Credit Porfolio
The “classic” credit portfolio, which excludes guarantees issued and credits classified under “held for sale”
marketable securities, totaled R$2.5 billion at the end of March 2013, in which Operations in Real accounted for
R$2.1 billion while Trade Finance operations totaled R$415.4 million.
This quarter, the portfolio was more evenly balanced between the Middle Market and Corporate segments: the
Middle Market segment accounted for 49.0% of the credit portfolio (42.0% in December 2012) and the
Corporate segment for 49.6% (56.4% in December 2012). Other loans, classified as Other, include the balance
of the direct consumer credit - used vehicles (CDC) portfolio, portfolios acquired from other banks and financing
of non-operating assets, and corresponded to 1.4% of the portfolio (1.6% in December 2012).
Credit Portfolio By Client Segment 1Q13 4Q12 1Q13/4Q12 1Q12 1Q13/1Q12
Middle Market 1,237.1 1,101.9 12.3% 1,500.8 -17.6%
Local Currency - Real 1,072.6 882.0 21.6% 1,211.3 -11.4%
Loans & Discounted Receivables 913.7 737.4 23.9% 1,051.7 -13.1%
Financing 0.0 0.0 n.m. 0.0 n.m.
BNDES / FINAME Onlending 158.9 144.7 9.9% 159.6 -0.4%
Foreign Currency 164.5 219.9 -25.2% 289.6 -43.2%
Corporate 1,251.0 1,479.8 -15.5% 830.6 50.6%
Local Currency - Real 1,000.0 1,273.7 -21.5% 677.3 47.6%
Loans & Discounted Receivables 839.6 1,083.0 -22.5% 518.8 61.9%
BNDES / FINAME Onlending 160.4 190.7 -15.9% 71.5 124.5%
Acquired Receivables 0.0 0.0 n.m. 87.1 -100.0%
Foreign Currency 250.9 206.1 21.7% 153.3 63.7%
Other 34.7 42.6 -18.6% 54.2 -36.0%
Consumer Credit – used vehicles 0.3 0.6 -45.7% 3.0 -89.8%
Acquired Loans & Financing 4.9 6.7 -26.5% 18.3 -73.0%
Non-Operating Asset Sales Financing 29.4 35.3 -16.6% 32.9 -10.5%
CREDIT PORTFOLIO 2,522.7 2,624.3 -3.9% 2,385.6 5.7%
By Collateral By Customer Concentration By Maturity
Aval PN
50%
Receivables
25%
Pledge /
Lien
9%
Property
8%
Monitored
Pledge
5%
Vehicles
2%Securities
1%
10 largest
16%
11 - 60
32%
61 - 180
27%
Other
25%
Up 90
days
36%
91 to 180
days
19%
181 to 360
days
16%
+360 days
29%
12/20
Quality of Credit Porfolio
Rating AA A B C D E F G H
Comp. TOTAL
ALL/
Loan
Port.
%
Required Provision % 0% 0,5% 1% 3% 10% 30% 50% 70% 100%
1Q13
Outstanding Loans 43.9 1,020.3 908.3 321.9 49.0 108.2 42.8 4.5 23.7 - 2,522.7
8.7%
ALL 0.0 5.1 9.1 9.7 4.9 32.5 21.4 3.1 23.7 110.7 220.2
4Q12
Outstanding Loans 53.4 1,103.2 919.8 344.7 65.0 82.2 27.1 8.5 20.4 - 2,624.3
3.7%
ALL 0.0 5.5 9.2 10.3 6.5 24.7 13.6 6.0 20.4 0.0 96.1
1Q12
Outstanding Loans 94.9 921.4 776.9 397.8 38.8 97.8 19.9 11.7 26.4 - 2,385.6
4.3%
ALL 0.0 4.6 7.8 11.9 3.9 29.4 10.0 8.2 26.4 0.0 102.0
During the quarter, we maintained the percentage of loans classified between AA and B high, at 97.8%, thus
maintaining the quality of the credit portfolio. The balance of loans classified in the low risk categories (AA to B)
accounted for 78.2% of the loan operations in the quarter (79.1% and 75.2%, respectively, at the end of 4Q12
and 1Q12), as the following chart shows:
Of the R$228.3 million classified between D and H (R$203.2 million in December 2012 and R$194.6 million in
March 2012), R$169.1 million correspond to loans whose payments are regular, equivalent to 74% of the total
(81% in December 2012 and 61% in March 2012). The remaining 26% correspond to overdue loans and are
detailed below:
Default by segment 1Q13 4Q12
> 60 days > 90 days
1Q13 4Q12 1Q13 4Q12
Credit Portfolio NPL %T NPL %T NPL %T NPL %T
Middle Market 1,237.1 1,101.9 45.9 3.7% 37.9 3.4% 44.8 3.6% 30.9 2.8%
Corporate 1,251.0 1,479.8 5.5 0.4% 1.5 0.1% 1.9 0.2% - 0.0%
Others 34.7 42.6 7.7 22.3% 0.2 0.5% 7.6 21.9% 0.2 0.5%
TOTAL 2,522.7 2,624.3 59.2 2.3% 39.6 1.5% 54.3 2.2% 31.1 1.2%
Allowance Loan Losses (ALL) 220.2 96.1
ALL / NPL - 372.2% 242.7% 405.1% 309.3%
ALL / Loan Portfolio 8.7% 3.7% - - - -
The default rate on loans overdue by more than 60 days (NPL 60 days) dropped 0.8 p.p. in 12 months but
increased by 0.8 p.p. from the previous quarter, while loans overdue by more than 90 days (NPL 90 days)
increased by 1.0 p.p. in the quarter but declined 0.6 p.p. in relation to March 2012, reflecting the improving
quality of our credit portfolio in the past 12 months.
The improvement in the NPL indicators in the 12-month comparison reflects the strategy adopted in 2011 of
enhancing the credit portfolio with better quality loans; on the other hand, the worsening of the indicators in the
4%
2%
2%
39%
42%
40%
33%
35%
36%
17%
13%
13%
8%
8%
9%
1Q12
4Q12
1Q13
AA A B C D - H
78.2%
79.1%
75.2%
13/20
quarter basically reflects the performance of older customers, that is, those acquired before 2011, for whom the
additional allowance mentioned earlier was created.
A comparison of the performance of the older portfolio (customers acquired before 2011) with that of the new
portfolio shows the better quality of the customers acquired under the new lending policy, as the table shows:
ALL/Credit Portfolio Ratio 1Q13
ALL/Credit Portfolio 8.7%
Clients acquired after April 2011 1.7%
Middle Market 2.7%
Corporate 1.1%
Clients acquired before April 2011 8.2%
Clients acquired after April 2011 including additional ALL 18.8%
Allowance for loan losses totaled R$220.2 million, providing coverage of 3.7x the balance of NPL 60 days, and of
4.1x the balance of NPL 90 days, mainly impacted, as mentioned earlier, by the additional provision of R$110.7
million for customers in the portfolio prior to April 2011.
Note that the potential default rate (ratio of installments overdue by between 15 and 60 days to the total credit
portfolio) was 0.2% in March 2013, a significant improvement of 0.6 p.p. in the quarter and of 0.4 p.p. in 12
months. During the quarter, R$9.3 million (R$15.3 million in 4Q12 and R$55.1 million in 1Q12) in loan
operations, already fully provisioned, were written off as losses.
14/20
Funding
Funding totaled R$3.2 billion at the end of March 2013, increasing 5.7% in the quarter and 15.9% in 12 months.
Time deposits through the issue of Bank Deposit Certificates (CDB) and Time Deposits with Special Guarantee
(DPGE I) are the main sources, accounting for 25.8% and 29.4%, respectively, of total funding. Funding through
agribusiness letters of credit (LCA), which increased 30% in the quarter and 63.9% in the year, Real Estate
Letters of Credit (LCI), which began in the second half of 2012, and Bank Notes (LF) correspond, all together, to
16.7% of the total funding balance, contributing to more balanced funding costs and diversification of our
product offering.
Funding in foreign currency is especially allocated to Trade Finance operations and its balance is impacted by
foreign exchange variations.
Total Funding 1Q13 4Q12 1Q13/4Q12 1Q12 1Q13/1Q12
Total Deposits 2,451.3 2,274.6 7.8% 2,087.8 17.4%
Time Deposits 818.1 707.0 15.7% 816.2 0.2%
Insured Time Deposits (DPGE) 931.8 1,007.4 -7.5% 799.7 16.5%
Agro Notes (LCA) 473.7 364.4 30.0% 288.9 63.9%
Bank Notes (LF) 33.1 29.5 12.1% 7.6 337.2%
Real Estate Notes (LCI) 23.9 12.1 96.9% 0.0 n.m.
Interbank Deposits 91.4 98.0 -6.7% 127.4 -28.3%
Demand Deposits and Other 79.3 56.1 41.2% 48.0 65.3%
Domestic Onlending 322.1 335.5 -4.0% 240.2 34.1%
Foreign Borrowings 396.4 388.6 2.0% 407.8 -2.8%
Trade Finance 345.9 337.4 2.5% 362.3 -4.5%
Other Foreign Borrowings 50.5 51.2 -1.3% 45.4 11.2%
TOTAL 3,169.7 2,998.7 5.7% 2,735.7 15.9%
By Type By Investor By Maturity
The average term of deposits stood at 745 days from issuance (800 days in December 2012) and 391 days from
maturity (430 days in December 2012).
Average Term in days
Type of Deposit from issuance to maturity 1
Time Deposits 476 310
Interbank 100 47
Time Deposits Special Guarantee (DPGE) 1,369 661
Agro Notes (LCA) 115 67
Bank Notes (LF) 891 602
Real Estate Notes (LCI) 169 104
Portfolio of Deposits 2
745 391
1
From March 31, 2013. | 2
Volume weighted average.
