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Banco Votorantim S.A. Earnings Presentation

2nd Quarter, 2012

1

Disclaimer

Disclaimer

“Certain statements made in this presentation may not be based on historical information or facts. This presentation therefore contains, or may be deemed to

contain, “forward looking statements” (within the meaning of Section 27A of the U.S. Securities Act of 1933, as amended, and Section 21E of the Securities

Exchange Act of 1934, as amended), including those relating to the general business plans and strategy, future financial condition and results and growth

prospects of Banco Votorantim S.A. (“Banco Votorantim” or the “Company”), and future developments in its industry and its competitive and regulatory

environment. By their nature, forward‐looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or

may not occur in the future and are based on assumptions, data or methods which, although considered reasonable by the company at the time, may turn out to

be incorrect or imprecise, or may not be possible to realize. Accordingly, actual results may differ materially from these forward‐looking statements due to a

number of factors, including future changes or developments in the Company‟s business, its competitive environment, technology developments and political,

economic, legal and social conditions in Brazil.

Forward looking information is not merely based on historical fact but also reflects management‟s objectives and expectations. The Company can give no

assurance that expectations disclosed in this presentation will be confirmed. The words “estimate”, “believe”, "anticipate", “wish", "expect", “foresee", “intend",

"plan“, "predict", “forecast", “aim" and similar words, written and/or spoken, are intended to identify affirmations which, necessarily, involve known and unknown

risks. Known risks include uncertainties which include, but are not limited to, interest rates, product competition, market acceptance of products, the actions of

competitors, regulatory approval, currency type and fluctuations, monetary policy, among others.

This presentation is based on events up to June 30th, 2012. The Company or any of its affiliates take no responsibility or liability to update the contents of this

presentation in the light of new information and/or future events.

Banco Votorantim and/or any of its affiliates do not accept and take no responsibility, whatsoever, direct or indirect, for transactions or investment decisions

made on the basis of information contained in this presentation.

Banco Votorantim may alter, modify or otherwise change in any manner the contents of this presentation, without the obligation to notify any person of such

revision or changes.

This presentation does not constitute an offer, or invitation, or solicitation of an offer, to subscribe for or purchase any securities. Neither this presentation nor

anything contained herein shall form the basis of any contract or commitment whatsoever. Recipients of this presentation are not to construe the contents of this

summary as legal, tax or investment advice and recipients should consult their own advisors in this regard.

The market and competitive position data, including market forecasts, used throughout this presentation were obtained from internal surveys, market research,

publicly available information and industry publications. Although the Company has no reason to believe that any of this information or these reports are

inaccurate in any material respect, the Company has not independently verified the competitive position, market share, market size, market growth or other data

provided by third parties or by industry or other publications and therefore does not make any representation as to the accuracy of such information.

This presentation and its contents are proprietary information and may not be reproduced or otherwise disseminated in whole or in part without the Company‟s

prior written consent.”

2

Executive summary (I) Banco Votorantim‟s results were still impacted by the new economic-regulatory context

Since 2011, economic-regulatory shifts and the worsening of the international crisis have changed the Brazilian

banking context. Simultaneously, there was a systemic increase in delinquency levels for individuals, imposing

challenges mainly to those institutions focused on consumer finance – such as Banco Votorantim

In the auto finance market, in which Banco Votorantim has a strong presence via BV Financeira, delinquency doubled

during 2011, and reached 6.0% in June/12

Additionally, in Jan/12 came into effect Brazilian Central Bank’s (Bacen) Resolution 3,533, which changes the rules for

recording credit assignments with recourse

• This Resolution impacted the securitization market and the results of banks operating in it

In this context, Banco Votorantim continued to advance in its prudential adjustment process, started in 4Q11, moving

forward on the strategic initiatives from its Change Agenda

• After a period of strong growth, the current focus is on increasing the return on capital of all business lines in the medium-

term

As anticipated in the last quarter, Banco Votorantim had its 2Q12 results impacted by four main factors – all related to

Consumer Finance

• Delinquency: expenses with credit provisions amounted to R$1,331M in 2Q12 (R$1,357M in 1Q12), still impacted by

delinquency rates above historical average of the auto finance portfolio originated between July/10 and Sept/11

• Bacen‟s Res. 3,533: in view of this regulatory change, it was decided not to perform credit assignments with recourse in

1H12, impacting Consumer Finance revenues

• Reduced origination: 55% reduction in the monthly average volume originated by Consumer Finance in 1H12 (R$ 1.2B per

month) vs. 2011 (R$ 2.5B per month), in order to guarantee the quality of the new financings

• Elevated Coverage Ratio: the coverage ratio of Consumer Finance‟s managed¹ loan portfolio, was increased to 100% in

June/12 (94% in Mar/12)

1. Includes credit assignments with recourse to other financial institutions and credit assignments for FIDCs (of which Banco Votorantim owns 100% of the subordinated quotas)

Executive summary

3

Executive summary (II) In 2Q12, Banco Votorantim kept on strengthening its credit risk quality

Even when faced with these four factors, consolidated results exhibited a slight improvement when compared to the

previous quarter (R$-536M in 2Q12; R$-597M in 1Q12), mainly because of the R$42M reduction in expenses with credit

provisions (R$1,449M in 2Q12; R$1,491M in 1Q12)

It is worth emphasizing two additional points related to results

• The Wholesale bank businesses (Corporate & Investment Banking, BV Empresas, Asset Management, Private Bank and

