banco abc - 2007 apimec presentation
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22
Summary
Who we are 03
Business Segments 10
Competitive Advantages 16
Financial Overview 22
Our Vision of the Future 26
Contacts and Disclaimer 28
4
Leading Credit Provider to Mid-Sized and
Large Companies
Strong focus on providing loans and structured products to Middle and Large-Middle.
Expertise in corporate credit risk analysis with remarkably low historical losses
Unique and wide range of credit products for Middle and Large-Middle segments
High level of customization
Sophisticated products for Large-Middle clients
Winning combination of a strong controlling shareholder and an independent local management
team
Agile decision making process
Access to attractive funding sources
Enhanced rating
Overview
5
Our History
Arab Bank Corporation and Roberto Marinho
Group jointly initiate Banco ABC Roma SA,
acting in the segments of corporate lending,
trade finance and treasury
Current
management starts
running the bank
Arab Banking Corporation
and Local Management
acquire Roberto Marinho
Group´s shares
The bank´s name
changes to
Banco ABC Brasil S/A
The bank structures
its Middle Market
Operations
The bank starts its
payroll deductible
activity
1989 1991 1997 2005 2006 2007
IPO
66
Initial Public Offering July 25 2007
R$ 1,7 Billion
Market Cap
Offering structure
IPO in Brazil with sales effort
abroad via 144A and Reg S
Offering Summary
Shares Offered
Offering price and
size
45,1 million preferred shares,
with 100% tag along (98.4%primary issuance)
R$ 13,50 / share. Total of
R$608.850.000,00
Ownership Structure
Marsau Uruguay
(ABC)
56,0%
Local Management
9,4%
Associates1,4%
Free Float
33,2%
7
Focus in Corporate Credit
1 Including guarantees
-
-
-
100%94% 88,5%
89,8%
86,7%
6%11%
10%
11,7%
0,5%
0,21%
1,6%
2004 2005 2006 9M 2006 9M 2007
2.011
2.605
2.911
2.649
4.251
CAGR = 20.3% CAG
R = 6
0,5%
-
-
-
100%94% 88,5%
89,8%
86,7%
6%11%
10%
11,7%
0,5%
0,21%
1,6%
2004 2005 2006 9M 2006 9M 2007
2.011
2.605
2.911
2.649
4.251
CAGR = 20.3% CAG
R = 6
0,5%
Corporate & Large Middle Middle Market Payroll Deductible
Credit Portfolio1 (R$ million)
CR
ED
IT
Corporate
Loans
Consumer
Large
Corporate &
Large
Middle
Middle
Market
Payroll
Deductible
Segments
Over R$ 250 mi
R$ 30 mi to
R$ 250 mi
Consumer
Annual
Revenues
8
Credit Portfolio
Guarantees % by Sector
Agribusiness 18%
Construction 14%
Financial Inst./Insurance 14%
Whosale Distribution 6%
Electric Energy 5%
Foods 4%
Professional Services 4%
Individuals 3%
Vehicles and Tools 3%
Industry - Machine 3%
Telecommunications 3%
Transport and Logistic 3%
Retail Distribution 3%
Payroll Deductible 2%
Industry - Chemicals 2%
Others 12%
Oth
ers
Sto
cks
Ru
ral P
rom
isso
ry N
ote
Me
rch
an
t P
led
ge
Ma
rke
tab
le S
ecu
ritie
s
Ve
hic
les
Re
al E
sta
te
Gu
ara
nte
es issu
ed
on
be
ha
lf o
f clie
nts
Go
od
s
Re
ce
iva
ble
s
Ch
atte
l M
ort
ga
ge
Cle
an
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
9
Employees
Headcount
187
269314
348 359 378
2004 2005 2006 1T07 2T07 3T07
Employees
246 247 254
102 112 124
1T07 2T07 3T07
Back Front
348 359 378
11
Large Corporate & Large Middle
Large
Corporate &
Large Middle
Target MarketAverage
Ticket
Companies with annual revenues
over R$ 250 miR$ 8,2mi
# Clients
446
Great SP
38%
SP Countryside and MG
37%
RJ and Northeast
14%
South
11%
Geographical Distribution (% of portfolio)
Large Corporate & Large Middle R$ mi
2.010,7
2.458,22.587,3
3.684,2
2004 2005 2006 9M2007
12
Middle Market
(R$ MM)
Middle Market
Target MarketAverage
Ticket
Companies with annual revenues
ranging from R$ 30 mi to R$ 250 miR$ 1,7mi
# Clients
297
Great SP89,4%
SP Countryside7,3%
MG3,3%
Geographical Distribution (% of portfolio)Middle Market R$ mi
146,4
309,2
498,4
2005 2006 9M2007
Middle Market
