mercantil servicios financieros, c. a. financial report first … · 2018-11-06 · mercantil...

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Contact: Investor Relations. Phone: 58-212-503.1335. e-mail: [email protected]. website: www.bancomercantil.com.

Mercantil Servicios Financieros (Mercantil). First Quarter 2013 Caracas Stock Exchange (MVZ.A & MVZ.B); Level 1 ADR: MSFZY & MSFJY

Caracas, April 30, 2013. Mercantil Servicios Financieros (Mercantil) reports its earnings for the quarter ended March 31, 2013.

Summary

Net Income: Mercantil posted Bs 2,039 million (US$ 363 million)1 in net income in 1Q 2013, 156.3% up on the Bs 796 million (US$ 185 million)

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registered in 1Q 2012.

Net earnings per share in 1Q 2013 were Bs 20.57, US$ 3.661 (Bs 8.02, US$ 1.87

1 in the first quarter of 2012).

ROE and ROA in 1Q 2013 reached 47.9% and 5.2%, respectively (27.7% and 3.0% in 1Q 2012).

The price of Mercantil’s Class “A” and “B” common shares closed at Bs 210 and Bs 202, respectively, compared to Bs 140 and Bs 135 at the end of December 2012 and Bs 71 and Bs 75 at the end of March 2012.

The main variations in net quarterly income are:

Net Interest Income reached Bs 2,591 million (US$ 461 million)1, Bs 870 million (50.6%) more than the Bs 1,721 million (US$ 401 million)

1

reached in 1Q 2012, mainly due to growth of financial assets and liabilities. The financial intermediation ratio (loans-to-deposits) was 68.6% at the close of 1Q 2013 (75.7% at the close of the first quarter of 2012).

Loan Portfolio Provision registered Bs 143 million (US$ 25 million)1 in expenditure, which reflects a Bs 39 million (21.4%) year-on-year decline

from Bs 182 million (US$ 42 million)1. The provision represents 3.1% of the gross loan portfolio (3.4% at March 31, 2012) and covers 306.4% of

past-due and nonperforming loans (235.9% at March 31, 2012).

Commission and income reached Bs 1,924 million (US$ 342 million)1, up Bs 1,077 million (127.1%) from Bs 847 million (US$ 197 million)

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registered in 1Q 2012, which stemmed from Bs 717 million income growth resulting from exchange differences due to the change from Bs 4.2893/US$1 to Bs 6.2842/US$1 in the exchange rate set by the Venezuelan Central Bank for the valuation of assets and liabilities in foreign currency; Bs 99 million earnings growth from securities trading; and Bs 261 increase in income from commissions on customer transactions; among other factors.

Insurance premiums, net of claims reached Bs 235 million (US$ 42 million)1, up Bs 60 million (34.3%) year-on-year from Bs 175 million (US$

41 million)1. Net earned premiums during the quarter reached Bs 2,099 million and reflected Bs 464 million (28.4%) year-on-year growth.

Personnel and Operating Expenses reached Bs 2,359 million (US$ 420 million)1,, Bs 674 million (40.0%) more than the Bs 1,684 million (US$

393 million)1 registered in 1Q 2012, due to increases of Bs 246 million (35.6%) in personnel expenses, Bs 144 million (56.9%) in expenses for

contributions to regulatory entities and Bs 284 million in expenses for commissions for using the point-of-sale network, ATMs and other banking facilities.

Personnel and Operating Expenses are affected by inflation in Venezuela which averaged 25.1% over the last 12 months, as well as by the effect of devaluation on expenses in Venezuela, and the conversion of the expenses of the overseas subsidiaries. The efficiency ratio measured by calculating operating expenses as a percentage of average assets, was 5.0% in March 2013 versus 5.4% in March 2012.

Summary of the Financial Statements and Ratios 2 (In millions of Bolivars, except percentages)

March 2013

December 2012

March 2012

∆ Mar 13 vs. Dec 12

∆ Mar 13 vs. Mar 12

QUARTERLY RESULTS % %

Net Interest Income 2,591 2,502 1,721 3.6 50.6 Allowance for losses on loan portfolio 143 280 182 (48.9) (21.4) Commissions and other income 1,924 1,378 847 39.7 127.1 Insurance premiums, net of claims 235 400 175 (41.3) 34.3 Salaries and Operating Expenses 2,359 2,129 1,684 10.8 40.0 Net Income – Quarter 2,039 1,508 796 35.4 156.3

KEY FINANCIAL INDICATORS

Income per share – Quarter Bs / share 20.57 15.20 8.02 35.3 156.5 Market price A share 210.00 140.00 71.00 50.0 195.8 Market price B share 202.00 135.00 75.00 49.6 169.3 Book value per share 174.74 147.49 114.04 18.5 53.2

Net Income (quarter) / Average Assets (ROA) 5.2% 5.0% 3.0% 4.0 73.3 Net Income (quarter) / Average Equity (ROE) 47.9% 47.6% 27.7% 0.6 72.8

1 Dollar figures are given for reference purposes only. Balance Sheet figures are translated at the closing exchange rate and income statement figures at the average exchange rate for the period. See exchange rates in Appendix VI. Exchange control in place in Venezuela since February 2003.

2 See Appendix III Summary of the Financial Statements and Ratios (in Dollars).

Mercantil Servicios Financieros, C. A.

Financial Report First Quarter 2013

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Assets: In 1Q 2013 total assets registered Bs 26,197 million (18.4%) quarter-over-quarter growth to Bs 168,839 million (US$ 26,869 million)1, and

Bs 59,425 million, (54.3%) year-on-year growth.

The variations for this item, taken individually by subsidiary, are as follows:

Mercantil Banco Universal registered Bs 11,672 million (11.1%) growth in 1Q 2013 and Bs 43,222 million (58.8%) year-on-year growth.

Mercantil Commercebank registered a US$ 94 million (1.4%) decline in 1Q 2013 and US$ 88 million (1.3%) decline compared to March 2012.

Mercantil Seguros registered Bs 1,219 million (17.8%) growth in 1Q 2013 and Bs 2,481 million (44.3%) growth compared to March 2012.

Loan Portfolio In 1Q 2013, total loans registered Bs 12,145 million (15.6%) quarter-over-quarter growth to Bs 90,031 million (US$ 14,327 million)1,

and Bs 27,227 million (43.4%) year-on-year growth.


Mercantil Banco Universal registered Bs 2,971 million (5.1%) growth in 1Q 2013 and Bs 16,423 million (37.1%) growth compared to March 2012.

Mercantil Commercebank registered a US$27 million (0.6%) decline in 1Q 2013 and US$ 234 million (5.7%) growth compared to March 2012.

Deposits: In 1Q 2013 deposits registered Bs 20,792 million (18.1%) quarter-over-quarter growth to Bs 135,397 million (US$ 21,545 million)1, and

Bs 49,531 million (57.7%) year-on-year growth.


Mercantil Banco Universal registered Bs 9,923 million (10.9%) growth in 1Q 2013 and Bs 37,975 million (60.4%) growth compared to March 2012.

Mercantil Commercebank, N.A. registered US$ 50 million (0.9%) growth in 1Q 2013 and US$ 31 million (0.6%) growth compared to March 2012.

Shareholders’ Equity: Totaled Bs 17,861 million (US$ 2,842 million)1, up Bs 2,785 million (18.5%) quarter over quarter from Bs 15,076 million

(US$ 3,515 million)1 and Bs 6,204 million (53.2%) year-on-year growth. The quarterly variation can be primarily attributed to Bs 2,039 million in net

income for the period; Bs 1,441 million growth due to the effect of converting the net assets of overseas subsidiaries, and reductions of Bs 664 million for provisions for dividends declared by the General Meeting of Shareholders (see page 22) and Bs 31 million from adjusting available-for-sale investments to their market value.

Capital Ratios: Mercantil’s equity/assets ratio at March 31, 2013 is 10.6% and its equity/risk-weighted assets ratio is 19.5%, based on the standards of the National Securities Superintendency-SNV, for its abbreviation in Spanish (10.7% and 18.5% at March 31, 2012).

Mercantil Banco Universal, in accordance with the requirements of the Superintendency of Banking Sector Institutions (SUDEBAN, for its abbreviation in Spanish), has an equity/assets ratio of 10.2% and an equity/risk-weighted assets ratio of 19.6% at March 31, 2013 (10.1% and 16.3% at March 31, 2012).

Mercantil Commercebank, N.A., based on the standards of the U.S. Office of the Comptroller of the Currency (OCC), at March 31, 2013 the equity/assets ratio is 10.1% and the equity/risk-based assets ratio 17.3%, (9.2% and 17.1% at March 31, 2012).

The equity ratios of Mercantil and its subsidiaries exceed the regulatory minimums.

Summary of the Financial Statements (In millions of Bolivars, except percentages)

March 2013

December 2012

March 2012



% %

Cash and due from banks 30,444 27,557 16,468 10.5 84.9

Investment Portfolio 42,624 32,621 26,305 30.7 62.0

Loan Portfolio, Net 90,031 77,885 62,804 15.6 43.4

Other assets 5,740 4,579 3,837 25.4 49.6

TOTAL ASSETS 168,839 142,642 109,414 18.4 54.3

ASSETS UNDER MANAGEMENT 28,673 22,566 18,823 27.1 52.3

Deposits 135,397 114,605 85,866 18.1 57.7

Financial Liabilities 3,523 2,683 2,894 31.3 21.7

Other Liabilities 12,058 10,278 8,997 17.3 34.0

Shareholders’ Equity 17,861 15,076 11,657 18.5 53.2 TOTAL LIABILITIES AND SHAREHOLDERS´ EQUITY

168,839 142,642 109,414 18.4 54.3


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Table of contents Page

Contribution of subsidiaries 4

Market share 5

Credit Ratings 5

Management discussion and analysis 6

Operating Income

Net Interest Income 6

Loan Portfolio Provision 7

Total Commissions and Other Income 8

Insurance Premiums, Net of Claims 8

Total Operating Expenses 9

Balance Sheet

Liquidity 10

Investment Portfolio 11

Financial Intermediation Activity

Loan Portfolio 13

Deposits 14

Total Assets 15

Financial Obligations 16

Shareholders’ Equity 16

Capital Ratios 16

Assets and Liabilities in Foreign Currency 17

Summary of Subsidiaries’ performance according to their Regulatory Accounting Standards 18

Private Banking and Wealth Management 21

Corporate Events New Measures announced for the Venezuelan Economy Awards and Acknowledgements

22 22 23

Global Economic Climate 23

U.S. Economic Climate 23

Venezuelan Economic Climate 24

Appendix I: Summary of the accounting principles used to prepare the financial statements 26

Appendix II: Financial statements Mercantil Servicios Financieros, C.A. 27

Appendix III: Summary of the Financial Statements and Ratios (in Dollars) 32

Appendix IV: Consolidated Loan Portfolio by Classification 33

Appendix V: Statutory percentage of Mercantil Banco Universal loans by economic sector and interest rates 34

Appendix VI: Summary of Financial Indicators – Mercantil Servicios Financieros 35

Appendix VII: Financial statements Mercantil Banco Universal 37

Appendix VIII: Financial statements Mercantil Commercebank Holding Corporation 39

Appendix IX: Financial statements Mercantil Seguros 41

Appendix X: Key Macroeconomic Indicators 43

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Contribution of the Subsidiaries

Shareholders’ Equity

In millions of Bs.(1) Total

Total Assets 115,265 41,973 3,678 7,478 73 373 168,839

% Assets 68.3% 24.9% 2.2% 4.4% 0.0% 0.2% 100.0%

Investments 23,613 12,539 1,183 5,197 29 63 42,624

Loans (Net) 60,727 27,308 1,996 - - - 90,031

Deposits 99,680 32,804 2,913 - - - 135,397

Contribution

Income net:

Quarter 1,761 63 (1) 195 15 6 2,039

Assets Management 11,780 10,967 2,688 40 3,198 - 28,673

In millions of US$(2)

Total Assets 18,344 6,679 585 1,190 12 59 26,869

Investments 3,758 1,995 188 827 5 10 6,784

Loans (Net) 9,663 4,345 318 - - - 14,327

Deposits 15,861 5,220 463 - - - 21,545

Contribution

Income net:

Quarter 313 11 - 35 3 1 363

Assets Management 1,875

1,745

428

6

509

-

4,563

Number of Employees 7,228 780 91 1,592 37 22 9,750

1 Financial data presented in accordance with SNV standards (see Appendix I). Figures net of elimination of inter-company transactions.

2 Dollar figures are given for reference purposes only. Balance Sheet figures are translated at the closing exchange rate and income statement figures at the average exchange rate for the period. See exchange rates in Appendix VI. Exchange control has been in place in Venezuela since February 2003.

3 See Summary of Subsidiaries’ performance according to their Regulatory Accounting Standards (page 18).

Venezuelan Universal

Bank

Insurance In Venezuelan

Other Minor

Investments

Patrimonio: Bs. 17.861 (US$ 2.842)

MERCANTIL SERVICIOS FINANCIEROS (1)

(In millions of Bolivars and Dollars (2)

, except percentages)

U.S.A Domestic Bank & Brokerage

International Banking

Investment banking, mutual funds, trading

& brokerage in Venezuelan

Main Activity

Mercantil Bank (Schweiz) AG.

(Suiza)

Mercantil Bank and Trust Limited (Islas Caiman)

Mercantil Bank Curacao, NV

Mercantil Bank Panamá, S.A.

Mercantil Commercebank N.A.

Mercantil Commercebank Investment Services (MCIS)

Mercantil Commercebank Trust Company (MCTC)

Mercantil Merinvest, Casa de Bolsa, C.A.

Mercantil Servicios de Inversión, C.A.

Mercantil Sociedad Administradora de Entidades de Inversión Colectiva, C.A.

Main Subsidiaries

March 31, 2013

(3) (3) (3) (3)

Mercantil Banco Universal

Bs. 8.368 US$ 1.949

Mercantil

Commercebank Bs. 2.631 US$ 613

Bank

Overseas

Bs. 764 US$ 178

Others

Bs. 155 US$ 36

Mercantil Merinvest

Bs. 89 US$ 21

Mercantil Seguros Bs. 1.794 US$ 418

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Commercial

and Universal

Bank's

Private

Tuorism Loans 3 2 12.9%

Industrial Loans 2 1 14.2%

Agricultural Loans 3 2 14.2%

Morgtgage Loans under the mortgage Debtor Law (Ley Especial del

Deudor Hipotecario)3 1 9.3%

Microcredits Loans 4 2 8.3%

Gross Loans 3 2 14.5%

Savings Deposits 1 1 20.7%

Total Deposits 3 2 13.7%

Total Deposits + Other Demand Liabilities 3 2 12.0%

Total Assets 4 3 11.6%

Trust 4 2 8.1%

Net Premiums 3 11.7%

U.S.A.

