Banco Votorantim S.A. U.S.$5,000,000,000 Global Medium-Term Note Program

LISTING PARTICULARS FOR LISTING PURPOSES ONLY Banco Votorantim S.A. (a corporation incorporated under the laws of the Federative Republic of Brazil) (acting through its principal office in São Paulo) U.S.$5,000,000,000 Global Medium-Term Note Program Banco Votorantim S.A., acting through its principal office in São Paulo, may from time to time issue medium-term Notes ( Notes ) pursuant to the Global Medium-Term Note Program described herein (the Program ) denominated in U.S. dollars or such other currencies or currency units as may be set forth in the relevant Final Terms described herein. The Notes will have maturities as may be set forth in the applicable Final Terms, subject to all legal and regulatory requirements applicable to issuances in particular currencies. The maximum principal amount of all Notes from time to time outstanding will not exceed U.S.$5,000,000,000 (or the equivalent, calculated as described herein, in other currencies or currency units), subject to any duly authorized increase. The Notes may bear interest on a fixed or floating rate basis, be issued on a fully discounted basis and not bear interest, or be indexed. All Notes denominated in the same currency, having the same maturity date, bearing interest, if any, on the same basis and at the same rate and the terms of which are otherwise identical, except for the issue date, issue commencement date and/or the issue price, will constitute a series. Each series may comprise one or more tranches, each a tranche, issued on different issue dates. The aggregate nominal amount, any interest rate or interest calculation, the issue price, and any other terms and conditions not contained herein with respect to such tranche of Notes will be established at the time of issuance and set forth in the applicable Final Terms. The Notes may be offered for sale (i) in the United States to qualified institutional buyers ( QIBs ) (as defined in Rule 144A ( Rule 144A ) under the Securities Act of 1933, as amended (the Securities Act )) pursuant to Rule 144A or (ii) outside the United States to non-u.s. persons in reliance on Regulation S under the Securities Act ( Regulation S ) and in accordance with applicable laws. See Plan of Distribution. Notes offered for sale pursuant to Rule 144A are referred to as restricted Notes, and Notes offered for sale in reliance on Regulation S are referred to as unrestricted Notes. See Risk Factors for a discussion of certain factors to be considered in connection with an investment in the Notes. The Notes may contain a Foreign Currency Constraint provision, as more fully described herein and in the applicable Final Terms. Upon the occurrence of a Foreign Currency Constraint Event (as defined herein), a holder of Notes that contain a Foreign Currency Constraint Provision may elect to exchange such Notes for an equivalent nominal amount of exchanged Notes with terms and conditions identical to the terms and conditions of the original Notes, except that payments in respect of the exchanged Notes will be made in the lawful currency of Brazil. Upon termination of the Foreign Currency Constraint Event, exchanged Notes will be exchanged for an equivalent nominal amount of the original Notes and such holder will receive future payments in respect of the Notes in the specified currency (as defined herein) of the Notes. If a holder does not elect to receive payments in the lawful currency of Brazil by making such exchange, after the termination of the Foreign Currency Constraint Event, such holder will receive payments in respect of the Notes in the specified currency of the Notes. A Foreign Currency Constraint Event will not be deemed an Event of Default, provided that we have fully complied with our obligations under Condition 25 of the Notes. See Terms and Conditions of the Notes Condition 25. Application has been made to the Irish Stock Exchange for the approval of these Listing Particulars and for any Notes issued under the Program for the period of 12 months from the date of these Listing Particulars to be listed on the Official List of the Irish Stock Exchange and to be admitted for trading on its Global Exchange Market (the Irish Stock Exchange (Global Exchange Market) ). However, Notes may be issued under the Program, which will not be listed on the Irish Stock Exchange (Global Exchange Market) or any other stock exchange, and the Final Terms applicable to a series will specify whether or not the Notes of such series will be listed and admitted to trade on the Irish Stock Exchange (Global Exchange Market) or any other stock exchange. With respect to the Program and any listed Notes issued under the Program, there can be no assurance that a listing on the Irish Stock Exchange (Global Exchange Market) or any other stock exchange will be achieved prior to the launch date of the Program or the issue date of any Notes or otherwise. In particular, in respect of Notes of any series initially listed on the Irish Stock Exchange (Global Exchange Market) or any stock exchange in the European Union, we may seek to terminate such listing and list such Notes on an alternative stock exchange outside the European Union in the event that the regime established under the EU Transparency Directive (Directive 2004/109/EC) imposes excessively onerous obligations on us at such time as it takes effect in relation to us, such as any requirement to publish financial statements in the European Union prepared in accordance with, or reconciled to, International Financial Reporting Standards. Tranches of Notes may be rated or unrated. Where a tranche of Notes is rated, such rating will be specified in the relevant Final Terms. A rating is not a recommendation to buy, sell or hold securities and may be subject to suspension, reduction or withdrawal at any time by the assigning rating agency. THE NOTES HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT, OR ANY STATE SECURITIES LAWS. THE NOTES MAY NOT BE OFFERED OR SOLD DIRECTLY OR INDIRECTLY WITHIN THE UNITED STATES OR TO OR FOR THE ACCOUNT OF U.S. PERSONS (AS DEFINED IN REGULATION S AND, IF BEARER BONDS ARE TO BE OFFERED, THE INTERNAL REVENUE CODE), EXCEPT PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. BEARER NOTES ARE SUBJECT TO U.S. TAX LAW REQUIREMENTS AND MAY NOT BE OFFERED, SOLD OR DELIVERED WITHIN THE UNITED STATES OR ITS POSSESSIONS OR TO A UNITED STATES PERSON, EXCEPT IN CERTAIN TRANSACTIONS PERMITTED BY U.S. TAX REGULATIONS. SEE PLAN OF DISTRIBUTION. These Listing Particulars are valid for twelve months from the date hereof. These Listing Particulars replace any listing particulars dated prior to the date hereof relating to the Program. The date of these Listing Particulars is April 7, 2011 Arrangers and Dealers BANCO VOTORANTIM S.A. VOTORANTIM BANK LIMITED

