Analyst

1
Analyst Investor meeting

• Business Unit Brazil of CCC

BU Brazil, 21 June 2002
2
Table of Contents

• 1 Current Brazilian Business Environment
• 2 Background
• 3 Overview of Banco ABN AMRO Real S.A. Legal
  Entity
  
• 4 Competitive Analysis
• 5 Overview of Business Unit CCC Brazil
• 6 CCC Brazil - Financial Performance
• 7 ABN AMRO Brazil - The Way Forward

3
Economic environment

• 8 years of economic plan Real Plan economic
  stability, inflation under control and primary
  fiscal surplus.
  

Inflation - IGP/DI p.m.
SourceFGV
4
Economic environment

• Interest rates are expected to decline further...

Base rate (Selic)
5
Economic environment
which will continue to benefit economic
activity...
Source IBGE
6
Economic activity
and will also positively benefit consumer
confidence.
Source FCSP
7
Economic environment

• The market has clearly recognized the differences
  between Argentina and Brazil.

Source Bloomberg
8
Economic environment

• The Net Public Debt / GDP ratio is relatively
  stable
  
• Primary Fiscal Surplus to be repeated in 2002 and
  2003, as a result of the Fiscal Responsibility
  Law (May/00).

Net Public Debt / GDP ()
Primary Fiscal Surplus / GDP ()
60.0
4,50
50.0
3,50
40.0
30.0
2,50
20.0
1,50
10.0
0,50
0.0
-0,50
1995
1996
1997
1998
1999
2000
2001
2002 F
1995
1996
1997
1998
1999
2000
2001
2002F
Source Brazilian Central Bank
9
Higher credit demand

• As a result of declining interest rates and
  economic stability, Brazilian banks have
  increased their credit portfolio

Source Brazilian Central Bank
10
Brazil still undervalued

• Compared to other countries, Brazil is still
  underleveraged room for credit growth.

Credit / GDP
11
Political scenario

• Presidential elections Cardoso to be replaced on
  January 2003
  
• Stronger candidates Lula (labor party PT) and
  Serra (Cardosos party PSDB). Second round
  expected
  
• While Serra would represent the continuity of
  Cardosos policy, Lula may redefine Government
  priorities

12
Political scenario

• Should Lula win for more than 20 years, PTs
  representatives have been elected Governors and
  mayors of important Brazilian States and cities
  like São Paulo, Rio Grande do Sul, Brasilia, etc.
  The outcome has been generally positive - fiscal
  balance, expenses under control and proper
  business environment.
• Fiscal Responsibility Law
• Created on May 2000
• Tight parameters regarding public expenditures
• Congress has to approve changes to the
  Government budget
  
• Public administrators (mayors, governors, etc)
  now have criminal responsibility for budget
  mismanagement

13

• 1 Current Brazilian Business Environment
• 2 Background
• 3 Overview of Banco ABN AMRO Real S.A. Legal
  Entity
  
• 4 Competitive Analysis
• 5 Overview of Business Unit CCC Brazil
• 6 CCC Brazil - Financial Performance
• 7 ABN AMRO Brazil - The Way Forward

14
Timeline
1917
1925
1963
1971
ABN AMRO Bank
Clemente de Faria
Banco Holandês Unido
Banco de Lavouras de
initiates its
establishes
acquires 50 of
Minas Gerais, which
operations in Brazil
"Cooperativa
Aymoré de Crédito,
two years before had
under the name
Bancária", three years
Financiamento e
established its
"Banco Holandês de
later renamed as
Investimento, which
headquarters in São
América do Sul."
Banco de Lavoura de
Will become a leader
Paulo, is renamed as
The first offices are
Minas Gerais, the
In the segment of car
Banco Real S.A.
located in Rio de
predecessor of Banco
Loans. The remaining
Janeiro and Santos
Real
50 was acquired in
1970
1993
1994
1998
2000
2001
Banco Holandês is
The Brazilian
In July ABN AMRO
Banco Real
ABN AMRO
renamed as ABN
operation of ABN
announces the
mergers with
Bank acquires
AMRO Bank and
AMRO presents
acquisition of
Banco ABN
Paraiban
moves its
the third largest
Banco Real,
AMRO S.A.
headquarters from
net income of the
completed in
Rio de Janeiro to
international
November. Also in
São Paulo
network
November ABN
AMRO acquires
Bandepe S.A.
15

