abn amro reports record operating result third quarter results 2003 31 october 2003

ABN AMRO reports record operating resultThird Quarter Results 2003

31 October 2003

0 2

Table of Contents

ABN AMRO reports record operating result 3

Operating Performance 4

Asset Quality and Capital 13

Outlook 17

Appendices 19

0 3

ABN AMRO reports record operating result

Compared to the third quarter of 2002

Operating result up (+23.7%) due to higher revenues

Provisioning down (-10.4%)

Net profit strongly up (+40.8%)

Efficiency ratio improved 330 basis points to 66.2%

Tier 1 ratio increased by 79 basis points to 7.79%

Operating Performance

0 5

Revenues Q3 2003

Group performance improves due to increasing momentum in WCS

Revenues increase, driven by revenue growth in WCS and C&CC

Increase in operating expenses largely due to various incidental costs in

C&CC, especially BU NA and BU NL

Operating result improves for the fourth consecutive quarter

WCS28.2%

AM2.6%

PC4.8%

Other9.9%

C&CC54.5%

% change

(EUR mln) Q3 03 Q2 03Q3 03/Q2 03

ytd 03/ytd 02

Revenues 4,827 4,588 5.2 1.0

Expenses 3,195 2,972 7.5 (4.9)

Operating result 1,632 1,616 1.0 15.2

Net profit 832 782 6.4 33.4

Efficiency ratio 66.2% 64.8%

0 6

C&CC shows stable and resilient income stream

Revenues slightly up due to higher commission income in BU NL and BU Brazil

Operating expenses up primarily due to incidentals in BU NA and BU NL

Operating result remains flat on a normalised basis

% change

(EUR mln) Q3 03 Q2 03Q3 03/Q2 03

ytd 03/ytd 02

Revenues 2,632 2,591 1.6 2.2

Expenses 1,636 1,523 7.4 (6.2)

Operating result 996 1,068 (6.7) 17.7


Revenues Q3 2003

Netherlands30.0%

US43.5%

Brazil17.0%

RoW9.5%

0 7

Revenues of BU NL remain on track despite recession

Revenues up due to an increase in net interest revenue and higher electronic banking commissions

Expense growth inflated due to a EUR 20 mln accrual release in Q2. Normalised expense growth amounts to 2.6% mainly driven by higher profit sharing accruals

Operating result remains flat adjusted for Q2 incidental items

% change

(EUR mln) Q3 03 Q2 03Q3 03/Q2 03

ytd 03/ytd 02

Revenues 790 764 3.4 6.1

Expenses 628 592 6.1 (3.0)

Operating result 162 172 (5.8) 52.7


Revenues Q3 2003

Interest79.1%

Other 1.1%

Trading0.4%

Commissions 19.4%

0 8

% change

(EUR mln) Q3 03 Q2 03Q3 03/Q2 03

ytd 03/ytd 02

Revenues 1,144 1,154 (0.9) 5.2

Expenses 593 536 10.6 (1.5)

Operating result 551 618 (10.8) 12.1


Natural servicing hedge supports BU NA income

The US dollar appreciated on average by 1.6% against the Euro during Q3

In local currency terms:

A USD 48 mln mortgage liability reserve was included in Q3 revenues

1.0% underlying revenue growth caused by retail and commercial banking activities. Mortgage revenues flat due to higher servicing income

Expenses increase mainly due to incidental costs related to rebranding and opening of new operations and technology centre

Revenues Q3 2003

Interest53.8%

Other 28.9%

Commissions 13.4%

Trading3.9%

0 9

BU Brazil revenues improve despite decline in interest rates

The Brazilian real was stable against the Euro compared to Q3

Higher revenues reflect volume and spread growth in consumer finance and trading gains. Stable retail revenues

Higher expenses due to increase in staff costs reflecting the implementation of the new Collective Labour Agreement in September

Operating result improves significantly

% change

(EUR mln) Q3 03 Q2 03Q3 03/Q2 03

ytd 03/ytd 02

Revenues 447 423 5.7 (11.4)

Expenses 262 256 2.3 (20.9)