You should rely only on the information contained in these listing particulars ( Listing Particulars ) or any final terms relating to any specific tranche of Notes ( Final Terms ). We have not authorized anyone to provide you with different information. We are not making, and each of the dealers for each series will not be making, an offer of these securities in any jurisdiction where such offer is not permitted. You should not assume that the information contained in these Listing Particulars or any Final Terms is accurate as of any date other than the date on the front of these Listing Particulars or the date of the relevant Final Terms, respectively. TABLE OF CONTENTS CERTAIN TERMS AND CONVENTIONS...5 SUPPLEMENTAL LISTING PARTICULARS...7 FORWARD-LOOKING STATEMENTS...8 PRESENTATION OF FINANCIAL AND OTHER INFORMATION...9 ENFORCEMENT OF JUDGMENTS...10 SUMMARY...12 RISK FACTORS...30 EXCHANGE RATES...45 USE OF PROCEEDS...47 CAPITALIZATION...48 MANAGEMENT S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS...49 SELECTED STATISTICAL INFORMATION...75 BUSINESS...87 OWNERSHIP AND CAPITAL STRUCTURE...115 MANAGEMENT...123 RELATED PARTY TRANSACTIONS...128 THE BRAZILIAN FINANCIAL SYSTEM AND BANKING REGULATION...129 TERMS AND CONDITIONS OF THE NOTES...158 CLEARING AND SETTLEMENT...188 TAXATION...192 CERTAIN UNITED STATES ERISA CONSIDERATIONS...207 PLAN OF DISTRIBUTION...209 NOTICE TO INVESTORS...213 LEGAL MATTERS...216 INDEPENDENT ACCOUNTANTS...217 GENERAL INFORMATION...218 ANNEX A - FORM OF FINAL TERMS...A-1 INDEX TO FINANCIAL STATEMENTS...F-1 Page i

The Issuer accepts responsibility for the information contained in these Listing Particulars. To the best of the knowledge of the Issuer (having taken all reasonable care to ensure that such is the case) the information contained in these Listing Particulars is in accordance with the facts and does not omit anything likely to affect the import of such information. These Listing Particulars have been and the relevant Final Terms will be prepared by us solely for use in connection with the proposed offering of the Notes described in these Listing Particulars and in the relevant Final Terms. These Listing Particulars do not and the relevant Final Terms will not constitute an offer to any other person or to the public generally to subscribe for or otherwise acquire securities. We and each of the dealers for each series reserve the right to reject any offer to purchase, in whole or in part, for any reason, or to sell less than all of the Notes offered by the relevant Final Terms. Distribution of these Listing Particulars and the relevant Final Terms to any person other than the prospective investor and any person retained to advise such prospective investor with respect to its purchase is unauthorized, and any disclosure of any of its contents, without our prior written consent, is prohibited. Each prospective investor, by accepting delivery of these Listing Particulars and the relevant Final Terms, agrees to the foregoing and to make no photocopies of these Listing Particulars and the relevant Final Terms or any documents referred to in these Listing Particulars and the relevant Final Terms. These Listing Particulars should be read and construed together with any amendments or supplements hereto and with any other documents incorporated by reference herein and, in relation to any series of Notes, should be read and construed together with the relevant Final Terms. Each time we offer or sell Notes under the Program, we will provide Final Terms that will contain certain specific information about the terms of that offering. If there is any inconsistency between the information in these Listing Particulars and any Final Terms, you should rely on the information in those Final Terms. These Listing Particulars and the relevant Final Terms are intended solely for the purposes of soliciting expressions of interest in the Notes from qualified investors and, if applicable, the listing of the Notes on the Irish Stock Exchange (Global Exchange Market) and do not purport to summarize all of the terms, conditions and other provisions contained in the agency agreement relating to the Notes and other transaction documents. The information provided is not all-inclusive and may not contain all the information you would desire. The market information in these Listing Particulars has been obtained by us or derived from publicly available sources deemed by us to be reliable. The third party market information in these Listing Particulars has been accurately reproduced and, as far as we are aware and are able to ascertain from the market information published by those publicly available sources, no facts have been omitted which would render the market information reproduced herein inaccurate or misleading. None of the Arrangers or the dealers (in each case, other than us in our capacity as Issuer) for any series will make any representation or warranty, express or implied, as to the accuracy or completeness of the information contained in these Listing Particulars and the relevant Final Terms. Nothing contained in these Listing Particulars and the relevant Final Terms is, or shall be relied upon as, a promise or representation by any such Arranger or dealer for any series as to the past or future. Notwithstanding any investigation that any such Arranger or dealer of any particular series may have conducted with respect to the information contained herein, such Arranger or dealer assumes no liability for the accuracy or completeness of any information contained in these Listing Particulars or any Final Terms. We confirm that, after having made all reasonable inquiries, these Listing Particulars contain and the relevant Final Terms will contain all information with regard to us and the Notes that is material to the offering and sale of the Notes, that the information contained in these Listing Particulars is and the relevant Final Terms will be true and accurate in all material respects and not misleading and that there are and there will be no omissions of any other facts from these Listing Particulars and the relevant Final Terms which, by their absence herefrom or therefrom, make these Listing Particulars and the relevant Final Terms misleading. We accept responsibility for the information contained in these Listing Particulars and any Final Terms regarding us and the Notes. 1