Time
Deposit
26%
Insured
Time Dep.
(DPGE)
29%
Agro
Bonds
15%
Bank and
Real Estate
Notes
2%
Onlendings
10%
Trade
Finance
11%
Foreign
Loans
2%
Interbank
3%
Demand
2%
Institutional
Investors
42%
Corporates
15%
Individuals
6%
National
Banks
8%
Brokers
3%
Other
4%
BNDES
10%
Foreign
Banks
12%
Demand
2%
up 90
days
34%
90 to 180
days
12%
180 to
360 days
13%
+360
days
39%
15/20
Free Cash
On March 31, 2013, the free cash position totaled R$760.1 million,
equivalent to 31% of total deposits and 1.5x shareholders’ equity. The
calculation considers cash, short-term interbank investments and securities
less funds raised in the open market and debt securities classified under
marketable securities, comprising rural product certificates (CPRs),
agribusiness deposit certificates and warrants (CDAs/WAs), debentures and
promissory notes (NPs).
Capital Adequacy
The Basel Accord requires banks to maintain a minimum percentage of the capital weighted by the risk in their
operations. In this context, the Central Bank of Brazil has stipulated that banks operating in the country should
maintain a minimum percentage of 11%, calculated according to the Basel II Accord regulations, which provides
greater security to Brazil’s financial system against oscillations in economic conditions.
In line with the best risk management practices, the BI&P bank has been taking steps to implement the Basel III
requirements. Thus, the Basel Index in the first quarter was impacted by the new criteria for weighting risk
according to the size of corporate customers.
The following table shows BI&P’s position in relation to the Central Bank’s minimum capital requirements:
Basel Index
1Q13 1Q13* 4Q12 1Q13/4Q12 1Q12 1Q13/1Q12
Total Capital 485.3 577,3 583.3 -16.8% 588.1 -17.5%
Tier I 486.3 578,3 584.3 -16.8% 576.6 -15.7%
Tier II 1.3 1,3 1.3 -0.9% 14.0 -90.5%
Deductions (2.3) (2,3) (2.3) 0.0% (2.4) -4.8%
Required Capital 376.8 376,8 430.3 -12.4% 369.1 2.1%
Credit Risk allocation 329.0 329,0 372.9 -11.8% 326.8 0.7%
Market Risk Allocation 29.9 29,9 38.2 -21.7% 22.1 35.2%
Operating Risk Allocation 17.9 17,9 19.7 -9.2% 20.2 -11.4%
Excess over Required Capital 108.5 200,5 153.1 -29.1% 219.0 -50.5%
Basel Index 14.2% 16,8% 14.9% -0.7 p.p. 17.5% -3.4 p.p.
* Simulation of the Basel Index if the capital increase of R$92 million occurred in March 31, 2013.
Risk Ratings
Agency Classification Observation
Last
Report
Financial
Data
Standard & Poor’s
BB/ Negative/ B
brA+/ Negative/ brA-1
Global Scale
Local Scale - Brazil
Mar. 13, 2013 Dec 31, 2012
Moody's
Ba3/ Stable/ Not Prime
A2.br/ Stable/ BR-2
Global Scale
Local Scale - Brazil
Feb. 14, 2013 Sept 30, 2012
FitchRatings BBB/ Stable/ F3 Local Scale - Brazil Nov. 12, 2012 Sept. 30, 2012
RiskBank
10,38
Ranking: 41
Riskbank Index
Low Risk Short Term
Apr. 12, 2013 Dec 31, 2012
644 571
760
1Q12 4Q12 1T13
R$million
16/20
Capital Market
Total Shares and Free Float
Number of shares as of March 31,2013
Type
Corporate
Capital
Controlling
Group
Management Treasury Free Float %
Common 36,945,649 20,743,333 277,307 - 15,925,009 43.1%
Preferred 26,160,044 619,026 60,125 734,515 24,746,378 94.6%
TOTAL 63,105,693 21,362,359 337,432 734,515 40,671,387 64.4%
Share Buyback Program
The following Stock Option Plans, approved for the Company’s executive officers and managers, as well as
individuals who provide services to the Company or its subsidiaries, had the following balances on March 31,
2013:
Quantity
Stock
Option
Plan
Date of
Approval
Grace Period
Term for
Exercise
Granted Exercised Extinct Not Exercised
I 03.26.2008 Three years Five years 2,039,944 37,938 215,967 1,786,039
II 04.29.2011 Three years Five years 1,840,584 - 326,048 1,514,536
III 04.29.2011 Five years Seven years 1,850,786 - - 1,850,786
IV 04.24.2012 Up to five years Five years 605,541 - 14,745 590,796
6,336,855 37,938 556,760 5,742,157
The aforementioned Stock Options Plans are filed in the IPE system of the Securities and Exchange Commission
of Brazil (CVM) and are also available in the Company’s IR website.
Remuneration to Shareholder
In the first quarter of 2013, the Bank neither provisioned nor paid interest on equity, calculated based on the
Long-Term Interest Rate (TJLP) and calculated towards the minimum dividend for fiscal year 2013. The Board of
Directors will, by the end of the year, study the possibility of early payment of interest on equity after
considering the results and the tax efficiency of such payment.
Share Performance
The preferred shares of BI&P (IDVL4), listed in the Level 2 Corporate Governance segment of BM&FBOVESPA,
closed March 2013 at R$7.49, for market cap of R$467.2 million, including the shares existing on March 31, 2013
and excluding treasury stock. The price of IDVL4 shares dropped 5.8% in the quarter and 12.9% (11.6%
adjusted for earnings) in the 12 months ended in March 2013. The Bovespa Index (Ibovespa) dropped 7.5% in
the quarter and 12.6% in relation to 1Q12. At the end of the quarter, the price/book value (P/BV) was 0.94.
17/20
Share Price evolution in the last 12 months
Liquidity and Trading Volume
The preferred shares of BI&P (IDVL4) were traded in 100% of the sessions in the quarter and 92.6% of the 243
sessions in the past 12 months. The volume traded on the spot market in the quarter was R$2.3 million,
involving 294,000 IDVL4 shares in 454 trades. In the 12 months ended in March 2013, the volume traded on the
spot market was R$26.3 million, involving around 3.7 million preferred shares in 2,325 trades.
Shareholder Base
Position as of March 31, 2013
Qtt Type of Shareholder IDVL3 % IDVL4 % TOTAL %
5 Controlling Group 20,743,333 56.1% 619,026 2.4% 21,362,359 33.9%
6 Management 277,307 0.8% 60,125 0.2% 337,432 0.5%
- Treasury - 0.0% 734,515,00 2.8% 734,515 1.2%
39 National Investors 1,201,090 3.3% 8,471,079 32.4% 9,672,169 15.3%
13 Foreign Investors 4,891,304 13.2% 13,980,344 53.4% 18,871,648 29.9%
6 Corporate - 0.0% 6,712 0.0% 6,712 0.0%
288 Individuals 9,832,615 26.6% 2,288,243 8.7% 12,120,858 19.2%
357 TOTAL 36,945,649 100.0% 26,160,044 100.0% 63,105,693 100.0%
18/20
Balance Sheet
Consolidated R$ thousand
Assets 03/31/12 12/31/12 03/31/13
Current 3,811,194 3,063,804 3,295,573
Cash 25,215 18,250 64,521
Short-term interbank investments 617,066 429,535 546,759
Open market investments 559,764 377,495 518,490
Interbank deposits 57,302 52,040 28,269
Securities and derivative financial instruments 1,281,882 671,587 718,515
Own portfolio 615,536 473,468 515,238
Subject to repurchase agreements 524,128 26,654 51,598
Linked to guarantees 129,701 150,415 127,461
Subject to the Central Bank - - -
Derivative financial instruments 12,517 21,050 24,218
Interbank accounts 3,337 938 11,996
Loans 1,294,343 1,495,533 1,354,555
Loans - private sector 1,316,621 1,515,490 1,451,470
Loans - public sector - - -
(-) Allowance for loan losses (22,278) (19,957) (96,915)
Other receivables 538,250 390,712 545,482
Foreign exchange portfolio 408,036 363,445 508,913
Income receivables 1,136 67 43
Negotiation and intermediation of securities 34,381 14,356 27,444
Sundry 100,282 17,300 13,909
(-) Allowance for loan losses (5,585) (4,456) (4,827)
(-) Outras provisões - - -
Other assets 51,101 57,249 53,745
Other assets 52,183 59,695 50,248
(-) Provision for losses (2,780) (4,277) -
Prepaid expenses 1,698 1,831 3,497
Long term 719,321 906,467 907,312
Short-term interbank investments - - -
Open market investments - - -
Interbank deposits - - -
Marketable securities and derivative financial instruments 27,918 59,737 51,163
Own portfolio 52 42 42
Subject to repurchase agreements - - -
Linked to guarantees - - -
Derivative financial instruments 27,866 59,695 51,121
Interbank Accounts 4,784 4,083 -
Loans 556,306 693,561 625,129
Loans - private sector 625,260 756,459 737,581
Loans - public sector - - -
(-) Allowance for loan losses (68,954) (62,898) (112,452)
Other receivables 129,823 148,536 199,332
Credit guarantees honored - 778 -
Trading and Intermediation of Securities 536 524 517
Sundry 134,501 156,024 204,788
(-) Allowance for loan losses (5,214) (8,790) (5,973)
Other rights 490 550 31,688
Permanent Assets 52,498 51,711 56,236
Investments 24,578 24,980 29,403
Subsidiaries and Affiliates 22,892 23,294 27,717
Other investments 1,842 1,842 1,842
(-) Loss Allowances (156) (156) (156)
Property and equipment 13,739 13,648 14,077
Property and equipment in use 1,210 1,210 1,210
Revaluation of property in use 2,634 2,634 2,634
Other property and equipment 18,440 19,660 20,481
(-) Accumulated depreciation (8,545) (9,856) (10,248)
Intangible 14,181 13,083 12,756
Goodwill 2,391 2,276 2,276
Other intangible assets 13,100 13,100 13,100
(-) Accumulated amortization (1,310) (2,293) (2,620)
TOTAL ASSETS 4,583,013 4,021,982 4,259,121
19/20
Consolidated R$ thousand
Liabilities 03/31/12 12/31/12 03/31/13
Current 2,984,718 2,123,097 2,512,472
Deposits 982,842 839,973 928,651
Cash deposits 47,964 56,145 79,284
Interbank deposits 126,365 97,867 91,336
Time deposits 808,513 685,961 758,031
Other - - -
Funds obtained in the open market 1,058,390 241,904 193,228
Own portfolio 520,776 26,745 51,699
Third party portfolio 175,021 106,200 53,211
Unrestricted Portfolio 362,593 108,959 88,318
Funds from securities issued or accepted 296,488 376,325 497,095
Agribusiness Letters of Credit, Real State Notes & Bank Notes 296,488 376,325 497,095
Interbank accounts 327 - 180
Receipts and payment pending settlement 327 - 180
Interdepartamental accounts 19,724 9,168 15,741
Third party funds in transit 19,724 9,168 15,741
Borrowings 362,521 388,626 396,399
Foreign borrowings 362,521 388,626 396,399
Onlendings 95,761 119,575 125,570
BNDES 58,487 77,426 83,659
FINAME 37,274 42,149 41,911
Other liabilities 168,665 147,526 355,608
Collection and payment of taxes and similar charges 835 509 287
Foreign exchange portfolio 72,021 46,177 206,208
Taxes and social security contributions 3,563 4,682 4,156
Social and statutory liabilities 1,750 10,320 2,500
Negotiation and intermediation securities 63,956 70,082 74,364
Derivative financial instruments 18,050 7,604 53,512
Sundry 8,490 8,152 14,581
Long Term 1,006,412 1,310,648 1,247,172
Deposits 808,429 1,028,553 992,003
Interbank Deposits 1,080 110 58
Time deposits 807,349 1,028,443 991,945
Funds from securities issued or accepted - 29,751 33,503
Agribusiness Letters of Credit, Real State Notes & Bank Notes - 29,751 33,503
Loan obligations 45,230 - -
Foreign loans 45,230 - -
Onlending operations - Governmental Bureaus 144,477 215,876 196,525
Federal Treasure 9,980 8,407 7,702
BNDES 61,639 118,477 101,588
FINAME 71,873 88,780 87,017
Other Institutions 985 212 218