Operating result 185 167 10.8 8.5


Revenues Q3 2003

Trading6.7%

Other 8.7%

Commissions 13.2%

Interest71.4%

0 10

WCS client-led model delivers on commitments

Higher revenues reflecting better client revenues and improved performance in the BU’s Financial Markets, Working Capital and Private Equity

Expenses up due to combination of higher bonus accruals reflecting improved performance and investments in BU Financial Markets and BU Working Capital

Commitment of positive EP achieved in third quarter

% change

(EUR mln) Q3 03 Q2 03Q3 03/Q2 03

ytd 03/ytd 02

Revenues 1,360 1,297 4.9 (5.6)

Expenses 1,096 1,052 4.2 (9.1)

Operating result 264 245 7.8 18.0


Revenues Q3 2003

Trading25.3%

Other 1.5%

Commissions 33.5%

Interest39.7%

0 11

Other 7.7%

Trading5.2%

Commissions 49.8%

Interest37.3%

PC improves its efficiency ratio for the second consecutive quarter

Revenues remain almost flat despite absence of significant placements of new funds

Expenses down due to absence of restructuring costs in France

Efficiency ratio improves for second consecutive quarter

Revenues Q3 2003

0 12

AM continues to leverage on improved market conditions

Increase in commissions reflects higher level of Assets under Management and improved margins due to changes in asset mix

Expenses slightly down due to strict cost control

Substantial improvement of efficiency ratio

Revenues Q3 2003

Interest0.8%

Commissions 96.8%

Trading1.6%

Other 0.8%

Asset Quality and Capital

0 14

Provisioning is coming down as global economy recovers

Overall provisioning lower despite increase in Corporate Centre and BU NL

WCS provisioning decreases substantially. Weighted average UCR improves for the third quarter in a row

In C&CC, provisioning is down primarily due to a decrease in Brazil. Provisioning in BU NL up driven by further deterioration of the quality of the SME portfolio

Overall quality of the portfolio remains solid

Annualised provisions / RWA (%)

0.0%

0.5%

1.0%

1.5%

2.0%

Q101

Q201

Q301

Q401

Q102

Q202

Q302

Q402

Q103

Q203

Q203

C&CC WCS ABN AMRO

0 15

Commercial29%

Consumer71%

SME portfolio drives provisioning levels up in BU NL

C&CC NL commercial portfolio by clientC&CC NL total portfolio

Provisions in 2004 expected to be

similar as in 2003, with a peak in

the first half

SME46%

Corporate Clients54%

C&CC SME portfolio

41.8% 41.0% 39.5% 38.1% 36.4%

56.8% 57.9% 59.8% 61.4% 63.2%

0%

20%

40%

60%

80%

100%

Sep. 02 Dec. 02 Mar. 03 Jun. 03 Sep. 03

3.0

3.23.4

3.6

3.84.0

4.2

UCR 1,2,3 UCR >=4 Not rated Average UCR

0 16

Capital Management is on track to deliver targeted Tier 1 ratio

Tier 1 ratio improvement led by high retained earnings

The gearing ratio decreased for the sixth consecutive quarter to 29.9%

We expect to deliver Tier 1 ratio and core Tier 1 ratio close to 8.00% and 5.70% respectively by year end

(EUR bln) 30 06 03 30 09 0230 09 03/ 30 06 03

% change30 09 03/30 09 02

Total assetsShareholders’ equityGroup capitalRisk-weighted assets

Tier 1 ratioTotal capital ratio

614.211.9431.1

228.4

7.63%11.10%

604.611.0131.0

252.1

7.00%10.87%

(2.2)3.41.61.1

(0.6)12.21.9

(8.4)

30 09 03

600.812.3531.6

230.9

7.79%11.42%

Outlook

0 18

ABN AMRO expects a 25% increase in net profit for FY 2003

“We are confident about the performance for the remainder of the year.