These Listing Particulars contain and the relevant Final Terms will contain summaries intended to be accurate with respect to certain terms of certain documents, but reference is and will be made to the actual documents, all of which will be made available to you, the Fiscal Agent or the relevant agents for each series for complete information with respect thereto, and all such summaries are and will be qualified in their entirety by such reference. You should rely only on the information contained in these Listing Particulars and the relevant Final Terms. None of the dealers for any series will have, nor have we authorized anyone to provide you with, different information. The information contained in these Listing Particulars is, and the relevant Final Terms will be, accurate only as of the date of these Listing Particulars or the date of the Final Terms, regardless of the time of delivery of these Listing Particulars, the relevant Final Terms or of any sale of the Notes. Neither the delivery of these Listing Particulars and the relevant Final Terms nor any sale made hereunder or thereunder shall under any circumstances imply that there has been no change in our affairs and in the affairs of each of our subsidiaries or that the information set forth herein is correct as of any date subsequent to the date hereof or thereof. By receipt of these Listing Particulars and the relevant Final Terms, you hereby acknowledge that (i) you have been afforded an opportunity to request from us and to review, and have received, all additional information considered by you to be necessary to verify the accuracy of, or to supplement, the information contained herein and in the relevant Final Terms, (ii) you have had the opportunity to review all of the documents described herein and in the relevant Final Terms, (iii) you have not relied on any of the Arrangers, the dealers or any person affiliated with them in connection with any investigation of the accuracy of such information or your investment decision, and (iv) no person has been authorized to give any information or to make any representation concerning us or the Notes (other than as contained herein, in the relevant Final Terms and information given by our duly authorized officers and employees, in connection with your examination of our business and the terms of each of the offerings under the Program) and, if given or made, you should not rely upon any such other information or representation as having been authorized by us or the dealers for each series. Each person receiving these Listing Particulars acknowledges that: (i) these Listing Particulars do not contain all the information that would be included in a prospectus for this offering were this offering to be registered under the Securities Act; (ii) the audited consolidated financial statements included in these Listing Particulars have been prepared in accordance with general accounting practices adopted in Brazil ( Brazilian GAAP ) prescribed by the Brazilian corporations law, the technical releases issued by IBRACON and the Federal Accounting Council (Conselho Federal de Contabilidade or CFC ), the rules and regulations of the CMN and the Central Bank and, when applicable, interpretative statements published by the Accounting Standards Committee (Comitê de Pronunciamentos Contábeis or CPC ); and (iii) Brazilian GAAP differs in certain significant respects from accounting principles generally accepted in the United States ( U.S. GAAP ) and from International Financial Reporting Standards ( IFRS ). 2

NOTICE FOR NEW HAMPSHIRE RESIDENTS ONLY NEITHER THE FACT THAT A REGISTRATION STATEMENT OR AN APPLICATION FOR A LICENSE HAS BEEN FILED UNDER CHAPTER 421-B OF THE NEW HAMPSHIRE REVISED STATUTES (THE RSA ) WITH THE STATE OF NEW HAMPSHIRE NOR THE FACT THAT A SECURITY IS EFFECTIVELY REGISTERED OR A PERSON IS LICENSED IN THE STATE OF NEW HAMPSHIRE CONSTITUTES A FINDING BY THE SECRETARY OF STATE THAT ANY DOCUMENT FILED UNDER RSA 421-B IS TRUE, COMPLETE AND NOT MISLEADING. NEITHER ANY SUCH FACT NOR THE FACT THAT AN EXEMPTION OR EXCEPTION IS AVAILABLE FOR A SECURITY OR A TRANSACTION MEANS THAT THE SECRETARY OF STATE HAS PASSED IN ANY WAY UPON THE MERITS OR QUALIFICATIONS OF, OR RECOMMENDED OR GIVEN APPROVAL TO, ANY PERSON, SECURITY, OR TRANSACTION. IT IS UNLAWFUL TO MAKE, OR CAUSE TO BE MADE, TO ANY PROSPECTIVE PURCHASER, CUSTOMER, OR CLIENT ANY REPRESENTATION INCONSISTENT WITH THE PROVISIONS OF THIS PARAGRAPH. In connection with the issue of any tranche of Notes, the dealer or dealers (if any) named as the Stabilizing Manager(s) (or persons acting on behalf of any Stabilizing Manager(s)) may over-allot Notes or effect transactions with a view to supporting the market price of the Notes at a level higher than that which might otherwise prevail. However, there is no assurance that the Stabilizing Manager(s) (or persons acting on behalf of a Stabilizing Manager) will undertake stabilization action. Any stabilization action may begin on or after the date on which adequate public disclosure of the terms of the offer of the relevant tranche of Notes is made and, if begun, may be ended at any time, but it must end no later than the earlier of 30 days after the issue date of the relevant tranche of Notes and 60 days after the date of the allotment of the relevant tranche of Notes. In making an investment decision, you must rely on your own examination of our business and the terms of each of the offerings under the Program, including the merits and risks involved. The Notes have not been approved or recommended by any federal or state securities commission or regulatory authority. Furthermore, the foregoing authorities have not confirmed the accuracy or determined the adequacy of these Listing Particulars or the relevant Final Terms. Any representation to the contrary is a criminal offense. These Listing Particulars do not and the relevant Final Terms will not constitute an offer to sell, or a solicitation of an offer to buy, any Notes offered hereby by any person in any jurisdiction in which it is unlawful for such person to make such an offer or solicitation. Neither we, the dealers for any series, nor any of our or their respective affiliates or representatives, are making any representation to you regarding the legality of any investment by you under applicable legal investment or similar laws. You should consult with your own advisors as to legal, tax, business, financial and related aspects of a purchase of the Notes. The Notes have not been and will not be registered under the Securities Act or with any securities regulatory authority of any state or other jurisdiction of the United States. The Notes may not be offered or sold within the United States or to, or for the account or benefit of, U.S. persons (as defined in Regulation S), except in certain transactions exempt from or not subject to the registration requirements of the Securities Act. Bearer Notes are subject to U.S. tax law requirements and may not be offered, sold or delivered within the United States or its possessions or to a United States person, except in certain transactions permitted by U.S. tax regulations. These Listing Particulars have been, and the relevant Final Terms will have been, prepared by us 3