Other liabilities 8,276 36,468 25,141
Taxes and social security contributions 6,297 29,598 18,468
Derivative financial instrument 213 2,620 2,420
Sundry 1,766 4,250 4,253
Future results 1,378 1,036 1,031
Shareholders' Equity 590,505 587,201 498,446
Capital 572,396 572,396 572,396
Capital Reserve 8,248 14,886 17,565
Revaluation reserve 1,377 1,340 1,327
Profit reserve - 3,512 (87,860)
(-) Treasury stock (5,859) (5,859) (5,859)
Asset valuation Adjustment 12,578 - -
Accumulated Profit / (Loss) 1,765 - -
Minority Interest - 926 877
TOTAL LIABILITIES 4,583,013 4,021,982 4,259,121
20/20
Income Statement
Consolidated R$ thousand
1Q12 4Q12 1Q13
Income from Financial Intermediation 161,778 123,742 87,588
Loan operations 70,197 62,343 55,972
Income from securities 68,606 28,626 19,626
Income from derivative financial instruments (3,746) 15,554 1,960
Income from foreign exchange transactions 26,721 17,219 10,030
Expenses from Financial Intermediaton 125,348 83,055 198,223
Money market funding 85,303 56,444 53,208
Loans, assignments and onlendings 25,647 18,756 11,631
Allowance for loan losses 14,398 7,855 133,384
Gross Profit from Financial Instruments 36,430 40,687 (110,635)
Other Operating Income (Expense) (27,151) (33,835) (33,887)
Income from services rendered 6,590 6,747 6,451
Income from tariffs 199 193 172
Personnel expenses (22,738) (23,700) (26,373)
Other administrative expenses (13,123) (13,331) (13,371)
Taxes (3,705) (4,326) (3,600)
Result from affiliated companies 1,544 991 787
Other operating income 4,971 5,473 3,204
Other operating expense (889) (5,882) (1,157)
Operating Profit 9,279 6,852 (144,522)
Non-Operating Profit 2,884 (1,616) (669)
Earnings before taxes ad profit-sharing 12,163 5,236 (145,191)
Income tax and social contribution (4,979) 220 59,189
Income tax 579 (4,553) 6,632
Social contribution 415 (2,722) 4,057
Deferred fiscal assets (5,973) 7,495 48,500
Statutory Contributions & Profit Sharing (2,139) (1,831) (5,431)
Net Profit for the Period 5,045 3,625 (91,433)

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1Q13 Earnings Release Report

  • 1. 1/20 Conclusion of the cycle of changes started in April 2011 Capital increase of up to R$92 million and additional allowance for loans granted under the previous credit concession criteria BI&P - Banco Indusval & Partners is a commercial bank with 45 years of experience in the financial market, focusing on local and foreign currency, fixed income and corporate finance for companies. BI&P relies on a network of 11 branches strategically located in economically relevant Brazilian regions, including an offshore branch in Cayman Islands, its brokerage firm operating at the São Paulo Stock, Commodities and Futures Exchange - BM&FBOVESPA and Serglobal Cereais, acquired in April 2011, which originates agricultural bonds. Highlights  This quarter we completed a cycle that begun in April 2011 with the entry of a new management team and new shareholders including the private equity fund Warburg Pincus. It was two years of restructuring of the Bank as a whole, adoption of a new Vision, change in the operating segment (migration to bigger companies with lower risk), changes to the credit granting criteria, expansion and sophistication of the product offering, renewal of nearly 80% of the sales team, structuring of the derivatives and agricultural bonds desk, a more active treasury area, acquisition of an investment banking team (Voga), structuring and distribution of fixed income products and establishment of new strategic alliances in Brazil and abroad. Today, all the teams, processes and strategies are fully operational.  During the period, we recycled our loan portfolio by acquiring new customers and through credit exit from poor quality loans.  To conclude this first cycle and to ensure that the future Bank results are not contaminated, in 1Q13 we decided to strengthen the allowance for loan losses (ALL). Of the total ALL expenses of R$133.4 million in the quarter, R$126.5 million pertain exclusively to the loans originated before April 2011. With this, the allowance coverage for loans classified between D and H increased from 47.3% in December 2012 to 96.4% in March 2013, reflecting a more conservative approach by the current management. As a result of this allowance, we recorded a loss of R$91.4 million in the quarter.  On a parallel note, we announced on this date a capital increase of up to R$92 million, of which the private equity fund Warburg Pincus and the controlling shareholders have already committed to subscribed to R$82 million, which underlines the confidence of all the parties in laying the solid foundation for a differentiated bank in the market.  After the approval by Brazilian Central Bank in April 17, we also announced on this date the closing of the acquisition process of Voga Empreendimentos e Participações Ltda, which is fully integrated into BI&P activities and working together with the sales team to identify new business opportunities. IDVL4: R$7.24 per share Closing: May 14, 2013 Outstanding Shares: 62,371,178 Market Cap: R$451.6 million Price/Book Value: 0.91 Conference Call / Webcasts May 15, 2013 In English 11 a.m. (US EST) / 12 p.m. (Brasília) Connections Brazil: +55 11 4688-6361 USA: +1 786 924-6977 Code: BI&P In Portuguese 10 a.m. (US EST) / 11 a.m. (Brasília) Number: +55 11 4688-6361 Code: BI&P Website www.bip.b.br/ir
  • 2. 2/20 Summary Message from the Management .............................................................................................3 Macroeconomic Environment .................................................................................................4 Key Indicators .....................................................................................................................5 Operating Performance .........................................................................................................6 Credit Portfolio ....................................................................................................................9 Funding ............................................................................................................................ 14 Free Cash ......................................................................................................................... 15 Capital Adequacy ............................................................................................................... 15 Risk Ratings ...................................................................................................................... 15 Capital Markets.................................................................................................................. 16 Balance Sheet ................................................................................................................... 18 Income Statement ............................................................................................................ 20
  • 3. 3/20 Message from Management Since April 2011, we have been working on broadly restructuring Banco BI&P, on expanding our operations, on reviewing the credit granting criteria, on expanding the product offering and on strengthening the teams. This restructuring was concluded in the first quarter of 2013 and the most significant changes are:  New Vision and new management team, with a team of renowned professionals;  New sales team: around 80% of the team was renewed, with the entry of professionals better qualified for our multiple product offering;  Repositioning of our target market to focus on bigger companies with lower risk;  New lending criteria, with more conservative risk and diversification criteria;  Reconstruction of the expanded credit portfolio within the new parameters, and portfolio growth of 52.8% since March 2011;  Expansion of the product and service offering for the purpose of cross selling to the customer base;  Structuring of the derivatives and agricultural bonds desk and an active treasury area in all the markets;  Investment banking team from Voga and fixed income structuring and distribution team already integrated with the Bank’s operations, working jointly with the sales team to identify new business opportunities;  Broadening of the funding mix, with diversification of funding sources and reduction of funding cost. In addition to all the efforts and investments made in processes and technology, we have worked in building a highly qualified team that is aligned with our values. During this period, we conducted organizational climate surveys, 360-degree feedback, force curve analysis, and constant training programs. We also placed emphasis on the trainee and intern program since we believe that by laying a solid foundation will we become a sustainable bank in the long run. To conclude this first cycle and to ensure that the future results of the Bank do not get tainted for loan losses, in 1Q13 we decided to strengthen the allowance for loan losses (ALL). Of the total ALL expenses of R$133.4 million in this quarter, R$126.5 million pertain exclusively to the loans originated before April 2011, of which R$110.7 million are the additional provisions. With this, we substantially improved coverage for loans classified between D and H, which increased from 47.3% in December 2012 to 96.4% in March 2013, reflecting a more conservative approach by the current management. As a result of this allowance, we recorded a loss of R$91.4 million in the quarter. At the same time, to maintain shareholders' equity at the same level as at the end of 2012, we announced on this date a capital increase of up to R$92 million, of which the private equity fund Warburg Pincus and the controlling shareholders have already committed to subscribe R$82 million, which underlines the confidence of all the parties in laying the solid foundation for a differentiated bank in the market. Had this capital increase taken place at the end of March 2013, it would have raised our Basel Index from the current 14.2% to 16.8%. And why create an additional provision now? As mentioned already, this quarter we concluded the whole process of building a new BI&P, with the most recent step being the acquisition of Voga and the arrival of a strong investment banking team. With this reinforcement to our allowance, we plan to eliminate possible problems from the past that could impact our future results. Our focus now is to gain scale in terms of assets and accelerate the generation of fee revenue in order to deliver an adequate result for our shareholders.