We will substantially exceed our previous 2003 outlook, barring any unforeseen adverse circumstances. We now expect the full year net profit to be above EUR 3 billion”

AppendicesThird Quarter Results 2003

0 20

Appendices: table of contents

Key figures: profit and loss account 21

Currency Variations 22

Profit and Loss Account BU NA and BU Brazil 28

Details on WCS Performance 31

Asset Quality and Provisioning 34

Asset Quality and Provisioning in C&CC 37

Asset Quality and Provisioning in WCS 49

0 21

Key figures: profit and loss account

% change

(EUR mln) Q3 2003 Q3 03/Q2 03 Q3 03/Q3 02 ytd03/ytd02

Total Revenue 4,827 5.2 11.7 1.0

Operating expenses 3,195 7.5 6.4 (4.9)

Operating result 1,632 1.0 23.7 15.2

Provisioning for loan losses 303 (0.7) (10.4) (27.5)

Operating profit before taxes 1,327 1.2 38.5 37.5

Net profit 832 6.4 40.8 51.4

Net profit excl. extraord. result 832 6.4 40.8 33.4

EPS excl. extraord. res. 0.51 6.3 37.8 30.3

Currency Variations

0 23

Impact of currency variations on group performance

Revenues

Expenses

Operating result

Pre-tax profit

(1,525)

1,001

(524)

(360)

Reported change (%)

Currency impact(EUR mln)

Organic growth (%)

12.1

5.4

28.1

50.8

1.0

(4.9)

15.2

37.5

Sept YTD 03/Sept YTD 02

Note: Reported change is the arithmetic sum of currency impact and organic growth. In this case, revenues were

negatively impacted by EUR 1,525 mln and costs were positively influenced by EUR 1,001

0 24


Revenues

Expenses

Operating result

Pre-tax profit

(183)

125

(58)

(42)

Reported change (%)


Organic growth (%)

15.9

10.5

28.2

42.9

11.7

6.4

23.7

38.5

Q3 03 / Q3 02


negatively impacted by EUR 183 mln and costs were positively impacted by EUR 125 mln

0 25


Revenues

Expenses

Operating result

Pre-tax profit

18

12

6

6

Reported change (%)


Organic growth (%)

4.8

7.1

0.6

0.8

5.2

7.5

1.0

1.2

Q3 03 / Q2 03


positively impacted by EUR 18 mln and costs increased by EUR 12 mln

0 26

Reported change (%)


Organic growth (%)

Q3 03 / Q2 03

Impact of currency variations on BU NA performance

Revenues

Expenses

Operating result

Pre-tax profit

20

9

10

9

(2.6)

8.9

(12.5)

(13.9)

(0.9)

10.6

(10.8)

(12.2)

Note: Reported change is the arithmetic sum of currency impact and organic growth. Revenues were positively impacted by EUR 20 mln and expenses increased by EUR 9 mln

0 27

Impact of currency variations on BU Brazil performance

Revenues

Expenses

Operating result

Pre-tax profit

1

1

0

0

5.5

2.1

10.8

48.4

5.7

2.3

10.8

48.1

Note: Reported change is the arithmetic sum of currency impact and organic growth. Revenues were positively impacted by EUR 1 mln and costs were increased by EUR 1 mln

Reported change (%)


Organic growth (%)

Q3 03 / Q2 03

Profit and Loss Account BU NA and BU Brazil

0 29

(USD mln) Q3 03 Q2 03

Revenues 1,290 1,324

Expenses 670 613

Operating result 620 711

Provisioning 86 87

Pre-tax profit 534 624

P&L BU NA in local currency

0 30

P&L BU Brazil in local currency

(BRL mln) Q3 03 Q2 03

Revenues 1,490 1,407

Expenses 852 836

Operating result 638 571

Provisioning 215 281

Pre-tax profit 423 290

Details on WCS Performance

0 32

WCS client performance

Overall client revenues for WCS are EUR 3,164 mln, representing 83% of WCS revenues

The revenue contribution of our Priority and Key clients represents almost 54% of total client revenues

WCS Revenues(EUR 3,802 mln YTD 2003)

Revenues by Client(EUR 3,164 mln YTD 2003)

Priority & Key Revenues by Client(EUR 1,713 mln YTD 2003)

