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0 1 Client base ABN AMRO Brazil * Inactive clients database went through full revision in Jan 03 Significant organic growth based on strong corporate franchise. 3.4 4.3 0.2 4.8 5.3 5.6 1.8 1.3 1.3 1.4 1.5 1.5 1.1 0.0 1.0 2.0 3.0 4.0 5.0 6.0 7.0 8.0 9.0 Dec-99 Dec-00 Dec-01 Dec-02 Apr-03 Inactive clients* Credit Card and Saving Accounts Consumer Finance SMEs, Corporate Retail Banking Active clients 5.6 6.2 6.8 7.1 7.8 6.7 In million clients

Client base ABN AMRO Brazil

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Client base ABN AMRO Brazil. Inactive clients*. Credit Card and Saving Accounts. Consumer Finance. SMEs, Corporate. 9.0. 7.8. Retail Banking. 8.0. 7.1. 1.1. Active clients. 6.8. 7.0. 1.5. 6.2. 1.5. 5.6. 1.3. 6.0. 1.4. 1.3. 5.0. 1.8. 4.0. 0.2. 6.7. 5.6. 5.3. 3.0. 4.8. - PowerPoint PPT Presentation

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Page 1: Client base ABN AMRO Brazil

0 1

Client base ABN AMRO Brazil

* Inactive clients database went through full revision in Jan 03

Significant organic growth based on strong corporate franchise.

3.44.3

0.24.8 5.3 5.6

1.8

1.3

1.31.4

1.51.5

1.1

0.0

1.0

2.0

3.0

4.0

5.0

6.0

7.0

8.0

9.0

Dec-99 Dec-00 Dec-01 Dec-02 Apr-03

Inactive clients*

Credit Card and Saving Accounts

Consumer Finance

SMEs, Corporate

Retail Banking

Active clients

5.66.2

6.87.1

7.8

6.7

In million clients

Page 2: Client base ABN AMRO Brazil

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Client base - integrated approach

Front office: Increased benefit from SME platform

Payroll product offer to Corporate/WCS clients: 6,240 payroll relationships; 920,000 individual clients

Important improvements through co-ordinated selection

criteria and pricing

Acquisition of Retail clients through corporate

relationships (Payroll/PAB):

48% of new retail clients acquired through corporate

relationships

Improvements in retail client mix through co-ordinated

selection criteria

Potential growth through supply-chain banking initiatives

Retail: acquisition mix 2002 (%new clients)

Revenue synergies: largely realised

Synergies currently realised between Retail and Corporate/WCS are

significant.

48%

52%

Corporate relationship Branches

Page 3: Client base ABN AMRO Brazil

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Client segmentation

Breakdown of Active Checking Accounts (2003)

Breakdown by Affinity Group (2003)

Monthly Income

Premium Clients:

> R$4,000

Special Clients:

R$4,000 - R$1,200

Classic Clients:

< R$1,200

17%

30%

53%

Premium Special Classic

23%

29%13%

14%

7%

14%

College StudentsSenior CitizensMilitaryProfessionals of EducationMedical DoctorsOther

Page 4: Client base ABN AMRO Brazil

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Average account revenue per segment

Index: Avg Classic revenue = 100

Client segmentation

Client segmentation currently being implemented is based on each segment revenue potential and is focused in: Providing products and services in-line with customer expectations

Strengthening relationship management capabilities

100

265

581

1,119

0

200

400

600

800

1000

1200

Classic Special Premium SME's

Page 5: Client base ABN AMRO Brazil

0 5

Client loyalty vs results

Source: Gallup, 2002

Clients of Banco Real

TotalTotally

EngagedEngaged

Not Engaged

Actively Disengaged

% % % % %

Gross margin 100 135 100 94 71

Avg results = 100

Page 6: Client base ABN AMRO Brazil

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Client loyalty vs relationship approach

Source: Gallup, 2002

Clients of Banco Real

TotalTotally

EngagedEngaged

Not Engaged

Actively Disengaged

% % % % %

Priority is "Sell" 34 17 24 35 52

Priority is "Relationship" 60 78 70 59 41

Page 7: Client base ABN AMRO Brazil

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Client loyalty

Source: Gallup, 2002

Around 34% of clients are totally satisfied with Banco Real. The evolution in Special and Premium segments is expressive.