Treasury) recorded a good performance once more in 2Q12, with consistent generation of revenues and delinquency

under control; and

• Administrative and Personnel Expenses totaled R$1,213M in 1H12, down 6.1% over 2H11 due to actions that resulted in

the structural reduction of the organization‟s cost base. In 2Q12, however, there was an increase of R$ 19M (or 3.1%) over

the previous quarter (R$ 616M in 2Q12; R$ 597M in 1Q12), resulting from non-recurring expenses associated with the

restructuring in progress and from the increase with credit collection expenses in Consumer Finance

In this context of results, Banco Votorantim kept on strengthening its credit risk quality

• Liquidity: the cash level continues prudentially high, complemented by a credit facility of approximately R$ 7B at Banco do

Brasil (BB), which has never been tapped

• Funding: after extending the average funding tenor in 2010/11, with significant reduction of the maturity mismatch between

assets and liabilities, the greater focus on return on capital (vs. growth) substantially reduced the need for additional

funding

• Coverage Ratio for loans: maintenance of the Wholesale coverage ratio at conservative levels and increase of the

coverage ratio of Consumer Finance‟s managed loan portfolio to 100% in June/12 (94% in Mar/12)

• Capital: the Basel index ended June/12 at 15.5%, 250 bps higher than Mar/12, benefited by the R$2.0B capital increase

made in June/12. With this measure, BB and Votorantim Finanças (VF) maintain BV‟s capital structure at appropriate

levels, as set out in the Shareholders‟ Agreement

Executive summary

4

Executive summary (III) Banco Votorantim keeps moving forward on its prudential adjustment process, initiated in 4Q11

Change Agenda: to resume growth with profitability, in 2Q12 Banco Votorantim continued progressing in the

implementation of a series of strategic initiatives, with full shareholders’ support. The highlights of 2Q12 were:

• Auto finance operating model: intensification of the focus on multi-brand dealers for origination to Banco Votorantim s loan

portfolio. In 2Q12, the multi-brand dealer channel represented 83% of light vehicle financing originated by BV Financeira

(67% in 2Q11). It is worth emphasizing that BV Financeira closed June/12 as leader in the financing of used vehicles, with a

market share of 18.3%

• Credit: new improvements of Consumer Finance policies, processes and models. After the significant progress in risk levels

of credits originated in 4Q11, 1H12 productions maintained the track record of good quality

• Credit collection: review of Consumer Finance credit collection processes, targeting delinquency reduction and the recovery

and/or minimization of losses

• Incentives: adjustment of the commissions paid to the distribution channels (multi-brand dealers, new car dealers and

correspondent banks)

• Efficiency: adaptation of the organizational structures to the new origination levels in Consumer Finance

• Talents reinforcement: aggregation of experienced market professionals to management team (e.g.: Wholesale Credit,

Audit)

• Operations: continuity of the work of the Operational Review Committee (CRO), formed by representatives of the

shareholders, which has worked with teams from BV Financeira in the refinement of internal controls and implementation of

operational improvements

Executive summary

5

The progress in the Change Agenda creates the conditions for Banco Votorantim to resume growth with profitability

over the medium-term

However, as previously informed to the market, the short-term results will continue impacted by the same four factors

related to Consumer Finance:

• Delinquency levels above historic average for auto financing vintages originated by BV Financeira between July/10-Sept/11

• Bacen‟s Res. 3,533 – decrease in income from credit assignments until the consolidation of the credit assignment model

without recourse to BB (“BV Financeira Originadora”), which will be focused on new car dealers (new vehicles)

• Gradual increase of the Coverage Ratio for Consumer Finance loan portfolio

• Reduced origination volumes in order to assure the quality of new credit operations

In summary, the strategies and initiatives adopted, whose effects are evident both in maintaining the good

performance of Wholesale, and in the generation of profitable new businesses in Consumer Finance, will allow Banco

Votorantim to resume its path of sustainable growth with profitability in the medium-term

This prudential adjustment process relies on full support from the shareholders, committed to maintaining the capital

structure at adequate levels, as set out in the Shareholders’ Agreement. The shareholders' commitment extends to the

preparation of Banco Votorantim to the new regulatory context of Basel III

Executive summary (IV) Prudential adjustment process will allow BV to resume growth with profitability in the medium-term

The ongoing prudential adjustment process, started in 4Q11,

relies on full support from the shareholders

Note: All numbers and indicators in this presentation were calculated based on Banco Votorantim‟s Managerial Result. For further information, see the last slide on this presentation.

Executive summary

6

Banco Votorantim and the implications of the economic-regulatory context

Recent results

Change Agenda developments

Financial highlights

Agenda

7

Banco Votorantim is one of the leading players in Brazil... 3rd largest privately-held Brazilian bank in total assets and loan portfolio

Banco Votorantim is the 3rd largest privately-

held Brazilian bank in total assets...

...and is well-positioned to consolidate itself

as one of the largest banks in Brazil

Banco Votorantim – Overview

Largest Financial Institutions - Assets (R$B)¹

...and also in terms of loan portfolio...