• 1 Current Brazilian Business Environment
• 2 Background
• 3 Overview of Banco ABN AMRO Real S.A. Legal
  Entity
  
• 4 Competitive Analysis
• 5 Overview of Business Unit CCC Brazil
• 6 CCC Brazil - Financial Performance
• 7 ABN AMRO Brazil - The Way Forward

16
ABN AMRO Brazil Overview

• Banco ABN AMRO Real has a leading presence in
  Brazils financial services sector
  
• Retail Banking - 2nd largest foreign
  institution
  
• Consumer Finance - Largest car financier in
  Brazil
  
• Commercial Banking - Maintains relationships
  with more than 2,500 companies
  
• Insurance - Fastest growing insurance
  company in Brazil currently
  positioned as the 7th largest insurer
  
• Wholesale Banking - Maintains relationships
  with over 400 of the largest
  corporations in Brazil
  
• Asset Management - 8th largest Asset Manager in
  Brazil, with R 17 bln of assets
  under management
  

17
ABN AMRO Brazil Overview
Total Assets (in R mln)
Total Loans (in R mln)
Net Income (in R mln)
1998 figures adjusted to reflect full Banco Real
results
18
Retail banking
Branch Network (incl Mini-branches)
Bank
of Branches
Rank
Bradesco
4,002
1
Banco Itaú
3,537
2
Santander
1,968
3
Banco Real
1,664
4
HSBC
1,636
5
Unibanco
1,306
6
Mini-branches branches on companies premises
19
Consumer finance

• ABN AMRO Consumer Finance division is Brazils
  largest car financer.
  

20
Commercial banking

• The commercial banking segment is responsible for
  the relationship with non-WCS corporate
  customers, with annual sales higher than R20mln
  (EUR 8 mln).

204
3.000
2.574
160
2.304
2001
2002F
Dec 2000
Apr 2002
Dec 2002F
Gross revenue, R million
Client base
21
Insurance
Consolidated Revenues (2001)
Total R1,153 mln
2001 ROAE ()
1997 - 2001 Premium Written CAGR
32.6
20.7
31.0
26.8
15.1
14.2
21.2
13.1
12.0
11.0
15.1
14.5
9.7
2.2
4.6
Itaú
Real
AGF
AGF
Porto
Real
Itau
HSBC
HSBC
Porto
Unibanco
Bradesco
-7.6
Unibanco
Sul América
Bradesco
Sul America
Source Company financials
() Based on mathematical reserves
22
Wholesale banking

• Commercial and Investment Banking products
• Around 410 WCS clients
• 83 of the WCS clients are subsidiaries of large
  multinational companies

Product Breakdown
Client segment Breakdown
YTD April 2002
YTD April 2002
Consumer
GTS Cash
9
23
Diversified
14
GTS Trade
Automotive
27
20
Energy
FIPS
17
6
LP
GTS Custody
25
4
TMT
GFM
Chemical / MM
16
CCC Prod.
Healthcare
17
16
4
2
23
Asset management

• 8th largest considering total assets under
  management
  
• 5th largest asset manager for Retail segment
• ABN AMRO recently acquired the Brazilian
  portfolio of Dresdner Asset Management

Growth in 2002 April 02 / Dec 01
24

• 1 Current Brazilian Business Environment
• 2 Background
• 3 Overview of Banco ABN AMRO Real S.A. Legal
  Entity
  
• 4 Competitive Analysis
• 5 Overview of Business Unit CCC Brazil
• 6 CCC Brazil - Financial Performance
• 7 ABN AMRO Brazil - The Way Forward

25
Size

• ABN AMRO Brazil is the 5th largest privately
  owned Brazilian bank, by total assets, and 4th by
  loans.

