Earnings Release 3rd Quarter — 2007 Weyerhaeuser Company October 31, 2007
Conference Call of the Results of the 3rd Quarter/2007 November 07 , 2007
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Transcript of Conference Call of the Results of the 3rd Quarter/2007 November 07 , 2007
Itaucred
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Conference Call of the Results of the Conference Call of the Results of the
3rd Quarter/20073rd Quarter/2007
November 07, 2007
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Highlights
2. The loan portfolio grew 8.8% in the quarter and 26.9% in the last 12 months:• Credit Cards: 6.8% in the 3rd Qtr/07 and 18.7% in the last 12 months;• Vehicles: 14.7% in the 3rd Qtr/07 and 62.1% in the last 12 months;• Small and Mid-Sized Companies: 9.8% in the 3rd Qtr/07 and 26.4% in the last 12 months.
1. Results:• 3rd Qtr/07: Net Income of R$ 2,428 million an increase of 14.8% compared to 2nd Qtr./07;
annualized ROE of 35.6% (Net Income of R$ 6,444 million for the nine months ended in Sep 30, 2007; annualized ROE of 33.3%);
• 3rd Qtr/07: Recurring Net Income of R$ 1,569 million, an 18.2% decrease; annualized ROE of 23.0% (Recurring Net Income of R$ 5,389 million for the nine months ended in Sep 30, 2007; annualized ROE of 27.9%).
4. Non-Recurring Events: • The sell of part of our shareholding in Redecard resulted in a positive impact of R$ 1.0 billion, after
taxes, in the 3rd Qtr/07.
5. Nonperforming Loans Ratio: Nonperforming loans ratio of 4.7%, representing a reduction compared to the prior quarter.
6. BIS Ratio: BIS ratio of 15.3%. Considering BACEN Circular Letter 3,367, which will be effective as from 4th Quarter of 2007, the BIS ratio in September 30, 2007 would be 18.5%.
3. Managerial Financial Margin:• The treasury performance under the highly volatility scenario prevalent in the period resulted in a loss
of R$ 64 million (R$ 40 million, after taxes) in the quarter.
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Current Account Opening
Units
122,535130,694
143,594152,867 153,844
180,894
126,981
72,242
124,338130,331
0
20,000
40,000
60,000
80,000
100,000
120,000
140,000
160,000
180,000
200,000
mar-03 sep-03 mar-04 sep-04 mar-05 sep-05 mar-06 sep-06 mar-07 sep-07
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Non Recurring Effects 1
1 For further details, please consult Itaú Holding’s Management Discussion and Analysis report – page 4.
R$ Million
3rd Q./07 2nd Q./07Jan –
Sep./07Jan –
Sep./06
Net Income 2,428 2,115 6,444 3,029
Non Recurring Effects (859) (196) (1,055) 1,539
Managerial Financial Margin - 124 124 (645)
Result from Loan Losses - 400 400 149
Non-interest Expenses 303 96 398 118
Tax Expenses for ISS, PIS and Cofins - - - 16
Non-operating Results (1,552) (850) (2,402) (46)
Effects of BkB acquisition - - - 1,909
Minority Interests (24) (77) (101) (48)
Tax effects on non-recurring effects 415 111 526 85
Recurring Net Income 1,569 1,919 5,389 4,568
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Highlights
3rd Q/07 2nd Q/07 VarianceJan –
Sep./07Jan –
Sep./06Variance
Net Income 2,428 2,115 14.8% 6,444 3,029 112.7%
Recurring Net Income 1,569 1,919 -18.2% 5,389 4,568 18.0%
Recurring Net Income per share (R$) 1.31 1.60 -18.2% 4.49 4.07 10.4%
Stockholders’ Equity 28,003 26,546 5.5% 28,003 21,693 29.1%
Recurring ROE (Average Equity) annualized (%)
23.0% 29.8 % -6.8b.p. 27.9% 34.1% -6.2b.p.
Market Capitalization 110,747 103,219 7.3% 110,747 76,453 44.9%
Solvency Ratio (%) 15.3% 17.6% -230b.p. 15.3% 16.8% -150b.p.