58

58

88

114

147432

511

666

815

935

CEF

Bradesco

Itaú Unibanco

Banco do Brasil

Citibank

BTG Pactual

Safra Votorantim

HSBC Santander

Largest Financial Institutions – Loan Portfolio (R$B)¹

State-owned

Foreign

National privately-held

20

20

41

48

59173

237

250

289

398

Volkswagen

Banrisul

Safra

HSBC Votorantim²

Santander

Bradesco

CEF

Itaú Unibanco

Banco do Brasil

State-owned

Foreign

National privately-held

1. Excluding BNDES (state-owned development bank); figures as of Mar/12, except for Banco Votorantim (June/12); 2. Considers BV‟s own portfolio (excluding securitization); 3. Includes credit assignments with recourse and FIDCs Source: Banco Votorantim; Bacen; Anbima

Diversified business portfolio

• Wholesale Banking

– “Top 5” in credit for large enterprises

• Consumer Finance

– Market leader in used auto finance

– “Top 5” in payroll loans³

– ~ 5.6 million customers

• Wealth Management

– 8th largest asset manager by Anbima‟s managers‟

ranking: R$43.2B in AuM

Strategic partnership with Banco do Brasil, the largest

financial institution in Latin America

Strong and committed shareholder base

• Banco do Brasil and Votorantim Group

Low fixed-cost business model

• Extensive third-party distribution network in Consumer

Finance (vs. branches)

+

Shareholder

50% total

8

...and has a diversified business portfolio, internally

divided into Wholesale and Consumer Finance

BV – Corporate strategy

1. Includes guarantees provided and private securities; 2.Consumer Finance‟s own loan portfolio totaled R$38.3B in June/12, besides R$15.4B in credit assignments with recourse (including FIDCs‟ subordinated shares, which represented R$3.3B) Note: Middle Market segment refers to enterprises with annual sales between R$20M and R$400M; when annual sales are above R$400M, the enterprise belongs to CIB segment

Banco Votorantim is focused on increasing the return on

capital of all business lines in the medium-term

Shareholders

Pillars

Cons. Finance² Wholesale

Auto

Finance

Among the top players

in the market,

enhancing partnership

with BB

Focus on used auto

finance

(multi-brand dealers)

Partner with BB in new

auto finance

(new car dealers)

Other

businesses Increase profitability in

individual loans, with

focus on INSS

payroll loans

Continue to grow in

credit cards

Expand insurance

brokerage revenues

(e.g. Auto)

Corporate &

IB (CIB)

Wealth

Management

Middle

Market

Continue to grow with

quality in this segment

of mid-sized

companies, gaining

scale and efficiency

Focus on

relationships and

operational agility

Enhance product

offering

8th largest asset

manager, with

innovative products

Private Bank focused

on estate planning,

offering customized

solutions, with an

open architecture

Continuously expand

synergies with BB

Position CIB as a relevant partner, by building agile and

long-term relationships, as well as offering integrated

financial solutions (IB, derivatives,

structured products and distribution), suitable for each

client

Banco do Brasil Votorantim Group +

Expanded¹

loan portfolio

R$42.3B

R$80.6B

R$80.6B

R$38.3B

9

The auto finance managed loan portfolio more

than doubled between 2008 and 2011...

1. Includes credit assignments with recourse and credit assignments for FIDCs; excludes guarantees provided; 2. Considers individual loans and credit cards; 3. Estimate based on BV‟s managed loan portfolio (excluding FIDCs) Source: Banco Votorantim; Bacen; Abel

Banco Votorantim – Auto finance managed loan

portfolio¹ (R$B)

In the post-2008 crisis period, Banco Votorantim rapidly

expanded its auto finance loan portfolio

BV – Auto finance expansion

…expanding its share in BV’s consolidated

managed loan portfolio

Banco Votorantim – managed loan portfolio¹

(excluding guarantees provided) (R$B)

41% 47% 45% 39%

7%8% 14% 21%

52%46% 41% 40%

48.6

2008

41.7

Auto finance

(loan portfolio)

Auto finance

(securitization)¹

Wholesale and

payroll loans²

2011

79.3

2010

70.4

2009

+33%

16.3

Auto finance

(loan portfolio)

Auto finance

(securitization)¹

2011 2010

41.6

47.5

31.3 32.0

9.6

2009

26.4

22.6

3.8

2008

20.0

17.2

(86%)

2.8

12% Market

share³ 21%

10

Since 2011, regulatory shifts and the international crisis have

imposed new challenges upon Brazil’s banking industry

Changes in the

banking context…

… have created significant challenges to the

Brazilian financial industry

New banking context

Regulatory changes

International crisis

1. Revoked by Bacen‟s Circ. 3,563 on 11/14/2011

Source: Banco Votorantim IR

Increase in capital requirements

• Circ. 3,515¹: payroll loans and auto finance

• Circ. 3,498: market risk

• Basel III: as of 2013, deduction of tax credit from capital and

additional subordinated debt decay

Changed rules for recording credit assignments with recourse

• Bacen‟s Res. 3,533: came into effect in Jan/12

Economic slowdown

• Deceleration in credit expansion

Higher delinquency levels for individuals

• Particularly in auto finance

1

2

3

4

Regulatory changes have impacted especially institutions

focused on consumer finance

High impact

on BV

11

In this context, the auto finance delinquency rate doubled

during 2011, and reached 6.0% in June/12

Bacen delinquency rate series¹ – over 90 days (%)

1. Past due by over 90 days, informed by Bacen Source: Bacen

Delinquency in auto finance has risen more sharply

than in other credit modalities

Market – over 90 days delinquency

9.0%

8.0%

7.0%

6.0%

5.0%

4.0%

3.0%

0.0%

Total individuals

(excluding

auto finance)