solely for use in connection with the offer and sale of the Notes outside the United States to non-u.s. persons pursuant to Regulation S, the offer and sale of the Notes within the United States pursuant to Rule 144A and, if applicable, the listing of the Notes on the Irish Stock Exchange (Global Exchange Market). Prospective purchasers are hereby notified that sellers of the Notes may be relying on the exemption from the provisions of Section 5 of the Securities Act provided by Rule 144A. For a description of the restriction on offers, sales, resales and transfers of the Notes and distribution of these Listing Particulars and the relevant Final Terms, see Notice to Investors. The Notes have not been, and will not be, registered with the CVM. Any public offering or distribution, as defined under Brazilian laws and regulations, of the Notes in Brazil is not legal without prior registration under Law No. 6,385/76, as amended, and Instruction No. 400, issued by CVM on December 29, 2003, as amended. Documents relating to the offering of the Notes, as well as information contained therein, may not be supplied to the public in Brazil (as the offering of the Notes is not a public offering of securities in Brazil), nor be used in connection with any public offer for subscription or sale of the Notes to the public in Brazil. Each of the Arrangers has agreed, and each of the dealers will agree, not to offer or sell the Notes in Brazil, except in circumstances which do not constitute a public offering or distribution of securities under applicable Brazilian laws and regulations. We have applied to have the Program listed on the Irish Stock Exchange (Global Exchange Market) in accordance with its rules. These Listing Particulars form and the relevant Final Terms will form in all material respects the listing particulars for admission to the Irish Stock Exchange (Global Exchange Market). 4

As used in these Listing Particulars, references to: CERTAIN TERMS AND CONVENTIONS Bahamian Branch are to our offshore branch in The Bahamas; Banco Votorantim, the Bank, we, our and us are to Banco Votorantim S.A., on a consolidated basis (unless the context requires otherwise); the Brazilian government are to the federal government of the Federative Republic of Brazil; Brazilian corporations law are to Law No. 6,404/76, as amended and supplemented; Central Bank are to Banco Central do Brasil, the Brazilian Central Bank; CMN are to the Conselho Monetário Nacional, the Brazilian National Monetary Council; Bank; COPOM are to the Comitê de Política Monetária, the monetary policy committee of the Central construction materials financing are to the financing of the purchase by individuals of construction materials; CVM are to the Comissão de Valores Mobiliários, the Brazilian Securities Commission; the Ermírio de Moraes family are to the families of Antonio Ermírio de Moraes, Ermírio Pereira de Moraes and Maria Helena de Moraes Scripilliti and their heirs and the estate of José Ermírio de Moraes Filho; IBRACON are to the Instituto dos Auditores Independentes do Brasil, the Brazilian professional body of independent accountants; the Issuer are to Banco Votorantim S.A., acting through its head office in Brazil; Novo Mercado are to the Novo Mercado listing segment of the BM&FBOVESPA; payroll deductible loans are to loans extended through advances of amounts to an individual employee or beneficiary, which advances are repaid through deductions from the borrower s paycheck or benefits check; real, reais or R$ are to Brazilian reais, the official currency of Brazil since July 1, 1994; Real Plan are to the economic stabilization plan implemented by the Brazilian government in 1994; real/u.s. Ptax 800 selling exchange rate are to the real/dollar offer rate for U.S. dollars at the close of business on any date, expressed as the amount of reais per one U.S. dollar reported by the Central Bank on the Central Bank Data System (Sistema de Informações do Banco Central SISBACEN) under transaction code PTAX-800 (alternative Consulta de Câmbio or Exchange Rate Enquiry ) Option 5 ( Cotações para Contabilidade or Rates for Accounting Purposes ); repasses are to on-lending transactions whereby a financial institution obtains financing outside of Brazil or from Brazilian government sources and on-lends these funds to local borrowers; U.S.$, dollars or U.S. dollars are to United States dollars; 5