  • 4. 4/20 Macroeconomic Scenario Despite the recent volatility of economic data - with strong growth in January and a slowdown in February - the Brazilian economy is showing more consistent signs of recovery in the first quarter, especially in terms of investments. The country’s GDP will probably show that the economy grew at the best pace since 2010, with industry recovering. Another sector worthy of highlighting is agriculture which, in the first quarter, did not suffer from the unusual climatic conditions such as in the beginning of 2012 in south Brazil and should register a new gain production record during the harvest in the first half of this year. In a scenario of improved economic data and continuously high inflation, the Central Bank of Brazil started a monetary tightening cycle, yet maintained a cautious approach on account of the deep uncertainties surrounding the global economy, notably the weak economic growth in Europe and the recent slowdown of the Chinese economy, indicating that the increase in interest rates should be less intense. In the foreign exchange market, the higher volatility seen at the end of 2012 continued in the beginning of this year and the Central Bank once again intervened by using exchange derivatives several times during the quarter to maintain the exchange rate within the range of R$1.95 and R$2.05. These interventions make it clear that the Central Bank wants to avoid inflationary pressures resulting from the devaluation of the Real as it happened in 2012. Credit volume in the national financial system grew 2.5% in the quarter to reach R$2.43 trillion. Credit volume in 12 months increased by 17%, with the average loan term increasing to 75 months in March 2012 to 86 months in the first quarter of 2013. As a percentage of GDP, credit volume increased from 53.8% in the fourth quarter of 2012 to 53.9% in March 2013, well above the 49.3% in the same period last year. Default in the individuals segment dropped from 8.0% in the last quarter of 2012 to 7.6% now, while corporate default remained practically stable at 3.6%. The slight improvement in default indicators is in line with the more selective approach to lending adopted by banks and the gradual improvement of the economy, which has kept unemployment rates at close to historic lows. Macroeconomic Data 1Q13 4Q12 1Q12 2013e Real GBP Growth (Q/Previous Q) 1.0%(e) 0.6% 0.1% 2.9% Inflation (IPCA - IBGE) – quarterly change 1.94% 1.99% 1.22% 6.00% Inflation (IPCA - IBGE) – annual change 6.59% 5.84% 5.24% 6.00% FX (US$/R$) – quarterly change -1.45% 0.64% -2.86% 5.50% Interest Rate (Selic) 7.25% 7.25% 9.75% 8.50% e= expectation
  • 5. 5/20 Key Indicators The financial and operating information presented in this report are based on consolidated financials prepared in millions of Real (local currency), according to Brazilian GAAP (BRGAAP), except were otherwise stated. Results 1Q13 4Q12 1Q13/4Q12 1Q12 1Q13/1Q12 Result from Financial Int. before ALL adjusted 1 44.8 44.3 1.2% 51.6 -13.1% Effects of hedge accounting and discounts 1 (22.1) 4.3 -618.9% (0.7) n.c. Result from Financial Int. before ALL 22.8 48.5 -53.1% 50.8 -55.2% ALL Expenses 2 (133.4) (7.9) 1598.1% (14.4) 826.4% Result from Financial Intermediation (110.6) 40.7 -371.9% 36.4 -403.7% Net Operating Expenses (33.9) (33.8) 0.2% (27.2) 24.8% Operating Result (144.5) 6.9 n.c. 9.3 n.c. Net Profit (Loss) (91.4) 3.6 n.c. 5.0 n.c. Assets & Liabilities 1Q13 4Q12 1Q13/4Q12 1Q12 1Q13/1Q12 Loan Portfolio 2,522.7 2,624.3 -3.9% 2,385.6 5.7% Expanded Loan Portfolio 3 3,047.5 3,067.9 -0.7% 2,759.1 10.5% Cash & Short Term Investments 611.3 447.8 36.5% 642.3 -4.8% Securities and Derivatives 769.7 731.3 5.2% 1,309.8 -41.2% Securities excl. Agro Sec. & Private Credit Bonds 4 417.4 445.9 -6.4% 1,100.1 -62.1% Total Assets 4,259.1 4,022.0 5.9% 4,583.0 -7.1% Total Deposits 2,451.3 2,274.6 7.8% 2,087.8 17.4% Open Market 193.2 241.9 -20.1% 1,058.4 -81.7% Foreign Borrowings 396.4 388.6 2.0% 407.8 -2.8% Domestic Onlending 322.1 335.5 -4.0% 240.2 34.1% Shareholders’ Equity 498.4 587.2 -15.1% 590.5 -15.6% Performance 1Q13 4Q12 1Q13/4Q12 1Q12 1Q13/1Q12 Free Cash 760.1 571.1 33.1% 643.6 18.1% NPL 60 days/ Loan portfolio 2.3% 1.5% 0.8 p.p. 3.2% -0.8 p.p. NPL 90 days/ Loan portfolio 2.2% 1.2% 1.0 p.p. 2.7% -0.6 p.p. Basel Index 4 14.2% 14.9% -0.7 p.p. 17.5% -3.4 p.p. ROAE -52.2% 2.5% -54.7 p.p. 3.5% -55.7 p.p. Adjusted Net Interest Margin (NIMa) 5 5.4% 5.2% 0.2 p.p. 6,7% -1.3 p.p. Efficiency Ratio 155.3% 78.4% 76.8 p.p. 67.6% 87.7 p.p. Other Information 1Q13 4Q12 1Q13/4Q12 1Q12 1Q13/1Q12 Number of Corporate Clients 811 851 -4.7% 775 4.6% Number of Employees 449 436 3.0% 426 5.4% BI&P Employees 397 401 -1.0% 394 0.8% Brokerage house and Serglobal Employees 52 35 48.6% 32 62.5% Details in the respective sections of this report: 1 Excluding (i) effects of the discontinuance of the treatment of hedge accounting, adopted in 2Q12, for booking hedges of cash flows, which continue to be protected by hedge, and (ii) discounts granted in operations renegotiated in the period. More details in the Profitability section of this report. 2 Including additional provisions. 3 Including Guarantees issued, Private Credit Bonds (PNs and Debentures) and agro securities (CDCA, CDA/WA and CPR). 4 Excluding Agro Securities (CPRs and CDA/WA) and Private Credit Bonds (PNs and debentures). 5 Excluding (i) repos with equivalent volumes, tenors and rates both in assets, and (ii) effects of the discontinuance of the treatment of hedge accounting, and also discounts granted in operations renegotiated in the period. n.c. = not comparable
  • 6. 6/20 Operating Performance Financial Intermediation Result before Allowance for Loan Losses Net Profit Expanded Credit Portfolio Funding Profitability Financial Intermediation 1Q13 4Q12 1Q13/4Q12 1Q12 1Q13/1Q12 Financial Intermediation Revenues 87.6 123.7 -29.2% 161.8 -45.9% Credit Operations 56.0 62.3 -10.2% 70.2 -20.3% Loans & Discounts Receivables 44.8 46.9 -4.3% 62.9 -28.7% Financing 6.8 7.5 -9.2% 6.4 7.4% Other 4.3 8.0 -45.8% 0.9 354.7% Securities 19.6 28.6 -31.4% 68.6 -71.4% Derivative Financial Instruments 2.0 15.6 -87.4% (3.7) 152.3% FX Operations Result 10.0 17.2 -41.7% 26.7 -62.5% Financial Intermediation Expenses 64.8 75.2 -13.8% 111.0 -41.6% Money Market Funding 53.2 56.4 -5.7% 85.3 -37.6% Time Deposits 40.8 40.0 2.1% 45.2 -9.8% Repurchase Transactions 4.6 8.4 -45.2% 30.5 -84.9% Interbank Deposits 1.3 1.6 -19.9% 3.1 -59.8% Agro Notes (LCA), Real Estate Notes (LCI) & Bank Notes (LF) 6.5 6.5 0.5% 6.4 1.6% Loans, Assignments & Onlending 11.6 18.8 -38.0% 25.6 -54.6% Foreign Borrowings 6.9 14.5 -52.7% 22.2 -69.1% Domestic Borrowings & Onlending 4.8 4.3 11.9% 3.5 37.9% Gross Result from Financial Intermediation before ALL 22.8 48.5 -53.1% 50.8 -55.2% Allowance for Loan Losses (ALL) (133.4) (7.9) 1598.1% (14.4) 826.4% Gross Result from Financial Intermediation (110.6) 40.7 n.c. 36.4 n.c. 50,8 59,6 48,4 48,5 22,8 51,6 43,3 45,6 44,3 44,8 1Q12 2Q12 3Q12 4Q12 1Q13 R$million Financial Intermediation Result before ALL Financial Intermediation Result before ALL adjusted 5,0 2,4 3,1 3,6 1Q12 2Q12 3Q12 4Q12 1Q13 R$million 2,8 2,8 3,0 3,1 3,0 1Q12 2Q12 3Q12 4Q12 1Q13 R$billion Private Credit Bonds (PNs and Debentures) Agro Bonds (CPR, CDA/WA and CDCA) Guarantees Issued Trade Finance Loans & Financing in Reais 2,7 2,8 2,9 3,0 3,2 1Q12 2Q12 3Q12 4Q12 1Q13 R$billion total Trade Finance & Foreign Borrowings Domestic Onlending Interbank & Demand Deposits Agro Bonds, Bank and Real Estate Notes Insured Time Deposits -91.4 10.5% 15.8%