Auto finance

June

12

6.1%

8.4%

5.0%

Dec

11

June

11

6.0%

8.2%

7.4%

3.8%

10.0%

6.7%

Dec

09

June

09

2.5%

Dec

10

5.5%

9.3%

Dec

08

June

08

June

10

12

Rise in individuals’ delinquency has several causes Examples: higher inflation in 2011, macro-prudential measures, economic slowdown, indebtness

12 month inflation – IPCA (%) Interest rates¹ (% p.y.) Auto finance average tenor¹ (days)

Income commitment³ and

family indebtness4 (%)

Delinquency – main factors

Economic activity - IBC-Br²

(proxy for GDP)

May

12

140.6

Dec

11

June

11

Dec

10

June

10

Dec

09

June

09

June

12

502

Dec

11

534

June

11

559

Dec

10

568

June

10

543

Dec

09

534

June

09

512

June

12

20.7

39.6

Dec

11

26.2

48.2

June

11

29.8

49.0

Dec

10

25.2

44.1

June

10

23.6

42.0

Dec

09

25.4

44.4

June

09

26.9

45.6

Auto finance Individual

loans Pro-consumption

measures

4.8

June

09

June

12

4.9

Dec

11

6.5

June

11

4.3

6.7

Dec

10

5.9

June

10

4.8

Dec

09

7.3

Dec

11

41.9

22.0

June

11

41.1

21.3

May

12

Dec

10

39.2 43.4

19.4

June

10

21.9

37.5 33.5

19.4 19.6

Dec

09

35.4

19.6

June

09

Family debt

Income commitment

1. Market average for individuals (Bacen); 2. Seasonally adjusted; 3. Considers what Bacen calls “Comprometimento de renda das famílias com o serviço das dívidas com o SFN, com ajuste sazonal”;

4. Considers what Bacen calls “Endividamento das famílias com o SFN em relação à renda acumulada dos últimos doze meses” Source: IBGE; Bacen

Macro-prudential measures impacted market’s practiced interest rates and tenors

13

In Sept/11, Banco Votorantim initiated a process of

prudential adjustment, guided by a Change Agenda

Diagnosis – Change Agenda

The adjustment process, started in 4Q11, has continued in 2012 and will allow

Banco Votorantim to resume growth with profitability in the medium-term

Change Agenda – Strategic initiatives that will further strengthen Banco

Votorantim‟s position as one of Brazil‟s leading banks

• Pursuit of greater efficiency in cost management and rationalization of capital use

• Redefinition of the organizational structure, in order to operate in a more efficient and integrated way

• Maintenance of BV‟s Basel Index at adequate levels

• Progress in the development of BV Financeira‟s new

asset origination model, enhancing partnership with

Banco do Brasil

• More conservative approach to credit concession,

focusing on profitability

• Intensification of credit collection processes

• Gradual increase in the Coverage Ratio

Consumer Finance

• Intensification of delivery of integrated financial

solutions for

– Credit,

– Structured products, and

– Investment banking services

• Focus on increasing Banco Votorantim‟s relevance

for its customers

Wholesale Banking

Corporate Initiatives – examples

14


Recent results



Agenda

15

As anticipated, BV’s consolidated results kept impacted by

credit provisions in Consumer Finance

Consolidated results

Note: excluding the non-recurring expenses related to the restructuring process (e.g. labor provisions), 2Q12 non-interest expenses would have decreased R$10M vs. 1Q12

1. Federal, state and local taxes (excludes ISS, PIS and Cofins)

Total revenues (Gross Financial Margin, Fee Income and Other Operating Income) Allowance for loan losses expenses

859813Cons.

Finance

Wholesale

2Q12

1,449

1,331

119

1Q12

1,491

1,357

134

4Q11

1,328

1,181

146

3Q11

989

130

2Q11

893

80

Non-interest expenses (Personnel, Administrative, Operating and Other Tax¹) Net income

354 415 433 362 372

210235 209 235 244

187145 157

Administrative

Personnel

Other

2Q12

773

1Q12

742

4Q11

829

3Q11

768

118

2Q11

672

108

-536-597-656

-85

156

2Q12 1Q12 4Q11 3Q11 2Q11

R$ million

∆ 2Q12/

1Q12

2Q12

1,405

1Q12

1,400

4Q11

1,186

3Q11

1,748

2Q11

1,819 -3%

-12%

-2%

16

Wholesale – Gross financial margin (R$M)

Wholesale businesses have once again shown a good

performance in 2Q12, with expansion in the net margin

Wholesale – Fee income¹ (R$M)

1. Includes banking fee income

Wholesale results

Wholesale shall keep reporting good results in all its

businesses (CIB, Middle Market, AM e PB) in 2012

112117

102

2Q12 1Q12 2Q11

In the 2Q12, Wholesale registered a 11%

expansion in the net margin vs. 1Q12... ...and consistent fee income generation

359

268 298

80

134119

Net margin

402

1Q12

+3%

ALL expenses

416

2Q12

439

2Q11

∆

2Q12/1Q12

-11.6%

11.0%

17

Wholesale: expanded¹ loan portfolio

reached R$42.3B in June/12 Corporate & IB (CIB) recent developments

1. Includes guarantees provided and private securities; 2. Ratio between ALL balance and balance of operations past due by over 90 days (Bacen‟s Res. 2,682 criteria); 3. Past due by over 90 days (Bacen‟s Res. 2,682 criteria)

Corporate

(CIB)