VBL are to our Bahamian subsidiary, Votorantim Bank Limited; and family. Votorantim Group are to the group of companies, including us, controlled by the Ermírio de Moraes Certain other terms are defined the first time they are used in these Listing Particulars. 6

SUPPLEMENTAL LISTING PARTICULARS We will, at the office of the Irish Paying Agent, provide, free of charge, a copy of these Listing Particulars. Written or telephone requests for such document should be directed to the office of the Irish Paying Agent and the Listing Agent. We have agreed to comply with any undertakings given by us from time to time to the Irish Stock Exchange in connection with the Notes and, without prejudice to the generality of the foregoing, shall furnish to such stock exchange all such information as such stock exchange may require in connection with the listing of the Notes. We shall, during the continuance of the Program, prepare a supplement to these Listing Particulars whenever required by the Irish Stock Exchange and in any event if there is a significant change affecting any matter contained in these Listing Particulars or a significant new matter arises, the inclusion of information in respect of which would have been so required had it arisen when the Listing Particulars were prepared. Any such supplement shall be deemed to be incorporated in, and form part of these Listing Particulars, save that any statement contained in a document which is deemed to be incorporated by reference herein shall be deemed to be modified or superseded for the purpose of these Listing Particulars to the extent that a statement contained herein modifies or supersedes such earlier statement (whether expressly, by implication or otherwise). Any statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of these Listing Particulars. 7

FORWARD-LOOKING STATEMENTS These Listing Particulars include estimates and forward-looking statements, principally under the captions Summary, Risk Factors, Management s Discussion and Analysis of Financial Condition and Results of Operations, Business and The Brazilian Financial System and Banking Regulation. Forward-looking statements are not guarantees of performance. They relate to future events and, therefore, depend on circumstances that may or may not occur in the future. Many of the factors that will determine these results are beyond our ability to control or predict. Investors are cautioned not to put undue reliance on any forwardlooking statements. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends affecting our business. These forward-looking statements are subject to risks, uncertainties and assumptions including, among other things: our relationship with Banco do Brasil S.A. ( Banco do Brasil ) and strategic initiatives we expect to undertake in this regard; general economic, political and business conditions in Brazil; risks relating to the current market environment; variations in loan default rates by our clients, as well as in our recording of provisions for doubtful loans; credit risk, market risk and any other risks related to financing activities; our level of capitalization; our ability to implement our business strategies successfully; availability and cost of funding; the market value of the Brazilian government securities; developments in laws, regulations, taxation and governmental policies that relate to our activities; administrative and legal proceedings involving us; competition in the Brazilian banking market; inflation, appreciation or depreciation of the real and fluctuations in interest rates; and the factors discussed under the section Risk Factors. This list of factors is not exclusive, and other risks and uncertainties may cause actual results to differ materially from those in the forward-looking statements. Various risks, uncertainties and other important factors have been identified in Risk Factors. The words believe, may, will, estimate, continue, anticipate, intend, expect, could, should, plan, potential and similar words are intended to identify forward-looking statements. We undertake no obligation to update publicly or revise any forward-looking statements because of new information, future events or otherwise. In light of these risks and uncertainties, the forward-looking information, events and circumstances discussed in these Listing Particulars might not occur. Our actual results and performance could differ substantially from those anticipated in our forward-looking statements. 8

PRESENTATION OF FINANCIAL AND OTHER INFORMATION The financial data related to the consolidated balance sheets and consolidated income statements contained in these Listing Particulars have been derived from our audited consolidated financial statements as and for each of the years ended December 31, 2010, 2009 and 2008 and the accompanying notes thereto, in each case contained elsewhere in these Listing Particulars. We publish our financial statements in Brazil in accordance with Brazilian GAAP, which differ in certain significant respects from IFRS and U.S. GAAP. The financial information included in these Listing Particulars has not been prepared in accordance with international accounting standards adopted pursuant to Article 3 of Regulation (EC) No. 1606/2002, and there may have been material differences in such financial information had Regulation (EC) No. 1606/2002 been applied to such financial information. On December 28, 2007, the Brazilian government enacted Law No. 11,638, which, together with Law No. 11,941, amended the Brazilian corporations law and introduced the process of conversion of financial statements into IFRS. In accordance with Central Bank Communication No. 14,259, financial institutions will also be required to apply IFRS accounting standards starting with their accounting and financial statements for the year ending December 31, 2010. IFRS differs, in certain material respects, from Brazilian GAAP. We have identified but not quantified such differences and have not prepared any reconciliation between IFRS and Brazilian GAAP for any of our financial statements in connection with these Listing Particulars or for any other purpose. In addition, in accordance with CMN Resolution No. 3,604, dated August 29, 2008, starting with their accounting and financial statements for the year ending December 31, 2008, financial institutions are required to publish their statements of cash flow. Our financial statements as of and for the years ended December 31, 2010, 2009 and 2008 were prepared in accordance with Brazilian GAAP with the adoption of the modifications introduced by Law No. 11,638, Law No. 11,941, Resolution No. 3,604 and additional regulations issued by the CMN and the Central Bank. The main difference between these statements and those prepared prior to the effectiveness of these new rules is the presentation of statements of cash flows instead of statements of changes in financial position. For the convenience of the reader, certain amounts included in these Listing Particulars derived from our audited consolidated financial statements as of and for the year ended December 31, 2010 have been translated into U.S. dollars from the amount of nominal reais at December 31, 2010, utilizing the Ptax 800 selling exchange rate as of such date as published by the Central Bank of R$1.6662 to U.S.$1.00. See Exchange Rates below. Brazilian GAAP does not address the translation of financial information expressed in reais to other currencies for the convenience of the reader, and therefore, there is no established methodology under Brazilian GAAP. Accordingly, the translation of nominal reais amounts into U.S. dollars included in these Listing Particulars may result in distortions to the amounts presented, particularly in items of the income statement which represent flows of income and expenses over the period covered thereby and when making period-to-period comparisons. Some amounts that appear in these Listing Particulars (including percentage amounts) may not sum due to rounding. 9