  • 7. 7/20 In 1Q13, the Result from Financial Intermediation before Expenses with Allowance for Loan Losses totaled R$22.8 million, down 53.1% from 4Q12 and 55.2% from 1Q12. This result was especially impacted: (i) in the item Derivative Financial Instruments, by the effect of discontinuance of the designation of hedge accounting, adopted in 2Q12, of operations to protect the cash flow, which continue to be protected by hedge operations; and (ii) in the item Loan Operations, by the discounts granted in operations renegotiated during the period. Excluding the impact of the discontinuance of hedge accounting and the discounts given on renegotiations to enable correct comparison between the quarters, the Result from Financial Intermediation before Expenses with Allowance for Loan Losses would be R$44.8 million, up 1.2% in the quarter and down 13.1% from 1Q12, as shown below: Financial Interm. Result before ALL w/o effects of hedge accounting and discounts granted in operations renegotiated 1Q13 4Q12 1Q13/4Q12 1Q12 1Q13/1Q12 A. Result from Financial Int. before ALL 22.8 48.5 -53.1% 50.8 -55.2% B. Effect of discontinuance of the designation of hedge accounting (15.6) 6.2 -350.3% - n.m. C. Discounts granted in operations renegotiated (6.5) (2.0) 228.6% (0.7) 771.3% Adjusted Result from Financial Int. before ALL (A-B-C) 44.8 44.3 1.2% 51.6 -13.1% n.m. = not measurable Revenue from Credit Operations decreased (ROC) decreased from R$62.3 million in 4Q12 to R$56.0 million in 1Q13, basically due to the discounts granted on loans renegotiated during the period (R$6.5 million). Excluding this amount, for correct comparison of the ROCs, the same remained practically stable, despite the fewer business days in the period. Income from Securities, which includes the results from the treasury’s proprietary position and CPR, CDA/WA and debentures, with offset in funding expenses, decreased significantly during the period in proportion to the significant reduction in the positions in the quarter. The Result from Derivative Financial Instruments includes results from operations involving swaps, forwards, futures and options used to hedge against exchange and interest rate exposure for funding operations indexed to the inflation indexes, as well as foreign borrowings (non-trade related), hedging of commodity prices resulting from CPR operations and indexers of federal government bonds held in the securities portfolio, in addition to the proprietary position. The decrease in this item in the quarter is mainly due to the effect of discontinuance of the designation of hedge accounting in 2Q12 of operations to protect cash flow from funding indexed to inflation indexes IPCA and IGPM and foreign borrowings, with exposure to the risk of variation in interest and foreign exchange rates, as detailed in notes 3(d) and 5(c) of the financial statements. Since then, the mark to market of the hedge operations, which continue to protect these cash flows, was no longer booked in shareholders' equity but in the income statement. The result of this in 1Q13 was a loss of R$15.8 million. Income from Foreign Exchange Transactions and expenses with Foreign Borrowings were especially impacted by the drop in demand from customers and the decline in spreads on these operations. As for Expenses with Time Deposits, the increase of 2.1% in the quarter is in line with the 1.1% increase in the average balance of Time Deposits in these periods (R$1,703.1 million in 1Q13 and R$1.684,9 million in 4Q12) and the decrease of 9.8% in 12 months refers, in particular, to the fall of the benchmark interest rate. Similar to these expenses, Expenses with Interbank Deposits and Agribusiness Letters of Credit, Real Estate Notes and Bank Notes are also related to the average balances in the periods being compared. Note that the Result from Financial Intermediation in 1Q13 was strongly impacted by expenses with allowance for loan losses amounting to R$133.4 million. In the first quarter, as a prudential measure in light of a few loans that are in the credit exit phase and which have longer terms, we set aside an additional allowance of R$110.7 million. With this, we strengthened our balance sheet for a possible deterioration of these loans, pertaining to customers acquired before 2011, increasing the coverage of loans classified between D and H (ALL/Loans D-H) from 47.3% at the end of December 2012 to 96.4% at the end of March 2013.
  • 8. 8/20 Net Interest Margin (NIM) Adjusted net interest margin was 2.7% in 1Q13, down 3.1 p.p. in the quarter and 3.9 p.p. from 1Q12. Net Interest Margin 1Q13 4Q12 1Q13/4Q12 1Q12 1Q13/1Q12 A. Result from Financial Interm. before ALL 22.8 48.5 -53.1% 50.8 -55.2% B. Average Interest bearing Assets 3,603.6 3,891.0 -7.4% 4,234.5 -14.9% Adjustment for non-remunerated average assets 1 (229.2) (505.2) -54.6% (1,096.9) -79.1% B.a Adj. Average Interest bearing Assets 3,374.4 3,385.8 -0.3% 3,137.6 7.5% Adjusted Net Interest Margin (NIMa) (Aa/Ba) 2.7% 5.9% -3.1 p.p. 6.6% -3.9 p.p. 1 Repos with equivalent volumes, tenors and rates both in assets and liabilities. As described in the section on Profitability, considering the effects on the Result from Financial Intermediation from the discontinuance of the designation of hedge accounting and discounts granted during renegotiations, of -R$15.8 million and R$6.5 million, respectively, in the quarter, NIM would increase to 5.4% in 1Q13, as the following table shows: Net Interest Margin w/o effects of hedge accounting and discounts granted in operations renegotiated 1Q13 4Q12 1Q13/4Q12 1Q12 1Q13/1Q12 A. Result from Financial Interm. before ALL 45.0 43.1 4.3% 51.6 -12.7% B. Average Interest bearing Assets 3,603.6 3,891.0 -7.4% 4,234.5 -14.9% Adjustment for non-remunerated average assets 1 (229.2) (505.2) -54.6% (1,096.9) -79.1% B.a Adjusted Average Interest bearing Assets 3,374.4 3.385,8 -0.3% 3,137.6 7.5% Adjusted Net Interest Margin (NIMa) (Aa/Ba) 2 5.4% 5.2% 0.2 p.p. 6,7% -1.3 p.p. 1 Repos with equivalent volumes, tenors and rates both in assets and liabilities 2 Excluding (i) effects of the discontinuance of the treatment of hedge accounting, adopted in 2Q12, for booking hedges of cash flows, which continue to be protected by hedge, and (ii) discounts granted in operations renegotiated in the period. Efficiency The efficiency ratio was 115.3% in 1Q13, -76.8 p.p. in the quarter and -87.7 p.p. when compared to 1Q12. Efficiency Ratio 1Q13 4Q12 1Q13/4Q12 1Q12 1Q13/1Q12 Personnel Expenses 26.4 23.7 11.3% 22.7 16.0% Contributions and Profit-sharing 5.4 1.8 196.6% 2.1 153.9% Administrative Expenses 13.4 13.3 0.3% 13.1 1.9% Taxes 3.6 4.3 -16.8% 3.7 -2.8% A- Total Operating Expenses 48.8 43.2 12.9% 41.7 17.0% Gross Income Financial Intermediation (w/o ALL) 22.8 48.5 -53.1% 50.8 -55.2% Income from Services Rendered 6.5 6.7 -4.4% 6.6 -2.1% Income from Banking Tariffs 0.2 0.2 -10.9% 0.2 -13.6% Other Net Operating Income (*) 2.0 (0.4) n.c. 4.1 -49.9% B- Total Operating Income 31.4 55.1 -43.0% 61.7 -49.1% Efficiency Ratio (A/B) 155.3% 78.4% 76.8 p.p. 67.6% 87.7 p.p. (*) Net of other Operating Expenses to offset the cost of acquisition and income on sale of commodities in the activity of Serglobal Cereais. Net Profit The operating income of -R$144,5 million in 1Q13, after (i) the non-operating loss from the sale of properties and non-operating assets of the R$669 thousand, (ii) taxes and contributions of the R$59,2 million, and (iii) profit sharing of the R$5,4 million, resulted in a loss of R$91.4 million.