Mar-01 Jul-02 Nov-02

All Segments 18% 32% 34%

Classic 16% 33% 31%

Special 17% 30% 38%

Premium 31% 38% 43%

% Totally Satisfied

Page 8: Client base ABN AMRO Brazil

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Client loyalty

Source: Gallup, 2002

Besides “overall satisfaction”, clients from segments Special and Premium intend to keep the relationship with Banco Real and would probably recommend the Bank to others, which reflects their Loyalty

Jun/2002 ________

L3 = 15%

Satisfaction32%

Recommend 34%

Continue 33%

L3

Nov/2002 ________

L3 = 17%

Satisfaction34%

Recommend 39%

Continue 35%

L3

Page 9: Client base ABN AMRO Brazil

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Our focus region

ABN AMRO Brazil focus region for organic growth: the marked area, the States’ capitals and Brazil’s main cities.

Focus Region as %of Brazil

GDP 59%Population 44%GDP per Capita 134% of Brazilian

averageArea 11%Deposits 69%Loans 65%Clients 62%

Page 10: Client base ABN AMRO Brazil

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Sudameris - The rationale

The consolidation in the Brazilian banking market is continuing. Since Dec/01,

Bradesco has acquired Banco Mercantil de São Paulo, Banco Cidade (SMEs),

Banco do Estado do Amazonas, Banco Ford and BBVA Brazilian operation,

whilst Itaú acquired Banco Fiat and Banco BBA.

Considering size of portfolio, excellent client reach and high concentration of

branches in the state of São Paulo (the wealthiest state of Brazil where Banco

Real had historically lower market share), Sudameris was the best option to fit

ABN AMRO’s growth and strategic goals.

Sudameris improves ABN AMRO’s market share immediately, especially in

some specific segments like SMEs and upscale clients.

The integration of Sudameris operations will enhance ABN AMRO’s

competitive positioning.

Page 11: Client base ABN AMRO Brazil

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Sudameris - The Final Agreement

ABN AMRO finalized the terms of the agreement with Intesa, last June 13th, to buy its

94.57% of the total share capital of Banco Sudameris Brasil S.A.. The proposal valued

Intesa’s stake at R$ 2.3bln. The acquisition will be phased over three years and fully

funded in Brazil.

Banco ABN AMRO Real S.A (“AAR”) will pay R$526mln in cash and proceed with a share

swap with shares of AAR. In this structure Intesa will become circa 12.89% shareholder of

AAR (to be confirmed at closing). The exit for Intesa can be summarised as follows:

Intesa will have the right to swap their shares in AAR for shares of ABN AMRO

Holding N.V. (“AA Holding”) in three annual installments. Intesa’s price for the put

right : the book value of Intesa’s stake in AAR, multiplied by 1.82

ABN AMRO Participações Financeiras S.A. (“AA Part”, the Brazilian holding

company of AAR) will have the right to call Intesa’s shares in AAR at anytime. AA

Part’s price for the call right: equivalent to Intesa’s put right, however ABN AMRO

call can be exercized at anytime.

Page 12: Client base ABN AMRO Brazil

0 12

Focus Region

Clients and Branch Network

Sudameris has approximately 500,000 clients (380,000 current accounts),

concentrated in our Focus Region (especially in São Paulo). Sudameris’ clients are

mainly upscale and the bank is known for its focus on SME’s.

34% of ABN AMRO Brazil’s retail branch

network and 53% of Sudameris’ branch network

are concentrated in São Paulo state.

563

137

287

156

ABN AMRO Sudameris

Other regions São Paulo

Page 13: Client base ABN AMRO Brazil

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Branch network expansion

Expected Evolution in Number of Branches(excluding PABs)

Growth focused in the most economically developed regions of the country

Presence in all state capitals

Although acquisitions such as Bandepe and Paraiban are focused on client acquisition, they also contribute to increase the number of branches.

680739

849 850 860

1,127

1999 2000 2001 2002 2003E 2003E AAR+

Sudameris

Page 14: Client base ABN AMRO Brazil

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Non-traditional distribution channels

Non-branch transactions are growing regularly, reducing costs and increasing client convenience.