Middle

Market

June/12

42.3

32.7

9.6

June/11

39.0

31.7

7.3

2011

39.2

30.2

9.0

2010

37.2

31.3

5.9

2009

35.6

33.4

2.1

2008

35.6

33.9

1.7

Wholesale expanded¹ loan portfolio (R$B)

Middle Market recent developments

More disciplined capital allocation (focus on profitability)

• Assessment of operations via Business Committee (weekly)

• Specific business plans for each client

Improved relevance to customers, through strengthening of

the product platform. 1H12 highlights:

• Derivatives (hedge): ranked 8th in CETIP‟s ranking

• Investment Bank: 25 Fixed Income and 2 Equities operations,

besides the announcement of 4 Mergers & Acquisitions

• Project Finance: R$1.1B in concluded operations

“One-stop-shop Project Structuring factory”

• Financing and advisory throughout the project cycle

Focus on profitability (vs. growth)

• Cautious loan portfolio expansion

• Delinquency levels below market average (2.3%³ in June/12)

Scale and efficiency gains

∆

June.12/

June.11

8%

30%

3%

Coverage Ratio² 189% 180%

Focus on exploring opportunities related to infrastructure

investments and the expected growth of capital market

Wholesale – CIB and Middle Market – recent developments

CIB and Middle Market have increased their focus on

profitability, and kept the conservatism in credit provisions

18

VWM&S reached R$43.2B in assets under management

Wealth Management (VWM&S) expands 14% in

12 months and VAM is now the 8th largest Asset¹ Asset Management highlights

Wholesale – Wealth Management – highlights

VWM&S assets under management²(R$B) Continuous market share expansion in the last months,

reaching 1.9% in June/12

Structured Products (FIDC, FII and FIP³) ends June/12

with R$11.4B in assets under management

Enhanced synergies with BB: assets from funds

structured in partnership reach R$2.2B4

43.2

+14%

June/12 June/11

37.8

2011

43.0

2010

31.4

2009

22.9

2008

19.1

13th Anbima

ranking¹ 9th 8th

Private Bank highlights

12% growth in assets under management (AuM) and

17% growth in the customer base, in the last 12

months

ISO 9001:2008 Certificate for the scope of Relationship,

Wealth Management and Advisory regarding Brazilian

clients, by Bureau Veritas

Focus on estate planning via customized solutions,

with an open architecture concept

1. Includes Treasury, Brokerage and offshore products; 2. Votorantim Asset Management „s(VAM) position in Anbima‟s managers‟ ranking; 3. Investment funds in credit receivables, real estate , and equity shares; 4. Total assets by the end of June/12 Source: Banco Votorantim; Anbima

VWM&S aims at being one of the best in structuring and

managing high value-added products

19

Consumer Finance results were impacted by four factors Auto finance delinquency, higher coverage ratio, Res. 3,533 and lower origination volumes

Cov. Ratio² - Cons. Finance

2

Delinquency - Auto finance¹

1

Gross results from credit

assignments³

Bacen’s 3,533 Resolution

3

Fee income4- Cons. Finance

Auto finance origination

4

• Effective since Jan/12

• Changed the rules for recording

credit assignments with recourse

– Sale revenues cannot be

recognized by the time of the

assignment

• In 1H12, BV decided not to execute

any credit assignment with recourse

• Progress in the new credit

assignment model without recourse

– Pilot securitization in June/12

10

827

615

486

2Q12 1Q12 4Q11 3Q11 2Q11

(R$B)

(R$M) (R$M)

Allowance for Loan Losses expenses - Consumer Finance

100%

95%

99%

June

12

Mar

12

94%

Dec

11

Sept

11

95%

June

11

859813

-1.9%

2Q12

1,331

1Q12

1,357

4Q11

1,181

3Q11 2Q11

2Q12

2.7

1Q12

2.7

4Q11

3.6

3Q11

6.2

2Q11

6.2

137126149

228225

2Q12 1Q12 4Q11 3Q11 2Q11

Focus on

quality

June

12

8.7%

Mar

12

7.8%

Dec

11

5.9%

Sept

11

4.7%

June

11

3.3%

(R$M)

1. Considers managed loan portfolio (with credit assignments); past due by over 90 days (Bacen‟s Res. 2,682 criteria); 2. Ratio between ALL balance and balance of operations past due by

over 90 days (Bacen‟s Res. 2,682 criteria); 3. Gross financial margin impact, before early settlements expenses and credit provisions; 4. Includes banking fees

Consumer Finance results

Reduced ALL expenses in the

2Q12 because of:

• Lower impact of vintages

originated between July/10 and

Sept/11

• Improved quality of the vintages

originated since Sept/11

• Intensified credit collection

processes

20

Consolidater results

As anticipated in the last quarter, short-term results will

remain impacted by Consumer Finance

Even in this economic-regulatory context, 2Q12 Results

registered slight improvement vs. 1Q12

Var. (R$M)

2Q12/1Q12

Gross Financial Margin 935 1,171 1,150 (21)

Allow ance for Loan Losses (1,328) (1,491) (1,449) 42

Net Income from Financial Intermediation (392) (320) (299) 21

Other Operating Income/Expenses (690) (580) (584) (4)

Fee Income 288 243 249 6

Personnel Expenses (209) (235) (244) (8)

Other Administrative Expenses (433) (362) (372) (10)

