presentation 4q10

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Presentation on

4Q10 Results

1

Credit Behavior in Brazil

Loan Portfolio

Funding and Liquidity

Results from Operations

Capital Market

2

1,704

607

733

936

1,2271,410

2005 2006 2007 2008 2009 2010

Nonearmarked Resources Earmarked Resources

Source: Central Bank of Brazil – Credit Information System - SCR

Loans in the Brazilian Financial System

R$ billion

29%

71%

29%

68%

32%

71%

Variation % Individuals Corporates

Total Credit Dec/10

Non

earmarked

Resource

Earmarked

Resource Total

Non

earmarked

Resources

Earmarked

Resources Total

In the month 1.8 2.7 2.1 1.1 1.1 1.1 1.6

In the quarter 5.6 7.7 6.2 5.0 5.2 5.1 5.6

In the year 18.8 30.7 21.9 15.4 25.7 19.3 20.5

In 12 months 18.8 30.7 21.9 15.4 25.7 19.3 20.5

Total Credit Volume and Segmentation

66%

34%

Loans to individuals growth mainly supported by

housing loans with earmarked resources and car

financing with free resources

Corporate Credit earmarked resources from BNDES

still stand out as well as working capital with free

resources.

Government owned banks maintained a 42% share on

total loans in the financial system

3

3.6

5.7

4.6

0

1

2

3

4

5

6

7

8

9

10

Dec Dec Dec 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q

2006 2007 2008 2009 2010

Corporates Individuals Total

Sourc

e: B

AC

EN

%

Central Bank Default Rates = loans overdue above 90 days on total loan portfolio

Default Rate on Loans to Individuals: Fast retreat from June 2009

Default Rate on Corporate Loans: Stable at circa 3.6% from March 2010

Credit Default Ratios Stability in Corporate lending and steady decline in loans to individuals

4


Loan Portfolio



Capital Market

5

14.3% Loan Portfolio* growth = R$ 1.9 billion

Local currency loans = 80% of total loan portfolio

Loans in Brazilian Reais and Trade Finance deals

allocated to the “Upper Middle” segment stand

for 14% of the total portfolio

Credit assignment accounts just for 0.6% of the

portfolio and guarantees, 3.3%

Trade Finance portfolio comprises :

85.7% Export financing (ACC/ ACE)

14.1% Import financing (FINIMP)

0.2% Import L/Cs

Amounts in foreign currency show a 10% growth

in 4Q10 and 31% in 12 months: US$ 168.3 million – 4Q09

US$ 200.8 million – 3Q10

US$ 221.0 million – 4Q10

Local Currency Loans Trade Finance

298.4344.1 369.1

4T09 3T10 4T10

R$ Million

1,400.3 1,425.01,572.2

4Q09 3Q10 4Q10

R$ Million

* including guarantees issued

Credit Assignment Guarantees issued and L/Cs

6

10 largest

20%

11 - 60

31%61 - 160

24%

Other

25%

Industry

56%

Other

Services

23%

Individuals

7%

Financial

Cos

3%

Commerce

11%

Up to 90

days

40%

91 to 180

18%

181 to 360

13%

Above 360

days

29%

Credit Portfolio Breakdown

By Client Concentration

By Economic Activity By Segment

By Maturity

Middle

Market

82%

Upper

Middle

14%

Retail and

other

4%

7

Loan Portfolio breakdown by Industry

18%

9%6%5%

5%5%

3%

3%

3%

4%

3%

17%

2%

2%

2%

2%

11%

Food & Beverage

Agribusiness

Heavy Construction

Financial Institutions

Chemical & Pharmaceutical

Transportation & Logistics

Automotive

Textile, Apparel & Leather

Education

Energy

Metal Industry

Oil & Biofuel

Wholesale & Retail Trade

Financial Services

Individuals

Pulp & Paper

Other Industries

8

Loan Portfolio Quality

(*) Total outstanding amount of contracts with any installment overdue above 60 days

Allowance for Loan Losses (ALL) NPL(*) / Total Loans (%)

Asset Quality

Provisioning Coverage = 6.4% of Loan Portfolio and 196% of NPL 90 days

5.9

3.7 3.8

4Q09 3Q10 4Q10

Collateral Structure

Securities

3%

Real State

9%

Other

4%

Aval PN

23%

Monitored

Pledge

8%

Vehicles

3%

Pledge/

Lien

4%

Receivables

46%

Risk Rating

C

22.2%

D-H

14.2%

AA

2.5%A

35.4%

B

25.6%

133.4

112.2119.6

4Q09 3Q10 4Q10

R$ Million

10.4% Performing

3.8% NPL +60 days

9


Loan Portfolio



Capital Market

10

Time

Deposits

37%

DPGE(*)