Total Deposits 15 1.2%

Mercantil Commercebank (3)

Mercantil Banco (1)

Positioning

Mercantil Seguros (2)

Venezuela

Market Share

Fitch Ratings Clave (*)

Long-term AA(Ven)

Short-term F1+(Ven)A2 A2

A1 A1

Long-term AA+(Ven)Short-term F1+(Ven)

Long-term (Foreign and local currency) B+

Short-term (Foreign and local currency) B

Viability b+

Long-term Deposit (Mercantil Commercebank ,N.A. only) BB+

Long-term BB

Short-term BViability bb

National Ratings

Mercantil Servicios Financieros

Mecantil Commercebank Florida Bancorp y

Mercantil Commercebank N.A.

Rating for Unsecured Bonds ( Long-term in local currency)

Rating for Commercial Paper (Short-term in local currency)


National Ratings

International Ratings

Market Share

(1) Source: Summary of Unconsolidated Financial Statements Published in National newspapers. (2) Source: Venezuelan Superintendency of Insurance at February 28, 2013. (3) Source: Federal Deposit Insurance Corporation (FDIC), to the Florida Stated USA, at June 30, 2012, total number of institutions: 292 in Florida

(*) A credit rating agency in Venezuela

Credit Ratings

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1,721 1,948 2,230 2,502 2,591

7.9%8.1%

8.6% 8.5% 8.4%

5.5%

6.0%

6.5%

7.0%

7.5%

8.0%

8.5%

9.0%

-

500

1,000

1,500

2,000

2,500

3,000

IQ2012 IIQ2012 IIIQ2012 IVQ2012 IQ2013

(Mill

ion

of

Bs)

Evolution of Net Interest Income

Net Interest Income Net Interest Income / Average Financial Assets

Management Discussion and Analysis

Operating Income Quarter

Ended on ∆

(In millions of Bolivars and millions of US$, except percentages)

US$ 1

Mar.2013 March 2013

March 2012 Bolivars %

Net Interest Income 461 2,591 1,721 870 50.6

Allowance for Losses on Loan Portfolio 25 143 182 (39) (21.4)

Net Financial Margin 436 2,447 1,539 908 59.0

Commissions and Other Income 342 1,924 847 1,077 127.1

Insurance Premiums, Net of Claims 42 235 175 60 34.3

Operating Income 820 4,606 2,561 2,045 79.9

Net Interest Income In 1Q 2013, net interest income was Bs 2,591 million (US$ 461 million)

1, 50.6% higher than the Bs 1,721 million (US$ 401 million)

1 registered in 1Q

2012, due to an increase in the volume of financial assets and liabilities. Interest income was Bs 3,698 million, a 50.7% year-on-year increase, both in growth of loan portfolio income by 50.0% and investment portfolio income by 54.1%. Financial expenses totaled Bs 1,107 million, up 51.1% compared to 1Q 2012.

The financial intermediation ratio (loan-to-deposits) was 68.6% at the close of 1Q 2013, 75.7% at the close of March 2012.

Mercantil Banco Universal, reached Bs 2,227 million, 54.3% up on the Bs 1,444 million in interest income registered in 1Q 2012, mainly due to a higher volume of financial assets and liabilities. The financial intermediation ratio was 62.6% in March 2013 and 73.5% in March 2012.

Mercantil Commercebank, N.A., totaled US$ 36 million, similar to the US$ 37 million registered in 1Q 2012. The Bank continues to hold a significant portion of its assets, US$ 2,170 million (more than 32%), in short-term investments and securities issued by the US government or US government-sponsored bodies. This high level of liquidity has continued to give the Bank ample flexibility to increase its credit operations.

Mercantil's net interest margin (income/average financial assets) at March 31, 2013 was 8.4% compared to 7.9% the previous year.


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Gross Loans Past Due and Non-Performing Loans

3.4%

3.3%

3.3%

3.3%3.1%

0.0%0.3%0.6%0.9%1.2%1.5%1.8%2.1%2.4%2.7%3.0%3.3%3.6%3.9%4.2%

2008 2009 2010 2011 2012

Allowance for Losses on Loan Portfolio / Gross Loans

1.4%

1.3%

1.1%0.9%

1.0%

0.0%

0.4%

0.8%

1.2%

1.6%

2.0%

2.4%

2.8%

3.2%

3.6%

4.0%

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

90,000

100,000

2008 2009 2010 2011 2012

Past Due and Non-Performing Loans / Gross Loans

Loan Portfolio Provision In 1Q 2013, expenses totaled Bs 143 million (US$ 25 million)

1, Bs 39 million (21.4%) down from Bs 182 million (US$ 42 million)

1 in 1Q 2012.

Mercantil Banco Universal registered Bs 138 million in loan portfolio provisions in 1Q 2013 (Bs 144 million in 1Q 2012), aimed mainly at provisions related to the commercial, construction and services sector and the result of loan portfolio growth during the quarter.

Mercantil Commercebank, N.A. registered US$ 0.1 million in loan portfolio provisions, US$ 8 million (99.2%) less compared to 1Q 2012, mainly for credits related to the commercial and construction sectors.

This brings the accumulated allowance to Bs 2,893 million (US$ 460 million)

1 at March 31, 2013 and represents 3.1% of gross loans (3.4% at

March 31, 2012). This provision covers 306.4% of the past-due and nonperforming loan portfolio (235.9% at March 31, 2012).


(Millions of Bs)

Evolution of Loan Portfolio and Asset Quality Ratios

8


88.2%

10.7%

1.1%

IQ 2013

Banking Insurance Asset Management

86.0%

12.6%

1.4%

IQ 2012

Total Commissions and Other Income In 1Q 2013, commissions and other income totaled Bs 1,924 million (US$ 342 million)

1, Bs 1,077 million (127.1%) up from Bs 847 million (US$ 197

million)1registered in 1Q 2012, primarily due to:

Bs 717 million (11,950.0%) increase in earnings from exchange difference due to the new exchange rate set by the Venezuelan Central Bank for the valuation of assets and liabilities in foreign currency (adjusted from Bs 4.2893/US$1 to Bs 6.2842/US$1).

Bs 261 million (43.0%) growth of earnings from commissions on debit and credit cards, insurance policy financing, other commissions on customer operations, and other income.

Bs 99 million (42.3%) growth of earnings from securities trading activities.

Insurance Premiums, net of Claims

En 1Q 2013, insurance premiums, net of commissions, reinsurance and claims, totaled Bs 235 (US$ 42 million)

1, reflecting 34.3% year-on-year

growth from Bs 175 million (US$ 41 million)1. This improvement is attributed

to the Property & Casualty business. Net earned premiums for 1Q 2013 amounted to Bs 2,099 million (US$ 374 million)

1, reflecting Bs 464 million (28.4%) year-on-year growth. The main

contributors to this variation were the Health (30%) and Automobile (25%) businesses. At February 28, 2013, Mercantil Seguros was the country’s third largest insurance company in terms of net earned premiums, with 11.7% of the insurance market.

Claims during 1Q 2013 totaled Bs 1,439 million (US$ 256 million)

1, up Bs

319 million (28.4%) compared to Bs 1,121 million (US$ 261 million) in 1Q 2012. The claims ratio was 65.8% in 2013 (63.8% in 2012). The technical result was Bs 43 million (US$ 8 million)

1, similar to Bs 44 million (US$ 10

million)1registered in the first quarter 2012.

1 Dollar figures are given for reference purposes only. Balance Sheet

figures are translated at the closing exchange rate and income statement figures at the average exchange rate for the period. See exchange rates in Appendix VI. Exchange control has been in place in Venezuela since February 2003.

Composition of Total Income

Bs. 2,743 million

US$ 640 million1

March 2012

Bs. 4,750 million US$ 845 million

1

March 2013

63%

55%

19% 17%

9%

21%

9% 7%

IQ 2012 IQ 2013

Net Interest Income

Commissions on Transactions, Insurance Premiums net and Other

Exchange Gains and Losses and Other Income

Income on Sales Investment Securities

Composition of Total Income by Business Segments

0%

10%

20%

30%

40%

50%

60%

IQ 2012 IIQ 2012 IIIQ 2012 IVQ 2012 feb 2013

Net Earned Premiums(12 months change)

Insurance Market Mercantil

9


Total Operating Expenses

Quarter

Ended on ∆

(In millions of Bolivars and US$, except percentages)

US$ 1

Mar. 2013 March 2013

March 2012 Bolivars %

Operating Income 820 4,606 2,561 2,045 79.9

Operating Expenses

Salaries and Employee Benefits 167 937 691 246 35.6

Other Operating expenses 253 1,422 993 429 43.2

Taxes Current and Deferred 37 207 80 127 158.8

Net Income 0 (1) (1) 0 0.0

Operating Income 363 2,039 796 1,243 156.3

In 1Q 2013, operating expenses totaled Bs 2,359 million (US$ 420 million)1, a 40.0% year-on-year increase from Bs 1,684 million (US$ 393

million)1. This increase is mainly due to:

Bs 246 million in personnel expenses, a year-on-year rise of 35.6%. The application of wage increase policies in Venezuela contributed to higher expenses as well as the effects of the new Labor Law in effect since May 2012 At Mercantil Banco Universal, assets per employee rose from Bs 10.5 million in 2012 to Bs 16.0 million in 2013. At Mercantil Seguros, net earned premiums per employee rose from Bs 1.1 million in 2012 to Bs 1.3 million in 2013. In the case of the overseas business, the assets per employee indicator remained at US$ 8.7 million in 2013.

Bs 144 million (56.9%) rise in expenses for contributions to regulatory agencies.

Bs 57 million (81.5%) increase in expenses for taxes and contributions.

Bs 227 million (33.9%) increase in expenses for commissions for using the point-of-sale and ATM network and other facilities.

The efficiency ratio measured by calculating operating expenses as a percentage of average assets, was 5.0% in March 2013, versus 5.4% in March 2012. The ratio of operating expenses to total income was 41.3% in March 2013 (52.3% in March 2012). Personnel and operating expenses are affected by inflation in Venezuela which averaged 25.1% over the last 12 months, as well as by the effect of devaluation on expenses in Venezuela, and the conversion of the expenses of the overseas subsidiaries.

138 191 185

252 305 396

603

925 841

691

708 937

IQ 2012 IVQ 2012 IQ 2013

Total Operating Expenses Quarters(In millions of Bolivars)

Salaries and employee benefits

Other operating expenses

Fees paid to regulatory agencies

Depreciation, Property and equipment, Amortization of intangibles and others expenses

1,684

Δ +40.0%

Δ +10.8%

2,1292,359

Δ +26.4%

24.6%21.3%

18.0%20.1%

25.1%

52.3%50.4% 49.8%

47.7%

41.3%

5.4%5.3%

5.5%5.4%

5.0%

4.5%

4.7%

4.9%

5.1%

5.3%

5.5%

5.7%

5.9%

6.1%

11.0%

17.7%

24.3%

31.0%

37.7%

44.3%

51.0%

57.7%

IQ 2012 IIQ 2012 IIIQ 2012 IVQ 2012 IQ 2013

Efficiency Ratios and Inflation in Venezuela

Inflation in Venezuela Operating Expenses / Total Income

Operating Expenses / Average Assets


10


Balance Sheet The principal balance sheet variations during 1Q 2013 are reviewed below and commented on with respect to the prior quarter. The main year-on-year variations are also indicated for comparison purposes.

Summary of Balance Sheet and Assets in Trust

(In millions of Bolivars and Dollars, except percentages)

∆ ∆ US$

1 March December March Mar 13 vs. Dec 12 Mar 13 vs. Mar 12

Mar.2013 2013 2012 2012 Bolivars % Bolivars %

Cash and due from banks 4,844 30,444 27,557 16,468 2,887 10.5 13,976 84.9

Investment Portfolio 6,784 42,624 32,621 26,305 10,003 30.7 16,319 62.0

Loan Portfolio, Net 14,327 90,031 77,885 62,804 12,145 15.6 27,227 43.4

Total Assets 26,869 168,839 142,642 109,414 26,197 18.4 59,425 54.3

Deposits 21,545 135,397 114,605 85,866 20,792 18.1 49,531 57.7

Shareholders´ Equity 2,842 17,861 15,076 11,657 2,785 18.5 6,204 53.2

Asset Management 4,563 28,673 22,566 18,823 6,107 27.1 9,850 52.3

Liquidity At the close of 1Q 2013, total cash and due from banks (cash and the reserve ratio in Venezuela) plus investments in time deposits and placements, which are included in the investment portfolio, increased 11.1% to Bs 34,872 million (US$ 5,549 million)

1, exceeding the Bs

31,394 million (US$ 7,319 million) recorded in the previous quarter by Bs 3,478 million This growth is attributed mainly to accounts held at the Central Bank of Venezuela. Compared to March 31, 2012, cash and due from banks plus investments in time deposits and placements grew Bs 16,229 million (87.1%), from Bs. 18,643 million to Bs 34,872 million.

2,175 3,837 4,428

8,581

11,492 13,041 7,886

16,065

17,403

IQ 2012 IVQ 2012 IQ 2013

Liquidity (In millions of Bolivars)

Cash and Due from Banks - Legal Reserves

Legal Reserves

Investments in Time Deposits and Placements

Δ +87.1%

34,872

31,394

18,642

Δ +68.4%Δ +11.1%

The liquidity ratio calculated by dividing total cash and due from banks by deposits was 22.5%; and the ratio calculated by dividing total cash and investments by deposits was 54.0%, compared with 24.0% and 52.5%, respectively in December 2012 and 19.2% and 49.8%, respectively at the close of 1Q 2012.


11


Investment Portfolio

At the close of 1Q 2013, the investment portfolio totaled Bs 42,624 million (US$ 6,784 million)

1, reflecting a quarter-over-quarter increase of Bs

10,003 million (30.7%) from Bs 32,621 million (US$ 7,606 million)1. This

growth is observed mainly in investments issued by the Venezuelan state, state-owned companies and decentralized entities to fund social housing construction projects.

Compared to March 31, 2012, the investment portfolio grew Bs 16,319 million (62.0%) from Bs 26,305 million to Bs 42,624 million. The variations for this item, seen individually by subsidiary, are as follows:

26,305

32,621

42,624

Mar. 2012 Dec. 2012 Mar. 2013

Investments Portfolio(In million of Bolivars)

Δ +62.0%

Δ + 30.7%

(In millions, except percentages)

March December ∆

2013 2012 Abs. %

Mercantil Banco Universal Bs. 24,302 18,413 5,889 32.0

Mercantil Seguros Bs. 5,473 4,681 792 16.9

Mercantil Commercebank, N.A. Us$ 1,995 2,122 (127) (6.0)

Investments by maturity and yield at the close of 1Q 2013 are broken down as follows:

Investments by Maturity and Yield

(In millions of Bolivars, except percentages)

Trading Available for Sale

Held to Maturity Shares

Time Deposits and Placements

Restricted Investments

Years Bs. 2 Bs.