ENFORCEMENT OF JUDGMENTS We are a corporation organized under the laws of Brazil. Substantially all of our directors and executive officers and certain advisors named herein reside in Brazil or elsewhere outside the United States, and all or a significant portion of the assets of such persons may be, and substantially all of our assets are, located outside the United States. As a result, it may not be possible for investors to effect service of process within the United States or other jurisdictions outside Brazil upon such persons or to enforce against them or against us any judgments obtained in such courts, including judgments predicated upon the civil liability provisions of the U.S. federal securities laws or predicated upon the laws of such other jurisdictions outside Brazil. In the Terms and Conditions of the Notes, we will agree that the courts of England shall have jurisdiction to hear and determine any suit, action or proceeding, and to settle any disputes, which may arise out of or in connection with the Notes and, for such purposes, irrevocably submit to the jurisdiction of such courts. See Terms and Conditions of the Notes. We have been advised by Campos Mello Advogados, our Brazilian counsel, that judgments of U.S., English and other non-brazilian courts for civil liabilities predicated upon the securities laws of such countries, including the securities laws of the United States, subject to certain requirements described below, may be enforced in Brazil. A judgment against either us or any other person described above obtained outside Brazil would be enforceable in Brazil against us or any such person without reconsideration of the merits, upon confirmation of that judgment by the Brazilian Superior Court of Justice. That confirmation, generally, will occur if the foreign judgment: is for payment of a sum certain; fulfills all formalities required for its enforceability under the laws of the country where the foreign judgment is granted; is issued by a competent court after proper service of process is made; is not subject to appeal; is authenticated by a Brazilian consular office in the country where the foreign judgment is issued and is accompanied by a translation into Portuguese of a Brazilian-registered sworn translator; and is not contrary to Brazilian national sovereignty, public policy or public morality (as set forth in Brazilian law). Notwithstanding the foregoing, no assurance can be given that confirmation will be obtained, that the process described above can be conducted in a timely manner or that a Brazilian court would enforce a monetary judgment for violation of the securities laws of countries other than Brazil with respect to the Notes. We understand that original actions predicated on the securities laws of countries other than Brazil may be brought in Brazilian courts and that, subject to Brazilian public policy, public morality and national sovereignty, Brazilian courts may enforce civil liabilities in such actions against us, our directors, certain of our officers and the advisors named herein. Pursuant to Article 835 of the Brazilian Code of Civil Procedures, a plaintiff (whether Brazilian or non-brazilian) who resides outside or leaves Brazil during the course of litigation in Brazil must provide a bond to guarantee court costs and legal fees if the plaintiff owns no real property in Brazil that may ensure such payment. This bond must have a value sufficient to satisfy the payment of court fees and defendant s attorneys fees, as determined by the Brazilian judge based on the amount under dispute. This requirement does not apply to enforcement of foreign judgments which have been duly confirmed by the Brazilian Superior Court of Justice, nor to the cases of collection of claims based on instruments (which does not include the Notes) that may be enforced in Brazil without the review of their merits (títulos executivos extrajudiciais) and counterclaims (reconvenções) under Article 836 of such code. Any judgment obtained 10

against us in Brazil would be expressed in an amount in reais equivalent on the date of remittance from Brazil to the U.S. dollar amount due and unpaid under the Notes. 11