Tax Expenses (149) (114) (111) 4

Equity in income of associated companies and subsidiaries (0) 14 16 2

Other Operating Income/Expenses (187) (126) (123) 2

Operating Income (1,083) (901) (883) 17

Provision for Income Tax and Social Contribution 493 447 484 37

Net Income (Loss) (656) (597) (536) 61

INCOME STATEMENT SUMMARY

(R$ Million)4Q11 1Q12 2Q12

21

In 2Q12, Banco Votorantim kept on strengthening its credit

risk quality

Banco Votorantim – credit risk quality

1. Ratio between ALL balance and balance of operations past due by over 90 days (Bacen‟s Res. 2,682 criteria)

Liquidity

Cash level continues prudentially high

Additionally, BV has a stand-by credit facility of ~R$7B from Banco do Brasil, which

has never been tapped

Funding

After extending the average funding tenor in 2010/11, with significant reduction of the

maturity mismatch between assets and liabilities, the greater focus on return on

capital (vs. growth) substantially reduced the need for additional funding

• Consolidated loan portfolio remained stable in 1H12 (~R$58.8B)

Coverage

Ratio¹

Wholesale: Coverage Ratio raised to 189% in 2Q12 (180% in 1Q12)

Consumer Finance: Coverage Ratio raised to 100% in 2Q12 (94% in 1Q12)

Capital

Basel Index of 15.5% in June/12 (13.0% in Mar/12), with a 10.2% Tier I ratio

In June/12, Shareholders increased BV’s capital by the amount of R$2B (R$1B each)

• Maintenance of Banco Votorantim‟s capital structure at adequate levels, as set out in the

Shareholders‟ Agreement

Strengthening of Banco Votorantim‟s credit risk quality – examples

22


Recent results



Agenda

23

In 2Q12, BV continued to move forward in its Change Agenda The adjustment process will allow BV to resume growth with profitability in the medium-term

Change Agenda

Auto finance

operating

model

Origination to BV: intensified focus on multi-brand dealers (used vehicles)

• Multi-brand dealers represented 81% of light vehicle origination in June/12 (67% in June/11)

• BV Financeira was the market leader in used vehicles in June/12, with a market share of 18.3%

Origination to BB: progress in the structuring of the credit assignment model without recourse (“BV Financeira

Originadora”), focused on new car dealers (new vehicles). A pilot without recourse was run in June/12

Change Agenda – Progress in 2Q12 (examples)

New improvements on Consumer Finance policies, processes and credit models, e.g.:

• Revision of credit approval models, with the addition of new variables (e.g.: BB internal rating)

• Review of the prioritization of proposal queues to increase conversion rates among clients with better scores

• Reduction in the average origination tenor and increase in the average down payment percentage(~43%)

Credit

Review of Consumer Finance processes, targeting delinquency reduction and the recovery and/or

minimization of losses, e.g.:

• Implementation of new policy for the settlement of overdue auto loans based on the restated value of the asset vs.

amount of debt;

• Negotiation of new “challenge goals” for the collection advisories

Credit

collection

Continuity of the work of the Operational Review Committee (CRO), that acts along with BV Financeira’s teams

in the refinement of internal controls and implementation of operational improvements Operations

Adjustment of commissions paid to the distribution channels (car dealers and banking correspondents) Incentives

Adaptation of organizational structures to the new origination levels in Consumer Finance Efficiency

Aggregation of experienced market professionals to management team (e.g.: Wholesale Credit, Audit) Talents

24

June/11

28.5 24.5 26.8

Mar/12 June/12

57%59%65%

June/12 Mar/12 June/11

81%77%67%

June/12 Mar/12 June/11

June/12

45.2

Mar/12

45.6

June/11

48.8

Higher than SFN²:

20.7% in June/12

Change Agenda – Consumer Finance

Production via multi-brand¹ dealers/Total (%) Auto production average interest rate (%p.y.)

Auto production average tenor (months) Auto production loan-to-value³ (%)

1. Considers light vehicles; 2. National Financial System (“Sistema Financeiro Nacional”); 3. Financed % of the asset‟s value (the lower the %, the higher the required down payment) Source: Banco Votorantim

BV Financeira reinforced focus on multi-brand dealers,

reduced average tenor and required greater down payment

25

June/12

0.9

Mar/12 Sept/11 Mar/11 Sept/10

2.6

Mar/10 Sept/09 Mar/09

0.9

64% 77% 90% 81%

1st installment delinquency ("Inad 30")

Multi-brand dealers (R$B)

New car dealers (R$B)

Light vehicles1 – Origination by channel (R$B) and first installment delinquency2 (%)

Vintages indicating lower quality

1. Includes CDC – vehicles and vans (excludes leasing); 2. % of each month‟s production with first installments past due by over 30 days Source: Banco Votorantim

“Inad 30” returned to

its historical quality

levels since 4Q11

Multi-brand

dealers/

light vehicle prod.