2 %

4 Bs.

3 %

4 Bs.

2 Bs.

2 % Bs.

2 %

4 TOTAL

Bs. Less Than 1

1,624 10.2

4,3845 5.6 3926 6.1 6,400

From 1 to 5

4,308 12.2 3,824 5.3

2 11.1 8,134

Over 5

8,233 14.8 4,666 4.2 21 12,920

US$ Less Than 1 8

513 13.2 98 4.7 38 0.1

314 3.7 972

From 1 to 5 51

1,386 5.5 324 3.1

17 2.8 1,778

Over 5 49

12,276 4.9 66 2.0 3 6 0.6

23 3.6 12,421

107

28,339

8,978 24

4,428

748 42,624


2 Registered at Market Value

3 Amortized cost

4 The yield of securities is based on amortized cost at the end of the period. Yield is calculated by dividing income from (including Premium amortization or discounts) by amortized cost or market value.

5 Bs. 3,690 million are Central Bank placements with maturity under 30 days.

6 Consists of Repos with the Central Bank of Venezuela with maturity under 30 days

12


0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

55%

60%

Venezuelan CentralBank

US Government Private VenezuelanGovernment and

Public Entities

US Gov. GuaranteedAgencies

Breakdown of Investments by IssuerMarch 2012

December 2012

March 2013

Investments at the close of 1Q 2013, by company, issuer and currency, are broken down as follows:

Breakdown of Investments by Issuer and Currency at March 31, 2012


Venezuelan

Venezuelan

Central Bank US

Government

US Gov. Guaranteed Agencies Int’I Private

Government and Public

Entities Venezuelan

Private Total Bs

Bolivars

Mercantil Banco Universal 4,076 19,079 33 23,187

Mercantil Seguros & Others 3,552 715 4,267

Total Bs. 4,076 - - - 22,6312 748 27,454

US Dollars Total US$1

Mercantil Banco Universal 12 22 13 20 68 Mercantil Commercebank Florida Bancorp 1,050 795 114 36 1,995

Mercantil Seguros & Others 60 29 106 156 351

Total US$ 1,123 846 233 212 - 2,414

Breakdown % 9.6% 16.6% 12.5% 3.4% 56.2% 1.7% 100.0%

1 Dollar figures given for reference purposes only and are translated al the closing exchange rate. See Exchange rates in Appendix VI. Exchange control has been in place in Venezuela since February 2003.

2 Bs. 1.385 million include US$ indexation clause Government bonds issued by the Venezuelan State account for 0.9 times Mercantil's equity and 9.2% of its assets (0.6 and 6.8%, respectively in December 2012). At Mercantil Banco Universal, these securities represent 1.0 times the equity and 9.1% of the assets (0.6% and 5.6%, respectively in December 2012). Mercantil holds 2.2% of the public debt securities in national and foreign currency issued by the Venezuelan nation according to official figures obtained from the Ministry of Planning and Finance at December 31, 2012. At March 31, 2013, the Mercantil, C.A. Banco Universal subsidiary, in line with a regulation issued by the executive, purchased Bs 8,639 million in Agricultural Bonds, Mortgage Bonds and Participation Certificates, accounting for 36.7% of the bank's investment portfolio and 0.8 times its shareholders' equity (Bs 7,517 million representing 42.1% of its investment portfolio and 0.8 times its shareholders' equity at December 31, 2012).

13


47% 47% 45% 43% 43%

25%24% 24% 24%

26%28%

29% 31% 33%

31%

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

90,000

100,000

Mar. 2012 Jun. 2012 Sep. 2012 Dec. 2012 Mar. 2013

Loan Portfolioby Business Segment(In millions of bolivars)

SME's

Large Corporation

Individuals

Financial Intermediation Activity

Loan Portfolio

At the close of 1Q 2013, net loans were Bs 90,031 million (US$ 14.327 million)

1, reflecting 15.6% growth over 4Q 2012 when they totaled Bs

77,885 million (US$ 18,158 million)1.

Compared to March 31, 2012, the loan portfolio grew Bs 27,227 million (43.4%) from Bs 62,804 million to Bs 90,031 million. At March 31, 2013, consumer and commercial loans account for 58.6% of the loan portfolio which totaled Bs 54,497 million, reflecting 17.9% quarter-over-quarter growth and 54.1% year-on-year growth.


62,804

77,885

90,031

Mar. 2012 Dec. 2012 Mar. 2013

Loan Portfolio(In million of Bolivars) Δ + 43.4%

Δ + 15.6%

(In millions,

except percentages March December ∆

2013 2012 Abs. %


Mercantil Commercebank, N A Us$ 4,345 4,372 (27) (0.6)

The ratio of past-due and nonperforming loans to gross loans was 1.0% (0.9% at December 2012). The ratio by subsidiary is as follows:

Mercantil Banco Universal 0.8% compared with 1.0% for the Venezuelan financial system.

Mercantil Commercebank, N.A. 1.5%, similar to the 1.6% registered at the close of December 2012 (1.8% non-accrual loans, 1.9% at December 31, 2012).

At March 31, 2013, 98.4% of Mercantil’s loan portfolio is outstanding. The allowance for losses on loan portfolio covers 306.4% of past-due and nonperforming loans 372.6% at December 31, 2012); this indicator is 496.1% at Mercantil Banco Universal (611.1% at December 31, 2012) and 105.2% at Mercantil Commercebank (92.2% at December 31, 2012). The analysis of Mercantil's main subsidiaries and their positioning in the market are shown on Pages 5 and 18.

Annex IV shows the distribution of the loan portfolio, broken down by economic activity, maturity, country and type of risk.

The statutory percentage of Mercantil Banco Universal loans by economic sector and interest rates is shown in Annex V.

1 Dollar figures given for reference purposes only and are translated al the closing exchange rate. See Exchange rates in Appendix VI. Exchange control has been in place in Venezuela since February 2003.

14


26% 25% 24% 24% 24%

19% 23% 24% 20%21%

55%52%

52%56%

55%

010,00020,00030,00040,00050,00060,00070,00080,00090,000

100,000110,000120,000130,000140,000

Mar. 2012 Jun. 2012 Sep. 2012 Dec. 2012 Mar. 2013

Breakdown Depositsby Business Segment(In millions of bolivars)

Individuals

Large Corporation

SME's

Deposits

At the close of 1Q 2013, deposits were Bs 135,397 million (US$ 21,545 million)

1, representing a quarter-over quarter increase of Bs 20,792 million

(18.1%) compared to Bs 114,605 million (US$ 26,720 million)1.

Compared to March 31, 2012, deposits grew Bs 49,531 million (57.7%) from Bs 85,866 million to Bs 135,397 million.

Checking accounts were the main component of deposits which totaled Bs 81,419 million, up 17.0% from the previous quarter, and represented 60.1% of total deposits. Savings deposits increased Bs 6,404 million (16.4%) and time deposits Bs 2,586 million (43.3%) compared to the previous quarter.


85,866

114,605

135,397

Mar. 12 Dec. 2012 Mar. 13

Deposits(In million of Bolivars)

Δ + 57.7%

Δ +18.1%

(In millions, except percentages)

March December ∆

2013 2012 Abs. %


Mercantil Commercebank, N.A. Us$ 5,380 5,330 50 0.9

The financial intermediation (loan-to-deposit) ratio is 68.6%, compared to 70.3% in December 2012. An analysis of Mercantil's main subsidiaries and their positioning in the market can be seen on Pages 5 and 18.

1 Dollar figures given for reference purposes only and are translated at the closing exchange rate. See Exchange rates in Appendix VI. Exchange control has been in place in Venezuela since February 2003.

15


Total Assets At the close of 1Q 2013, total assets registered 18.4% growth to Bs 168,839 million (US$ 26,869 million)

1, up Bs 26,197 million compared to Bs 142,642

million (US$ 33,258 million)1 in the previous quarter. This is the result of the

combined behavior of the investment portfolio and the loan portfolio, which grew Bs 10,003 million and Bs 12,145 million, respectively. The ratio of performing assets to total assets was 79.7%, up Bs 22,153 million (19.7%) on the previous quarter. Compared to March 31, 2012, assets grew Bs 59,425 million (54.3%) from Bs 109,414 million to Bs 168,839 million. The variations for this item, taken individually by subsidiary, are as follows:

109,414

142,642

168,839

Mar. 2012 Dec. 2012 Mar. 2013

Total Assets Consolidated(In million of Bolivars)

(In millions,

except percentages) March December ∆

2013 2012 Abs. %

Mercantil Banco Universal Bs. 116,668 104,996 11,672 11.1%

Mercantil Seguros Bs. 8,083 6,864 1,219 17.8%

Mercantil Commercebank, N.A. Us$ 6,693 6,787 (94) (1.4)

The analysis of Mercantil's main subsidiaries and their positioning in the market are shown on Pages 5 and 18. The loan portfolio remained the principal component (53.3%) of total assets, and the investment portfolio increased its share to 25.2%, while total cash and due from banks at the end of the quarter accounted for 18.0%.

Assets Distribution Total Bs. 168,839 million

(US$ 26,869 million)1

March 2013

Composition of Assets(In millions of Bolivars)

Cash and Due from Banks 18%

Loan Portfolio, Net 53%

Venezuelan Central Bank 3%

Venezuelan Govermment 14%

US Govermment. 4%

Private Sector 1%

US Govermment Guaranteed Agencies 3%

Other Assets 4%

Investment Portfolio 25%

Breakdown of Assets by Sudsidiaries(In millions of Bolivars)

Mercantil Banco Universal 68.3%

Mercantil Commercebank 24.9%

Mercantil Seguros 4.4%

Others Countries 2.2%

Other Subsidiaries (Venezuela) 0.2%


16


Financial Obligations At the close of 1Q 2013, total financial obligations were 4,320 million (US$ 788 million)

1, 29.4% up compared to Bs 3,338 million (US$ 779

million)1 in the previous quarter, while compared to March 31, 2012, obligations rose 28.1%.

March 2013

December 2012

March 2012

(In million of bolivars and dollars) US$1 Bs. Bs. Bs.

Publicly Traded Debt Securities Issued by Mercantil 15 96 176 -

Subordinated debt 112 701 479 479

227 797 655 479

Other Financial Liabilities * 561 3,523 2,683 2,894

788 4,320 3,338 3,373

* Includes liabilities under repurchase agreements with BCV, funds received for special financing programs, liabilities with credit cards, letters of credit and securities loan agreements.

Shareholders’ Equity At the close of 1Q 2013, shareholder's equity reached Bs 17,861 million (US$ 2,842 million)

1, 18.5% up from Bs 15,076 million (US$ 3,515 million)

1in

the previous quarter and 53.2% up from Bs 11,657 million (US$ 2,719 million)

1in 1Q 2012.

The variation in the first quarter is primarily due to Bs 2,039 million in net income for the period, a Bs 1,441 increase from conversion adjustments of net assets of subsidiaries abroad, and a reduction of Bs 664 million in provisions for dividends declared by the Shareholders' Meeting (see Page 22) and Bs 31 million from adjusting available-for-sale investments to their market value.

11,657

15,076

17,861

Mar. 2012 Dec. 2012 Mar. 2013

Evolution of Shareholders´Equity (In million of Bolivars)

Capital Ratios Mercantil’s equity/assets ratio at March 31, 2013 is 10.6% and its equity/risk-weighted assets ratio is 19.5%%, based on the standards of the National Securities Superintendency-SNV (10.7% and 18.5% at March 31, 2012).

Mercantil Banco Universal, in accordance with the requirements of the Superintendency of Banking Sector Institutions (SUDEBAN), the equity/assets ratio at March 31, 2013 is 10.2% and its equity/risk-weighted assets ratio 19.6% (10.1% and 16.3% at March 31, 2012).

Mercantil Commercebank, N.A., based on the standards of the U.S. Office of the Comptroller of the Currency (OCC), at March 31, 2013, the equity/assets ratio is 10.1% and the equity/risk-based assets ratio 17.3%, (9.2% and 17.1% at March 31, 2012).

The equity ratios of Mercantil and its subsidiaries exceed the regulatory minimums.

Capital StructureMarch 2013

Capital Stock 2%

Capital Reserve 1%

Share Premium 1%

Traslation Adjustments of net Assets of Subsidiaries Abroad 17%

Retained Earnings 74%

Unrealized Gain fron Adjustments of Investments to Market Value 5%


17


0%

20%

40%

60%

80%

100%

Mercantil CommercebankFlorida Bancorp andSubsidiaries (43%)

Other Foreing Subsidiaries(9%)

Subsidiaries in Venezuelan(40%)

Overseas Branch andAgencies (8%)

Cash and Due from Banks

(Foreing Banks), 28.7%

US Treasuries, 3.1%

US$ denominated bonds issued by the Venezuelan government (*),

28.1%

Principal and Interest Covered

Bonds (Ticc), 37.8%

Loan Portfolio & Other Assets,

2.3%

Assets and Liabilities in Foreign Currency

Mercantil has US$ 8,024 million and US$ 6,578 million in assets and liabilities in foreign currency, respectively at March 31, 2013. The estimated effect of each Bs 0.10/US$1 increase in the exchange rate of 6.2842/US$1 at March 31, 2013, would be a rise of Bs 802 million in assets, and Bs 145 million in liabilities, of which Bs 32 million would be recorded as income for the period.