  • 9. 9/20 Credit Portfolio Expanded Credit Portfolio The Expanded Credit Portfolio remained practically stable in the quarter but grew 10.5% in 12 months. The Expanded Credit Portfolio includes loan and financing operations in Brazilian Real and trade finance operations, both detailed in note 6(a) to the financial statements, as well as: (i) guarantees issued (sureties, guarantees and letters of credit), (ii) agribusiness bonds originated from the absorption of the operations of Serglobal Cereais (CPR and CDA/WA); and (iii) private credit bonds (promissory notes and debentures). Items (ii) and (ii) were both booked under Securities as per Central Bank regulations. Expanded Credit Portfolio by Product Group 1Q13 4Q12 1Q13/4Q12 1Q12 1Q13/1Q12 Loans & Financing in Real 2,019.8 2,080.6 -2.9% 1,861.3 8.5% Trade Finance (ACC/ACE/IMPFIN) 415.4 426.0 -2.5% 442.8 -6.2% Guarantees Issued (LGs & L/Cs) 172.5 158.2 9.0% 163.8 5.3% Agro Bonds (Securities: CPRs & CDA/WA; Credit: CDCAs) 370.9 327.1 13.4% 229.7 61.5% Private Credit Bonds (Securities: PNs & Debentures) 41.1 40.1 2.5% 25.5 60.9% Other 27.8 35.9 -22.5% 35.9 -22.5% TOTAL 3,047.5 3,067.9 -0.7% 2,759.1 10.5% The Middle Market segment comprises customers with annual revenue between R$40 million and R$400 million and Corporate segment includes companies with annual revenue between R$400 million and R$2 billion. The Other segment basically refers to Consumer Credit operations for Used Vehicles and financing of non- operating assets. Loans and financing operations in Real, which include loans, bills discounted, acquisition of client receivables and BNDES onlendings, represented 66.3% of the Expanded Credit Portfolio. The highest growth was in loans and discounted receivables, up 10.2% in 12 month and down 2.6% in the quarter, and BNDES onlending, up 38.2% in 12 months and down 4.8% in the quarter. Trade Finance operations correspond to 13.6% of the Expanded Credit Portfolio and include import financing, which account for 27.5% of Trade Finance operations, and export financing, which account for 72.5%. Though we maintained our credit lines with foreign banks, the Trade Finance portfolio was negatively impacted, mainly due to the adverse external scenario. Guarantees issued (sureties, guarantees and import letters of credit) correspond to 5.7% of the Expanded Credit Portfolio, up 9.0% from 4Q12 and 5.3% from 1Q12. This growth reflects the higher share of Corporate segment customers since these operations have greater demand in this segment. Though the portfolio of agribusiness bonds and private credit bonds represent credit exposure, it is classified under “held for sale” marketable securities in the balance sheet, in accordance with Brazilian Central Bank regulations due to its tradability, and has been growing consistently in recent quarters. The private bonds portfolio grew 2.5% in the quarter and 60.9% in 12 months. 51% 51% 42% 39% 47% 48% 48% 56% 59% 51% 2% 2% 2% 2% 1% 1Q12 2Q12 3Q12 4Q12 1Q13 Expanded Credit Porfolio Middle Market Corporate Others
  • 10. 10/20 The agribusiness bonds portfolio continues to increase its share of the Expanded Credit Portfolio, accounting for 12.2% in 1Q13. Agro Bonds Portfolio 1Q13 4Q12 1Q13/4Q12 1Q12 1Q13/1Q12 Booked under Securities 311.2 245.3 26.9% 184.1 69.0% Warrants - CDA/WA 7.1 8.0 -10.6% 7.2 -1.8% Agro Product Certificate - CPR 304.1 237.4 28.1% 176.9 71.9% Booked under Credit Portfolio - Loans & Financing 59.7 81.8 -27.0% 45.6 31.1% Agro Credit Rights Certificate - CDCA 59.7 81.8 -27.0% 45.6 31.1% AGRICULTURAL BONDS 370.9 327.1 13.4% 229.7 61.5% Our Expanded Credit Portfolio breakdown is as follows: By Economic Activity By Region By Customer Segment By Economic Sector By Product Industry 49% Commerce 28% Other Services 20% Individuals 2% Financial Institution 1% North 1% Northeast 2% South 19% Midwest 21% Southeast 57% Corporate 52% Middle Market 47% Others 1% 7,0% 1,0% 1,4% 1,6% 1,7% 1,7% 1,8% 2,5% 2,9% 3,0% 3,0% 3,0% 3,1% 3,3% 3,9% 4,2% 5,7% 13,0% 13,4% 22,8% Other sectors (% lower than 1%) Individuals Financial institutions Power Generation & Distribution Machinery and Equipments Electronics Financial Services Education Advertising & Publishing Commerce - Retail & Wholesale Oil & Biofuel Metal Industry Textile, apparel & Leather Pulp & Paper Chemical & Pharmaceutical Transportation & Logistics Automotive Construction Food & Beverage Agribusiness Loans & Discounts 56% BNDES Onlending 10% Trade Finance 14% Agro Bonds 12% Guarantees Issued 6% Debentures 1% Other 1%
  • 11. 11/20 Credit Porfolio The “classic” credit portfolio, which excludes guarantees issued and credits classified under “held for sale” marketable securities, totaled R$2.5 billion at the end of March 2013, in which Operations in Real accounted for R$2.1 billion while Trade Finance operations totaled R$415.4 million. This quarter, the portfolio was more evenly balanced between the Middle Market and Corporate segments: the Middle Market segment accounted for 49.0% of the credit portfolio (42.0% in December 2012) and the Corporate segment for 49.6% (56.4% in December 2012). Other loans, classified as Other, include the balance of the direct consumer credit - used vehicles (CDC) portfolio, portfolios acquired from other banks and financing of non-operating assets, and corresponded to 1.4% of the portfolio (1.6% in December 2012). Credit Portfolio By Client Segment 1Q13 4Q12 1Q13/4Q12 1Q12 1Q13/1Q12 Middle Market 1,237.1 1,101.9 12.3% 1,500.8 -17.6% Local Currency - Real 1,072.6 882.0 21.6% 1,211.3 -11.4% Loans & Discounted Receivables 913.7 737.4 23.9% 1,051.7 -13.1% Financing 0.0 0.0 n.m. 0.0 n.m. BNDES / FINAME Onlending 158.9 144.7 9.9% 159.6 -0.4% Foreign Currency 164.5 219.9 -25.2% 289.6 -43.2% Corporate 1,251.0 1,479.8 -15.5% 830.6 50.6% Local Currency - Real 1,000.0 1,273.7 -21.5% 677.3 47.6% Loans & Discounted Receivables 839.6 1,083.0 -22.5% 518.8 61.9% BNDES / FINAME Onlending 160.4 190.7 -15.9% 71.5 124.5% Acquired Receivables 0.0 0.0 n.m. 87.1 -100.0% Foreign Currency 250.9 206.1 21.7% 153.3 63.7% Other 34.7 42.6 -18.6% 54.2 -36.0% Consumer Credit – used vehicles 0.3 0.6 -45.7% 3.0 -89.8% Acquired Loans & Financing 4.9 6.7 -26.5% 18.3 -73.0% Non-Operating Asset Sales Financing 29.4 35.3 -16.6% 32.9 -10.5% CREDIT PORTFOLIO 2,522.7 2,624.3 -3.9% 2,385.6 5.7% By Collateral By Customer Concentration By Maturity Aval PN 50% Receivables 25% Pledge / Lien 9% Property 8% Monitored Pledge 5% Vehicles 2%Securities 1% 10 largest 16% 11 - 60 32% 61 - 180 27% Other 25% Up 90 days 36% 91 to 180 days 19% 181 to 360 days 16% +360 days 29%
  • 12. 12/20 Quality of Credit Porfolio Rating AA A B C D E F G H Comp. TOTAL ALL/ Loan Port. % Required Provision % 0% 0,5% 1% 3% 10% 30% 50% 70% 100% 1Q13 Outstanding Loans 43.9 1,020.3 908.3 321.9 49.0 108.2 42.8 4.5 23.7 - 2,522.7 8.7% ALL 0.0 5.1 9.1 9.7 4.9 32.5 21.4 3.1 23.7 110.7 220.2 4Q12 Outstanding Loans 53.4 1,103.2 919.8 344.7 65.0 82.2 27.1 8.5 20.4 - 2,624.3 3.7% ALL 0.0 5.5 9.2 10.3 6.5 24.7 13.6 6.0 20.4 0.0 96.1 1Q12 Outstanding Loans 94.9 921.4 776.9 397.8 38.8 97.8 19.9 11.7 26.4 - 2,385.6 4.3% ALL 0.0 4.6 7.8 11.9 3.9 29.4 10.0 8.2 26.4 0.0 102.0 During the quarter, we maintained the percentage of loans classified between AA and B high, at 97.8%, thus maintaining the quality of the credit portfolio. The balance of loans classified in the low risk categories (AA to B) accounted for 78.2% of the loan operations in the quarter (79.1% and 75.2%, respectively, at the end of 4Q12 and 1Q12), as the following chart shows: Of the R$228.3 million classified between D and H (R$203.2 million in December 2012 and R$194.6 million in March 2012), R$169.1 million correspond to loans whose payments are regular, equivalent to 74% of the total (81% in December 2012 and 61% in March 2012). The remaining 26% correspond to overdue loans and are detailed below: Default by segment 1Q13 4Q12 > 60 days > 90 days 1Q13 4Q12 1Q13 4Q12 Credit Portfolio NPL %T NPL %T NPL %T NPL %T Middle Market 1,237.1 1,101.9 45.9 3.7% 37.9 3.4% 44.8 3.6% 30.9 2.8% Corporate 1,251.0 1,479.8 5.5 0.4% 1.5 0.1% 1.9 0.2% - 0.0% Others 34.7 42.6 7.7 22.3% 0.2 0.5% 7.6 21.9% 0.2 0.5% TOTAL 2,522.7 2,624.3 59.2 2.3% 39.6 1.5% 54.3 2.2% 31.1 1.2% Allowance Loan Losses (ALL) 220.2 96.1 ALL / NPL - 372.2% 242.7% 405.1% 309.3% ALL / Loan Portfolio 8.7% 3.7% - - - - The default rate on loans overdue by more than 60 days (NPL 60 days) dropped 0.8 p.p. in 12 months but increased by 0.8 p.p. from the previous quarter, while loans overdue by more than 90 days (NPL 90 days) increased by 1.0 p.p. in the quarter but declined 0.6 p.p. in relation to March 2012, reflecting the improving quality of our credit portfolio in the past 12 months. The improvement in the NPL indicators in the 12-month comparison reflects the strategy adopted in 2011 of enhancing the credit portfolio with better quality loans; on the other hand, the worsening of the indicators in the 4% 2% 2% 39% 42% 40% 33% 35% 36% 17% 13% 13% 8% 8% 9% 1Q12 4Q12 1Q13 AA A B C D - H 78.2% 79.1% 75.2%
  • 13. 13/20 quarter basically reflects the performance of older customers, that is, those acquired before 2011, for whom the additional allowance mentioned earlier was created. A comparison of the performance of the older portfolio (customers acquired before 2011) with that of the new portfolio shows the better quality of the customers acquired under the new lending policy, as the table shows: ALL/Credit Portfolio Ratio 1Q13 ALL/Credit Portfolio 8.7% Clients acquired after April 2011 1.7% Middle Market 2.7% Corporate 1.1% Clients acquired before April 2011 8.2% Clients acquired after April 2011 including additional ALL 18.8% Allowance for loan losses totaled R$220.2 million, providing coverage of 3.7x the balance of NPL 60 days, and of 4.1x the balance of NPL 90 days, mainly impacted, as mentioned earlier, by the additional provision of R$110.7 million for customers in the portfolio prior to April 2011. Note that the potential default rate (ratio of installments overdue by between 15 and 60 days to the total credit portfolio) was 0.2% in March 2013, a significant improvement of 0.6 p.p. in the quarter and of 0.4 p.p. in 12 months. During the quarter, R$9.3 million (R$15.3 million in 4Q12 and R$55.1 million in 1Q12) in loan operations, already fully provisioned, were written off as losses.