*Non Branches include transactions through direct channels and operational centres

65% 71% 75% 79% 81%

35% 29% 25% 21% 19%

1999 2000 2001 2002 abr/03

Non Branches* Branches

Page 15: Client base ABN AMRO Brazil

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Infrastructure and ATM network

Investments made since 1998 created competitive infrastructure to Banco Real, which will be key to integrate Sudameris.

Number of ATM’sMainframeUsage & Capacity (MIPS)

1,603

2,286 2,401

3,244

4,493

5,667 5,715

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

Jan-

00

Apr

-00

Jul-0

0

Oct

-00

Jan-

01

Apr

-01

Jul-0

1

Oct

-01

Jan-

02

Apr

-02

Jul-0

2

Oct

-02

Jan-

03

Apr

-03

3,992

4,912

6,0406,699 6,730

Dec-99 Dec-00 Dec-01 Dec-02 Apr-03

Page 16: Client base ABN AMRO Brazil

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Call center

Call center implemented in Brazil in

1985

7 days X 24 hours

Full service

Inbound and proactive outbound

activities

450 workstations

1,290 people

14 million calls per month

Part of Call center transactions are

migrating to Real Internet Banking

*Calls answered within 20 seconds**Assisted calls

2001 2002YTD May

2003

Availability 93.7% 99.0% 99.5%

Automatic answering 70.0% 74.0% 77.0%

Level of service* 78.0% 79.0% 87.0%

Transactions per call** 2.7 2.3 2.6

Page 17: Client base ABN AMRO Brazil

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Internet banking

Real Internet Banking was started on February 2000. Since then, nearly 30% of Real’s current account clients have become users of this service.

Number of Real Internet Bkg users (in thd)

Number of Transactionsdone through internet (in mln)

197248

299

364

421472

527

641680 697

Dez-00

Mar-01

Jun-01

Se

t-01

Dez-0

1

Ma

r-02

Jun-02

Se

t-02

Dez-02

Ma

i-03

2.2

3.2 3.4 3.5

5.0

5.7 5.96.4

6.7

7.3

Dez-00

Mar-01

Jun-01

Se

t-01

Dez-0

1

Ma

r-02

Jun-02

Se

t-02

Dez-02

Abr-0

3

Page 18: Client base ABN AMRO Brazil

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Corporate internet banking

Real Internet Empresa (Banco Real’s office bank through internet) was launched on August 2000. More than 95 thousand corporate and SME clients of Real are users of this service.

Number of companies usingReal Internet Empresa

0

20,000

40,000

60,000

80,000

100,000

120,000

Sep

-00

Dec

-00

Mar

-01

Jun-

01

Sep

-01

Dec

-01

Mar

-02

Jun-

02

Sep

-02

Dec

-02

Mar

-03

Page 19: Client base ABN AMRO Brazil

0 19

5C&CC Brazil - Financial Performance

Page 20: Client base ABN AMRO Brazil

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Brazil: contribution to Global C&CC

C&CC Pre-Tax Profit (1Q03)

Brazil accounted for 9% of C&CC’s global result in 1Q03.

9%9%

63%

19%

Brazil North America Netherlands Other

Page 21: Client base ABN AMRO Brazil

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C&CC Brazil: gross revenues

Evolution total C&CC Brazil gross revenues (NIR + fees)R$ million

912 886

1,019 1,057 1,036 1,0511,144

1,2781,259

1Q01 2Q01 3Q01 4Q01 1Q02 2Q02 3Q02 4Q02 1Q03

Page 22: Client base ABN AMRO Brazil

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C&CC Brazil: fee income retail

Evolution fee income Retail C&CC BrazilR$ million

416

485

575

2000 2001 2002

Page 23: Client base ABN AMRO Brazil

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Evolution total expenses C&CC Brazil R$ million

C&CC Brazil: total expenses

575 575644

753682

739793

897814

1Q01 2Q01 3Q01 4Q01 1Q02 2Q02 3Q02 4Q02 1Q03

Page 24: Client base ABN AMRO Brazil

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C&CC Brazil: risk management

Credit scoring : Reducing manual approvals of credit limits# of monthly approvals in thd