70.5%

29.5%

69.1%

30.9%

Bolivars US$

At March 31, 2013, Mercantil’s shareholders’ equity was Bs 17,861 million, equivalent to US$ 2,842 million1, which is partially covered in US dollars

by the following net assets:

Allocation by Company:


US$ 1.455

Assets

Assets by subsidiaries in Venezuela (40%)

* Issued in US$ or under indexation clause (see Investment Portfolio, page 11)

Bs. 109,414 million (US$ 25,509 million

1)

March 2012

Bs. 168,839 million (US$ 26,869 million

1)

March 2013

Assets by Currency

18


Summary of Subsidiaries’ performance according to their Regulatory Accounting Standards Mercantil Banco Universal Mercantil Banco Universal’s total assets grew Bs 11,470 million (11.0%) compared with December 2012. During 1Q 2013 net loans grew Bs 2,971 million (5.1%) and total deposits rose Bs 10,320 million (11.2%) quarter over quarter to Bs 60,727 million and Bs 102,820 million, respectively. Loan portfolio quality remains very favorable, with a 0.8% ratio of past-due and nonperforming loans to gross loans compared to 1.0% for the Venezuelan financial system as a whole. The loan portfolio provision covers 496.1% of ´past-due and nonperforming loans (372.6% at December 31, 2012). At March 31, 2013, the Mercantil Banco Universal subsidiary ranks fourth in the Venezuelan financial system in terms of total assets with 11.6% of the market. The leading institution has a 15.3% share and Venezuela’s four main banks account for 51.9% of the country’s financial system. It is also the leading bank in the private financial system in terms of mortgage and manufacturing loans, with market shares of 9.3% and 14.2%, respectively. The bank also ranks second in terms of gross loans and microcredits, tourism and agricultural loans with 14.5%, 8.3%,12.9% and 14.2% of the market, respectively. Mercantil is Venezuela's leading bank in terms of savings deposits with 20.7% of the market. Shareholders’ Equity registered Bs 1,045 million (11.3%) quarter-over-quarter growth to Bs 10,279 million. This increase mainly includes Bs 1,100 million in net quarterly income, Bs 927 million increase registered in exchange differences using the new exchange rate set by the Venezuelan Central Bank for the valuation of assets and liabilities in foreign currency, which went from Bs 4.2893/USS$1 to Bs 6.2842/US$1, reduction of Bs 479 million from adjusting investments available for sale to their market value, and Bs 469 million in dividends paid in cash. The equity/assets ratio as of March 31, 2012 is 10.2% (minimum requirement 8%) and the equity/risk-weighted assets ratio, according to the standards of the Superintendency of Banking Sector Institutions in Venezuela, is 19.6% (minimum requirement 12%). In the first quarter of 2013, the Bs 1,100 million in net earnings reflected Bs 433 million (65.1%) year-on-year growth, mainly due to a Bs 651 million rise in net interest income as a result of higher financial assets and liabilities; Bs 373 million in net income from commissions on credit and debit cards and other income; Bs 18 million decrease in loan portfolio provisions; rises of Bs 407 million in personnel and operating expenses; Bs 134 million in contributions to regulatory agencies; and Bs 67 million in corporate income tax, among others.

Mercantil C.A., Banco Universal Consolidated (In millions of Bs and US$)

US$ Mar. 2013

Mar. 2013

Dec. 2012

Mar. 2012

18,455 115,984 104,514 73,175 Total Assets 3,775 23,724 18,038 12,492 Investments Portfolio 9,663 60,727 57,756 44,303 Loan Portfolio 16,362 102,820 92,500 64,721 Deposits 1,636 10,279 9,233 6,608 Shareholders´ Equity 196 1,100 1,224 666 Historic figures in accordance with the standards of the Venezuelan Superintendency of Banking Sector Institutions (SUDEBAN).

1,531 1,694 1,890 2,236 2,182

10.9% 10.6%11.0% 11.1%

10.2%

1.0%

3.0%

5.0%

7.0%

9.0%

11.0%

13.0%

0

500

1,000

1,500

2,000

2,500

IQ 2012 IIQ 2012 IIIQ 2012 IVQ 2012 IQ 2013

Net Interest IncomeNet Interest Margin

4.3% 4.5% 4.4% 4.2%3.8%

Evolution of Net Interest Income

Operating Expenses / Average Total Assets

8.5%

12.3%

9.1%

11.9%

5.7%5.4%

16.7%

6.8%

4.2% 4.9%

15.4%16.0%

15.7% 15.7%

14.5%

9.0%

10.0%

11.0%

12.0%

13.0%

14.0%

15.0%

16.0%

17.0%

0.0%

4.0%

8.0%

12.0%

16.0%

20.0%

IQ 2012 IIQ 2012 IIIQ 2012 IVQ 2012 IQ 2013

Evolution of Gross Loans PortfolioVenezuela

Venezuelan Financial System Mercantil Market Share

19


Mercantil Commercebank N.A. At March 31, 2013, total assets reached US$ 6,724 million, similar to the US$ 6,820 million registered in the previous quarter. Total loans reached US$ 4.342 million, similar to the previous quarter and 5.7% more than in 1Q 2012. Commercial and industrial loans registered 22.4% year-on-year growth. At March 31, 2013, the bank holds US$ 2,170 million (32.3% of total assets) mainly in short-term investments and bonds issued or guaranteed by the US government. Deposits and investments sold under repurchase agreement totaled US$ 5,431 million at the close of March 2013, which reflects quarter-over-quarter growth of 0.9% and year-on-year growth 0.7 %.

Nonperforming assets (non-interest earning loans and assets received in lieu of payment) fell US$ 10 million during the quarter and US$ 135 million compared to March 2012. Nonperforming assets accounted for 1.3% of total assets, 0.1% down on the previous quarter. The ratio of nonperforming loans to total loans declined from 1.9% in 4Q 2012 to 1.8% in 1Q 2013, and the bank registered US$ 0.1 million in loan provisioning, 99.2% lower than in 4Q 2012. The bank's equity at March 31, 2013 was US$ 727 million, US$ 8 million (1.1%) up on the prior quarter, mainly attributable to the quarterly result of US$ 10 million. At March 31, 2013, the equity/assets ratio is 10.1% and the equity/risk-based assets ratio 17.3% (9.2% and 17.1% at March 31, 2012), based on the standards of the Office of the Comptroller of the Currency (OCC).

In 1Q 2013, net earnings totaled US$ 10 million, US$ 4 million (63.8%) up on 1Q 2012, mainly attributable to US$ 8 million (99.2%) reduction in loan portfolio provisioning and US$ 2 million (10.1%) year-on-year decline in commissions and other income. Additionally, corporate income tax expenditure registered a US$ 2 million (63.8%) year-on-year rise to US$ 6 million in 1Q 2013.

Mercantil Commercebank N.A. Consolidated (In millions of US$)

Mar. 2013

Dec. 2012

Mar. 2012

Total Assets 6,724 6,820 6,816 Investments Portfolio 2,170 2,253 2,474 Loan Portfolio 4,342 4,371 4,107 Deposits 5,407 5,366 5,138 Investments Sold under Repurchase Agreements 24 15 255 Shareholders´ Equity 727 719 690 Income net Quarter 10 10 6 Figures presented according to accounting principles generally accepted in the United States (USGAAP )

4.62%

3.84%

2.82%

1.94% 1.77%

5.80%

4.88%

3.77%

2.85%

2.33%

39.56%

31.30%

23.41%

18.71%

14.47%

0%

8%

16%

24%

32%

40%

0%

2%

4%

6%

8%

IQ 2012 IIQ 2012 IIIQ 2012 IVQ 2012 IQ 2013

Assets Quality Ratios

NA(w/o Commitments) /Total Lns.

Total Class Lns /Total Lns.

Total Class+OREO /Tier 1+ALLL

20


Mercantil Seguros In 1Q 2013, premium income registered 28.4% growth to Bs 2,099 million from Bs 1,635 million at the close of 1Q 2012. At the close of February 2013, Mercantil Seguros was the country’s third insurance company in terms of net collected premiums, with 11.7% of the insurance market. Total Assets stood at Bs 7,475 million at March 31, 2013 reflecting 12.1% quarter-over-quarter growth. The company registered Bs 2,163 million in equity, thus complying with statutory solvency requirements. The figures presented include all the mandatory and voluntary reserves required to guarantee the company’s operations, including outstanding claims reserves and end-of-period payments.

At March 31, 2013, the company’s investment portfolio was Bs 6,432 million (12.4% up on the previous quarter). Total investments representing technical reserves reached Bs 4,534 million (4.0% below the figure for the previous quarter and 24.5% less than at the close of March 2012), while liquidity levels meet all the statutory requirements on commitments towards policyholders, insurance brokers and reinsurers. In the first quarter of 2013, the technical result closed at Bs 43 million, with a combined operating ratio of 97.6%. Net income for 1Q 2013 registered 76.3% year-onyear growth to Bs 193 million. The claims ratio was 65.8% (63.8% in 2012).

Mercantil Merinvest

At March 31, 2013, Mercantil Merinvest reached Bs 144 million in total consolidated assets, representing 16.1% quarter-over-quarter growth and a 26.3% year-on-year increase. In 1Q 2013, net earnings reached Bs 15 million, reflecting 47.6% growth from Bs 10 million in 1Q 2012.

Mercantil Seguros C.A. Consolidated (In million of Bs. and US$)

US$ Mar. 2013

Mar. 2013

Dec. 2012

Mar. 2012

Total Assets 1,189 7,475 6,671 5,181 Investments suitable for representing Technical Reserves 722 4,534 4,724 3,641 Investments not-suitable for representing Technical Reserves 302 1,898 1,000 853 Shareholders´ Equity 344 2,163 2,236 1,428 Income net Quarter 34 193 319 109 Premiums Received Net Quarter 374 2,099 2,498 1,635

Historic figures in accordance with the standards of the Venezuelan Superintendency of Insurance Activity (Sudeseg)

Mercantil Merinvest C.A. Consolidated (In millions of Bs and US$)

US$ Mar. 2013

Mar. 2013

Dec. 2012

Mar. 2012

Total Assets 23 144 124 114 Investments Portfolio 14 87 56 55 Shareholders´ Equity 20 128 98 102 Income net Quarter 3 15 7 10

Figures presented according to the standards of the Venezuelan Securities and Exchange Commission (SNV)

1,635

1,470 1,563

2,498

2,099

44 54 82 135 43

IQ 2012 IIQ 2012 IIIQ 2012 IVQ 2012 IQ 2013

Evolution of Net Collected Premiums andTechnical Result

Premiums Received Net Technical Result

30.6%

21.2%

33.0% 33.1%

17.2%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

Technical Result / Total Income

21


Private Banking and Wealth Management The Private Banking and Wealth Management business is comprised of: trust services, securities brokerage, mutual funds and portfolio management services. Net assets under management recorded off-balance sheet at March 31, 2013 stood at Bs 28,673 million (US$ 4,563 million)

1, representing a 27.1% quarter-over-quarter increase and 52.3% year-on-year growth. They are broken down as follows:

1

Dollar figures are given for reference purposes only. Balance Sheet figures are translated at the closing exchange rate and income statement figures at the average exchange rate for the period. See exchange rates in Appendix VI. Exchange control has been in place in Venezuela since February 2003.

During the first quarter of 2013, the Trust Fund managed Bs 15,104 million in assets, which reflects quarter-over-quarter growth of 16.0% and year-on-year growth of 36.2%. At March 31, 2012, Mercantil's trust fund ranked second in the private banking sector and fourth in the fiduciary market in Venezuela. At the close of March 2013, Mercantil maintained its position as Venezuela's mutual fund industry leader. Mutual Fund assets under management grew 7.0% and 42.5% compared to December and March 2012, respectively, reaching Bs 1,302 million. Mercantil offers its clients investment products and services (as broker-dealers and investment advisers) in global financial markets. At the close of March 2013, the total value of client assets was Bs 12,267 million, 47.4% up on the close of December 2012 (up 80.0% year-on-year).

TOTAL ASSETS UNDER MANAGEMENT


March 2013

December 2012

March 2012



Trust Funds 15,104 13,026 11,093

% 16.0

% 36.2

Mutual Fund 1,302 1,217 914 7.0 42.5 Brokerage 9,592 6,696 5,432 43.2 76.6 Financial Advisory 2,675 1,627 1,384

64.4 93.3

Total Private Banking and Wealth Management Bs. 28,673 22,566 18,823 27.1 52.3

Total Private Banking and Wealth Management US$

4,5631

5,2611

4,3881

(13.3) 4.0

22


Corporate Events Shareholders’ Meetings The Shareholders’ Meetings of Mercantil Servicios Financieros and its subsidiaries in Venezuela and abroad were held during the first quarter of 2013. They approved the reports presented by the Board of Directors for consideration by the shareholders, the audited financial statements and Statutory Auditors Report as of December 31, 2012, the proposal made in accordance with the bylaws to appoint the members of the Board of Directors, the Statutory Auditors and set their remunerations. On behalf of Mercantil's Board of Directors and shareholders, the president of Mercantil, Gustavo J. Vollmer A. thanked Alejandro González Sosa for his brilliant overall performance during over 32 years and his valuable contribution as Executive President of the Corporation, adding that he will remain on the Board of Directors. Share Repurchase Program

The Shareholders’ Meeting authorized the Twenty-seventh Phase of Mercantil Servicios Financieros’ Stock Repurchase Program, which started from April 11, 2013, giving continuity to the program initiated in May 2000 to add value to the company.

Dividends The Shareholders’s Meeting of Mercantil Servicios Financieros held in March 2013 approved a cash dividend of Bs 6.50 per common share, payable as follows: two ordinary cash dividends for each Class A and B outstanding share at the rate of Bs 1.00 per common share, payable on April 10 and October 10, 2013, respectively, and an extraordinary cash dividend at the rate of Bs 4.50 per common share, payable on May 10, 2013. Changes in the organizational structure of Mercantil Servicios Financieros and its subsidiaries In February 2013, the Board of Directors approved Mercantil's new organizational structure whose purpose is to adapt to the evolution of the corporation's activities in Venezuela and the countries where it has a presence. Under the new structure, Gustavo Vollmer A. holds the positions of President and Executive President of Mercantil Servicios Financieros, in accordance with the bylaws of the company. Furthermore, two Executive Management Director positions were created, reporting directly to the President and Executive President of Mercantil. Nerio Rosales Rengifo was appointed Global Executive Director of Mercantil Servicios Financieros and National Business, and Millar Wilson as Executive Director of International Business. In addition, Millar Wilson, who had served as President & Chief Executive Officer (CEO) of Commercebank since 2009, has been appointed Vice Chairman & Chief Executive Officer (CEO) of the company. Gustavo A. Vollmer continues to be Chairman of Commercebank N.A. In March 2013, the Board of Directors of Mercantil Banco Universal appointed Nelson Pinto Alves as Executive President of the company. He has been with Mercantil Banco Universal for more than thirty years, and held the position of Manager of Personal and Commercial Banking. Gustavo Vollmer A. thanked Nerio Rosales Rengifo, who is undertaking new responsibilities, for his dedication as Executive President during the past five years. The Board of Directors of Mercantil Seguros appointed María Silvia Rodríguez Feo as Executive President of the company. She held the position of General Manager and has been with Mercantil for twenty-five years. Alberto Benshimol continues to be President of Mercantil Seguros. In addition, the Board of Directors of Commercebank appointed Alberto (Al) Peraza as President and Chief Operating Officer (COO), who has been with Mercantil for over 20 years and served as Chief Financial Officer (CFO) of the Bank. Peraza joins the Mercantil Commercebank, N.A. Board of Directors.