26
Efficiency

• The investments made after the acquisition of
  Banco Real are now starting to positively impact
  the efficiency ratio.

27
Asset quality
Ranking E-H Loans (criteria 90 days past due,
a.o.)
Loans / Total Assets ratio
28
Results

• ABN AMRO Brazil achieved in 2001 a ROE of 22.9
  (behind Itau and Bradesco), and an ROA of 2.5
  (behind Itau only).
  

ROE and ROA Adj refers to recurring results
as disclosed in the Financial Statements
Dec-01
29
Headcount

• ABN AMRO Brazil headcount decreased since the
  acquisition of Banco Real on November 1998
  

30

• 1 Current Brazilian Business Environment
• 2 Background
• 3 Overview of Banco ABN AMRO Real S.A. Legal
  Entity
  
• 4 Competitive Analysis
• 5 Overview of Business Unit CCC Brazil
• 6 CCC Brazil - Financial Performance
• 7 ABN AMRO Brazil - The Way Forward

31
Management team
F. C. Barbosa
CEO
Support Functions
Commercial Functions
M. Kerbert
F. Nunes
J. L. Majolo
J. Bierrenbach
E. Souza
M. Matioli
Bank
Planning
Support
Risk Mgmt Operations
Insurance
C. Finance
TBD
L. R. Felipak
N. Pasini
Treasury
Distribution
Legal
P. Longuini
E. Costa
E. Andery
Financial Control
Products
Audit
C. E. Fonseca
F. Cardamone
Technology
Segments
E. Fregni
M. Helfrich
Direct Channels
e-Business
F. Lanzer
O. Prado
Human Resources
Commercial Clients
M. L. Pinto
C. Antunes
Social Responsibility
Bandepe
C. Camargo
Private Clients
L. E. Costa
Corporate Finance
F. Martins
Marketing
32
Our Strategic Vision
PEOPLESKILLED AND COMMITTED
COMPETITIVEINFRASTRUCTURE
CORPORATE VALUES
CLIENT FOCUS
CLIENT SATISFACTION
RESULTS
SHAREHOLDERS
EMPLOYEES
COMMUNITY
33
Employee satisfaction survey

• Key achievements
• - Im proud to work at AAB Brazil - from
  favorable 92 in 2001 to favorable 93 (6
  neutral) in 2002.
  
• - Im optimistic about the future of AAB
  Brazil - from 87 to 88 (9 neutral).
  
• - I clearly know the objectives of my area -
  stable at 92 (5 neutral).
  
• - The Bank has an ethical relationship with its
  clients - from 86 to 87 (10 neutral).

Surveys were conducted in 2002 and 2001, by the
HR consultants Quota, to evaluate employee
satisfaction with ABN AMRO Brazil.
34
Our Strategic Vision
PEOPLESKILLED AND COMMITTED
COMPETITIVEINFRASTRUCTURE
CORPORATE VALUES
CLIENT FOCUS
CLIENT SATISFACTION
RESULTS
SHAREHOLDERS
EMPLOYEES
COMMUNITY
35
Social responsibility model
36
Social responsibility initiatives
MARKET COMMITTEE
MANAGEMENT COMMITTEE
SOCIAL ACTION COMMITTEE

• INITIATIVES
• Diversity
• Suppliers
• Environment
• Academy
• IEB

• INITIATIVES
• The Bank at School
• Trail of Tiles
• Branch Network - Social Projects

• INITIATIVES
• Credit Policy
• Credit for Education
• Ethical Fund
• Microcredit
• Senior Citizen Talent Prize
• Playing in the Web