Other 17%

Client segments

83%

Integrated Energy

14%

Country Coverage

18%

TMTH15%

FIPS45%

Consumer8% Integrated

Energy17%

Country Coverage

18%

TMTH19%

FIPS39%

Consumer7%

0 33

WCS product performance

Revenues by ProductEUR 1,360 mln in Q3 2003

Revenues by ProductEUR 1,297 mln in Q2 2003

Most important revenue contributor is Financial Markets

Other9%

Equities & CF

14%

Working Capital24%

Financial Markets

53%

Financial Markets

55%Working Capital24%

Equities & CF

19%

Other2%

Asset Quality and Provisioning

0 35

September 2002 December 2002 September 2003

Private loans (EUR bn - by outstanding)

WCS21%

C&CC70%PCAM

3%

Other6%

PCAM3%

Other6%

WCS20%

C&CC71%

Brazil3%Other

4%

NL62%

US31%

WCS22%

C&CC70%

PCAM2%

Other6%

0.0

50.0

100.0

150.0

200.0

Sep-02 Dec-02 Sep-03

Wholesale C&CC Private Other

Private loans

0 36

Q3 2003 loan loss provisioning by SBUs

Overview of total loan loss provisioning per SBU

Loan loss provisioning per SBU (EUR mln) Annualised provisioning / average RWA

SBU Q302 Yr 02 Q1 03 Q2 03 Q3 03 Q3 02 YTD 02 Q1 03 Q2 03 Q3 03

C&CC 185 881 181 217 205 0.49% 0.58% 0.50% 0.61% 0.55%

WCS 141 742 156 83 54 0.68% 0.87% 0.88% 0.48% 0.33%

PCAM 1 13 3 2 3 0.06% 0.21% 0.15% 0.18% 0.11%

Total 338 1,695 343 305 303 0.53% 0.66% 0.59% 0.53% 0.52%

Total ABN mainly includes Corporate Centre and Auto Lease Holland

Other15%

WCS18%

C&CC67%

0.0%

0.5%

1.0%

1.5%

2.0%

Q101

Q201

Q301

Q401

Q102

Q202

Q302

Q402

Q103

Q203

Q203

C&CC WCS ABN AMRO

Asset Quality and Provisioning in C&CC

0 38

Overview of the C&CC consumer and commercial franchise

C&CC Total Private Loans (EUR bln) (Numbers may not add up due to rounding)

Sep. 03 Netherlands N. America Brazil Rest of World Dec 02 Mar 02

Commercial 70.3 31.3 33.3 1.5 4.2 70.1 73.4Consumer 103.6 78.4 20.2 2.9 2.1 102.5 104.4Total Private Loans 173.9 109.7 53.5 4.4 6.3 172.5 177.8

Brazil3%

Rest of World4%

North America

31% Netherlands62%

Commercial40%

Consumer60%

0 39

Q3 2003 loan loss provision by geography

C&CC loan loss provisions - slight decrease despite market conditions

Brazil30%

Other2%

USA36%

Netherlands32%

Loan loss provisioning per SBU (EUR mln) Quarterly annualised provisioning / Avg. RWA