New Measures announced for the Venezuelan Economy The Ministry of Planning and Finance established a new exchange rate In February 2013, the Executive branch and the Central Bank of Venezuela amended Exchange Agreement N° 14, establishing the fixed bid exchange rate at Bs 6.2842/US$1 and the fixed ask exchange rate at Bs 6.30/US$1, effective from that date. In February 2013, the BCV suspended the purchase and sale of securities through SITME, the Foreign Currency Transactions System. The Executive Office of the President created the Superior Body for the Optimization of the Exchange System The Executive Office of the President of the Republic created the Superior Office for the Optimization of the Exchange System under the Ministry of Planning and Finance, the Central Bank and the Ministry of Petroleum and Mining. The purpose of this body will be to design, plan and execute the state's exchange strategies by setting priorities for the allocation of foreign currency, the equilibrium of total currency flows, and the coordination of foreign currency inflows from hydrocarbons and other sources, among others. The Ministry of Planning and Finance issued an Exchange Agreement on special currency auctions The Ministry of Planning and Finance issued an Exchange Agreement authorizing the Superior Body for the Optimization of the Exchange System to regulate the terms and conditions governing the special currency auctions of oil revenue in foreign currency that will be earmarked for imports for the real sector of the national economy, through the Complementary Exchange Administration System (SICAD). This system is managed by the Central Bank of Venezuela and in accordance with auction notices sent out for that purpose.

23


The Ministry of Planning and Finance and the Ministry of Agriculture and Land established the minimum monthly percentages and the conditions applicable to compulsory agricultural loans during financial year 2013 The Ministry of Planning and Finance and the Ministry of Agriculture and Land established the minimum loan portfolio percentages that all banks must earmark each month for the agricultural sector during financial year 2013 at between 21% and 25%. Additionally, the percentage corresponding to June, September, October, November and December 2013 was reduced and the percentage corresponding to February was increased. The different percentages for the financing of strategic items will continue to be established, setting maximum or minimum limits depending on the particular case; and the number of new borrowers (individuals) under the agricultural portfolio must be increased by at least 30% compared with the total number of borrowers at the close of the immediately preceding year. The Ministry of Housing and Habitat established the minimum percentage for the mortgage portfolio The Ministry of Housing and Habitat established the minimum percentage of the annual gross loan portfolios that banking sector institutions must earmark out of their own funds for residential real estate loans for the construction, purchase, refurbishment, expansion or self-construction of main dwellings at 20% and modified the distribution of the percentages to be earmarked for long-term loans for home purchase; or short term loans for home construction, refurbishment, expansion and self-construction.

Awards and Acknowledgements Mercantil Servicios Financieros among Forbes’ Global 2000 ranking In April 2013, Mercantil Servicios Financieros is among the world's biggest 2000 public companies, according to Forbes magazine's ranking based on sales, profits, assets and market capitalization. Mercantil Servicios Financieros was number 1,148 on the list and is the only Venezuelan company in the ranking, having risen 245 positions compared with the previous year.

Global Economic Climate The threats and challenges looming over global economic growth and stability during much of 2012 have not disappeared. The global economy is still dependent on the growth demonstrated by the emerging countries, given that numerous mature economies in Europe and especially Japan are showing difficulties to achieve economic growth. The performance of big emerging countries like China, India and Brazil continues to be key in this regard. The major players in the global economy are beginning to show some improvement, starting with stable economic growth in the USA and the economic expansion of China, which slightly exceeded general expectations. China's first-quarter GDP appears to have been in the region of 7.7%. In March the Management Purchases Index exceeded 50 points for the fifth consecutive month, reaffirming the view of more significant growth in recent months. Inflation, one of the greatest threats, remained low in January and an average year-on-year variation of 2.4% is expected. Asian economic growth was solid in South Korea and slightly less so in Japan. Less dynamism was observed however in other countries, India for example. The Brazilian economy grew 2.7% in 2012, at a slower pace than in 2011 (7.5%), the relatively weak tone being attributable to the loss in the significance of net exports (due to exchange appreciation) and lower stocks. Inflation has picked up again, spurred on by rising food prices. January's figure stood at 6.2%, almost two percentage points above the central target of the Monetary Policy Committee (4.5%). Renewed inflationary tensions have once again pushed the monetary authority against the ropes and complicate the use of further reductions in the reference interest rate of the Special Settlement and Custody System (Selic) in order to boost the country’s depressed activity. It has been confirmed that in the eurozone GDP shrank by 0.5% in the fourth quarter, a greater decline than expected. The symptoms of weak economic activity were widespread, even though there was ample evidence of financial tensions abating somewhat in the European periphery countries. However, the financial crisis that reared its head in Cyprus in mid-March has rather changed the financial outlook for Europe. Although the eurozone countries have agreed to a 10 billion euro bailout for Cyprus to avoid default (largely triggered by the crisis in Greece), some to-ing and fro-ing regarding the scope of the measures agreed caused panic in European financial markets, affecting the stability of the euro. In March, the banks in Cyprus reopened their offices after remaining closed for thirteen days (to avoid a massive run on deposits) and received 5 billion euros in financial aid from the European Central Bank.

U.S. Economic Climate During the first quarter the US economy continued to grow, thereby avoiding another sharp economic turndown. The best news this quarter was in relation to private consumer spending, retail sales in particular which registered 4.6% year-on-year growth at the end of February. The International Council of Shopping Centers and Goldman Sachs reported that chain store sales in March were up 2.6% from their February level. Consumer spending in the first part of the year is confirmed by the Consumer Confidence Index reported by the University of Michigan which reached 78.6 points in March (vs. 76.2 averaged over 2012). Increased consumer confidence was also reflected by the strength of the consumer credit index which rose 5.8% to US$ 16.1 billion since January 2012.

24


1.0%

1.3%

1.6%

1.9%

2.2%

2.5%

2.8%

3.1%

3.4%

3.7%

4.0%

4.3%

4.6%

IQ08

IIQ

08

IIIQ

08

IVQ

08

IQ09

IIQ

09

IIIQ

09

IVQ

09

IQ10

IIQ

10

IIIQ

10

IVQ

10

IQ11

IIQ

11

IIIQ

11

IVQ

11

IQ12

IIQ

12

IIIQ

12

IVQ

12

IQ13

Source: Bloomberg

Treasury Rate 10 Years

The expansion of economic activity in the first quarter was reflected by substantial improvements in the job market. Unemployment closed at 7.6% in March, against the 2012 average of 8.1%. Even though, January and February were good months in terms of job creation with average increases of more than 200,000 jobs per month, in March they slowed down with a net creation of just 88,000 jobs. Job creation in the public sector is continuing to fall, although this factor is more than offset in the private sector. Amid a scenario of recovering employment, there is some uncertainty as to how the fiscal adjustment program under way might affect the course of the economy in the short term. A conservative tone of the fiscal policy and the need to maintain some incentives for growth, partially explain the Federal Reserve's monetary policy to continue to anchor the short-term interest rate (at 0.13%). The stance of the monetary authorities can also partly be explained by the still low minimum inflationary pressures shown by the US economy. In the first quarter, annualized inflation may close around 2.1%, relatively in line with its behavior in 2012. In the real estate market there are still clear signs of a recovery. In February, 7.9% more homes were built and sales of new homes picked up in the first two months of the year to more than 400,000 homes per annum (against an average of 366,000 in 2012) and sales of used homes reached 4,980,000 in February, equivalent to 10.5% growth in one year. All of this has contributed to a continuous improvement in house prices. In January, the Case-Shiller home price index showed that prices in 20 cities had risen 8.1% year-on-year.

Venezuelan Economic Climate

Economic activity During the first quarter of 2013, despite the fact that the global economy was slightly more robust this year, above all due to China's slower economic growth and the improvements foreseen in the US job market, persistent doubts over Europe's economic performance may and in fact have counteracted upward pressure on the principal prices of crude oil in the first months of the year compared to the close of the first quarter of 2012. Despite high oil prices, less currency being available from the Foreign Currency Administration System (CADIVI) and the fact that no resources have been transferred from the Central Bank of Venezuela (BCV) to the National Development Fund ((FONDEN), the Central Bank's level of international reserves declined in the first three months of the year. On the fiscal front, central government’s performance during the first quarter was marked by an increase in the income it received, due fundamentally to the higher bolivar value of the oil industry’s contribution to the national treasury in reaction to the new rate of exchange, as well as more net income from domestic borrowing, in the context of an electoral scenario. On the monetary front, a slight increase in money supply was reported, explained mainly by higher public spending as a result of the availability of less currency through Cadivi, the increase in the secondary creation of money through loans, despite the net restrictive effect of Open Market Operations on payment systems. All these steps caused a slowdown in the growth of domestic prices.

25


0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

110%

120%

IQ08

IIQ

08

IIIQ

08

IVQ

08

IQ09

IIQ

09

IIIQ

09

IVQ

09

IQ10

IIQ

10

IIIQ

10

IVQ

10

IQ11

IIQ

11

IIIQ

11

IVQ

11

IQ12

IIQ

12

IIIQ

12

IVQ

012

IQ13

Monetary Liquidity

Monetary Base

Source: Central Bank of Venezuela and Own Calculation

Monetary Liquidity (M2) and Monetary Base (BM) (Annual Var.)

BMM2

Oil Sector, Reserves The price of the Venezuelan oil basket averaged US$103.8/bbl in the first quarter, 5.6% more than in the previous quarter. However this was 7.4% down on the first quarter of 2012. Venezuelan oil production averaged 2,858 mbd in the first quarter, down 2 mbd compared to the previous quarter. However, compared to the first quarter of 2012 it was up 23.2%. Notwithstanding, international reserves fell an accumulated US$ 2,852 million, closing at US$ 27,035 million in March, their lowest level since December 2012. The executive branch represented by the Ministry of Planning and Finance and the Central Bank of Venezuela, announced an amendment to Exchange Agreement N° 14 through Decree N° 9,381 of February 8, 2013 which adjusted the official exchange rate from Bs 4.30/US$1 to Bs 6.30/US$1 and created a new superior body in charge of the exchange system and policies. The Superior Body for the Optimization of the Exchange System (OSOSC - for its abbreviation in Spanish) will come under the Ministry of Planning and Finance and the Central Bank of Venezuela and the office of Petroleum and Mining, but its decisions will be reached by consensus between the Ministry and the Central Bank. Their attributions include setting priorities for the allocation of foreign currency and guidance on applications for non-production and insufficient production certificates.

Monetary Policy

In the fiscal area, primary spending by the National Treasury stood at Bs 108.2 billion, representing a 27% year-on-year increase. Stripping out the high level of inflation for the period, this makes an increase of 3.7%, which contrasts clearly with the real decline of 26.3% in the first quarter of 2012. In the area of the national debt, assignments of Government Bonds and Treasury Bills amounted to Bs 45.2 billion which, together with shorter maturities, resulted in Bs 14.7 billion in net positive domestic indebtedness, reflecting a 72.5% year-on-year increase in positive domestic indebtedness. In the money market, money in the hands of the public (M2) increased 6% in the first quarter, 30 basis points above the 5.7% increase reported in 1Q 2012. With respect to the handling of the monetary policy, in the first quarter, the Venezuelan Central Bank was more actively involved in open market operations than in the same period of last year which restricted the net effect of open market operations on payment systems by Bs 5.2 billion, 1.1 times above the Bs 2.6 billion contraction in the first quarter of 2012.

Inflation

Accumulated domestic inflation was 5% in the first two months of the year1 which is almost double the figure for the first two months of 2012 (2.6%).

Broken down by group, the highest above-average price increases were in: Restaurants and Hotels (8,3%), Food and Non-alcoholic Beverages (5.7%), Health, Entertainment and Culture (5.6%). According to the eleven geographical locations comprising the National Consumer Price Index, the cities that underwent higher-than-the-national-average price adjustments (5%) were: Maracay, Ciudad Guayana (6.2%), Mérida (6.1%), San Cristóbal (5.8%), Maturín (5.4%), Puerto La Cruz-Barcelona and Valencia (5.1%). 1 Latest information available by BCV

26


APPENDIX I

Summary of the Accounting Principles used to prepare the Financial Statements

Financial statements are presented in accordance with the accounting standards of the National Securities Superintendency (SNV), in bolivars. A summary of some of the main accounting principles applied is given below:

Investment Portfolio Securities Held for Trading - Unrealized gains or losses resulting from differences in market value due to market fluctuations are included in the results for the period. Available-for-Sale Securities – Recorded at their market value. Unrealized gains or losses resulting from differences in market value and exchange rate fluctuations are included in shareholders’ equity. Held-to-Maturity Securities – Recorded at their acquisition cost, adjusted for amortization of premiums or discounts. For all portfolio investments, permanent losses in market value are recorded as a charge to income in the period in which they occur. Permanent investments are investments that represent 20% to 50% stock ownership. Those greater than 50% are recorded as an equity interest and consolidated, except when control is likely to be temporary.

Loan Portfolio Loans are classified as overdue 30 days after their maturity. Allowances for losses on loan portfolio are determined through a collectibility assessment that quantifies the amount to be set aside for each loan. These assessments take into account such aspects as economic conditions, credit risk by customer, credit history and the collateral received. When evaluating loans for small amounts of the same nature, these are grouped together to determine provisions. Recognition of income and expenditure Income, costs and expenses are recorded as they are earned or incurred. Interest earned on loan portfolios is recorded as income when collected. Fluctuations in the market value of derivatives are recognized in income in the period in which they occur. Insurance premiums are recorded as income when earned. Consolidation The consolidated financial statements include the accounts of Mercantil and its more than 50%-owned subsidiaries and other institutions in which Mercantil has a controlling interest. See the main subsidiaries on Page 5 and the reconciliation of their accounting standards with SNV standards on Pages 37, 39, 41. Inflation Adjustment According to SNV standards, Mercantil’s financial statements, as of December 31, 1999 must be presented in historic figures. Since then Mercantil has ceased to adjust for inflation in its primary financial statements. As a result, fixed and other assets are shown at their inflation-adjusted value up to December 31, 1999. The market value determined by independent assessments is higher than adjusted cost for inflation indicated above. New additions are being recorded at their acquisition value. Differences between the accounting standards of the Superintendency of Banking Sector Institutions in Venezuela (SUDEBAN) and US GAAP The main accounting differences for the reconciliation of items under SNV and SUDEBAN for Mercantil Servicios Financieros are:

Amortization of premiums or discounts of securities carried out on a straight-line basis under SUDEBAN standards and in accordance with the constant amortization rate under SNV standards.

Under SNV standards, the effects of exchange fluctuations are included in the results for the period, with the exception of exchange fluctuations from available-for-sale investments and the stock trading portfolio which are included in shareholders' equity. Under SUDEBAN standards, all fluctuations are recorded in the results, with the exception of exchange fluctuations from the stock trading portfolio and the fluctuations which, as provided by the SUDEBAN exception, must subsequently be included in income when authorized by SUDEBAN.