Efficiency Ratio (%) (*) 47.1% 45.8% 130b.p. 45.6% 47.5% -190b.p.
Nonperforming Loans Ratio (%) 4.7% 5.1% -40b.p. 4.7% 5.2% -50b.p.
R$ Million
(*) If Treasury had performed in this quarter like the average of the last quarters - R$ 200 million – the efficiency ratio would be 45.2%.
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Itaú Holding Pro Forma
3rd Q/07 2nd Q/07 VarianceJan –
Sep./07Jan –
Sep./06Variance
Managerial Financial Margin 4,825 5,250 -8.1% 15,059 12,211 23.3%
• Banking Operations 4,635 4,417 5.0% 13,421 11,163 20.0%
• Treasury (1) (64) 571 -111.2% 875 627 39.5%
• Management of Foreign Exchange Risk from Investments Abroad
253 262 -3.3% 763 420 81.5%
Banking Service Fees 2,529 2,550 -0.8% 7,500 6,641 12.9%
Managerial Financial Margin plus Banking Service Fees
7,354 7,800 -5.7% 22,559 18,852 19.7%
Result of Loan Losses (2) (1,330) (1,217) 9.3% (3,813) (3,827) -0.4%
Non Interest Expenses (3) (3,447) (3,524) -2.2% (10,251) (8,975) 14.2%
Recurring Net Income 1,569 1,919 -18.2% 5,389 4,568 18.0%
R$ Million
(1) It does not include the result of R$ 88 million which would be recognized if the liabilities were marked-to-market.(2) Credit transactions increased 8.8% in the quarter.(3) Include the effects of R$ 51 million of Collective Labor Agreement.
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Net Interest Margin (NIM) x SELIC
13.3% 14.0% 13.5% 12.7% 12.5%11.3% 11.4%
16.5%15.3%
14.3%13.3% 12.8%
12.0%11.3%
1st Q./06 2nd Q./06 3rd Q./06 4th Q./06 1st Q./07 2nd Q./07 3rd Q./07
NIM SELIC
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Loans by Type of Customer
Sep 30,07 Jun 30, 07 Dec 31, 06 Sep 30,06Variance sep/07-jun/07
Variancesep/07-dec/06
Variancesep/07-sep/06
Individuals 49,174 45,035 40,358 37,463 9.2% 21.8% 31.3%
• Credit Cards 9,466 8,867 9,188 7,976 6.8% 3.0% 18.7%
• Personal Credit 14,149 13,886 13,156 13,721 1.9% 7.6% 3.1%
• Vehicles 25,558 22,282 18,014 15,766 14.7% 41.9% 62.1%
Company Loans 50,880 46,885 46,552 45,825 8.5% 9.3% 11.0%
• Corporate 31,247 28,982 30,312 30,294 7.8% 3.1% 3.1%
• Small and Medium Sized 19,633 17,903 16,240 15,532 9.8% 20.9% 26.4%
Mandatory Credit 1 5,853 5,711 5,896 5,740 2.5% -0.7% 2.0%
Argentina, Chile and Uruguay 8,164 7,190 842 841 13.6% 869.9% 871.1%
Total Loans 114,071 104,821 93,648 89,869 8.8% 21.8% 26.9%
1 Rural and Mortgage Loans – linked with the balances of Demand and Savings Deposits, respectively.
R$ Million
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Loans by Type of Customer
12,77718,272
28,372
40,35849,174
27,768 30,480 34,095
46,55250,880
44,58153,275
67,756
93,648
114,071
dec-03 dec-04 dec-05 dec-06 sep-07
Individuals Companies Total
CAGR = 28.5%
CAGR = 17.5%
CAGR = 43.2%
R$ Million
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Nonperforming Loans and Coverage Ratios
Nonperforming Loans Ratio Coverage Ratio (*)
NPL RatioNPL Ratio- IndividualsNPL Ratio- Companies
(*) Provision for loan losses / Credits overdue for more than 60 days, which are not accrued.