37
Client base ABN AMRO Brazil
Active clients
Retail Banking
SMEs, Corporates
Consumer Finance
Credit Card and Saving Accounts
8,0
Clients inactive 180 days
6.9
6.8
7,0
6.2
1,5
1,5
5.6
6,0
1,4
1,3
5,0
1,1
4,0
1,2
3,0
5,4
0,2
5,3
4,8
4,3
2,0
2,9
1,0
0,0
Dec-99
Dec-00
Dec-01
Mar-02
in million clients
38
Client segmentation
Breakdown of Active Checking Accounts (2001)
Breakdown by Affinity Group (2001)

• Monthly Income
• Premium Clients
• R4,000
• Special Clients
• R4,000 - R1,200
• Classic Clients

39
Client segmentation
Average account revenue per segment
Index Avg Classic revenue 100
40
Client loyalty versus results
Source Gallup, 2001
41
Client loyalty versus relationship approach
Source Gallup, 2001
42
CRM integrated client view
43
Client acquisition alternative initiatives

• ABN AMRO owns 100 of Brazils leading automotive
  website with a 86 market share
  
• WebMotors has a database of 2.7 mln users, with
  detailed car ownership information for 760
  thousand.
  
• Currently, Webmotors has operating agreements
  with other companies in addition to ABN AMROs
  consumer finance division.

www.webmotors.com.br
44
Clients versus channels
45
Our focus region

• ABN AMRO Brazil focus region for organic growth
  the marked area, the States capitals and
  Brazils main cities.

46
Distribution channel our branch network
47
Branch network

• ABN AMRO Brazil has a network of 791 retail
  branches, 58 Consumer Finance branches, 815
  mini-branches.
  
• The Bank's distribution network is further
  enhanced by non-traditional channels, such as a
  Call Center and Internet Banking.

ABN AMRO Brazil - Distribution Network
Banco Real
Bandepe
Paraiban
Consumer
Total
Branches
729
54
8
58
849
Mini-branches
760
47
8
0
815
Total
1,489
101
16
58
1,664
48
Branch network - organic expansion
Expected Evolution in Number of Branches

• Growth focused in the most economically developed
  regions of the country
  
• Presence in all state capitals
• Although acquisitions such as Bandepe and
  Paraiban are focused on client acquisition, they
  also contribute to increase the number of
  branches.

CAGR 9.2
967
917
849
739
680
1999
2000
2001
2002
2003
49
Non-traditional distribution channels are more
cost efficient
50
Non-traditional distribution channels

• Non-branch transactions are growing regularly,
  reducing costs and increasing client convenience.

100
21
22
25
30
33
36
80
60
40
79
78
75
70
67
64
20
0
Jan-Mar/98
Jan-Mar/99
Jan-Mar/00
Jan-Mar/01
Jan-Mar/02
Abr/02
Non Branches
Branches
51
Non-traditional distribution channels
ATM Network
Call Center
Internet Banking

• One of the countrys largest ATM networks
• Currently 6.4 thousand ATM, up from 3.1 thousand
  on December 1998.
  
• All ATMs are technically up to date.

• Last year the number of ABN AMROs Call Centers
  sites was reduced from 41 to 2, in Brazils
  largest cities Sao Paulo and Rio de Janeiro.
  
• Inbound and outbound calls are segmented
  according to the origin or destination of the
  call (region, affinity group, client
  segmentation, etc).

• Full service internet banking, started early
  2000.
  
• Currently counting with almost 500 thousand
  individual users and 64 thousand corporate users
  (mainly SMEs).
  
• Community sites enhance relationship with
  affinity groups Real Médicos (for medical
  doctors), Real Universitário (for university
  students), etc.