The main accounting differences for Mercantil Servicios Financieros between the above mentioned SNV standards and SUDEBAN standards are:

Deferred Income Tax: US GAAP allows deferred tax to be recognized for the total amount of loan portfolio loss allowances, while SNV standards only allow recognition of allowances for loans classified as high risk and unrecoverable.

Provision for assets received in lieu of payment: SNV standards stipulate a 100% allowance for real property received in lieu of payment after one year from the date of incorporation; under US GAAP no amortization deadlines are established. (See SNV - USGAAP earnings reconciliation, Page 39).

27


APPENDIX II

MERCANTIL SERVICIOS FINANCIEROS, C.A. CONSOLIDATED BALANCE SHEET

UNAUDITED FIGURES


∆ ∆

US$ 1 March December March Mar 13 vs. Dec 12 Mar 13 vs. Mar 12

Mar. 2013 2013 2012 2012 Bolivars % Bolivars %

CASH AND DUE FROM BANKS

Cash 330 2,076 2,457 1,303 (381) (15.5) 773 59.3

Banco Central de Venezuela 3,997 25,121 22,414 11,902 2,707 12.1 13,219 111.1

Venezuelan Banks and Other Financial Institutions 46 287 76 84 211 277.6 203 241.7

Foreign and Correspondent Banks 253 1,588 888 1,853 700 78.8 (265) (14.3)

Allowance for Cash and Due from Banks 218 1,372 1,722 1,326 (350) (20.3) 46,0 3.5

4,844 30,444 27,557 16,468 2,887 10.5 13,976 84.9

INVESTMENT PORTFOLIO

Investments in Trading Securities 17 107 88 437 19 21.6 (330) (75.5)

Investments in Securities Available for Sale 4,510 28,339 20,192 19,430 8,147 40.3 8,909 45.9

Investments in Securities Held to Maturity 1,429 8,978 7,364 2,880 1,614 21.9 6,098 211.7

Share Trading Portfolio 4 24 20 14 4 20.0 10 71.4

Investments in Time Deposits and Placements 705 4,428 3,837 2,175 591 15.4 2,253 103.6

Restricted Investments 119 748 1,120 1,369 (372) (33.2) (621) (45.4)

6,784 42,624 32,621 26,305 10,003 30.7 16,319 62.0

LOAN PORTFOLIO

Current 14,550 91,432 79,337 63,747 12,095 15.2 27,685 43.4

Rescheduled 87 548 492 322 56 11.4 226 70.2

Past Due 113 711 552 581 159 28.8 130 22.4

Litigation 37 233 161 349 71 43.8 (116) (33.2)

14,787 92,924 80,543 64,999 12,381 15.4 27,925 43.0

Allowance for Losses on Loan Portfolio (460) (2,893) (2,657) (2,195) (236) 8.9 (698) 31.8

14,327 90,031 77,885 62,804 12,145 15.6 27,227 43.4

INTEREST AND COMMISSIONS RECEIVABLE 182 1,141 895 670 246 27.5 471 70.3

LONG-TERM INVESTMENTS 33 210 185 216 25 13.5 (6) (2.8)

ASSETS AVAILABLE FOR SALE 10 60 49 141 11 22.4 (81) (57.4)

PROPERTY AND EQUIPMENT 152 956 832 696 124 14.9 260 37.4

OTHER ASSETS 537 3,373 2,616 2,114 757 28.9 1,259 59.6

TOTAL ASSETS 26,869 168,839 142,642 109,414 26,197 18.4 59,425 54.3

1

Dollar figures are given for reference purposes only. Balance Sheet figures are translated at the closing exchange rate and income statement figures at the average exchange rate for the period. See exchange rates in Appendix VI. Exchange control has been in place in Venezuela since February 2003.

28


APPENDIX II

MERCANTIL SERVICIOS FINANCIEROS, C.A.

CONSOLIDATED BALANCE SHEET UNAUDITED FIGURES


∆ ∆


Mar. 2013 2013 2012 2012 Bolivars % Bolivars %

DEPOSITS

Non-interest Bearing 6,223 39,108 35,309 24,563 3,799 10.8 14,545 59.2

Interest-Bearing 6,733 42,311 34,308 26,485 8,003 23.3 15,826 59.8

Savings Deposits 7,227 45,418 39,014 27,963 6,404 16.4 17,455 62.4

Time Deposits 1,362 8,560 5,974 6,855 2,586 43.3 1,705 24.9

21,545 135,397 114,605 85,866 20,792 18.1 49,531 57.7

DEPOSITS AUTHORIZED BY THE VENEZUELAN SECURITIES AND EXCHANGE COMMISSION

15 96 176 0 (80) (45.5) 96 100.0 Publicly Traded Debt Securities Issued FINANCIAL LIABILITIES 561 3,523 2,683 2,894 840 31.3 629 21.7 INTEREST AND COMMISSION PAYABLE 5 34 23 27 11 47.8 7 25.9

OTHER LIABILITIES 1,788 11,219 9,593 8,487 1,626 16.9 2,732 32.2

SUBORDINATED DEBT 112 701 479 479 222 46.3 222 46.3

TOTAL LIABILITIES 24,026 150,970 127,559 97,753 23,411 18.4 53,217 54.4

MINORITY INTEREST IN CONSOLIDATED SUBSIDIARIES 1 8 7 5 1 14.3 3 60.0

SHAREHOLDERS’ EQUITY

Paid in Capital 24 153 153 153 0 0.0 0 0.0

Capital Inflation Adjustment 31 192 192 192 0 0.0 0 0.0

Share Premium 32 204 204 204 0 0.0 0 0.0

Capital Reserves 27 167 167 167 0 0.0 0 0.0 Translation Adjustments of net Assets of Subsidiaries Abroad 476 2,992 1,550 1,551 1,442 93.0 1,441 92.9

Retained Earnings 2,113 13,277 11,902 8,524 1,375 11.6 4,753 55.8

Shares repurchased and held by Subsidiaries (1) (7) (7) (4) 0 0.0 (3) 75.0 Repurchased Shares Restricted for Employee Stock Option Plan (8) (49) (49) (48) 0 0.0 (1) 2.1

Unrealized Gain (Loss) from Adjustment on Investments Available For Sale to Market Value 148 932 963 918 (31) (3.2) 14 1.5

TOTAL SHAREHOLDERS´ EQUITY 2,842 17,861 15,076 11,657 2,785 18.5 6,204 53.2

TOTAL LIABILITIES AND SHAREHOLDERS´ EQUITY 26,869 168,839 142,642 109,414 26,197 18.4 59,425 54.3


29


APPENDIX II

MERCANTIL SERVICIOS FINANCIEROS, C.A. CONSOLIDATED INCOME STATEMENT

UNAUDITED FIGURES (In millions of Bolivars and Dollars, except percentages)

Quarter

Ended on ∆

US$

1 March

2013 March 2012

Mar. 2013 Bolivars %

Income from Cash and Due from Banks 1 4 3 1 33.3

Income from Investment Securities 117 655 425 230 54.1

Income from Loan Portfolio 541 3,039 2,026 1,013 50.0

INTEREST INCOME 658 3,698 2,454 1,244 50.7

Interest for Demand and Savings Deposits 186 1,047 672 375 55.7

Interest for Time Deposits 5 27 28 (1) (3.6)

Interest for Securities Issued by the Bank 1 4 0 4 1.0

Interest on Financial Liabilities 5 29 32 (3) (9.4)

INTEREST EXPENSE 197 1,107 732 375 51.1

NET INTEREST INCOME 461 2,591 1,721 870 50.6

Provision for losses on loan portfolio 25 143 182 (39) (21.4)

Expenses from write-down of available for sale investments 436 2,447 1,539 908 59.0

NET FINANCIAL MARGIN 4 21 16 5 31.3

Trust Fund Operations 2 10 (4) 14 (350.0)

Foreign Currency Transactions 27 154 106 48 (45.7)

Commissions on Transactions 1 4 6 (2) (26.7)

Commissions on Letters of Credit and Guarantees Granted 4 24 20 4 20.0

Equity in Long-Term Investments 129 723 6 717 11.950.0

Exchange Gains and Losses 59 333 234 99 42.3

Income (Loss) on Sale of Investment Securities 116 654 463 191 41.3

Other Income 342 1,924 847 1,077 127.1

TOTAL COMMISSIONS AND OTHER INCOME 42 235 175 60 34.3

Total insures premiums, net of claims 820 4,606 2,561 2,045 79.9

OPERATING INCOME 167 937 691 246 35.6

Salaries and employee benefits 33 185 138 47 34.1 Depreciation, Property and Equipment Expenses, Amortization of Intangibles and Others 70 396 252 144 56.9

Fees paid to regulatory agencies 150 841 603 238 39.5

Other operating expenses 420 2,359 1,684 674 40.0

TOTAL OPERATING EXPENSES 400 2,247 877 1,370 156.3

INCOME BEFORE TAXES AND MINORITY INTEREST 37 207 80 127 158.8

Total Taxes 0 (1) (1) 0 0.0

Minority Interests 363 2,039 796 1,243 156.3

NET INCOME 363 185 177 95.6


30


APPENDIX II


CONSOLIDATED STATEMENT OF CASH FLOWS

UNAUDITED FIGURES

(In millions of Bolivars)

Quarter ended on

March 2013

March 2012

CASH FLOWS FROM OPERATING ACTIVITIES

Net income 2,039 796

Adjustments to reconcile net income to net cash provided Operating activities - Allowance for losses on the loan portfolio 144 182

Depreciation and amortization 61 43

Provision for interest receivable and other assets 2 19

Gain on equity in long-term investment (24) (20)

Minority interest expense 1 1

Deferred Income Tax 50 2 Provision for available for sale assets 0 10 Accrual for employee termination benefits 175 81

Payment of employee termination benefits (129) (69)

Net change in operating assets and liabilities -

Interest and commissions receivables (246) (37)

Interest and commissions payables 11 2

Available for sale and other assets (841) (214)

Other liabilities 917 1,680

Net cash provided by operating activities 2,160 2,475

CASH FLOWS FROM INVESTING ACTIVITIES Net change in investments securities (8,004) (1,201) Loans granted (31,099) (14,881)

Loans collected 18,810 12,265

Additions to fixed assets, net of depreciation and write-offs (165) (27)

Net cash flows from investing activities (20,458) (3,844)

CASH FLOWS FROM FINANCING ACTIVITIES

Net change in

Deposits 20,791 4,032

Short-term financial liabilities 184 (225) Debt securities by Mercantil (80) 0 Subordinated debt 223 0

Long-term financial liabilities received 650 386

Long-term financial liabilities paid 6 (258)

Cash dividends (0) (1)

Net cash flows from financing activities 21,773 3,934

CASH AND CASH EQUIVALENTS 1

Net increase for the period 3,475 2,565

At the beginning of the period 31,390 16,005

At the end of the period 34,866 18,570

1 Includes: Cash and Cash Equivalents, Cash and Due from banks, Investments in time deposits and placements within 90 days maturity

31


APPENDIX II

MERCANTIL SERVICIOS FINANCIEROS, C.A. Statement of Shareholders’ Equity

UNAUDITED FIGURES

(In millions of Bolivars)

Shares repurchased

held by subsidiaries

Unrealized Gain

(loss) from adjustments

on investments Available for

sale to market value

Total Share-holders' Equity

Capital stock

Capital inflation

adjustment Paid-in Surplus

Capital Reserve

s

Translation adjustment

of the assets In

subsidiaries Abroad

Retained earnings

Repurchased shares

restricted for employee

stock option plan

Balance as of March 31, 2012 153 192 204 167 1,551 8,524 (4) (48) 918 11,657

Net income 873 873

Cash paid dividend to subsidiaries 10 10 Unrealized income on Investments available for sale (262) (262) Translation effect of net assets in subsidiaries abroad (7) (7)

Balance as of June 30, 2012 153 192 204 167 1,544 9,407 (4) (49) 656 12,271

Net income 986 986

Share repurchased 1 (3) (3)

Unrealized income on Investments available for sale 77 77 Translation effect of net assets in subsidiaries abroad 1 1

Balance as of September 30, 2012 153 192 204 167 1,545 10,394 (6) (49) 733 13,333

Net income 1,508 1,508 Unrealized income on Investments available for sale 230 230 Translation effect of net assets in subsidiaries abroad 5 5

Balance as of December 31, 2012 153 192 204 167 1,550 11,902 (7) (49) 963 15,076

Net income 2,039 2,039

Cash dividends (664) (664) Unrealized income on Investments available for sale (31) (31) Translation effect of net assets in subsidiaries abroad 1,441 1,441

Balance as of March 31, 2013 153 192 204 167 2,992 13,277 (7) (49) 932 17,861

32


APPENDIX III

MERCANTIL SERVICIOS FINANCIEROS, C.A. Summary of the Financial Statements and Ratios

(In millions Dollars 1, except percentages and figures per share)

March 2013

December 2012

March 2012

∆ Mar 13

vs. Dec 12 ∆ Mar 13

Vs. Mar 12

% %

Cash and due from banks 4,844 6,425 3,840 (24.6) 26.1 Investment Portfolio 6,784 7,606 6,133 (10.8) 10.6 Loan Portfolio Net 14,327 18,158 14,642 (21.1) (2.2) Other assets 914 1,066 894 (14.3) 2.2

TOTAL ASSETS 26,869 33,255 25,509 (19.2) 5.3

ASSET MANAGEMENT 4,563 5,261 4,388 (13.3) 4.0 Deposits 21,545 26,720 20,019 (19.4) 7.6 Financial Liabilities 561 626 675 (10.4) (16.9) Other Liabilities 1,921 2,394 2,096 (19.7) (8.4) Shareholders’ Equity 2,842 3,515 2,719 (19.1) 4.5

TOTAL LIABILITIES AND SHAREHOLDERS´ EQUITY 26,869 33,255 25,509 (19.2) 5.3 INCOME – QUARTER

Financial Margin 461 583 401 (20.9) 15.0 Allowance for losses on loan portfolio 25 65 42 (61.5) (40.5) Commissions and other income 342 321 197 6.5 73.6 Insurance premiums, net of claims 42 93 41 (54.8) 2.4 Salaries and Operating Expenses 420 496 393 (15.3) 6.9 Net Income - Quarter 363 352 185 3.1 96.2 KEY FINANCIAL INDICATORS

Income per share – Quarter Bs/ share 3.66 3.54 1.87 3.4 95.7 Market price A share 33.42 32.64 16.55 2.4 101.9 Market price B share 32.14 31.47 17.49 2.1 83.8 Book value per share 27.81 34.39 26.59 (19.1) 4.6

Net Income (quarter) / Average Assets (ROA) 5.2% 5.0% 3.0% 4.0 73.3 Net Income (quarter) / Average Equity (ROE) 47.9% 47.6% 27.7% 0.6 72.8