2005 2006 9M2007
13
Payroll Deductible
Payroll
Deductible
Target MarketAverage
Ticket
INSS retirees
Civil Servants24.778
# Clients
58R$2.740 24
# Credit
Agents # Agreements
(R$ MM)
Payroll Deductible R$ mi
14,4
67,9
2006 9M2007
50,3%
INSS
49,7%
CCóódigos (% digos (%
OTHERS
50,3%
49,7%
Agreements (% of portfolio)
Originated Loans per Month : R$12
Million
Credit Assigned : Zero
14
Other Activities
Hedge & Derivatives – sophisticated products offered to Clients
Pricing & Asset Liability Management
Proprietary Trading
Brazilian Sovereign Bonds (Local / Offshore)
Interest Rates
FX (USD-BRL)
Brazilian Corporate Bonds (Local / Offshore)
Brazilian Corporate – other instruments (CDS, CLN, Forfaiting)
Average V@R 2006 : US$1 Million
Treasury
15
Other Activities
Capital Markets
Products Offered : FIDCs / Debentures / Structured Trade Finance
Local Mkt (1H2007)
# Transactions : 5
R$ 1,6 Bi
Offshore (1H2007)
# Transactions : 5
US$ 82 Mi
1717
Sophisticated and Diversified Products
Our sophisticated and diversified product portfolio allows us to benefit from an
untapped demand in our market niche
Note:
1 In terms of annual revenues in R$ million
Larg
e
Co
rpo
rate
Larg
e-M
idd
leM
idd
le
Client Size1
2,000+
250-
2,000
30-250
Clients
NeedsHow We See Competition?
Individuals
Co
nsu
mer
# of potential clients
Industry
Supply
Product Sophistication
Products
Onshore / Offshore loansGuaranteesDebt capital marketsFIDC / securitizationStructured trade financeStructured project financeHedge and derivatives
Loans (working capital, revolving credit)Advances on receivablesTrade financeGuarantees
Untapped Demand
Onshore / Offshore loansGuaranteesDebt capital marketsFIDC / securitizationStructured trade financeStructured project financeHedge and derivatives
Payroll deductible loans
LEGEND: High Mid-High Medium Low
1818
Proven Track Record
Growth Despite Adverse Economic Conditions
Mexican Crisis
Growth throughout different economic scenarios
Credit Portfolio
1996 2000 2001 20032002199919981997 2004 2005 2006 9M07
Asian Crisis
Russian Crisis
Devaluation of R$
“Apagão”
September11th
Argentinean Crisis
Presidential Elections of
Lula
Banco Santos Bankruptcy
IPO(R$ million)
0.33% 0.39% 0.10%0.02%0.00% 0.02% 0.06%
0.67%
0.00% 0.02% 0.06%
1.09%
19
AA-C99,3 %
D-H0,7 %
High Quality of
Credit Portfolio
Credit Portfolio
Classification 3Q07
% by
portfolio
AA 510,6 15,2%
A 1.529.6 45,5%
B 1.067.1 31,7%
C 232,7 6,9%
D 8,4 0,2%
E 0,7 0,0%
F 2,8 0,1%
G 2,8 0,1%
H 8,4 0,2%
Total 3.363,1 100,0%
(Em R$ Million)
(Em R$ Million)
2001 2002 2003 2004 2005 2006 2007
Losses/Portfolio (%) 0,1% 0,1% 0,7% 1,2% 0,0% 0,0% 0,1%
Provision/Portfolio (%) 0,5% 1,8% 2,7% 1,6% 1,2% 1,4% 1,1%
AA-C 3.340,0
D-H 23,1
2020
Agile Decision Making & Experienced
Management
Key Management Team
& Shareholders
Fast and secure credit approval is possible due to the 16 years experience of the same
senior management team
Credit Approval Process
Committees meet officially every week or whenever it is necessary
Whole credit approval process takes no longer than 20 days after
client visit
Ability to get credits safely approved within 48 hours
Days
CommercialArea
Credit Risk Area
Credit Risk &Commercial
Credit Committee
Disbursement
Client Visits
Document Requests
ProposalProposal Analysis
Client Due Diligence
Further Client Information
Credit Risk Analysis and Discussions
D1 D2 D3 D4 D5 D6 D7 D8 D9 D10 D11 D12 D13 D14 D20
At least 70% of clients have its credit
analyzed, approved and money disbursed
within 14 daysFast Track – 1 Day Credit Approval
Tito E. da Silva 16 38
Name ABC Banking
Years
Anis Chacur 16 24
José E. C. Laloni 16 23
Gustavo A. Lanhoso 16 23
Sérgio L. Jacob 16 19
Sérgio R. Borejo - 20
21
Controlling
Shareholders
(1S07)
Total Assets: US$ 27,311 Mi.
Equity Shareholders: US$ 2,168 Mi.