52
ATM network

• Investments done since 1998 created competitive
  infrastructure to Banco Real

Number of ATMs
6393
6040
4912
3992
Dec-99
Dec-00
Dec-01
Apr-02
53
Call center

• Call center implemented in Brazil in 1985
• 7 days X 24 hours
• 98 availability
• 700 workstations
• 1,224 people
• 60 of the calls answered without personal
  assistance
  
• Full service
• Inbound and proactive outbound activities
• 15 million calls per month
• 1.95 transactions per call

54
Internet banking

• Real Internet Banking was started on February
  2000. Since then, nearly 20 of Reals clients
  have become users of this service.

Number of Real InternetBkg users (x 1000)
Number of Transactions done through internet (in
mln)
55
Corporate internet banking

• Launched on August 2000, Real Internet Empresa
  (Banco Reals office bank through internet) was
  awarded by Speer Associates as Americas 2nd
  best Internet Office Banking. More than 60
  thousand corporate and SME clients of Real are
  users of this service.

Number of companies using Real Internet Empresa
56
Internet affinity group medical doctors
57
Internet affinity group university students
58
Non-traditional distribution channels
ABN AMRO sees the ATM Network, the Call Center
and its Internet Banking Platform as vital tools
to increase
Availability Always available when clients demand
services
Efficiency Increased number of transactions throu
gh cost-effective channels
Convenience Maximises client satisfaction and loy
alty
Profitability Greater cross-sell opportunities an
d segmented approach

• Key Initiatives for 2002
• Focus on maximizing cross-sell opportunities
• Focus on acquisition of new clients
• Intensify outbound CRM
• Develop second-generation e-Banking

59

• 1 Current Brazilian Business Environment
• 2 Background
• 3 Overview of Banco ABN AMRO Real S.A. Legal
  Entity
  
• 4 Competitive Analysis
• 5 Overview of Business Unit CCC Brazil
• 6 CCC Brazil - Financial Performance
• 7 ABN AMRO Brazil - The Way Forward

60
Brazil contribution to Global CCC

• Brazil accounted for 19 of CCCs global result
  in 2001, and 17 in 1stQ2002.
  

CCC Pre-Tax Profit (2001)
61
CCC Brazil gross revenues
Evolution total CCC Brazil gross revenues (NIR
fees)
R million
62
CCC Brazil fee income retail
Evolution fee income Retail CCC Brazil
R million
based on current run rate
63
CCC Brazil total expenses
Evolution total expenses CCC Brazil R million
64
CCC Brazil credit scoring
Reducing manual approvals of credit limits
of approvals in thd
27,8
101
83
21,9
68
62
58
51
47
6,9
6,3
4,2
3,0
3,0
jan/00
jun/00
dec/00
jan/01
jun/01
dec/01
may/02
approvals
manual approvals
65
CCC Brazil credit portfolio
Although past due loans are presently
proportionally higher. (past due loans 15 days
, of total credit portfolio)
66
CCC Brazil credit portfolio
...The effective credit losses (write-offs) are
under control.
(effective losses, R million)
200
196
195
162
1H00
2H00
1H01
2H01
67
CCC Brazil Profit Loss R million
68
CCC Brazil Profit Loss R million
69
CCC Brazil Profit Loss R million
70

• 1 Current Brazilian Business Environment
• 2 Background
• 3 Overview of Banco ABN AMRO Real S.A. Legal
  Entity
  
• 4 Competitive Analysis
• 5 Overview of Business Unit CCC Brazil
• 6 CCC Brazil - Financial Performance
• 7 ABN AMRO Brazil - The Way Forward

71
The way forward Productivity

• Main retail productivity targets for 2002
• - improve revenue / client by 12
• - improve fee income as a of total income from
  23 to 25
  
• As from this year, the performance appraisal of
  all ABN AMRO Brazils directors is also linked
  to
  
• - productivity targets (ratio differs per area)
• - client satisfaction ratios, as measured by
  Gallup, from 72 to 75.
  

72
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73
CCC Brazil Profit Loss (EUR mln)
74
CCC Brazil Profit Loss (EUR mln)
75
CCC Brazil Profit Loss (EUR mln)
76
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77
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