SUMMARY This summary highlights information contained elsewhere in these Listing Particulars. Unless the context implies otherwise, all data in these Listing Particulars is presented on a consolidated basis. This summary does not contain all of the information you should consider before investing in the Notes. You should read these Listing Particulars in their entirety, as amended or supplemented, especially the information set forth in Risk Factors and our consolidated financial statements and the notes thereto and the relevant Final Terms before making an investment decision. Introduction We are a privately held Brazilian bank providing a wide range of financial services. Historically, we operated mainly as a wholesale bank with a focus on treasury, large corporate and investment banking activities. In recent years, we have diversified our operations to include lending to the Brazilian corporate and middle market segments, consumer finance and fund management services. Our headquarters and administrative offices are located in São Paulo and we have 23 branches throughout Brazil. In addition, we have 283 affiliated offices throughout Brazil that support our consumer finance business. Outside of Brazil, we have a full service branch in the Bahamas, a representative office in London and a broker-dealer in New York. Based on total assets, we were ranked the seventh largest private bank in Brazil as of December 31, 2010, according to the Central Bank. Historically, we focused on providing credit, advisory, investment banking and other services to large corporations with annual sales over R$700 million. In recent years, we have implemented a strategy to expand our operations to companies in the Brazilian corporate sector, with annual sales ranging from R$200 million to R$700 million, and companies in the middle market sector, with annual sales ranging from R$10 million to R$200 million. Besides credit, we offer our clients corporate and investment banking tailor-made products and advisory services, such as structuring and advising on mergers and acquisitions, project finance, local and international capital markets and other structured finance transactions. Fund management services are offered to our corporate and institutional clients and to a select client base of high net worth individuals. We also offer treasury products to our clients and carry out risk management transactions and, subject to our internal investment criteria and risk management limits, proprietary trading for our own account. We believe we benefit from an efficient structure that allows us to respond quickly and directly to client demands and business opportunities and to effectively manage risk. Through our subsidiaries B.V. Financeira S.A. Crédito, Financiamento e Investimento ( B.V. Financeira ) and B.V. Leasing Arrendamento Mercantil S.A. ( B.V. Leasing ), we have increased our consumer credit business by providing financing for the purchase and leasing of vehicles, although our main focus is providing financing for purchasing rather than leasing. We are also currently expanding our consumer finance activities through B.V. Financeira in the areas of payroll deductible loans and, to a lesser extent, the financing of the purchase of construction materials and other assets. Payroll deductible loans are extended through advances of amounts to individual employees at certain designated companies or public sector entities or to pension recipients from the Brazilian National Pension Fund (Instituto Nacional de Seguridade Social or INSS ). Amounts due are automatically deducted from the employees payroll by the relevant employer or the INSS and credited directly to us. We undertake our fund management activities through our subsidiary, Votorantim Asset Management Distribuidora de Títulos e Valores Mobiliários Ltda. ( Votorantim Asset ), and we undertake brokerage activities through our subsidiary Votorantim Corretora de Títulos e Valores Mobiliários Ltda. ( Votorantim Corretora ). We are part of the Votorantim Group, one of the largest privately held industrial conglomerates in Latin America. We believe we benefit significantly from relations with other entities within the Votorantim Group. We conduct transactions with other entities within the Votorantim Group on an arm s length basis and compete with other financial institutions for the business of the Votorantim Group. Under Central Bank regulations, we 12

are not allowed to grant loans or credit in any form (including cash advances or guarantees issued to secure obligations of affiliates) to any affiliate of the Votorantim Group. See Related Party Transactions. In January 2009, the Ermírio de Moraes family entered into a strategic partnership with Banco do Brasil, whereby Banco do Brasil acquired 50% of our capital stock. We believe we are able to obtain better funding conditions and benefit from the origination and distribution capabilities of Banco do Brasil in all segments in which we operate as a result of this partnership. See Strategic Partnership with Banco do Brasil below. On December 31, 2010, we had R$107,818 million in total assets (compared to R$84,801 million on December 31, 2009 and R$72,310 million on December 31, 2008) and R$8,389 million in shareholders equity (compared to R$7,145 million on December 31, 2009 and R$6,361 million on December 31, 2008) on a consolidated basis. Net profit for the year ended December 31, 2010 was R$1,015 million (compared to R$802 million for the year ended December 31, 2009 and R$902 million for the year ended December 31, 2008). For the year ended December 31, 2010, our return on average shareholders equity (net profit divided by average shareholders equity) was 12.8% (compared to 12.0% for the year ended December 31, 2009 and 14.3% for the year ended December 31, 2008). See Selected Historical Financial Data and Management s Discussion and Analysis of Financial Condition and Results of Operations. Banco Votorantim s loan portfolio grew from R$0.9 billion as of December 31, 2002 to R$19.6 billion as of December 31, 2010, while B.V. Financeira s loan portfolio grew from R$1.7 billion to R$37.2 billion during the same period. Our headquarters are located at Avenida das Nações Unidas, 14171, Torre A, 18th Floor, 04794-000, São Paulo, SP, Brazil (telephone: +55 11 5185-1700). We are registered with the State of São Paulo Commercial Registry under NIRE (Número de Identificação no Registro de Empresas) number 35300525353. History We were originally incorporated under the laws of Brazil on August 31, 1988, with indefinite duration. We were organized as a limited liability company (sociedade limitada) under the laws of Brazil under the name Baltar Distribuidora de Títulos e Valores Mobiliários Ltda., and subsequently renamed Votorantim Distribuidora de Títulos e Valores Mobiliários Ltda. We became a corporation (sociedade por ações) under the laws of Brazil on February 25, 1991, a result of our transformation into a multiple service bank. We obtained the authorization from the Central Bank on August 7, 1991 to undertake a full range of banking activities. In August 1995, we commenced our consumer finance operations with the establishment of our subsidiary B.V. Financeira, which operates alongside B.V. Leasing. We commenced fund management activities in November 1995 by acquiring a brokerage company, with operations beginning in June 1996. In 1999, we established a new subsidiary, Votorantim Asset, to carry out fund management transactions. We were originally established by the Ermírio de Moraes family as the financial arm of the Votorantim Group, but since acquiring multiple bank status in 1991, we have actively sought to expand our client base outside the Votorantim Group. Benefiting from the strong recognition of the Votorantim brand, our operations have expanded to meet the needs of corporate clients with sales of over R$700 million per year, including both Brazilian companies and multinational corporations with a presence in Brazil, and an increasing client base of selected high net worth individuals. In recent years, we have implemented a strategy of expanding our lending to the Brazilian corporate, and middle market sectors, as well as consumer finance. See Business Corporate Banking and Strategic Partnership with Banco do Brasil below. One of our goals is to expand our business outside Brazil. In this respect, on February 20, 2002, we obtained a license to carry out banking business in The Bahamas from the Central Bank of The Bahamas through our Bahamian Branch. The Bahamian Branch enables us to raise funds in a more cost-effective manner and to offer our corporate client base a broader range of products. 13