BU Q3 02 Yr 02 Q1 03 Q2 03 Q3 03 YTD 03 Q3 02 Yr 02 Q1 03 Q2 03 Q3 03 YTD 03

Netherlands 23 137 51 57 69 177 0.17% 0.25% 0.40% 0.45% 0.53% 0.44%

USA 87 477 87 76 75 238 0.52% 0.71% 0.56% 0.50% 0.50% 0.52%

Brazil 47 193 42 86 65 193 2.85% 2.72% 2.75% 5.33% 3.97% 4.15%

Other 28 74 1 -2 -4 -5 0.53% 0.34% 0.05% -0.03% -0.06% -0.03%

Total C&CC 185 881 181 217 205 603 0.49% 0.58% 0.50% 0.61% 0.57% 0.55%

Total ABN 338 1,695 343 305 303 951 0.54% 0.67% 0.59% 0.53% 0.53% 0.55%

-1%

0%

1%

2%

3%

4%

5%

6%

Q1 01 Q2 01 Q3 01 Q4 01 Q1 02 Q2 02 Q3 02 Q4 02 Q1 03 Q2 03 Q3 03

Netherlands USA Brazil Rest of World C&CC

0 40

Overview of the portfolio of BU NL

SME46%

Corporate Clients54%

Not rated0.3%

UCR>452.1%

UCR 1,2 and 3

47.6%

Consumer71%

Commercial29%

C&CC NL commercial portfolio by client C&CC NL commercial portfolio by UCR

C&CC NL total portfolio

0 41

Commercial29%

Consumer71%

Overview of the commercial portfolio of BU NL

C&CC NL commercial portfolio by product 2

C&CC NL commercial portfolio by Industry 2C&CC NL total portfolio 1

1 Incl. Bouwfonds 2 excl. Bouwfonds

Other Services2.5%

Mining1.0%

Metal Industry9.3%

Manufacturing2.1%

Chemical Industry3.0%

Food Industry2.4%

Health & Social Services5.6%

Education1.1%

Construction3.5%

Hotels and Restaurants1.7%

Public0.6%

Public Utilities0.0%

Business Services7.4%

Banks and Non-Banking Financial Institutions

14.3%

Real Estate4.6%

Retail Trade5.6%

Stil to / not classified3.7%

Transport & Communication

6.4%Wholesale Trade

13.5%

Agriculture & Fishery11.6%

Corporate Clients SME non programlending

Total Commercial

Sep .02 Dec. 02 Sep . 03

+2.9% +0.4%

+1.7%

0 42

BU NL commercial portfolio asset quality

46.9% 46.7% 48.9% 47.3% 47.6%

47.1% 47.1%50.6% 52.1% 52.1%

6.0% 6.2%

0.5% 0.6% 0.3%

0%

20%

40%

60%

80%

100%

Sep-02 Dec-02 Mar-03 Jun-03 Sep-03

UCR 1,2,3 UCR>=4 Not Rated

0 43

0%

20%

40%

60%

80%

Sept.02 Dec.02 Mar.03 Jun.03 Sept.03

UCR 1, 2, and 3 UCR >= 4

UC

R %

Overview of the portfolio of BU NA

C&CC - Asset quality

Business mix as per Sep 2003

Commercial49%

Resid. Mortgage

46%

Other4%

Individual1%

0 44

Commercial56%

Consumer44%

Overview of BU NA commercial portfolio

C&CC BU NA commercial portfolio

C&CC BU NA commercial portfolio by IndustryC&CC BU NA total portfolio

+ 3.5%

Total USA Commercial

3Q02 4Q02 3Q03

Construction / Contracting6%

Electrical Equipment / Appliance1%

Energy1% Food / Beverage / Tobacco

4%

Government / Agency1%

Grocery Stores / Restaurants2%

Health Care4%

Miscellaneous7%

Other0%

Metal processing / Fabrication5%

Insurance1%

Industry / Commercial Machinery2%

Individuals (unqualif ied)3%

Paper / Pulp / Lumber1%

Non regulated Financials2%

Professional Services5%

Publishing / Broadcasting / Movies1%

Real Estate / Development30%

Regulated Utility1%

Regulated Financial2%

Transportation / Storage4%

Textile / Shoes / Clothing2%

Retailing / Wholesaling (general)5%

Chemicals / Fertilizers2%

Automotive3%Waste Disposal

1%Computer / Off ice Equipment

1%Travel / Lodging / Entertainment2%

0 45

BU NA commercial portfolio asset quality

39.9% 40.2% 40.8% 41.5% 39.9%

60.1% 59.9% 59.2% 58.5% 60.1%

0%

20%

40%

60%

80%

100%



0 46

* Note: Includes only loans booked onshore

0%

10%

20%

30%

40%

50%

60%

70%

Sep. 02 Dec. 02 Mar. 03 Jun. 03 Sep. 03

UCR 1/2/3 UCR >=4 Not rated

UC

R %

Overview of the portfolios of BU Brazil

C&CC - Asset quality

Business mix (*) UCR breakdown

UCR 1, 2, 361%

UCR>=433%

Not rated6%

Car Financ.