161%162%166%168%169%
sep/07jun/07mar/07dec/06sep/06
1.7%2.3%2.1%2.1% 2.2%
4.7%5.1%5.0%5.2% 5.3%
7.3%7.5%7.8%8.1%8.3%
Sep/06 Dec/06 Mar/07 Jun/07 Sep/07
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Nonperforming Loans (NPL) by Segment
Sep 30, 07Jun 30, 07
Mar 31, 07
NPLCredit
PortfolioNPL
RatioNPL Ratio NPL Ratio
Itaubanco 2,553 42,162 6.1% 6.5% 6.8%Banking 2,264 37,005 6.1% 6.6% 6.9%Credit Cards – Account Holders 289 5,157 5.6% 5.8% 5.7%
Itaú BBA 16 26,024 0.1% 0.3% 0.1%Itaucred 2,301 35,647 6.5% 6.4% 6.1%Vehicles 1,572 27,571 5.7% 5.4% 5.1%Credit Cards – Non Account Holders 241 3,827 6.3% 7.0% 6.5%
Taií – FIT/FIC/FAI 475 1,796 26.5% 24.4% 28.7%Taií – Payroll Credit 13 2,453 0.5% 0.7% 0.5%Total 4,870 103,832 4.7% 5.1% 5.0%
R$ Million
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Funding
Sep 30, 07 Jun 30, 07 Sep 30,06
Variance (%)
Sep./07-Jun./07
Sep./07-Sep./06
Deposits 1 109,442 105,055 80,949 4.2% 35.2%
Investment Funds 181,469 180,121 166,822 0.7% 8.8%
Managed Portfolios 2 23,873 21,008 10,044 13.6% 137.7%
Technical Provisions Regarding to Insurance, Pension Plans and Capitalization
22,466 21,510 17,534 4.4% 28.1%
Subtotal – Clients 337,250 327,694 275,348 2.9% 22.5%
Funds from Acceptances and Securities Issued 7,327 7,899 7,568 -7.2% -3.2%
On-lendings 5,684 5,443 5,496 4.4% 3.4%
Repurchase Agreement – Third Part Portfolio 19,250 9,860 5,477 95.2% 251.5%
Subtotal - Market 32,261 23,202 18,541 39.0% 74.0%
Total 369,511 350,896 293,890 5.3% 25.7%
R$ Million
1 Includes Repurchase Agreement – Own Issue Securities.
2 On Jun 30, 07, includes the acquisition of two companies from Bank of America: BankBoston International (Miami) and Bank of America Trust
Company Ltd (Bahamas).
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Funding
132,192161,746
200,482
288,367337,250
13,910
14,055
13,786
21,232
32,261
146,102
175,802
214,268
309,598
369,511
dec-03 dec-04 dec-05 dec-06 sep-07
Customers Market
R$ Million
CAGR = 28.1%
CAGR = 25.1%
CAGR = 28.4%
Total
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Banking Service Fees
3rd Q/07 2nd Q/07 VarianceJan –
Sep./07Jan –
Sep./06Variance
Asset Management 1 521 504 3.5% 1,508 1,504 0.3%
Current Account Services 373 406 -8.4% 1,184 1,139 3.9%
Credit Cards 581 556 4.5% 1,682 1,433 17.4%
Loan Operations and Guarantees Provided
580 545 6.4% 1,622 1,203 34.8%
Collection Services 237 229 3.3% 688 659 4.4%
Other 238 232 2.2% 649 452 43.5%
Subtotal 2,529 2,472 2.3% 7,333 6,390 14.8%
Redecard Banking Service Fees 2 - 35 - 67 94 -29.0%
Serasa Banking Service Fees 3 - 42 - 100 157 -36.0%
Total 2,529 2,550 -0.8% 7,500 6,641 12.9%
R$ Million
1 Funds and Consortia Management Fees
2 We adjusted Redecard Banking Service Fees to reflect the participation change from 31.9% to 23.2% that occurred in July, 2007. Thus, the amount of R$ 35 million corresponds to the reduction of 870 b.p. in the 2nd Q./07.