Focus on

multi-brand

dealers

Initiatives resulted in consistent improvement of the risk

level of auto finance operations originated since Sept/11

Change Agenda – Consumer Finance

Quality of auto finance origination has been addressed since 4Q11,

but vintages originated until Sept/11 will impact ST results

26

Despite the progress on the Change Agenda, short-term

results will still be impacted by Consumer Finance

Perspectives

The progress in the Change Agenda creates the conditions for Banco Votorantim to resume growth

with profitability over the medium-term. However, as previously informed to the market, the short-

term results will continue impacted by four factors related to Consumer Finance:

• Auto finance delinquency: the evolution of the portfolio originated until Sept/11, which registered

delinquency levels above the historical average, will keep on pressuring credit provisions expenses

• Reduced results from credit assignments: Bacen‟s Res. 3,533 impacted the model for credit

assignments with recourse. Therefore, there will be a decrease in income from credit assignments until

the full implementation of the credit assignment model without recourse to BB (“BV Financeira

Originadora”), which will be focused on new car dealers (new vehicles)

• Reduced production: focus on more profitable businesses, such as financing used vehicles via multi-

brand dealers, with reduced origination volumes when compared to 2010/11 average

• Coverage Ratio: gradual increase of the Coverage Ratio for Consumer Finance loan portfolio

In summary, the strategies and initiatives adopted, whose effects are evident both in maintaining the

good performance of Wholesale, and in the generation of profitable new businesses in Consumer

Finance, will allow Banco Votorantim to resume its path of sustainable growth with profitability in the

medium-term

Adjustments have full support of shareholders, and will allow

BV to resume growth and profitability in the medium-term

27


Recent results



Agenda

28



Note: excluding the timely expenses related to the restructuring process (e.g. labor provisions), 2Q12 non-interest expenses would have decreased R$10M vs. 1Q12

1. Federal, state and local taxes (excludes ISS, PIS and Cofins)

Total revenues (Gross Financial Margin, Fee Income and Other Operating Income) Allowance for loan losses expenses

859813Cons.

Finance

Wholesale

2Q12

1,449

1,331

119

1Q12

1,491

1,357

134

4Q11

1,328

1,181

146

3Q11

989

130

2Q11

893

80

Non-interest expenses (Personnel, Administrative, Operating and Other Tax¹) Net income

354 415 433 362 372

210235 209 235 244

187145 157

Administrative

Personnel

Other

2Q12

773

1Q12

742

4Q11

829

3Q11

768

118

2Q11

672

108

-536-597-656

-85

156

2Q12 1Q12 4Q11 3Q11 2Q11

R$ million

∆ 2Q12/

1Q12

2Q12

1,405

1Q12

1,400

4Q11

1,186

3Q11

1,748

2Q11

1,819 -3%

-12%

-2%

29

Dec/11

39.7%

Sept/11

37.0%

June/11

36.2%

June/12

48.1%

Mar/12

43.4%


2Q12

4.4%

1Q12

4.5%

4Q11

3.5%

3Q11

4.9%

2Q11

5.5%


Net Interest Margin – NIM (% p.y.) Efficiency Ratio¹ (%) – last 12 months

1.Ratio between (a) the sum of Personnel and Other administrative expenses and (b) the sum of Gross income from financial intermediation before Allowance for Loan Losses (ALL), Fee

income, Other operating income/expenses, and Fiscal hedge adjustment

30

June/12

43.2

Mar/12

44.6

Dec/11

43.0

Sept/11

38.6

June/11

37.8

Expanded¹ managed² loan portfolio

Total assets Assets under management

Loan portfolio

June/12 Mar/12

113.6

Dec/11 Sept/11 June/11

119.2 113.5 112.4 124.3

1. Includes guarantees provided and private securities, 2. Includes credit assignments with recourse and credit assignments for FIDCs (of which Banco Votorantim owns 100% of the subordinated quotas)


Expanded credit

portfolio¹

Securitization

June/12

95.7

80.3

15.4

Mar/12

97.6

79.6

18.0

Dec/11

97.4

76.8

20.5

Sept/11

99.4

82.8

16.6

June/11

95.7

79.8

15.9 58.8

Dec/11

58.7

Sept/11

64.0

June/11

61.2

Mar/12

58.8

June/12


R$ Billion

31

Expanded managed loan portfolio

Others³

Auto finance

June/12 Sept/11

99.4

Corporate

95.7

48.0

95.7

Middle

Market

10.8

June/11

43.0

10.4

31.7

7.3

46.2

10.4

Mar/12

97.6

32.4

9.1

45.6

10.5

9.6

Dec/11

97.4

30.2

9.0

10.7

31.8 32.7

8.8

47.5

Credit assignments with recourse(R$B)

Expanded¹ managed² loan portfolio (R$B)

1. Includes guarantees provided and private securities, 2. Includes credit assignments with recourse and credit assignments for FIDCs (of which Banco Votorantim owns 100% of the subordinated quotas); 3. Payroll loans, CDC, credit cards and individual loans

Total

Credit assignments for FIDCs(R$B)


15.4 12.9 12.0

5.2 2.9 3.3

∆

June12/June11

∆

June12/Mar12

0.0% -1.9%

-0.5% -0.8%

-7.0% -5.8%

30.5% 5.2%

3.3% 1.1%

32

June/12

6.9%

5,091

Mar/12

5.9%

4,536

Dec/11

4.6%

3,675

Sept/11

3.7%

2,992

June/11

2.9%

2,248

June/12

108.1%

Mar/12

102.0%

Dec/11

103.9%

Sept/11

103.9%

June/11

108.2%

Allowance for loan losses balance Coverage Ratio¹ (%)

Non-performing loans - 90 days¹ (%) Non-performing loans - 15 to 90 days¹ (%)

ALL balance/managed loan portfolio¹

ALL balance (R$M)