  • 14. 14/20 Funding Funding totaled R$3.2 billion at the end of March 2013, increasing 5.7% in the quarter and 15.9% in 12 months. Time deposits through the issue of Bank Deposit Certificates (CDB) and Time Deposits with Special Guarantee (DPGE I) are the main sources, accounting for 25.8% and 29.4%, respectively, of total funding. Funding through agribusiness letters of credit (LCA), which increased 30% in the quarter and 63.9% in the year, Real Estate Letters of Credit (LCI), which began in the second half of 2012, and Bank Notes (LF) correspond, all together, to 16.7% of the total funding balance, contributing to more balanced funding costs and diversification of our product offering. Funding in foreign currency is especially allocated to Trade Finance operations and its balance is impacted by foreign exchange variations. Total Funding 1Q13 4Q12 1Q13/4Q12 1Q12 1Q13/1Q12 Total Deposits 2,451.3 2,274.6 7.8% 2,087.8 17.4% Time Deposits 818.1 707.0 15.7% 816.2 0.2% Insured Time Deposits (DPGE) 931.8 1,007.4 -7.5% 799.7 16.5% Agro Notes (LCA) 473.7 364.4 30.0% 288.9 63.9% Bank Notes (LF) 33.1 29.5 12.1% 7.6 337.2% Real Estate Notes (LCI) 23.9 12.1 96.9% 0.0 n.m. Interbank Deposits 91.4 98.0 -6.7% 127.4 -28.3% Demand Deposits and Other 79.3 56.1 41.2% 48.0 65.3% Domestic Onlending 322.1 335.5 -4.0% 240.2 34.1% Foreign Borrowings 396.4 388.6 2.0% 407.8 -2.8% Trade Finance 345.9 337.4 2.5% 362.3 -4.5% Other Foreign Borrowings 50.5 51.2 -1.3% 45.4 11.2% TOTAL 3,169.7 2,998.7 5.7% 2,735.7 15.9% By Type By Investor By Maturity The average term of deposits stood at 745 days from issuance (800 days in December 2012) and 391 days from maturity (430 days in December 2012). Average Term in days Type of Deposit from issuance to maturity 1 Time Deposits 476 310 Interbank 100 47 Time Deposits Special Guarantee (DPGE) 1,369 661 Agro Notes (LCA) 115 67 Bank Notes (LF) 891 602 Real Estate Notes (LCI) 169 104 Portfolio of Deposits 2 745 391 1 From March 31, 2013. | 2 Volume weighted average. Time Deposit 26% Insured Time Dep. (DPGE) 29% Agro Bonds 15% Bank and Real Estate Notes 2% Onlendings 10% Trade Finance 11% Foreign Loans 2% Interbank 3% Demand 2% Institutional Investors 42% Corporates 15% Individuals 6% National Banks 8% Brokers 3% Other 4% BNDES 10% Foreign Banks 12% Demand 2% up 90 days 34% 90 to 180 days 12% 180 to 360 days 13% +360 days 39%
  • 15. 15/20 Free Cash On March 31, 2013, the free cash position totaled R$760.1 million, equivalent to 31% of total deposits and 1.5x shareholders’ equity. The calculation considers cash, short-term interbank investments and securities less funds raised in the open market and debt securities classified under marketable securities, comprising rural product certificates (CPRs), agribusiness deposit certificates and warrants (CDAs/WAs), debentures and promissory notes (NPs). Capital Adequacy The Basel Accord requires banks to maintain a minimum percentage of the capital weighted by the risk in their operations. In this context, the Central Bank of Brazil has stipulated that banks operating in the country should maintain a minimum percentage of 11%, calculated according to the Basel II Accord regulations, which provides greater security to Brazil’s financial system against oscillations in economic conditions. In line with the best risk management practices, the BI&P bank has been taking steps to implement the Basel III requirements. Thus, the Basel Index in the first quarter was impacted by the new criteria for weighting risk according to the size of corporate customers. The following table shows BI&P’s position in relation to the Central Bank’s minimum capital requirements: Basel Index 1Q13 1Q13* 4Q12 1Q13/4Q12 1Q12 1Q13/1Q12 Total Capital 485.3 577,3 583.3 -16.8% 588.1 -17.5% Tier I 486.3 578,3 584.3 -16.8% 576.6 -15.7% Tier II 1.3 1,3 1.3 -0.9% 14.0 -90.5% Deductions (2.3) (2,3) (2.3) 0.0% (2.4) -4.8% Required Capital 376.8 376,8 430.3 -12.4% 369.1 2.1% Credit Risk allocation 329.0 329,0 372.9 -11.8% 326.8 0.7% Market Risk Allocation 29.9 29,9 38.2 -21.7% 22.1 35.2% Operating Risk Allocation 17.9 17,9 19.7 -9.2% 20.2 -11.4% Excess over Required Capital 108.5 200,5 153.1 -29.1% 219.0 -50.5% Basel Index 14.2% 16,8% 14.9% -0.7 p.p. 17.5% -3.4 p.p. * Simulation of the Basel Index if the capital increase of R$92 million occurred in March 31, 2013. Risk Ratings Agency Classification Observation Last Report Financial Data Standard & Poor’s BB/ Negative/ B brA+/ Negative/ brA-1 Global Scale Local Scale - Brazil Mar. 13, 2013 Dec 31, 2012 Moody's Ba3/ Stable/ Not Prime A2.br/ Stable/ BR-2 Global Scale Local Scale - Brazil Feb. 14, 2013 Sept 30, 2012 FitchRatings BBB/ Stable/ F3 Local Scale - Brazil Nov. 12, 2012 Sept. 30, 2012 RiskBank 10,38 Ranking: 41 Riskbank Index Low Risk Short Term Apr. 12, 2013 Dec 31, 2012 644 571 760 1Q12 4Q12 1T13 R$million
  • 16. 16/20 Capital Market Total Shares and Free Float Number of shares as of March 31,2013 Type Corporate Capital Controlling Group Management Treasury Free Float % Common 36,945,649 20,743,333 277,307 - 15,925,009 43.1% Preferred 26,160,044 619,026 60,125 734,515 24,746,378 94.6% TOTAL 63,105,693 21,362,359 337,432 734,515 40,671,387 64.4% Share Buyback Program The following Stock Option Plans, approved for the Company’s executive officers and managers, as well as individuals who provide services to the Company or its subsidiaries, had the following balances on March 31, 2013: Quantity Stock Option Plan Date of Approval Grace Period Term for Exercise Granted Exercised Extinct Not Exercised I 03.26.2008 Three years Five years 2,039,944 37,938 215,967 1,786,039 II 04.29.2011 Three years Five years 1,840,584 - 326,048 1,514,536 III 04.29.2011 Five years Seven years 1,850,786 - - 1,850,786 IV 04.24.2012 Up to five years Five years 605,541 - 14,745 590,796 6,336,855 37,938 556,760 5,742,157 The aforementioned Stock Options Plans are filed in the IPE system of the Securities and Exchange Commission of Brazil (CVM) and are also available in the Company’s IR website. Remuneration to Shareholder In the first quarter of 2013, the Bank neither provisioned nor paid interest on equity, calculated based on the Long-Term Interest Rate (TJLP) and calculated towards the minimum dividend for fiscal year 2013. The Board of Directors will, by the end of the year, study the possibility of early payment of interest on equity after considering the results and the tax efficiency of such payment. Share Performance The preferred shares of BI&P (IDVL4), listed in the Level 2 Corporate Governance segment of BM&FBOVESPA, closed March 2013 at R$7.49, for market cap of R$467.2 million, including the shares existing on March 31, 2013 and excluding treasury stock. The price of IDVL4 shares dropped 5.8% in the quarter and 12.9% (11.6% adjusted for earnings) in the 12 months ended in March 2013. The Bovespa Index (Ibovespa) dropped 7.5% in the quarter and 12.6% in relation to 1Q12. At the end of the quarter, the price/book value (P/BV) was 0.94.
