Transcript CONFERENCE CALL FIRST QUARTER

CONFERENCE CALL
SECOND QUARTER OF 2000
Balance Sheets - Consolidated
R$ Million
Assets
Jun/00 Mar/00
Var %
Liabilities
Cash and Cash Equivalents 1,557
1,496
Money Market
3,867
2,257
71.4
2,740
1,757
56.0
14,188
15,831
(10.4)
5,613
6,371
Credit Operations (*)
16,834
15,712
Provision for
Loan Losses
(1,443)
(1,287)
12.1 Other Liabilities
Other Assets
8,182
8,956
(8.6) Minority Interest
Permanent Assets
2,991
3,002
(0.4) Stockholders’ Equity
Interbank Funds Applied
Securities
Interbank Deposits
Total Assets
54,529 54,094
(*) Not Included Advances on Exchange Contracts.
4.1 Deposits
0.8
Var %
21,888
22,131
(1.1)
Money Market Repurchase
4,672
Commitments
4,289
8.9
Acceptances and
Debentures
2,916
3,140
(7.1)
3,152
2,504
25.9
Borrowing and On-Lending
5,191
Borrowings
5,470
(5.1)
9,912
10,040
(1.3)
445
395
12.8
6,353
6,125
3.7
54,529
54,094
0.8
(11.9) Interbank Accounts
7.1
Jun/00 Mar/00
Total Liabilities
Income Statement
R$ Million
Itaú Consolidated
Net Income from Financial Operations
Provision for Loan Losses
Banking Service Fees
Salaries, Employee Benefits and Other Adm. Expenses
Equity Share in Income of Subsidiaries and Affiliates
Other Operating and Non Operating Income
Income before Income Tax and Social Contribution and Profit Sharing
Income Tax and Social Contribution
Profit Sharing
Minority Interest
Net Income
2Q/00
1Q/00
Var %
1,169
(163)
871
(1,234)
90
(67)
666
(174)
(40)
(16)
1,179
(153)
802
(1,156)
(53)
(69)
550
(158)
(29)
2
(0.8)
6.9
8.8
6.8
(270.4)
(1.4)
21.0
10.2
41.1
836.4
435
365
19.1
HIGHLIGHTS
R$ Billion(*)
TOTAL ASSETS
80,0
60,0
54.5 56.3
54.3
51.9
LOANS (1)
20
54.1
54.5
15.4
Mar.99
Jun.99
10
20,0
5
18.2
Mar.00
Jun.00
0
Mar.99 Jun.99 Sep.99 Dec.99 Mar.00 Jun.00
DEPOSITS
25
15.9
17.4
15
40,0
0,0
15.8
17.3
21.5
21.4
23.2
20.1
22.1
21.8
20
ASSET MANAGEMENT (2)
40
30
Sep.99 Dec.99
25.8
27.2
28.0
32.0
37.3
34.1
15
20
10
10
5
0
0
Mar.99
Jun.99
Sep.99
Dec.99
Mar.00
Jun.00
(*) Balance at the end of period
(1) Credit Operations: Loans, Leasing, Other Receivables ( Res. 2682 ) and Advances on Exchange Contracts
(2) Including Matrix Funds
Mar.99 Jun.99 Sep.99 Dec.99 Mar.00 Jun.00
Market Capitalization Consolidated, Stockholders’
Equity and Consolidated Net Income (1)
R$ Million
761
8,000
Extraordinary Result (2)
Market Capitalization, Stockholders’ Equity
18,000
6,000
226
4,000
5,182
16,000
14,000
12,000
10,000
800
Consolidated Stockholders' Equity
Market Capitalization
Consolidated Net Income
333
8,911
9,914
5,563
700
17,834
415
360
16,566
365
600
435
5,907
500
400
6,353
11,109
5,801
17,395
300
200
6,125
Consolidated Net Income
20,000
100
2,000
0
0
1Q99
2Q99
3Q99
4Q99
1Q00
2Q00
(1) Net Income of Quarter; Stockholders’ Equity and Market Capitalization as of period ended.
(2) In the first quarter of 1999, the Banco Itaú has Extraordinary Result of R$ 535 million, related to the valorization of permanent
Bank investments abroad.