3 Serasa results started to be recognized under the equity method of accounting.
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Non Interest Expenses 1
3rd Q/07 2nd Q/07 VarianceJan –
Sep./07Jan –
Sep./06Variance
Personnel Expenses (1,375) (1,341) 2.6% (3,968) (3,574) 11.0%
Other Administrative Expenses (1,570) (1,624) -3.3% (4,734) (4,153) 14.0%
Other Operating Expenses (388) (460) -15.7% (1,225) (973) 25.9%
Tax Expenses (CPMF and Others) 2 (114) (100) 13.9% (325) (275) 18.2%
Total (3,447) (3,524) -2.2% (10,251) (8,975) 14.2%
1 Includes the effect of R$ 51 million due to Collective Labor Agreement
2 It does not include PIS, Cofins and ISS
R$ Million
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Financial Instruments – Market Value
Unrealized Profits /(Losses) 1
At the Stockholders’ Equity
Sep 30, 07 Jun 30, 07 Sep 30,06
Interbank deposits 19 32 18
Securities and derivative financial instruments 210 220 153
Loan, lease and other credit operations 223 293 80
Redecard Participation 5,188 - -
Serasa Participation 352 - -
Investment in BPI 1,401 1,584 1,526
Parent company 826 934 899
Minority stockholders 575 650 626
Securitization of foreign payment orders (18) (13) (5)
Subordinated debt (64) (134) 21
Other liabilities 957 801 473
Total unrealized 8,268 2,782 2,265
R$ Million
1 It does not consider corresponding tax effects.
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Segmentation (Pro forma)
ItaucredItaubanco
Banking
Credit Cards – Account Holders
Insurance, Capitalization and
Pension Plans
Investment Funds and Managed
Portfolio
Corporation
Itaú
Itaú BBA
Corporate Operations
&
Investment Banking
Vehicles
Credit Card – Non Account Holders
Taií: FIT, FIC (CBD), FAI (LASA) and Payroll Credit
NB: The organization chart of Itaucred segment reflects, chiefly, the transactions
carried out through channels intended for non current account holders.
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Highlights of Pro Forma Segments
Itaubanco Itaú BBA Itaucred Corporation Itaú 1
3rd Quarter of 2007
Recurring Net Income 833 321 333 83 1,569
Allocated Capital Tier I 14,106 6,442 3,315 4,140 28,003
RAROC in the Quarter (% p.y.) 25.1% 21.6% 40.2% 7.0% 23.0%
Total Assets 245,703 105,852 35,125 8,113 298,484
2nd Quarter of 2007
Recurring Net Income 1,255 302 310 52 1,919
Allocated Capital Tier I 12,454 5,425 3,313 5,354 26,546
RAROC in the Quarter (% p.y.) 40.8% 23.8% 39.6% 3.9% 29.8%
Total Assets 207,752 85,110 30,951 9,966 255,418
R$ Million
1 It does not represent the sum of the parts, because there are transactions between the segments eliminated in the consolidated figures only.
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Net Income
1,425 1,397
1,902 1,919
1,569
2,428
1,5921,579 1,628
1,352
2,115
1,280
1,460
1,498
71
1,902
1,4251,352
0
500
1,000
1,500
2,000
2,500
3,000
3Q/05 4Q/05 1Q/06 2Q/06 3Q/06 4Q/06 1Q/07 2Q/07 3Q/07
Net Income Recurring Net Income
R$ Million
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APIMEC Meetings 2007
APIMEC Meetings 2007Itaúsa and Banco Itaú Holding Financeira
From 11:00 am to 1:30 pm – Presentations of Itaúsa and Subsidiaries Investor Relations Officers;
From 3:00 pm to 6:00 pm – Presentation of Banco Itaú Holding Financeira CEO and Executives Directors.
More information on: www.itausa.com.br and www.itauir.com
Date: December 5th, 2007 – Wednesday Where: Buffet Rosa Rosarum - São Paulo
RSVP: 0800 722 8880
Itaucred
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Conference Call of the Results of the Conference Call of the Results of the
3rd Quarter/20073rd Quarter/2007
November 07, 2007