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Brazil Summit 2010. April 2010. DISCLAIMER. - PowerPoint PPT Presentation
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1
Brazil Summit 2010
April 2010
2
This presentation may include references and statements, planned synergies, increased
estimates, projections of results and future strategy for Banco do Brasil, it’s Associated
and Affiliated Companies and Subsidiaries. Although these references and statements
reflect the management’s belief, they also involve imprecision and highly difficult risks to
be foreseen, consequently, they may lead to a different result than the one anticipated
here. These expectations are highly dependent on market conditions, on Brazil’s
economic and banking system performance, as well as on international market one.
Banco do Brasil is not responsible for update any estimate in this presentation.
Banco do Brasil has announced that its Board of Directors has decided to submit to the
Shareholders’ Meetings a proposal to raise capital through a public offer of new shares.
Concomitantly, the controlling shareholders will promote a secondary public offering to
allow the achievement of the 25% minimum free float. Any further decision related to this
matter will be promptly communicated to the market. In case of any offering, before
investing in stocks issued by Banco do Brasil, read carefully the Offering Memorandum,
especially the “Risk Factors” section.
This presentation may include references and statements, planned synergies, increased
estimates, projections of results and future strategy for Banco do Brasil, it’s Associated
and Affiliated Companies and Subsidiaries. Although these references and statements
reflect the management’s belief, they also involve imprecision and highly difficult risks to
be foreseen, consequently, they may lead to a different result than the one anticipated
here. These expectations are highly dependent on market conditions, on Brazil’s
economic and banking system performance, as well as on international market one.
Banco do Brasil is not responsible for update any estimate in this presentation.
Banco do Brasil has announced that its Board of Directors has decided to submit to the
Shareholders’ Meetings a proposal to raise capital through a public offer of new shares.
Concomitantly, the controlling shareholders will promote a secondary public offering to
allow the achievement of the 25% minimum free float. Any further decision related to this
matter will be promptly communicated to the market. In case of any offering, before
investing in stocks issued by Banco do Brasil, read carefully the Offering Memorandum,
especially the “Risk Factors” section.
DISCLAIMER
3
Brazil’s Main Figures
Federative Republic of Brazil
Source: IBGE
• Composed of 26 federal states and one federal district, split into 5,565 municipalities.
• Area: 8.51 million square kilometers.
• Population: Approximately 193 million inhabitants (82% of which living in urban areas and 18% in rural areas).
• GDP: R$ 3.143 trillion (US$ 2.327 trillion) - in current values/2009, distributed as follows: Services: R$ 1.8 trillion, Industry: R$ 0.6 trillion, Agribusiness: R$ 0.16 trillion and Taxes R$ 0.44 trillion.
• Oil and natural gas: 2.5 million barrels a day in oil equivalent (boed). Forecast: 3.5 million boed by 2015. Considering the pre-salt exploration – above 4 million boed.
• Automobile manufacturing: 2.5 million units – 2009 (1.26% bigger than 2008) and 826.7 thousand units – 1Q10 (24.4% more than in 2009).
4
Brazil’s Main Figures
Brazil’s Strengths
• Self-sufficient in the production of food and third largest world exporter.
• Self-sufficient in the production of oil.
• Diversity of energy sources, including a significant share of renewable energy.
• Availability of fresh water and great amount of arable land.
• Expectations of huge investments in infrastructure:
a) Federal Growth Acceleration Program PAC2: USD 550 Billion for the period from 2011 to 2014.
b) Soccer World Cup 2014 – USD 79.4 Billion;
c) Rio de Janeiro 2016 Olympic Games – USD 50 Billion.
5
Brazil’s Main Figures
Economic and Financial Scenario in Brazil
• Resumption of economic growth – The main surveys report that the Brazilian GDP will grow between 5% and 7% per annum in the period between 2010 and 2016. 2010 – near 5%.
• The ratio credit/GDP will reach approximately 70% by 2014 according to a BNDES study. This index was 45.9% in December 2009 and 37.4% in 2008.