Sustainable growth in a controlled environment

62 58

101

51

77 829121.9%

6.9%

4.2%1.8%

3.0% 2.4%1.6%

Jun-00 Dec-00 Jun-01 Dec-01 Jun-02 Dec-02 Mar-03

# approvals % manual approvals

Page 25: Client base ABN AMRO Brazil

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C&CC Brazil: risk management

Actions taken have avoided further deterioration of the credit portfolio despite the 2002 adverse economic scenario... (past due loans > 15 days, % of total credit portfolio)

Sustainable growth in a controlled environment

2.00%

2.20%

2.40%

2.60%

2.80%

3.00%

3.20%

3.40%

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

2001 2002 2003

Page 26: Client base ABN AMRO Brazil

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C&CC Brazil: risk management

...The effective credit losses (total credit expenses) are under control & the C&CC runs with sound spread(amounts in R$ million)

Sustainable growth in a controlled environment

Qtrly evolution of total credit expense and revenue as percentage of loans

Qtrly total credit expenses and revenues evolution

0

5,000

10,000

15,000

1Q02 2Q02 3Q02 4Q02 1Q03

0%

5%

10%

Loans Qtrly credit exp.%Loan Qtrly revenues%Loans

-

4,000

8,000

12,000

1Q02 2Q02 3Q02 4Q02 1Q03

-

400

800

1,200

1,600

2,000

Loans Qtrly revenues Qtrly credit exp.

Credit exp., RevenuesLoans

Page 27: Client base ABN AMRO Brazil

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C&CC Brazil: Profit & Loss R$ million

R$ mln 2001 2002 %change

Revenues 3,852 4,486 16.5

Expenses (2,549) (3,116) 22.2

Operating Profit 1,303 1,370 5.1

Provisions (394) (462) 17.0

Oper. Profit Before Taxes 909 908 (0.0)

Taxes (75) 240 (418.3)

Net Profit 833 1,148 37.8

Efficiency Ratio 66% 69% NA

Page 28: Client base ABN AMRO Brazil

0 28

C&CC Brazil: Profit & Loss R$ million

R$ mln 4Q02 1Q03 %change

Revenues 1,165 1,278 9.7

Expenses (897) (814) (9.3)

Operating Profit 268 464 73.1

Provisions (83) (149) 79.5

Oper. Profit Before Taxes 185 315 70.3

Taxes (57) (90) 57.9

Net Profit 128 225 75.8

Efficiency Ratio 77% 64% NA

Page 29: Client base ABN AMRO Brazil

0 29

Thank You

Page 30: Client base ABN AMRO Brazil

0 30

Appendix 1

Background

Page 31: Client base ABN AMRO Brazil

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Timeline

1917 1925 1963 1971ABN AMRO Bank initiates its operations in Brazil under the name "Banco Holandês de América do Sul." The first offices are located in Rio de Janeiro and Santos.

Clemente de Faria establishes "Cooperativa Bancária", three years later renamed as Banco de Lavoura de Minas Gerais, the predecessor of Banco Real.

Banco Holandês Unido acquires 50% of Aymoré de Crédito, Financiamento e Investimento, which will become a leader in the segment of car loans. The remaining 50% was acquired in 1970.

Banco de Lavouras de Minas Gerais, which two years before had established its headquarters in São Paulo, is renamed as Banco Real S.A.

1993 1994 1998 2000 2001 2003Banco Holandês is renamed as ABN AMRO Bank and moves its headquarters from Rio de Janeiro to São Paulo.

The Brazilian operation of ABN AMRO presents the third largest net income of the international network.

in July ABN AMRO announces the acquisition of Banco Real, completed in November. Also in November ABN AMRO acquires Bandepe S.A.

Banco Real mergers with Banco ABN AMRO S.A.

ABN AMRO acquires Paraiban

ABN AMRO acquires Sudameris

Page 32: Client base ABN AMRO Brazil

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Appendix 2

Sudameris Acquisition

Page 33: Client base ABN AMRO Brazil

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Sudameris - Background

On 4Q01 ABN AMRO approached Intesa showing interest in Sudameris.

On December 2001, Intesa and Banco Itaú entered into an agreement for the

purchase of Sudameris.