Excelent Performance
ROA
ROE
80.0%
70.0%
60.0%
50.0%
40.0%
30.0%
20.0%
10.0%
0.0%
-10.0%
-20.0%
72.9%
48.1%
18.6%
1Q99
7.0%
6.0%
26.2% 27.3%
26.2%
2Q99
Extraordinary
(*) Annualized
31.2%
26.1%
33.8%
40.3%
-5.2%
-7.0%
3Q99
4Q99
26.1%
30.3%
30.3%
5.0%
4.0%
3.0%
2.0%
1.0%
0.0%
5.7%
4.0%
2.4%
1.7%
2.4%
-1.0%
-2.0%
1Q00
Recurring
2Q00
1Q99
2Q99
Extraordinary
2.7%
3.2%
3.3%
4.1%
-0.6%
-0.8%
3Q99
4Q99
2.7%
3.2%
2.7%
3.2%
1Q00
2Q00
Recurring
Excelent Performance
R$ Million
EFFICIENCY RATIO
BIS RATIO
30.0%
23.9%
23.9%
24.2% 23.3%
3.0%
2.9%
3.4%
25.0%
20.0%
62.0%
3.7%
60.0%
58.0%
15.0%
10.0%
64.0%
21.3%
24.0%
20.9%
21.0%
20.8%
19.6%
54.0%
5.0%
52.0%
0.0%
50.0%
03.31.99
06.30.99
63.2%
56.0%
09.30.99
12.31.99
03.31.00
Calculated in accordance with previous criteria
Calculated in accordance with criteria in place
06.30.00
55.0%
1Q99
57.0%
2Q99
3Q99
57.3%
56.6%
4Q99
1Q00
EFFICIENCY RATIO
58.6%
2Q00
Banking Services Fees
R$ Million
Itaú Consolidated
2Q / 00
1Q / 00
Var %
208
207
0.5
52
52
0.0
145
140
3.6
Collection Fees Agremeements whith Public Co.
37
41
(9.8)
Interbank Tariff
37
35
5.7
Loans
48
45
6.7
Credit Cards
214
190
12.6
Other Services
130
92
41.3
Total
871
802
8.6
Mutual Fund Management Fees
Collection Fees
Current and Savings Account Service Fees
Credit Operations
R$ Million *
21,572
20,000
18,233
19,596
18,000
14,127
16,000
16,890
14,000
11,798
12,000
9,057
11,572
12,325
10,000
8,000
6,000
6,366
8,022
4,634
5,846
6,328
4,000
5,531
3,958
2,000
0
82
83
84
85
86
Credit Operations
87
88
89
90
(1)
Credit Operations and Guarantees (2)
( * ) In currency of Constant Purchasing Power as of December 31, 1995 until then, after
which the calculation will be made in accordance to the Corporation Lawe
( * * ) June 30, 2000.
( 1 ) ) Credit Operations: Loans, Leasings, Other Receivables and Advances on Exchange
Contracts (AEC)
( 2 ) Guarantees: Endorsements, Sureties and Other Guarantees
91
92
93
94
95
96
97
98
Credit Operations
Jun.00
Mar.00
Loans
16,187
15,123
Leasing
647
589
O.Receivable 166
168
AEC
1,234
1,513
Sub-total 18,233
17,393
Garantees 3,339
2,848
Total
21,572
20,241
99
2000
( ** )
Var(%)
7.0
9.8
-1.2
-18.4
4.8
17.2
6.6
Provision For Loan Losses - Res. 2682
Risk
AA
A
B
C
D
E
F
G
H
Balances
%
Specific
Provision (1)
Generic
Provision (2)
4,932
6,769
3,456
1,514
514
275
339
80
353
0.0%
0.5%
1.0%
3.0%
10.0%
30.0%
50.0%
70.0%
100.0%
0
0
4
7
12
25
53
55
281
0
34
30
38
39
58
116
2
72
438
389
616
1,443
Excess
Provision
Total
Provision
Total
18,233
Risk
Balances
%
Specific
Provision (1)
Generic
Provision (2)
4,907
6,022
3,507
1,530
723
90
298
40
275
0.0%
0.5%
1.0%
3.0%
10.0%
30.0%
50.0%
70.0%
100.0%
0
0
2
8
12
26
41
26
207
0
30
33
38
61
1
108
2
69
322
341
AA
A
B
C
D
E
F
G
H
Total
17,393
Excess
Provision
Total
Provision
R$ Million
June 30, 2000
R$ Million
March 31, 2000
625
1,287
Credit Portfolio Development Consolidated by
Client Type
R$ Million
Client
Jun 30, 00
Corporate
Small and Medium-Sized Companies
Individuals
%
Mar 31, 00
%
Variation
%
12,409
1,287
3,414
57.5
6.0
15.8
11,680
1,214
3,016
57.7
6.0
14.9
729
73
398
6.2
6.0
13.2
2,479
363
2,842
11.5
1.7
13.2
2,488
401
2,889
12.3
2.0
14.3
(9)
(38)
(47)
(0.3)
(9.4)
(1.6)
Credit Card
1,619
7.5
1,442
7.1
177
12.2
TOTAL
21,572
100.0
20,241
100.0
Individuals
Businesses
Total
Real Estate
1,331
6.6
Net Interest Income
R$ Million
Itaú Consolidated
2Q/00
1Q/00
1,149
875
27
47
2,099
(930)
1,169
1,046
863
7
49
1,965
(786)
1,179
Average Loans
Average Earning Assets
Average Funding Resources
17,813
45,652
37,676
17,346
44,802
37,269
Annual Average Rate of Income from Loans and Leases
Annual Average Rate of Income from Financial Operations
Annual Average Rate of Expenses from Financial Operations
Annual Average Rate of Net Interest Income
25.8%
18.4%
9.9%
10.7%
24.1%
17.5%
8.4%
11.0%
Loans and Leases
Securities Portfolio
Trade Finance and Foreign Exchange Portfolio
Compulsory Deposits
Income from Financial Operations
Expenses from Financial Operations
Net Interest Income
Changes in the Valuation Allowance for Securities
R$ Thousand
Balances as of December 31, 1999
902,301
Constituion
Write-offs:
. Reversals
. Losses for sales
14,971
(13,809)
(3,008)
(10,801)
Balances as of June 30, 2000
903,463
Minimum Provision Required
157,563
Additional provision (*)
745,900
Summary
Securities and interbank deposits
Valuation allowance
Net Book Value
06/30/2000 03/31/2000
17,831,953
(903,463)
18,475,698
16,928,490
17,587,124
(*) Additional provisions were constituted to cover the risk of future price fluctuations.