• Brazil was granted investment grade by the three largest rating agencies (Standard & Poor's, Moody's & Fitch Ratings).
• Jobs created in Brazil:
. 2008: 1.4 million
. 2009: 1.0 million
. 2010: forecast of 1.6 million.
Sources: Federal, State and Municipal Governements, and Infraero-Brazilian Airports
6
Brazil’s Main Figures
Sustainable Growth: an increase in the investment rate
Source: IBGE
16.4
15.316.1 15.9
16.4
17.4
18.7
16.7
18.519.3
20.0
20.921.5
2002 2003 2004 2005 2006 2007 2008 2009 2010* 2011* 2012* 2013* 2014*
Gross formation of fixed capital as % of GDP
* Ministry of Finance estimates
7
Brazil’s Main Figures
International Reserves - Brazil
* As of feb/2010
Source: Brazilian Central Bank
.38,6 51,7 60,0 27,5 17,0 21,0 180,3 193,8 238,5 241,185,853,828,052,1 39,8 27,5 31,2
1,8 8,3 20,8
28,3 24,9
8,8
0,00,1
0,1
0,2 4,8
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 *
Reserve (IMF Loans NET)
IMF Loans
In US$ billions
8
Brazil’s Main Figures
Brazilian Agricultural Production
Planted Area: - Actual: 153.2 million of acres- 2022 Estimates: 227.3 million of acres of planted area (land dedicated to livestock, without causing deforestation or environmental damage*).
Source: IBGE, * Statement by the former Minister of Agriculture – Roberto Rodrigues
141134
Production (million ton.)
Crop 2009 Forecast 2010 Growth Potential %
5.2%
9
Brazil’s Main Figures
Brazil’s Capital Markets
IPO and Follow-On Offerings in Brazil
Source: BMF&BOVESPA
53
4 5 7
52.0
7.010.0
6.0
2007 2008 2009 2010
Companies R$ (billion)
10
Banco do Brasil’s Leadership
Market Share - %
Source: Site BB – IR 4Q09
(1) Posição em Setembro 2009
2008 2009
Assets¹ 17.2 21.5
Domestic Loan Portfolio 17.1 20.1
Total Funding¹ 20.7 25.8
Total Deposits¹ 22.2 25.8
Demand Deposits¹ 31.6 33.2
Savings Deposits¹ 20.3 24.1
Time Deposits¹ 19.4 24.8
Assets Under Management 20.7 21.1
ACC/ACE 28.2 34.7
Foreign Exchange Exports 27.9 31.4
Foreign Exchange Imports 24.7 25.4
Total Revenues from Cards 17.6 18.7(1) As of September/09
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Banco do Brasil’s Highlights
• Financial Institution, 202 years old and the country’s largest bank.
• Net Income: R$ 10.15 Billions in 2009.
• Best Results among Brazilian banks
• Financial Institution, 202 years old and the country’s largest bank.
• Net Income: R$ 10.15 Billions in 2009.
• Best Results among Brazilian banks
Source: Site BB – IR 4Q09
..........
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.. .
. ..
.
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Banco do Brasil at a glance
• Leadership in Assets• Leadership in Assets
Assets Loan Portfolio
Deposits Individual Loan Portfolio
R$ billions R$ billions
R$ billions R$ billions
18.4 24.032.0
48.8
91.8
2005 2006 2007 2008 2009
= 88.1% = 88.1%
101.8133.2
160.7
224.8
300.8
2005 2006 2007 2008 2009
= 33.8% = 33.8%
137.7 158.8188.3
270.8
337.6
2005 2006 2007 2008 2009
= 24.6% = 24.6%
253.0296.4
367.2
521.3
708.5
2005 2006 2007 2008 2009
= 35.9% = 35.9%
13
Competitive Advantages
• Regionalized Branch Networks;
• Tailor-made products and services;
• Teams segmented by industry;
• Multidisciplinary team in the implementation of projects;
• Specialists in overseas markets, foreign trade and agribusiness;
• Wide range of products and services
• Structured operations (project and corporate finance) in the domestic and
foreign markets.