  • 17. 17/20 Share Price evolution in the last 12 months Liquidity and Trading Volume The preferred shares of BI&P (IDVL4) were traded in 100% of the sessions in the quarter and 92.6% of the 243 sessions in the past 12 months. The volume traded on the spot market in the quarter was R$2.3 million, involving 294,000 IDVL4 shares in 454 trades. In the 12 months ended in March 2013, the volume traded on the spot market was R$26.3 million, involving around 3.7 million preferred shares in 2,325 trades. Shareholder Base Position as of March 31, 2013 Qtt Type of Shareholder IDVL3 % IDVL4 % TOTAL % 5 Controlling Group 20,743,333 56.1% 619,026 2.4% 21,362,359 33.9% 6 Management 277,307 0.8% 60,125 0.2% 337,432 0.5% - Treasury - 0.0% 734,515,00 2.8% 734,515 1.2% 39 National Investors 1,201,090 3.3% 8,471,079 32.4% 9,672,169 15.3% 13 Foreign Investors 4,891,304 13.2% 13,980,344 53.4% 18,871,648 29.9% 6 Corporate - 0.0% 6,712 0.0% 6,712 0.0% 288 Individuals 9,832,615 26.6% 2,288,243 8.7% 12,120,858 19.2% 357 TOTAL 36,945,649 100.0% 26,160,044 100.0% 63,105,693 100.0%
  • 18. 18/20 Balance Sheet Consolidated R$ thousand Assets 03/31/12 12/31/12 03/31/13 Current 3,811,194 3,063,804 3,295,573 Cash 25,215 18,250 64,521 Short-term interbank investments 617,066 429,535 546,759 Open market investments 559,764 377,495 518,490 Interbank deposits 57,302 52,040 28,269 Securities and derivative financial instruments 1,281,882 671,587 718,515 Own portfolio 615,536 473,468 515,238 Subject to repurchase agreements 524,128 26,654 51,598 Linked to guarantees 129,701 150,415 127,461 Subject to the Central Bank - - - Derivative financial instruments 12,517 21,050 24,218 Interbank accounts 3,337 938 11,996 Loans 1,294,343 1,495,533 1,354,555 Loans - private sector 1,316,621 1,515,490 1,451,470 Loans - public sector - - - (-) Allowance for loan losses (22,278) (19,957) (96,915) Other receivables 538,250 390,712 545,482 Foreign exchange portfolio 408,036 363,445 508,913 Income receivables 1,136 67 43 Negotiation and intermediation of securities 34,381 14,356 27,444 Sundry 100,282 17,300 13,909 (-) Allowance for loan losses (5,585) (4,456) (4,827) (-) Outras provisões - - - Other assets 51,101 57,249 53,745 Other assets 52,183 59,695 50,248 (-) Provision for losses (2,780) (4,277) - Prepaid expenses 1,698 1,831 3,497 Long term 719,321 906,467 907,312 Short-term interbank investments - - - Open market investments - - - Interbank deposits - - - Marketable securities and derivative financial instruments 27,918 59,737 51,163 Own portfolio 52 42 42 Subject to repurchase agreements - - - Linked to guarantees - - - Derivative financial instruments 27,866 59,695 51,121 Interbank Accounts 4,784 4,083 - Loans 556,306 693,561 625,129 Loans - private sector 625,260 756,459 737,581 Loans - public sector - - - (-) Allowance for loan losses (68,954) (62,898) (112,452) Other receivables 129,823 148,536 199,332 Credit guarantees honored - 778 - Trading and Intermediation of Securities 536 524 517 Sundry 134,501 156,024 204,788 (-) Allowance for loan losses (5,214) (8,790) (5,973) Other rights 490 550 31,688 Permanent Assets 52,498 51,711 56,236 Investments 24,578 24,980 29,403 Subsidiaries and Affiliates 22,892 23,294 27,717 Other investments 1,842 1,842 1,842 (-) Loss Allowances (156) (156) (156) Property and equipment 13,739 13,648 14,077 Property and equipment in use 1,210 1,210 1,210 Revaluation of property in use 2,634 2,634 2,634 Other property and equipment 18,440 19,660 20,481 (-) Accumulated depreciation (8,545) (9,856) (10,248) Intangible 14,181 13,083 12,756 Goodwill 2,391 2,276 2,276 Other intangible assets 13,100 13,100 13,100 (-) Accumulated amortization (1,310) (2,293) (2,620) TOTAL ASSETS 4,583,013 4,021,982 4,259,121
  • 19. 19/20 Consolidated R$ thousand Liabilities 03/31/12 12/31/12 03/31/13 Current 2,984,718 2,123,097 2,512,472 Deposits 982,842 839,973 928,651 Cash deposits 47,964 56,145 79,284 Interbank deposits 126,365 97,867 91,336 Time deposits 808,513 685,961 758,031 Other - - - Funds obtained in the open market 1,058,390 241,904 193,228 Own portfolio 520,776 26,745 51,699 Third party portfolio 175,021 106,200 53,211 Unrestricted Portfolio 362,593 108,959 88,318 Funds from securities issued or accepted 296,488 376,325 497,095 Agribusiness Letters of Credit, Real State Notes & Bank Notes 296,488 376,325 497,095 Interbank accounts 327 - 180 Receipts and payment pending settlement 327 - 180 Interdepartamental accounts 19,724 9,168 15,741 Third party funds in transit 19,724 9,168 15,741 Borrowings 362,521 388,626 396,399 Foreign borrowings 362,521 388,626 396,399 Onlendings 95,761 119,575 125,570 BNDES 58,487 77,426 83,659 FINAME 37,274 42,149 41,911 Other liabilities 168,665 147,526 355,608 Collection and payment of taxes and similar charges 835 509 287 Foreign exchange portfolio 72,021 46,177 206,208 Taxes and social security contributions 3,563 4,682 4,156 Social and statutory liabilities 1,750 10,320 2,500 Negotiation and intermediation securities 63,956 70,082 74,364 Derivative financial instruments 18,050 7,604 53,512 Sundry 8,490 8,152 14,581 Long Term 1,006,412 1,310,648 1,247,172 Deposits 808,429 1,028,553 992,003 Interbank Deposits 1,080 110 58 Time deposits 807,349 1,028,443 991,945 Funds from securities issued or accepted - 29,751 33,503 Agribusiness Letters of Credit, Real State Notes & Bank Notes - 29,751 33,503 Loan obligations 45,230 - - Foreign loans 45,230 - - Onlending operations - Governmental Bureaus 144,477 215,876 196,525 Federal Treasure 9,980 8,407 7,702 BNDES 61,639 118,477 101,588 FINAME 71,873 88,780 87,017 Other Institutions 985 212 218 Other liabilities 8,276 36,468 25,141 Taxes and social security contributions 6,297 29,598 18,468 Derivative financial instrument 213 2,620 2,420 Sundry 1,766 4,250 4,253 Future results 1,378 1,036 1,031 Shareholders' Equity 590,505 587,201 498,446 Capital 572,396 572,396 572,396 Capital Reserve 8,248 14,886 17,565 Revaluation reserve 1,377 1,340 1,327 Profit reserve - 3,512 (87,860) (-) Treasury stock (5,859) (5,859) (5,859) Asset valuation Adjustment 12,578 - - Accumulated Profit / (Loss) 1,765 - - Minority Interest - 926 877 TOTAL LIABILITIES 4,583,013 4,021,982 4,259,121
  • 20. 20/20 Income Statement Consolidated R$ thousand 1Q12 4Q12 1Q13 Income from Financial Intermediation 161,778 123,742 87,588 Loan operations 70,197 62,343 55,972 Income from securities 68,606 28,626 19,626 Income from derivative financial instruments (3,746) 15,554 1,960 Income from foreign exchange transactions 26,721 17,219 10,030 Expenses from Financial Intermediaton 125,348 83,055 198,223 Money market funding 85,303 56,444 53,208 Loans, assignments and onlendings 25,647 18,756 11,631 Allowance for loan losses 14,398 7,855 133,384 Gross Profit from Financial Instruments 36,430 40,687 (110,635) Other Operating Income (Expense) (27,151) (33,835) (33,887) Income from services rendered 6,590 6,747 6,451 Income from tariffs 199 193 172 Personnel expenses (22,738) (23,700) (26,373) Other administrative expenses (13,123) (13,331) (13,371) Taxes (3,705) (4,326) (3,600) Result from affiliated companies 1,544 991 787 Other operating income 4,971 5,473 3,204 Other operating expense (889) (5,882) (1,157) Operating Profit 9,279 6,852 (144,522) Non-Operating Profit 2,884 (1,616) (669) Earnings before taxes ad profit-sharing 12,163 5,236 (145,191) Income tax and social contribution (4,979) 220 59,189 Income tax 579 (4,553) 6,632 Social contribution 415 (2,722) 4,057 Deferred fiscal assets (5,973) 7,495 48,500 Statutory Contributions & Profit Sharing (2,139) (1,831) (5,431) Net Profit for the Period 5,045 3,625 (91,433)