29%

Interbank

Deposits

6%

Foreign

Borrowings

16%

BNDES

Onlending

6%

Demand

Deposits

2%ALC &

BN(*)

4%

Local Currency Funding prevalence

R$ Million

6.7% increase in the quarter

84% of funding in Brazilian Real

Foreign Borrowings:

• Trade Finance – 94%

• IFC – 6%

Total Funding Funding Breakdown

1.793,21.902,7

2.030,6

4Q09 3Q10 4Q10

CDs and DPGEs(*) account for 66% of total funding

Deposits average term to maturity = 496 days

CDs: R$ 740 MM - 347 days

DPGEs: R$ 591 MM - 795 days

ALC & BN: R$ 82 MM – 120 days

Interbank Deposits: R$ 117 MM - 175 days

(*) DPGE – Time Deposits bearing Special Insurance from FGC; ALC – Agribusiness Letters of Credit; BN – Bank Notes

11

348

248

603

521492

244

791734

90 days 180 days 360 days Above 360 days

Assets Liabilities

Good Liquidity maintained

696.9 680.7733.8

4Q09 3Q10 4Q10

Free Cash

R$ Million

R$ Million

Assets and Liabilities Management

Treasury’s main task is the

management of liquidity, interest rate,

currencies and tenor mismatch risks

Free Cash:

46% of Total Deposits

172% of Shareholder’s Equity

Free Cash =

(Cash + Liquid Fin. Assets + Securities + Derivatives)

(-)

(Open Market Funds + Derivatives)

12


Loan Portfolio



Capital Market

13

Profit from Financial Intermediation growth in

2010 derived from:

Increased revenue from securities, derivatives and FX operations

Stability in Financial Intermediation Expenses, including the lower pressure of provisioning expenses

R$ Million R$ Million

Income from Financial Intermediation composed by revenues from:

Loans 59%

Securities 21%

Derivatives 12%

Foreign Exchange Operations 8%

Revenues from derivatives are both related to hedge of investments in government bonds and time deposits

Income from Financial Intermediation Gross Profit from Financial intermediation

Financial Intermediation Results Evolution

93.0123.0 116.0

407.0454.0

4Q09 3Q10 4Q10 2009 2010

27.439.1

94.3

141.9

34.5

4Q09 3Q10 4Q10 2009 2010

14

63.2% 61.6%65.7%

52.3%

60.9%

4Q09 3Q10 4Q10 2009 2010

Net operating expenses increased by 7.2%

quarter on quarter, also impacted by the

labor union agreement

Third party services were also relevant in the

increased administrative expenses

In %

Net Operating Expenses

Slight increase in Operating Expenses

Efficiency Ratio

Closely tied to scale, the efficiency ratio

reflects:

stable loan portfolio throughout the year

Maintenance of high liquidity to ensure

business sustainability

the "upper middle" business unit

implementation and the structured finance

area strengthening

23.2 26.5 28.4

93.2100.3

4Q09 3Q10 4Q10 2009 2010

S&

P m

eth

od

R$ Million

15

Net Recurring Profit:

4Q10: R$ 5.9 million / 4Q09: R$ 4.2 million = +40.5%

2010: R$ 28.5 million / 2009: R$ 9.8 million = +190.8%

ROAE

• 4Q10: 5.6% / 4Q09: 4.1% = +150 bps

• 2010: 6.8% / 2009: 2.9% = +390 bps

Net Profit

Improved Recurring Profit

Net Interest Margin (NIM)