On November 2002, the parties broke up the negotiations since they could

not reach a satisfactory agreement in connection with the purchase price

adjustment.

ABN AMRO approached Intesa again on December 2002.

Further to subsequent discussions with Intesa, a new proposal has evolved

and finally an agreement was reached on April 16th.

Page 34: Client base ABN AMRO Brazil

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Sudameris - Branch network

Apr-03

Branch Network Banco Real Sudameris

São Paulo 287 156

Focus Region(except São Paulo)

293 68

Outras region 270 69

# Branches Total 850 293

# PAB's Total 796 51

Page 35: Client base ABN AMRO Brazil

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R$ mln

Sudameris Financials

Total Assets 16,020 18,716 -14.4%

Securities (TVM) 3,344 6,390 -47.7%

Loans 7,861 8,359 -6.0%

Off balance guaraqntees 561 759 -26.1%

Provisions 559 634 -11.9%

Provisions / Loans 7.1% 7.6% -48 bp

Loan Portfolio AA-B% 79.0% 83.0% -396 bp

Deposits 5,709 4,950 15.3%

AUM (Anbid) 5,403 7,400 -27.0%

Deposits + AUM 11,112 12,350 -10.0%

Networth 1,324 1,276 3.7%

Interest Revenue 4,582 3,886 17.9%

Financial Margin 1,519 1,300 16.8%

Provisions (P&L) 369 393 -6.2%

Net Interest Margin 1,150 907 26.8%

Fee Income 301 322 -6.5%

Personnel Expenses 552 515 7.2%

Other Expenses 456 454 0.4%

Net Income 220 178 24.0%

ROE 16.6% 13.9% 271 bp

ROA 1.4% 0.9% 43 bp

Branches 293 292 0.3%

Branches + PABs 344 356 -3.4%

Employees 6,298 6,531 -3.6%

Dec/02 Dec/01 % ch Dec/02 Dec/01 % varR$ mln

Page 36: Client base ABN AMRO Brazil

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Appendix 3

C&CC Brazil - Financial Performance

Page 37: Client base ABN AMRO Brazil

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C&CC Brazil: Profit & Loss R$ million

R$ mln 1Q02 1Q03 %change

Revenues 1,036 1,278 23.4

Expenses (682) (814) 19.4

Operating Profit 354 464 31.1

Provisions (117) (149) 27.4

Oper. Profit Before Taxes 237 315 32.9

Taxes (66) (90) NA

Net Profit 171 225 31.6

Efficiency Ratio 66% 64% NA

Page 38: Client base ABN AMRO Brazil

0 38

C&CC Brazil: Profit & Loss Euro million

EUR mln 2001 2002 %change

Revenues 1,920 1,736 (9.6)

Expenses (1,290) (1,199) (7.1)

Operating Result 630 537 (14.8)

Provisions (193) (193)

Oper. Profit Before Taxes 437 344 (21.3)

Taxes (39) 57

Profit After Taxes 398 401 0.8

Minority Interest (9) (10) 11.1

Net Profit 389 391 0.5

Efficiency Ratio 67% 69% NA

Page 39: Client base ABN AMRO Brazil

0 39

C&CC Brazil: Profit & Loss Euro million

EUR mln 1Q02 1Q03 %change

Revenues 536 361 (32.6)

Expenses (355) (227) (36.1)

Operating Result 181 134 (26.0)

Provisions (59) (42) (28.8)

Oper. Profit Before Taxes 122 92 (24.6)

Taxes (34) (41) NA

Profit After Taxes 88 51 (42.0)

Minority Interest (3) (1) (66.7)

Net Profit 85 50 (41.2)

Efficiency Ratio 66% 63% NA

Page 40: Client base ABN AMRO Brazil

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C&CC Brazil: Profit & Loss Euro million

EUR mln 4Q02 1Q03 %change

Revenues 346 361 4.3

Expenses (257) (227) (11.7)

Operating Result 89 134 50.6

Provisions (30) (42) 40.0

Oper. Profit Before Taxes 59 92 55.9

Taxes (18) (41) NA

Profit After Taxes 41 51 67.0

Minority Interest 1 (1) NA

Net Profit 42 50 68.2

Efficiency Ratio 74% 63% NA