33


APPENDIX IV


Consolidated Loan Portfolio by Classification (In millions of Bolivars, except percentages)

By Economic Activity March 2013 %

December 2012 %

March 2012 %

Commercial 39,577 42.6 32,194 40.0 26,653 41.0

Consumer 12,694 13.7 11,727 14.6 7,257 11.2

Agricultural 9,432 10.1 9,049 11.2 7,423 11.4

Services 6,079 6.5 5,337 6.6 4,879 7.5

Foreign trade 5,828 6.3 4,316 5.4 3,304 5.1

Industrial 5,692 6.1 5,618 7.0 4,570 7.0

Residential mortgage 4,513 4.9 4,169 5.2 3,625 5.6

Construction 2,451 2.6 2,344 2.9 2,548 3.9

Car loans 2,226 2.4 2,276 2.8 1,875 2.9

Other 4,433 4.8 3,511 4.4 2,864 4.4 92,924 100.0 80,543 100.0 64,999 100.0

By Maturity March 2013 %

December 2012 %

March 2012 %

Up to six months 33,462 36.0 29,019 36.0 21,585 33.2

Six months to one year 12,429 13.4 12,444 15.5 9,637 14.8

One to two years 15,484 16.7 13,191 16.4 12,715 19.6

Two to three years 9,981 10.7 8,130 10.1 6,470 10.0

Three to four years 5,629 6.1 4,674 5.8 3,500 5.4

Four to five years 5,702 6.1 4,396 5.5 3,884 6.0

Over five years 10,239 11.0 8,689 10.8 7,206 11.1 92,924 100.0 80,543 100.0 64,999 100.0

By Geographical Location of the Debtor March 2013 %

December 2012 %

March 2012 %

Venezuela 63,831 68.7 60,562 75.2 46,764 71.9

United States of America 18,189 19.6 11,993 14.9 10,790 16.6

Mexico 733 0.8 623 0.8 670 1.0

Colombia 393 0.4 371 0.5 470 0.7

Brazil 1,379 1.5 1,077 1.3 1,424 2.2

Switzerland 861 0.9 648 0.8 432 0.7

Peru 2,145 2.3 1,396 1.7 1,033 1.6

Other countries 5,393 5.8 3,872 4.8 3,414 5.3 92,924 100,0 80,543 100.0 64,999 100.0

By Type of Risk March 2013 %

December 2012 %

March 2012 %

Normal 89,536 96.4 77,332 96.0 61,737 91.8

Potential 903 1.0 887 1.1 965 2.5

Real 1,551 1.7 1,509 1.9 1,977 4.9

High 812 0.9 695 0.9 248 0.7

Unrecoverable 122 0.1 120 0.1 73 0.1 92,924 100.0 80,543 100.0 64,999 100.0

34


APPENDIX V

Statutory percentage of Mercantil Banco Universal loans by economic sector and interest rates

March 2013

March 2013

Sector Percentages of compliance

% of Compliance

Reached

% of Compliance

required

Interest Rates

Agriculture

Calculated on the average gross loans at 12/31/2012 and 12/31/2011, monthly compliance. Maximum per customer 5% of the current portfolio. It requires a minimum number of new clients. Additionally the portfolio must be quarterly classified between strategic a non-strategic sectors. The concentration in the strategic segment of the loan portfolio must not be less than 70% and medium and long-term credits less than 10% of the total agricultural loan portfolio.

21.6%1 21.0%

Set weekly by the Central Bank (BCV). At 03/31/2012 this is 13%

Mortgage

Calculated on the gross loan portfolio at 12/31/2012, distributed as follows: 6.0% in long term loans and 13.0% in short-term loans. Annual Compliance.

8.0%1 -

Set semi-annually by the Housing and Habitat Ministry. Set in accordance with family income of debtors, ranging between 1.40% and 11.42%

Microcredits 3% Calculated on the gross loan portfolio at 12/31/2012. Monthly Compliance.

3.2% 3.0%

Within minimum and maximum rates established by the Central Bank. At 03/31/2013 the rate cannot be higher than 24%

Tourism

It’s calculated based on the average of the Loan Portfolio figures at year-end 2012 and 2011. Compliance must be reached by December 31, 2013 (1.5% semiannually).

2.1% -

The Central bank establishes a preferential rate for the sector on a monthly basis. As of March 31, 2012, the rate is 10.64% and can be as low as 7.64% in some cases in accordance with the Law for Tourism Loans.

Industrial Calculated on the gross loan portfolio at 12/31/2012. Monthly Compliance.

9.5% 10.0%

Set by the Central Bank at 19%.

1 Includes Bs 1.757 million in Agricultural Bonds issued by the Venezuelan State in accordance with the agricultural portfolio, and Bs. 1.283 million in special mortgage securities issued by mortgage issued by Fondo Simón Bolivar para la Reconstrucción, S.A. attributable to mortgage portfolio growth

35


88.8%9.6%

1.6%

IQ 2013

Banking Insurance Asset Management

82.3%

14.5%

3.2%

IQ 2012

0

15

30

45

60

75

90

105

120

135

150

165

180

195

210

225

Mar-12 Jun-12 Sep-12 Dec-12 Mar-13

Market Quote Mercantil Class A and Class B Sharesvs. Caracas Stock Exchange (CSE) Index

Price MVZ/A Adjusted CSE Price MVZ/B

APPENDIX VI

Summary of Financial Indicators

“Caracas Stock Exchange: MVZ A & MVZ B ADR Level 1: MSFZY y MSFJY”

Quarter Ended on

US$

Mar 13 Mar 13 Mar 12

Net income in billions of Bolivars (millions of US$) 363 2,039 796

Mercantil’s stock indicators

Class A share:

Number of outstanding shares3 (Issued shares minus repurchased shares) 59,401,343 59,401,343

Market Price 33.42 210.00 71.00

Average daily volume (# of shares) 1,559 1,848

Market Price / Book value per share 1.2 0.6 6 Market Price / Period Net Earnings per share 10.2 8.9

Dividends received in Cash / Market price A 0.0 0.0

Class B share:

Number of outstanding shares3 (Issued shares minus repurchased shares) 42,813,618 42,813,618

Market Price 32.14 202.00 75.00

Average daily volume (# of shares) 2,173 1,705

Market Price / Book value per share 1.2 0.7

Market Price / Period Net Earnings per share 9.8 9.4

Dividends received in Cash / Market price B 0.0 0.0

Book value per share in Bs (Equity / # of outstanding shares) 2 27.819

174.74 114.04

Total weighted outstanding shares 99,162,172 99,198,316

Earnings per share (Net Result/ weighted outstanding shares) 3.66 20.57 8.02

1

Figures in US$ given for reference purposes only; Balance Sheet figures translated at the closing exchange rate and income at the average exchange rate for the period. See exchange rates in Appendix VI. Exchange control has been in place in Venezuela since February 2003.

2 Issued shares minus repurchased shares.

3 Stock dividends paid are considered as issued shares for comparison purposes.

Composition of Net Income by Business Segments

36


APPENDIX VI

Quarter Ended on

Mar 13 Mar 12

Balance Structure indicators

Gross Loans/Deposits 68.6% 75.7%

Profitability Ratios (%):

Gross financial margin / Average interest earning assets 8.4% 7.9%

Commissions and other income as a percentage of Total income 45.5% 37.3%

Return on average assets (ROA) 5.2% 3.0%

Return on average equity (ROE) 47.9% 27.7%

Efficiency Ratios (%):

Operating expenses / Average total assets 5.0% 5.4%

Operating expenses / Total income 41.3% 52.3%

Liquidity Ratios (%):

Cash and due from banks / Deposits 22.5% 19.2%

Cash and due from banks and Investments Portfolio / Deposits 54.0% 49.8%

Asset Quality Ratios (%):

Non-performing loans/ Gross loans 1.0% 1.4%

Allowance for loan losses / Non performing loans 306.4% 235.9%

Allowance for loan losses / Gross loans 3.1% 3.4%

Capital Adequacy Ratios (%):

Equity / Assets 10.6% 10.7%

Equity / Risk – Weighted Assets (regulatory minimum 8%) 19.5% 18.5%

Number of employees

Employees in Venezuela 8,869 8,530

Employees Abroad 881 849

Distribution network

Branches in Venezuela 302 302

Bank branches 268 269

Insurance branches 34 33

Branches Abroad 24 23

Representative Offices 5 5

Number of ATMs 1,398 1,307

Number of points of sale (POS) 49,415 43,785

Mercantil Aliado Network:

Correspondent Desk 119 69

Correspondent Trading Points 192 164

Exchange and inflation rates

Exchange rate Bs/US$1 (Controlled since February 2003) 6.2842 4.2893

Average Exchange Rate for the quarter (Bs/US$1) 5.6192

4.2893

Inflation for the last 12 months 25.1% 24.6%

Summary of Financial Indicators

37


APPENDIX VII

MERCANTIL C.A. BANCO UNIVERSAL

According to rules issued by SNV 1 UNAUDITED CONSOLIDATED FIGURES


∆ ∆



SUMMARY OF BALANCE SHEET ASSETS Cash and Cash Equivalents 4,650 29,224 26,894 15,124 2,330 8.7 14,100 93.2 Investments Portfolio 3,867 24,302 18,414 12,664 5,888 32.0 11,638 91.9 Loan Portfolio 9,663 60,727 57,756 44,303 2,971 5.1 16,423 37.1 Properties and Equipment and Other Assets 384 2,415 1,932 1,354 483 25 1,061 78.3

TOTAL ASSETS 18,565 116,668 104,996 73,446 11,672 11.1 43,222 58.8

LIABILITIES AND SHAREHOLDERS'EQUITY Deposits 3 16,050 100,863 90,940 62,888 9,923 10.9 37,975 60.4 Financial Liabilities and Other Liabilities 757 4,759 4,263 3,602 497 11.7 1,157 32.1


SHAREHOLDERS´ EQUITY 1,758 11,046 9,793 6,956 1,252 12.8 4,090 58.8

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 18,565 116,668 104,996 73,446 11,672 11.1 43,222 58.8

Quarter

Ended on ∆

US$ 2 March 2013

March 2012 Bolivars % Mar.2013

SUMMARY OF STATEMENT OF INCOME 585 3,285 2,127 1,158 54.4 Interest Income

Interest Expense 188 1,058 684 374 54.7

Gross Financial Margin 397 2,227 1,444 784 54.3 Provision for Losses on Loan Portfolio 25 138 144 (7) (4.7)

Net Financial Margin 372 2,090 1,299 791 60.9 Commissions and Other Income 279 1,569 638 931 145.9

Operating Income 651 3,658 1,937 1,721 88.9 Operating Expenses 316 1,773 1,271 502 39.5

Income before taxes 335 1,885 666 1,219 182.9 Taxes 22 125 58 67 115.4

NET INCOME 313 1,761 608 1,152 189.3

NET INCOME IN US$ 2 313 142 171 120.9

1 These financial statements are presented in accordance with SNV standards and adjusted for inflation up to December 31. 1999 (See accounting principles used). They reflect Mercantil Banco Universal’s contribution to Mercantil´s results. These Standards of the SNV are described in Appendix I.


3 Historic figures in accordance with the standards of the Superintendency of Banking Sector Institutions in Venezuela.

Conciliation of Net Income SNV and SUDEBAN Quarter

(In millions of Bs.) Ended on

March March

2013 2012

Net income 3 1,100 666

Deferred Income Tax 0 0

Long term interest bearing loans, investments in securities adjusted for amortization, and other consolidation effects 661 (58)

Net income SNV 1,761 608

Inter-company eliminations 0 0

Contribution to Mercantil's Results 1,761 608

38


APPENDIX VII

MERCANTIL C.A. BANCO UNIVERSAL

According to rules issued by SUDEBAN 1

UNAUDITED CONSOLIDATED FIGURES (In millions of Bolivars and Dollars, except percentages)

∆ ∆



SUMMARY OF BALANCE SHEET ASSETS Cash and Cash Equivalents 4,650 29,224 26,894 15,124 2,330 8.7 14,100 93.2 Investments Portfolio 3,764 23,656 17,970 12,436 5,686 31.6 11,220 90.2 Loan Portfolio 9,663 60,727 57,756 44,303 2,971 5.1 16,423 37.1 Properties and Equipment and Other Assets 378 2,377 1,895 1,312 482 25.5 1,066 81.2

TOTAL ASSETS 18,455 115,984 104,514 73,175 11,470 11.0 42,809 58.5

LIABILITIES AND SHAREHOLDERS'EQUITY Deposits 16,362 102,820 92,500 64,721 10,320 11.2 38,099 58.9 Financial Liabilities and Other Liabilities 457 2,885 2,780 1,846 105 3.8 1,039 56.3


SHAREHOLDERS´ EQUITY 1,636 10,279 9,233 6,608 1,045 11.3 3,671 55.6

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 18,455 115,984 104,514 73,175 11,470 11.0 42,809 58.5

Quarter

Ended on ∆

US$ 3 March 2013

March 2012 Bolivars % Mar.2013

SUMMARY OF STATEMENT OF INCOME 584 3,279 2,296 983 42.8 Interest Income

Interest Expense 195 1,097 765 332 43.4

Gross Financial Margin 389 2,182 1,531 651 42.5 Allowance for Losses on Loan Portfolio 25 138 157 (18) (11.6)

Net Financial Margin 364 2,044 1,375 669 48.7 Commissions and Other Income 191 1,072 699 373 53.3

Operating Income 555 3,116 2,074 1,042 50.3 Operating Expenses 336 1,890 1,350 541 40.1

Income before taxes 219 1,225 724 501 69.1 Taxes 22 125 58 67 115.6

NET INCOME 196 1,100 666 433 65.1

NET INCOME IN US$ 3 196 155 40 26.1


Indicators1 from Consolidated Financial Statements

System March March

average2 2013 2012

Gross financial margin / Average assets 7.9% 8.0% 8.3%

Return on average assets (ROA) 2 3.8% 3.9% 3.8%

Return on average equity (ROE) 2 42.7% 43.6% 42.1%

Non-performing loans / Gross loans 1.0% 0.8% 0.7%

Allowance for loan losses / Non performing loans 329.1% 496.1% 605.7%

Allowance for loan losses / Gross loans 3.2% 3.9% 4.2%

Operating expenses / average total assets 4.6% 5.0% 5.8%

Equity / Assets 8.5 7.9% 8.1%

Equity / Assets minus Venezuelan Government Investments N.D. 10.2% 10.1%

Equity / Risk-weighted Assets N.D. 19.6% 16.3%

1 Consolidated.

2 Based on annualized figures.


N.A.: Not available

39


APPENDIX VIII

MERCANTIL COMMERCEBANK FLORIDA BANCORP

According to rules issued by SNV 1 UNAUDITED CONSOLIDATED FIGURES

(In millions of Dollars, except percentages)

∆ ∆

March December March Mar 13 vs. Dec 12 Mar 13 vs. Mar 12

2013 2012 2012 Dollars % Dollars %

SUMMARY OF BALANCE SHEET ASSETS Cash and Cash Equivalents 186 145 376 41 28.2 (190) (50.5) Investments Securities 1,995 2,122 2,107 (127) (6.0) (112) (5.3) Loan Portfolio 4,345 4,372 4,111 (27) (0.6) 234 5.7 Properties and Equipment and Other Assets 167 148 187 19 12.8 (20) (10.9)

TOTAL ASSETS 6,693 6,787 6,781 (94) (1.4) (88) (1.3)

LIABILITIES AND SHAREHOLDERS’ EQUITY Deposits 5,380 5,330 5,349 50 0.9 31 0.6 Financial Liabilities, Other Liabilities and Subordinated Debt 691 845 862 (153) (18,1) (170) (19,8)

TOTAL LIABILITIES 6,072 6,175 6,211 (103) (1.7) (139) (2.2) SHAREHOLDERS´ EQUITY 622 613 570 9 1.5 52 9.1

TOTAL LIABILITIES AND SHAREHOLDERS´ EQUITY 6,693 6,787 6,781 (94) (1.4) (88) (1.3)

Quarter Ended on ∆ March

2013 March 2012 US$ %

SUMMARY OF STATEMENT OF INCOME

Interest Income 43 46 (3) (5.7)

Interest Expense 7 9 (2) (23.9)

Gross Financial Margin 36 37 (0) (1.2)

Allowance for Losses on Loan Portfolio 0 8 (8) (99.2)

Net Financial Margin 36 28 8 28.1

Commissions and Other Income 15 16 (2) (9.5)

Operating Income 51 45 6 14.4

Operating Expenses 36 36 (0) (0.7)

Income before taxes 15 8 7 81.0

Taxes 4 1 2 146.9

NET INCOME US$ 11 7 5 66.6

1 These financial statements are presented in accordance with rules of the SNV (see accounting principles used) to reflect the contribution of Mercantil Commercebank Florida Bancorp to the results of Mercantile. These Standards of the SNV are described in Appendix I.