• Regionalized Branch Networks;
• Tailor-made products and services;
• Teams segmented by industry;
• Multidisciplinary team in the implementation of projects;
• Specialists in overseas markets, foreign trade and agribusiness;
• Wide range of products and services
• Structured operations (project and corporate finance) in the domestic and
foreign markets.
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Structured Operations
Agribusiness Automotive
Agribusiness, Leather and
Textile
Automotive,Auto parts
Commerce, Food and Drink
Capital goods
Paper, Pulp and Furniture
Steelmaking, Metallurgy and
Mining
Energy
Energy
Perfume, Cosmetics and
Chemical
Transport and Logistics
Others
Concessionaires and PPPs
Telecom and Electronics
Civil and Heavy-duty
construction
Sanitation
Oil and Natural Gas
Segmentation by Industry
Petrochemical
15
“Syndicated Loan”
Co-arranger TrusteeAdministrative
Agent
FundingArranger
Adviser
Structured Operations
BB’s Multiple Roles
16
Financing Sources
• Banco do Brasil and other Commercial Banks
• National Bank for Economic and Social Development (BNDES)
• Specialized Funds(Middle-West Region Fund and the Mercantile Marine Fund)
• Fixed Income Capital Market: Promissory Notes, Debentures, FIDC, CRI.
• Equity Market: IPO, Follow On offerings.
• Foreign fundraising (Bonds, Eurobonds, Ag. Mult: IFC, CAF etc...)
• Private Equity for Institutional Investors
• Banco do Brasil and other Commercial Banks
• National Bank for Economic and Social Development (BNDES)
• Specialized Funds(Middle-West Region Fund and the Mercantile Marine Fund)
• Fixed Income Capital Market: Promissory Notes, Debentures, FIDC, CRI.
• Equity Market: IPO, Follow On offerings.
• Foreign fundraising (Bonds, Eurobonds, Ag. Mult: IFC, CAF etc...)
• Private Equity for Institutional Investors
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Amount Disbursed by BB (2009)
BNDES System1st place
R$ 12.3 billion
131,363 transactions131,363 transactions
Oil and Gas
R$ 0.4 billion
4 Pre-Salt Plataforms4 Pre-Salt Plataforms
FCO
R$ 10.9 billion
64.6 thousand transactions64.6 thousand transactions
Mercantile Marine Fund (FMM)
R$ 0.927 billion
13 projects13 projects
Business Credit
R$ 125.3 billion
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Project Finance - Highlights
Position in 2009
Hydroelectric Power Plant of Santo Antônio
Total investment: R$ 13.2 Billion
Amount financed: R$ 8.6 Billion
BB’s on-lending: R$ 558 Million (BNDES-FINEM) and
R$ 390 Million (Bank guarantee).