(888,574)
PREFERRED SHARES - APPRECIATION *
EVOLUTION OF US$ 100 INVESTED IN JUNE OF 1990
US$
8,000
7,000
6,000
Russian Crisis
ANNUAL APPRECIATION
. 10 years (Average)
. 5 years (Average)
. 12 years (Average)
. 2000
52.80 %
28.80 %
78.17 %
1.97 %
Asian Crisis
6,962
Real Devaluation
5,000
4,000
ITAÚ
3,000
BOVESPA
2,000
Mexican Crisis
Real Plan
1,173
100
1,000
Collor Plan
0
JUN-90
DEC-91
* Without Reinvestiment
DEC-92
DEC-93
DEC-94
DEC-95
DEC-96
DEC-/97
DEC-98 DEC-99
JUN-00
Internet
Banking
Home & Office Banking Transactions
Thousand transactions / Month
14,000
12,000
10,000
3.1
8,000
6,000
5.5
4,000
2,000
3.5
2.3
0
DOS
WINDOWS
INTERNET
4.4
5.6
1.9
5.2
5.8
1.5
PC and Internet Banking Transactions
In Million
12.5
Customers
June 00
March 00
Individuals(Thousand) 1,067
997
Businesses(Thousand) 196
176
5.5
5.3
5.2
4.4
4.4
5.7
3.2
3.7
3.4
Businesses
3.9
3.2
5.8
4.7
2.9
4.7
3.1
3.7
4.0
6.7
7.0
5.0
4.7
Individuals
2.5
Dec/97
Mar/98
Jun/98
Sep/98
Dec/98
Mar/99
Jun/99
Sep/99
Dec/99
Mar/00
Jun/00
Initial Public Offering - AOLA
• IPO NASDAQ
:
08/07/2000
• IPO - Floating Shares :
25 million shares
• Initial Offering Price
US$ 8.00 / share
:
• Itaú Special Issuance :
• Itaú Disbursement
31.7 million shares
US$ 253.6 million
: None
This value will be allocated to Itaú’s
results during the next five years
according to the Strategic Interactive
Services and Marketing Agreement
signed by Itaú and AOLA
Key Points of the Agreement
• A Co-branded service will be developed by AOL-Brasil to provide a
differentiated access to Itau’s services.
• AOL-Brasil will develop a customized financial channel to Itau’s clients;
• Itaú will provide to its clients free hours of Internet Access. The number
of free hours to be offered will depend on the relationship between the
client and Itaú;
• Itaú will be in charge of marketing AOL/Itaú Service and for billing AOL
services from Itaú’s clients. Customer Service will be shared by Itaú
and AOL.
• A non-cash transaction provided Itaú a 12% stake in AOLA.
Rational for the Strategic Alliance
• Bring value to Itau’s Offering in order to attract prospect clients
• Created Value Added Services to Itaú’s clients:
• It is more than Free Internet Access
- Access all over the world;
- Complete Internet Banking Services.
• Offer value added Internet Services to clients
- Banking and global e-mail;
- Diverse Content;
- ICQ & IM
• Aggressive Computer Financing Program.
• Heavy investments in technology in order to keep Itaú at the
state-of-the-art banking technology
- Mobile Internet - WAP
- Palm Internet - PDA
- Web TV
• Increase shareholders value by partnering with a global leader in the
Internet.
Itaú/AOL Service - Client Acquisition
Minimal Requirement
Internal Goal
• First Year
100,000
300,000
• Second Year
200,000
700,000
• Third Year
300,000
1,200,000
• Forth Year
450,000
2,000,000
• Fifth Year
----
2,500,000