41%

Retail40%

Middle Corp19%

0 47

Commercial Portfolio

65%

Consumer Portfolio

35%

Education5.3%

Electrical Machinery1.8%

Food & Beverages & Tobacco

4.1%

Health Services5.0%

Metal & Mining6.8%

Capital Goods & Machinery

5.6%

Banking & Finance Companies

2.8%

Consumer Goods4.3%

Construction & Engineering

10.5%

Computer & Related Activities

0.4%

Chemicals6.1%

Miscellaneous2.1%

Oil & Gas2.1%

Others10.1%

Packaging0.9%

Paper & Pulp0.9% Petrochemicals

0.9%

Public0.4%

Automotive10.7%

Agribusiness19.2%

Overview of the portfolio of BU Brazil commercial portfolio

C&CC BU Brazil Commercial Portfolio

C&CC BU Brazil Commercial Portfolio by IndustryC&CC BU Brazil Loan Portfolio

Car FinanceCorp.

SME Middle Corp. TotalCommercial

Sep .02 Dec. 02 Sep . 03

-5.3%

39.3%

-16.0%

-2.7%

0 48

BU Brazil commercial portfolio asset quality

30.0%22.0% 23.0% 21.0% 22.0%

59.0%

66.0% 65.0% 66.0% 65.0%

11.0% 12.0% 12.0% 13.0% 13.0%

0%

20%

40%

60%

80%

100%



Asset Quality and Provisioning in WCS

0 50

Geographic exposure calculated based on the country lending office of each counterparty

OECD: Organisation for Economic Co-operation and Development

Asia Pacific Advanced

6.9%

North America26.5 %

Latin America3.4%

Eastern Europe0.5%

Africa0.4%

Europe 56.3%

Middle East0.7%

Asia5.3%

Wholesale corporate portfolio is predominantly OECD

0 51

Breakdown of Wholesale portfolio per client sector

Commercial banks exposure includes commercial lines, money market and OBSI facilities

Wholesale - Corporate portfolioWholesale - Total portfolio

Integrated Energy

10%

Consumer6%

Other FI21%

Commercial Banks33%

Telecom, Media, Technology,

Health9%

Automotive & Industrial

14%

Public Sector7%

Country Coverage

36%

Consumer15%

Integrated Energy

26%

Telecom, Media,

Technology, Health23%

0 52

As a % of total limits of Wholesale Corporate portfolio which excludes FIPS

Wholesale corporate portfolio is well diversified

Tobacco1.0%

Leisure0.6%

(Non) durables5.7%

Food6.0%

Services3.0%

Manufacturing (general)7.6%

Real estate2.3%

Agri/raw materials1.2%

Construction4.3%

Transport services7.1%

Manuf other transport means1.7% Automotive (oem + supply)

9.2%

Metals & mining3.4%

Chemicals5.2%

Utilities8.1%

Oil & gas9.5%

Health/pharma3.9%

Retail1.5%

Technology6.4%

Media5.0%

Telecom7.3%

0 53

TMTH Integrated Energy Automotive & Industrial Consumer Total

Sept.02 Dec.02 Sept.03

-17.5%-19.0%

-14.2%

-13.9%

-16.2%

Continued reduction of exposure

Sector breakdown of wholesale portfolio - Total limits

0 54

Average UCR of wholesale client sectors

Average UCRs - Historical performance Average UCRs

2.6

2.7

2.8

2.9

3.0

3.1

3.2

Jun. 02 Sep. 02 Dec. 02 Mar. 03 Jun. 03 Sep. 03

TMTH Int. Energy

Automotive & Industrials Consumer

WCS Portfolio

0 55

Asset quality of wholesale client sectors

Automotive & industrial Integrated Energy

Consumer

Wholesale corporate portfolio

(36.5% of WCS corp. portfolio) (26.2% of WCS corp. portfolio)

(14.8% of WCS corp. portfolio)

TMTH

(22.6% of WCS corp. portfolio)

UCR 1, 2, 381%

UCR >=419%

UCR >=419%

UCR 1, 2, 381%

UCR 1, 2, 380%

UCR >=420%

UCR >=415%

UCR 1, 2, 385%

UCR 1, 2, 381%

UCR >=419%

80% 80% 81%

20.1% 20.3% 18.7%

0%

20%

40%

60%

80%

100%

Sep. 02 Dec. 02 Sep. 02

UCR 1, 2, 3 UCR >=4

abn amro reports record operating result third quarter results 2003 31 october 2003

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