Conciliation of Net Income SNV and USGAAP

(In millions of dollars ) Quarter

Ended on March March

2013 2012

Mercantil Commercebank N.A. Consolidated - Net Income 10 6

Results for the Holding and other Affiliates (1) (1)

Mercantil Commercebank Florida Bancorp - Net Income 9 5

Deferred Income Tax 2 1

Provision for available for sale assets 1 0

Others (0) 1

Contribution to Mercantil's Results1 11 7

40


APPENDIX VIII

MERCANTIL COMMERCEBANK, N.A.

According to USGAAP UNAUDITED CONSOLIDATED FIGURES

(In millions of Dollars, except percentages)

∆ ∆

March December March Mar 13 vs. Dec 12 Mar 13 vs. Mar 12

2013 2012 2012 Dollars % Dollars %

SUMMARY OF BALANCE SHEET

ASSETS Cash and Cash Equivalents 11 13 8 (2) (14.1) 3 40.7 Investments Securities 2,170 2,253 2,474 (84) (3.7) (304) (12.3) Loan Portfolio 4,342 4,371 4,107 (29) (0.7) 235 5.7 Properties and Equipment and Other Assets 202 182 227 20 10.8 (25) (11.1)

TOTAL ASSETS 6,724 6,820 6,816 (95) (1.4) (91) (1.3)

LIABILITIES AND SHAREHOLDERS’ EQUITY Deposits 5,407 5,366 5,138 41 0.8 269 5.2 Financial Liabilities, Other Liabilities and Subordinated Debt 591 735 988 (144) (19,6) (397) (40,2)

TOTAL LIABILITIES 5,998 6,101 6,126 (103) (1.7) (128) (2.1) SHAREHOLDERS´ EQUITY 727 719 690 8 1.1 37 5.4

TOTAL LIABILITIES AND SHAREHOLDERS´ EQUITY 6,724 6,820 6,816 (95) (1.4) (91) (1.3)

Quarter Ended on ∆

March 2013

March 2012 US$ %

SUMMARY OF STATEMENT OF INCOME Interest Income 43 46 (3) (5.6) Interest Expense 5 7 (2) (28.8)

Gross Financial Margin 38 38 (0) (1.2) Allowance for Losses on Loan Portfolio 0 8 (8) (99.2)

Net Financial Margin 38 30 8 26.6 Commissions and Other Income 13 15 (2) (10.1)

Operating Income 51 45 6 14.4 Operating Expenses 35 35 0 0.6

Income before taxes 16 10 6 63.8 Taxes 6 4 2 63.8

NET INCOME US$ 2 10 6 4 63.8

Mercantil Commercebank, N.A. Indicators

Similar March March

Group1 2013 2012

Gross financial margin / Average assets 3.6% 2.3% 2.4%

Return on average assets (ROA) 2 1.0% 0.6% 0.4%

Return on average equity (ROE) 2 9.1% 5.6% 3.6%

Non Accrual / Gross loans 1.6% 1.8% 4.6%

Allowance for loan losses / Gross loans 1.7% 1.6% 1.5%

Operating expenses / average total assets 2.8% 2.1% 2.1%

Equity / Assets N.D. 10.1% 9.2%

Equity / Risk-weighted Assets N.D. 17.3% 17.1% 1

Based on September, 2012. 2 Annualized

N.A.: Not available

41


APPENDIX IX

MERCANTIL SEGUROS

According to rules issued by SNV 1 Unaudited Consolidated Figures


∆ ∆



SUMMARY OF BALANCE SHEET ASSETS Cash and Cash Equivalents 89 557 357 392 200 56.1 166 42.3 Investments Portfolio 871 5,473 4,681 3,686 792 16.9 1,788 48.5 Premiums receivable 164 1,032 955 761 77 8.1 271 35.7 Property and equipment 33 205 212 147 (7) (3.3) 58 39.2 Other assets 129 815 659 617 156 23.7 198 32.1

TOTAL ASSETS 1,286 8,083 6,864 5,603 1,219 17.8 2,481 44.3

LIABILITIES AND SHAREHOLDERS’ ÉQUITY Uncollected Premium 405 2,547 2,317 1,978 230 9.9 569 28.8 Reserves 235 1,476 1,179 997 297 25.2 479 48.1 Financial Liabilities 21 130 0 185 130 100.0 (55) (29.7) Accounts Payable Reinsures 54 341 287 241 54 18.9 100 41.4 Other provisions and other liabilities 128 807 743 637 64 8.7 170 26.7

TOTAL LIABILITIES 843 5,301 4,527 4,038 775 17.1 1,264 31.3

SHAREHOLDERS’ ÉQUITY 443 2,782 2,338 1,565 444 19.0 1,217 77.8

TOTAL LIABILITIES AND SHAREHOLDERS’ ÉQUITY 1,286 8,083 6,864 5,603 1,219 17.8 2,481 44.3

Quarter Ended on ∆ US$

2 March March

Mar.2013 2013 2012 Bolivars %


Earned Premiums Received 312 1,755 1,309 446 34.1

Claims Incurred (205) (1,154) (832) (322) 38.7

Commissions and Acquisition Expenses (50) (280) (229) (51) 22.3 Management Expenses (32) (179) (128) (51) 39.9 Taxes and Contributions (17) (96) (69) (27) 38.7

Technical Result 8 45 50 (5) -9.3 Income from Investments 32 180 100 80 80.3 Foreign exchange gains 5 27 0 27 26,500 Taxes (1) (8) (4) (5) 137.1 Contracts of excess of lost (9) (49) (31) (18) 57.3

NET INCOME 35 195 115 80 69.1

NET INCOME US$ 2 35 27 8 29.1

1

These financial statements are presented in accordance with SNV standards and adjusted for inflation up to December 31, 1999 (See accounting principles used, Appendix I). They reflect Mercantil Seguros contribution to Mercantil’s results. These Standards of the SNV are described in Appendix I.


Conciliation of Net Income SNV and SUDESEG (In million of Bs.)

Quarter

Ended on

March March

2013 2012

Mercantil Seguros (Consolidated) - Net Income 193 109

Valuation of Investments 0 (0)

Earned premiums 1 4

Exchange Gains and Losses 0 0

Other 1 2

Contribution to Mercantil's Results 195 115

42


APPENDIX IX

MERCANTIL SEGUROS

According to rules issued by SUDESEG Unaudited Consolidated Figures


∆ ∆



SUMMARY OF BALANCE SHEET ASSETS Cash and Cash Equivalents 722 4,534 4,724 3,641 (190) (4.0) 894 24.5 Investments Portfolio 302 1,898 1,000 853 898 89.8 1,045 122.5 Premiums receivable 165 1,043 947 687 96 10.1 356 51.8

Property and equipment 1,189 7,475 6,671 5,181 804 12.1 2,294 44.3

Other assets TOTAL ASSETS 640 4,023 3,498 2,996 525 15.0 1,027 34.3

LIABILITIES AND SHAREHOLDERS’ ÉQUITY 205 1,288 936 757 352 37.6 532 70.2

Uncollected Premium 845 5,311 4,434 3,753 877 19.8 1,559 41.5 Reserves

Financial Liabilities 344 2,163 2,236 1,428 (73) (3.2) 735 51.5 Accounts Payable Reinsures

Other provisions and other liabilities 1,189 7,475 6,671 5,181 805 12.1 2,294 44.3

Quarter Ended on ∆ US$ 1 March March

Mar.2013 2013 2012 Bolivars %


Earned Premiums Received 312 1,754 1,304 450 34.5

Claims Incurred (205) (1,154) (832) (322) 38.7

Commissions and Acquisition Expenses (50) (282) (231) (51) 21.9

Management Expenses (32) (179) (128) (51) 39.9

Taxes and Contributions (17) (96) (69) (27) 38.7

Technical Result 8 43 44 (1) (2.0)

Income from Investments 32 180 100 80 80.3

Foreign exchange gains 5 27 0 27 26,500.0 Taxes (1) (8) (4) (5) 137.1 Contracts of excess of lost (9) (49) (31) (18) 57.3

NET INCOME 34 193 109 83 76.3

NET INCOME US$2 34 25 9 34.6

KEY FINANCIAL AND OPERATING INDICATORS Mercantil Seguros

(In millions of Bolivars, except percentages)

Quarter Ended on

March March

2013 2012

Premiums Received Net 2,099 1,635

Market Share 11.7%2 13.7%2

Equity / Total Assets 29.0% 27.6%

Incurred Claims / Earned Premiums (%) 65.8% 63.8%

Commissions and Acq. Expenses / Earned Premiums (%) 16.0% 17.7%

Administrative Expenses / Earned Premiums (%) 10.2% 9.8%

Combined Ratio (%)3 97.6% 96.7%

Insured Persons4 1,503,645 1,422,790


2 Market Share at 2012/11/30

3 Combined ratio = (incurred claims + commissions + operating expenses)/ earned premiums

4 In numbers.

43


APPENDIX X

Key Macroeconomic Indicators

12 Months Quarter

2011 2012 I 12 II 12 III 12 IV 12 I 13

Gross Domestic Product. Var.% 1

Consolidated 4.2 5.6 5.9 5.6 5.5 5.5 ND

Oil activities 0.6 1.4 2.2 1.1 1.1 1.1 ND

Non-Oil activities 4.5 5.8 6.1 6 5.6 5.4 ND

Other Net Taxes on Products 5.9 9.1 8.7 8.2 9.5 9.8 ND

Consumer Price Index (% Change)2 29 19.5 14.9 17.2 16.6 30.1 ND

Unemployment Rate (% Change)3 7.8 7.4 9.3 8.3 7.8 6.5 ND

Wage Income Index (% Var )1 38.3 23.6 39.5 29.4 22.7 23.6 ND

Monetary Liquidity (% Change)1 50.6 60.1 53.9 53.1 57.4 60.1 60.5

Interest Rates (Period end) (%)4

Six Main Commercial and Universal Banks

Period-end Loan Rate 15.6 15.6 15.4 16.3 16.8 15.6 15.3

Period-end Saving Deposit Rate 12.5 12.5 12.5 12.5 12.5 12.5 12.5

Period-end Time Deposit Rate 14.5 14.6 14.5 14.5 14.5 14.6 14.5

Exchange Rate (Preferential)

Period end (Bs/US$) (Bid rate) 7 4,289.3 4,289.3 4,289.3 4,289.3 4,289.3 4,289.3 6,284.2

Annual average exchange rate (Bs/US$)7 4,289.3 4,289.3 4,289.3 4,289.3 4,289.3 4,289.3 6,284.2

Depreciation (%) 2 0.0 0.0 0.0 0.0 0.0 0.0 0.0

Exchange Rate (Oil)

Period end (Bs/US$) (Bid rate) 7 4,289.3 4,289.3 4,289.3 4,289.3 4,289.3 4,289.3 6,284.2

Annual average exchange rate (Bs/US$)7 4,289.3 4,289.3 4,289.3 4,289.3 4,289.3 4,289.3 6,284.2

Depreciation (%) 2 0.0 0.0 0.0 0.0 0.0 0.0 0.0

External Sector (millions of US$)

Trade Balance 5 45,998 38,001 12,020 10,580 8,616 6,785 ND

Oil Exports 88,132 93,569 24,677 22,647 22,464 23,781 ND

Non-Oil Exports 4,679 3,771 1,059 1,021 ,846 845 ND

Imports 46,813 59,339 13,716 13,088 14,694 17,841 ND

Central Bank of Venezuela Intl. Res. 29,889 29,887 27,587 28,424 25,887 29,887 27,035

FEM 3 3 3 3 3 3 3

Oil Export Average Price (US$/b) 101.1 103.4 112.0 103.5 100.0 98.3 103.8

Average Oil Production (Thousands bpd) 2,263 2,545 2,313,3 2,345 2,663,3 2,860 2,858

Central Government (millions of Bs)

Non-Oil Income 147,443 192,340 42,843.9 45,386.3 48,181.9 55,927.3 ND

Realized Expenses by the National Treasury 6 324,726 414,000 85,274.0 86,920.1 105,093.3 136,712.9 108,204.5

1 Year-on-year variation.

2 Annual Dec-Dec figures. Annualized quarterly figures.

3 Annual figures for the second semester.

4 Annual figures correspond to weighted averages.

5 Balance of payments figures.

6 Does not include public debt amortization.

7 Exchange Rate US$/1 for comparison purposes. At January 1, 2008, begins the Monetary Conversion Law.

ND: Not Available FEM: Macroeconomic Stabilization Fund Source: Central Bank of Venezuela (BCV). Ministry of Finance (MF). National Statistics Institute (INE) Ministry of Energy and Production (MEP). Bloomberg and own calculation

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