ROE: 13,6%
Ratings:
BBB+ A3BBB+
2004 2005 2006 2007
National - Long Term A A AA- AA-
National- Short Term F1 F1 F1+ F1+
International - Long Term - BB- BB BB+
International - Short Term - B B B
The combination of independent management with successful track record and a strong
controlling shareholder helps to support our high rating
High Rating with Strong Sponsor &
Independent Management
23
Funding
Performance
1.707
2.045
2.472
3.106
2004 2005 2006 9M2007
CAGR = 24,3%
Private
3%
Private
2%
Financial Inst.
32%
BNDES
14%
Corporate
26%
Institutional
23%
Local International
24
Profitability *
Net Profit (R$ mi) - Quarterly
16,2
25,8 23,3
3Q06 2Q07 3Q07
CAGR = 43,8%
41,1
67,5
Jan-Sep/06 Jan-Sep/07
Net Profit (R$mi) – 9 months
CAGR = 64,3%
15,7%
22,0%
10,1%
3Q06 2Q07 3Q07
ROAE (%aa) - Quarterly
13,3% 14,7%
Jan-Sep/06 Jan-Sep/07
ROAE (%aa) – 9 months
*Excluding IPO expenses
25
Indicators
Shareholders Equity (R$ MM) and Basel Index (%)
422 483
1.083
14,0% 13,6%
26,7%
3Q06 2Q07 3Q07
Efficiency Ratio (%)
52,4%41,9%
35,8%
3Q06 2Q07 3Q07
NIM (Quarterly)
6,7% 6,8%5,9%
3Q06 2Q07 3Q07
6,7% 6,8%5,9%
NIM (9 months)
6,3% 6,5%
Jan-Set/06 Jan-Set/07
6,3% 6,5%
Jan-Sep/06 Jan-Sep/07
27
Diversified Growth Strategy
Banco ABC Brasil is well-positioned to capture growth from different segments within
the industry
Strategic Approach
Opportunistic
Increase average loan per client
Cross-selling of products
Strong focus with long-term approach
Increase average loan per client
Increased product sophistication
Geographic expansion (new offices)
Increase client base
Increase average ticket
Increase client base organically or through acquisition of on-going business
Fo
cu
s
Large-Middle
Large
Corporate
Middle
Payroll
Drivers
# Clients Avg. Loan Spread
28
Contacts and Disclaimer
Investor Relations
Sergio Lulia Jacob – CFO and IRO
Alexandre Sinzato – IR Manager
Eduardo Randich – IR Analyst
Web Site: www.abcbrasil.com.br/ri
Email: ri@abcbrasil.com.br
Phone: +55 (11) 3170 2186
The material that follows is a presentation of general background information about Banco ABC Brasil S.A. ( “Banco ABC” or the “Bank”) as of the date of the presentation. It is information
in summary form and does not purport to be complete. No representation or warranty, express or implied, is made concerning, and no reliance should be placed on, the accuracy,
fairness, or completeness of this information.
This presentation may contain certain forward-looking statements and information relating to Banco ABC that reflect the current views and/or expectations of the Bank and its
management with respect to its performance, business and future events. Forward looking statements include, without limitation, any statement that may predict, forecast, indicate or imply
future results, performance or achievements, and may contain words like “believe,” “anticipate,” “expect,” “envisages,” “will likely result,” or any other words or phrases of similar meaning.
Such statements are subject to a number of risks, uncertainties and assumptions. We caution you that a number of important factors could cause actual results to differ materially from the
plans, objectives, expectations, estimates and intentions expressed in this presentation. In no event, neither the Bank nor any of its affiliates, directors, officers, agents or employees shall
be liable before any third party (including investors) for any investment or business decision made or action taken in reliance on the information and statements contained in this
presentation or for any consequential, special or similar damages.
Securities may not be offered or sold in the United States unless they are registered or exempt from registration under the United States Securities Act of 1933. Any offering of securities
to be made in the United States will be made solely by means of an offering circular that may be obtained from the placement agents or the underwriters. Such offering circular will
contain, or incorporate by reference, detailed information about Banco ABC and its business and financial results, as well as its financial statements.
This presentation does not constitute an offer, or invitation, or solicitation of an offer, to subscribe for or purchase any securities. Neither this presentation nor anything contained herein
shall form the basis of any contract or commitment whatsoever.
The market and competitive position data, including market forecasts, used throughout this presentation was obtained from internal surveys, market research, publicly available
information and industry publications. Although we have no reason to believe that any of this information or these reports are inaccurate in any material respect, we have not
independently verified the competitive position, market share, market size, market growth or other data provided by third parties or by industry or other publications. Banco ABC, the
selling shareholders, the placement agents and the underwriters do not make any representation as to the accuracy of such information.
This presentation and its contents are proprietary information and may not be reproduced or otherwise disseminated in whole or in part without Banco ABC’s prior written consent.
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