Credit indicators

Financial highlights – Credit indicators

June/12

8.0%

2.1%

6.3%

Mar/12

7.1%

2.0%

5.8%

Dec/11

5.5%

1.7%

4.5%

Sept/11

4.4%

1.3%

3.6%

June/11

3.3%

1.1%

2.7% 1.1%

7.4%

June/11

5.9%

8.7%

Mar/12

6.0%

0.7%

8.1%

June/12

1.2%

6.7%

Dec/11

8.1%

0.8%

6.2%

Sept/11

7.6%

0.3%

5.5%

Total Consumer Finance Wholesale Wholesale Total Consumer Finance

1. Considers credit assignments with recourse and credit assignments for FIDCs ; past due loans according to Bacen‟s Res. 2,682 criteria

33

June12/Mar12 June12/June12

Deposits 23.6 25.6 23.0 (10.2) (2.8)

Repos¹ 19.4 20.7 16.2 (21.6) (16.5)

Issuance of Securities² 15.7 19.1 21.4 11.9 36.7

Financing Bills 5.7 8.4 10.1 19.7 77.3

Subordinated Debt 5.7 7.5 7.8 4.1 37.8

Subordinated Financing Bills 1.1 2.2 2.1 (3.6) 95.4

Loans and Others³ 9.6 7.7 7.0 (10.0) (27.8)

Onlendings 7.1 6.0 5.6 (6.4) (21.2)

Total Funding 81.1 86.6 81.0 (6.5) (0.2)

Securitization (credit assignments + FIDCs) 15.9 18.0 15.4 (14.5) (3.2)

Credit assignments - w ith recourse 12.9 13.6 12.0 (11.8) (7.0)

Credit assignments - for FIDCs4 2.9 4.3 3.3 (23.0) 14.0

Total Funding and Securitization 97.0 104.6 96.4 (7.9) (0.7)

International Funding5/Total Funding and Securitization (%) 13.0 12.4 14.8

Loan Portfolio/Total Funding (%) 75.4 67.9 72.6

FUNDING SOURCES

(R$ Billion)

(R$ Bilhões)

June.11 Mar.12 June.12Variation (%)

Funding sources

1. Private securities (excludes government securities); 2. Includes Eurobonds, Debentures, Financial bills and LCA; 3. Includes Option Box and NCE repo; 4. FIDCs of which Banco Votorantim owns 100% of the subordinated quotas; 5. Includes foreign securities, foreign borrowings and subordinated bills

Financial highlights – Funding

Additionally, Banco Votorantim has a stand-by credit

facility of ~R$7B from BB, which has never been tapped

34

Basel Index and Shareholders’ Equity

Tier I

Tier II

Sept/11

12.7%

8.5%

4.2%

June/11

13.9%

9.7%

4.1%

June/12

15.5%

10.2%

5.3%

Mar/12

13.0%

8.7%

4.4%

Dec/11

14.1%

9.5%

4.7%

Financial highlights – Capital and liquidity

Basel Index

8,718

7,566

Dec/11 June/11

8,706 8,041

Sept/11 June/12 Mar/12

9,304

Shareholders’ Equity (R$M)

Shareholders increased capital

by R$ 2B in June/12

35

Banco Votorantim’s main ratings

Ratings

Banco Votorantim is an Investment Grade bank by Fitch, Moody’s and S&P

RATING

AGENCIES

International National

Long-Term Short-Term Long-Term Short-Term Long-Term Short-Term

Fitch Ratings Local Currency Foreign Currency Nacional

BBB- F3 BBB- F3 AA+(bra) F1+(bra)

Moody’s Local Currency Deposits Foreign Currency Deposits Nacional

Baa2 P-2 Baa2 P-2 Aaa.Br BR-1

Standard & Poor's Local Currency Foreign Currency Nacional

BBB- A-3 BBB- A-3 brAAA brA-1

36

Conciliation between Managerial and Accounting Results From 2Q12, result explanations started to be based on BV‟s Managerial Results

Managerial x Accounting results

Income from Financial Intermediation 3,872 114 11 3,997

Loans 2,522 - 11 2,533

Derivative Financial Instruments (129) 114 - (15)

Expenses from Financial Intermediation (2,847) - - (2,847)

Gross Financial Margin 1,025 114 11 1,150

Allow ance for Loan Losses (1,438) - (11) (1,449)

Net Income from Financial Intermediation (413) 114 - (299)

Other Operating Income/Expenses (511) (73) - (584)

Tax Expenses (106) (5) - (111)

Other Operating Income 75 (69) - 6

Other Operating Expenses (130) 0 - (130)

Operating Income (924) 41 - (883)

Non-operating Income (44) - - (44)

Income before Taxation and Profit Sharing (968) 41 - (927)

Provision for Income Tax and Social Contribution 525 (41) - 484

Net Income (Loss) (536) - - (536)

Managerial

2Q12

1. Foreign exhange variation of foreign investments, accounted in Other Operating Income (Expenses), as w ell

as f iscal and tax effects form the foreign investments hedge strategy, accounted in Tax Espenses (PIS/Cofins)

and IT/SC, w ere relocated to Income from Derivative Financial Instruments;

2. Expenses w ith credit provisions related to credit assignments w ith recourse, and Income from the recovery

of w rite-offs to loss, both accounted in Income from Loans and relocated to Allow ance for Loan Losses.

INCOME STATEMENT SUMMARY

(R$ Million)

Accounting

2Q12Hedge¹

ALL Credit

Assignmen

ts²

banco votorantim s.a. · it is worth emphasizing that bv financeira closed june/12 as leader in the...

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