NIM(a) net interest margin adjusted by FX

effects on financial assets and by deducting

the balance of repos from the average

interest-bearing assets

GIM= Gross Interest Margin

4.47.5

12.8

29.0

5.9

4Q09 3Q10 4Q10 2009 2010

R$ Million

6,5%

7,9%

4,6%

1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10

NIM NIM(a) GIM

16


Loan Portfolio


Result from Operations

Capital Market

17

Free Float

47.5%Controlling

Group

44.0%

Directors +

Officers

6.6%

Treasury

1.8%

Capital Distribution on Dec. 31, 2010

Class # of Shares Controlling

Group Management Treasury Free Float

Free

Float

Common 27,000,000 (17,116,173) (2,574,269) - 7,309,558 27.1%

Preferred 14,212,984 (1,026,653) (159,570) (746,797) 12,280,064 86.9%

TOTAL 41,212,984 (18,142,826) (2,733,839) (746,797)* 19,589,622 47.5%

Capital Distribution and Free Float

* 4th Share Buyback Program for

up to 1,301,536 preferred shares

valid until Aug. 09, 2011

18

BIM’s practice for shareholder remuneration has been

the quarterly anticipated payment of Interest on Equity

Shareholder Remuneration

2.8 2.3

6.0 6.8 6.32.7 2.3

6.66.9

6.3

2.4 5.1

6.56.6

6.3

2.2

6.1

6.46.7

6.2

10.2

15.9

24.5 25.1

27.0

2006 2007 2008 2009 2010

1Q 2Q 3Q 4Q

R$ M

M

Remuneration per share

R$ 0.34235 R$ 0.41635 R$ 0.59451 R$ 0.63704 R$ 0.60983

19

70

80

90

100

110

120

130

12/3

0/200

9

01/1

4/201

0

01/2

9/201

0

02/1

3/201

0

02/2

8/201

0

03/1

5/201

0

03/3

0/201

0

04/1

4/201

0

04/2

9/201

0

05/1

4/201

0

05/2

9/201

0

06/1

3/201

0

06/2

8/201

0

07/1

3/201

0

07/2

8/201

0

08/1

2/201

0

08/2

7/201

0

09/1

1/201

0

09/2

6/201

0

10/1

1/201

0

10/2

6/201

0

11/1

0/201

0

11/2

5/201

0

12/1

0/201

0

12/2

5/201

0

IBOVESPA IDVL4 IDVL4 adjusted to earnings

Stock Performance IDVL4 X IBOV - 2010

Share Performance 4Q10 2010

IDVL4 -0.62% -4.10%

IDVL4 (adjusted to earnings) +1.40% +3.52%

IBOV -0.18% +1.04%

IGC +2.32% +12.54%

ITAG +1.43% +11.72%

Source: Enfoque

20

Business Focus: Corporate lending

Credit Behaviour in Brazil Earmarked credit accelerated growth throughout the year, lowering speed in the last quarter

Government owned banks maintain 42% share on total credit in the Brazilian financial system

Central Bank data shows stability in corporate loans delinquency ratios at 3.6%

Loan Portfolio Growth resumption: 10% quarter on quarter and 14.3% in the year, reaching R$ 1.9 billion

82% middle market companies and 14% upper-middle, companies with annual sales above R$ 400

million, in line with the strategy of expanding the target market

Adequate provision coverage = 196% on Non Performing Loans above 90 days

Funding and Liquidity High liquidity maintained: Free Cash at 46% of total deposits and 172% of Shareholder’s Equity

Funding totaled R$ 2 billion, an increase of 6.7% in the quarter and 13% in 12 months

Operating Results Evolution on Financial Intermediation Results also helped by lower ALL expenses pressure

Accumulated 12-month net profit reaches R$ 29 MM against R$ 12.8 in 2009

Highlighting recurring profit: R$ 28.7 million in 2010 from R$ 7.7 million in 2009

In Short

21

Questions and Answers Please pose your questions by utilizing the Q&A

button at the right bottom end of the Webcast panel.

Please note that this is the English version of the presentation originally prepared in Portuguese. In case of any discrepancy between those versions,

the Portuguese version shall prevail. Banco Indusval Multistock complete financial statements are available at www.indusval.com.br/ir, under Financial

Information – Financial Statements and they are filed with the CVM – Brazilian Securities and Exchange Commission that disposes them to the market

at www.cvm.gov.br.

Any reference or statement regarding Banco Indusval Multistock - or its subsidiaries and affiliates - anticipated synergies, growth plans, projected

results and future strategies are just estimates. Although forward-looking statements reflect management’s good faith beliefs, they involve known and

unknown risks and uncertainties that may cause the Company’s actual results or outcomes to be materially different from those anticipated and

discussed herein. These risks and uncertainties include, but are not limited to, our ability to realize the amount of the projected synergies and in the

timetable projected, as well as economic, competitive, governmental and technological factors affecting Banco Indusval Multistock’s operations,

markets, products and prices, and other factors detailed in Banco Indusval Multistock’s filings with the CVM – Brazilian Securities and Exchange

Commission which, readers are urged to read carefully, in analyzing investment alternatives.

22

Investor Relations – Contact Information

Ziro Murata Jr.

IRO

Phone: (55 11) 3315-6961

E-mail: [email protected]

Maria Angela R. Valente

Head of IR

Phone: (55 11) 3315-6821

E-mail: [email protected]

Banco Indusval S/A

Rua Boa Vista, 356 – 7º andar

01014-000- São Paulo – SP

Brasil

IR Site:

www.indusval.com.br/ir