Sponsors: Odebrecht, Furnas, Cemig, Andrade Gutierrez, FIP Amazonia Energia (Banif and FI-FGTS- CEF)
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Corporate Finance - Highlights
The Telemar Group
Acquisition of Brasil Telecom
Total amount: R$ 16 billion
BB’s Investment: R$ 4.3 billion
Mode: Long-Term Working Capital
Position in 2009
InBev
Total amount: R$ 2 billion
Mode: Issuance of debentures (term of 03 years)
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Other Highlights
Working CapitalIssue of Debentures
Lead Manager
Issue of Debentures Issue of Debentures
Issue of Debentures
Issue of Debentures
Position in 2009
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Other Operations - Highlights
Posição em 2009
Issue of DebenturesIPO
IPOIPO
IPO
Promissory Notes
Promissory Notes
Coordinator
Acquisition of Receivables
IPO
Coordinator Contracted
Position in 2009
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Other Operations - Highlights
IPO
IPO
Promissory NotesIssue of Debentures
Promissory Notes Working Capital
Working Capital
Position in 2009
Provision of Securities
23
Capital Market – 2009 Transactions
Fixed Income
Position in 2009
24
Capital Market – 2009 Transactions
Equity
2009
Joint Bookrunner
Follow-on
R$ 5,290 millions
2009
Co-Lead
Follow-on
R$ 1,308 millions
2009
Joint Lead Bookrunner
IPO
R$ 8,397 millions
Position in 2009
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FIDC – 2009 Issues
R$ 150,000,000
June/2009
FIDC
R$ 245,000,000
Lead Manager and Disbutor
July/2009
FIDC
Lead Manager, Disbutor and Custodian
R$ 227,000,000
July/2009
FIDCLead Manager and Disbutor
Position in 2009
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Foreign Network
Service Points
La Paz
Miami
Washington
Cidade do MéxicoPanama
BB Securities LLC
BAMB BB Leasing
LATIN AMERICALATIN AMERICA
NORTH AMERICANORTH AMERICA
Caracas
Lima
Santiago
Assunção
Grand Cayman
Nova Iorque
Buenos Aires
MontevidéuCidade do Leste
Santa Cruz de La Sierra
Luanda
ASIAASIA
Xangai
Hong Kong
Gunma
Gifu
Nagano
Ibaraki
Tóquio
Nagoia
HamamatsuSeul
LisboaFrankfurt
BB Securities EUROPEEUROPE
Cascais
Londres
Milão
Dubai
Viena
Roma
Madri
Paris
AFRICAAFRICA
Parque das Nações
Porto
45 Service Points in 23 countries 05 Subsidiaries 15 Branches 10 Sub-branches 12 Offices 01 Service Unit
27
Brazilian Companies – More Internationalized than ever
1970 1980 1990 2000 2009 l..........................l........................l...........................l...........................l
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Brazilian Companies
around the World
1999 2003 2009 l..........................l..........................l
29
Where to invest in Brazil?
• Several investment opportunities, particularly in the infrastructure industry.
• There are projects in progress and others to be installed involving a budget of approximately US$ 1 trillion.
• The current IRR of the analyzed projects is around 15% on average.
• Several investment opportunities, particularly in the infrastructure industry.
• There are projects in progress and others to be installed involving a budget of approximately US$ 1 trillion.
• The current IRR of the analyzed projects is around 15% on average.
PRÉ-SALPRÉ-SAL
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PAC 2 – Preliminary Estimate of the Government Investment
PAC “Energy” – Considering PRE-SALT PROJECT 8
Source: www.brasil.gov.br/pac/pac2
R$ billion
PAC 2011-2014 AFTER 2014 TOTAL
PAC “BETTER CITY” 57.1 - 57.1
PAC “CIVIL COMMUNITY” 23.0 - 23.0
PAC “MY HOME, MY LIFE” 278.2 - 278.2
PAC “WATER AND ENERGY FOR ALL” 30.6 - 30.6
PAC “TRANSPORTATION” 104.5 4.5 109.0
PAC “ENERGY” 465.5 627.1 1,092.6
TOTAL 958.9 631.6 1,590.5
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Soccer World Cup - 2014
• 500 Thousand foreign tourists expected;
• Investments may exceed R$ 100 billion in various sectors;
• 6 Stadiums will be built and 6 renovated;
• 47 Public Transportation Projects;
• 1,100 Projects, considering the renovation and construction of hotels and inns;
• Expansion and modernization of the hotel network, adding 93 thousand beds by 2014. The present capacity will increase from 295 thousand to 387 thousand beds.
32
Rio de Janeiro 2016 Olympic Games
• U$ 50 Billion in investments for Rio.
• Several construction works involving transport, sanitation, energy, security, facilities, olympic villages and press center.
• Expansion and modernization of the hotel network from 28 thousand to 50 thousand beds by 2016.
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Do you want to invest in Brazil?
BB is ready to serve you.
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Thank You !
Banco do Brasil Ivan de Souza Monteiro
CFOwww.bb.com.br
phone: 55 (61) 3310-5353