The Ermírio de Moraes Family The Votorantim Group was founded by Mr. José Ermírio de Moraes in 1918. Currently, the member companies of the Votorantim Group are under the common control of Mr. José Ermírio de Moraes successors, namely: Mr. Antonio Ermírio de Moraes, Mr. Ermírio Pereira de Moraes, Ms. Maria Helena de Moraes Scripilliti and Mr. José Ermírio de Moraes Filho s successors (the Second Generation ). The Second Generation owns, directly or indirectly, all of the voting rights in respect of Hejoassú Administração S.A., which is the holding company for the Votorantim Group. The Second Generation and their children are collectively referred to herein as the Ermírio de Moraes Family. All of the companies controlled by the Ermírio de Moraes Family are collectively referred to herein as the Votorantim Group. The Votorantim Group The Votorantim Group is one of the largest privately held industrial conglomerates in Latin America. Its core companies are market leaders in Brazil in their respective business segments: cement, non-ferrous metals, pulp and paper and financial services. The Votorantim Group also has significant steel, agribusiness and chemical operations. In addition, it has a presence in the energy sector generating energy for its own consumption. The Votorantim Group companies supply markets around the world. Due to the international expansion of its businesses, its assets now include overseas cement plants in Canada and the United States and zinc plants in China, Peru and the United States which help diversify risk and generate non-brazilian currency revenue flows. The Votorantim Group commenced its operations in 1918 with Fábrica de Tecidos Votorantim, a small textile plant located in the city of Votorantim, in the state of São Paulo, under the direction of Senator José Ermírio de Moraes. In 1936, the Votorantim Group entered the cement business by opening a cement plant in the state of São Paulo. In 1937 and 1938, the Votorantim Group entered the rayon and steel businesses. By the 1940s, Senator José Ermírio de Moraes had created one of the largest industrial conglomerates in Latin America, producing textiles, cement, chemicals and steel. In 1942, the Votorantim Group expanded its cement operations to the state of Pernambuco in the northeast of Brazil. In the 1950s, the Votorantim Group began producing aluminium and hydroelectric power and refining sugar. In the 1960s, the Votorantim Group entered the zinc industry and expanded its hydroelectric power and aluminium production capacities. The Votorantim Group s focus in the 1970s and 1980s was the further expansion of its cement, aluminium, zinc, nickel and energy production capacities. In 1988, the Votorantim Group began its pulp and paper operations and, in 1989, it began producing concentrated orange juice. The Votorantim Group entered the financial sector in 1988 through the incorporation of a broker-dealer, a predecessor of what is today Banco Votorantim. In the 1990s, the Votorantim Group ceased its operations in industries that no longer offered it competitive advantages, including textiles, rayon and sugar refining. Strategic Partnership with Banco do Brasil This section presents a summary of the terms and conditions of our strategic partnership with Banco do Brasil and our assessment of the actions to be taken in respect thereof and expected benefits to be derived therefrom. The implementation of some or all of the actions described below by us and Banco do Brasil is subject to further analysis and market conditions. As a result, no assurance can be given that these actions and benefits will be implemented or achieved. General description of the transaction On January 9, 2009, the Ermírio de Moraes Family, through Banco Votorantim and Votorantim Finanças, entered into a share purchase agreement with Banco do Brasil (the Share Purchase Agreement ) for (i) the sale of 33,356,791,198 common shares of Banco Votorantim held by Votorantim Finanças to Banco do Brasil 14

for R$3.0 billion and (ii) the issuance by Banco Votorantim of 7,412,620,277 new preferred shares and the subscription thereof by Banco do Brasil for R$1.2 billion, of which R$750 million was paid by Banco do Brasil on September 28, 2009 and the balance of R$450 million was paid on March 29, 2010. This acquisition of an interest in Banco Votorantim by Banco do Brasil was approved by the Central Bank on September 11, 2009 and was completed on September 28, 2009, when Banco do Brasil and Votorantim Finanças executed the definitive agreements for the partnership, including a shareholders agreement (the Shareholders Agreement ) and a revolving credit facility agreement. As a result of this transaction, Banco do Brasil shares in the management of Banco Votorantim with Votorantim Finanças and controls 49.9999999925% of the common shares and 50.0000000337% of the preferred shares of Banco Votorantim. Pursuant to the Shareholders Agreement, the shares of Banco Votorantim held by Banco do Brasil and Votorantim Finanças are subject to a three-year lock-up period. The purchase price paid by Banco do Brasil was calculated based on an economic and financial evaluation prepared by consultants contracted by Banco do Brasil, which took into consideration, among other factors, the prospects for our future profitability and our discounted cashflow, adjusted to reflect the existing economic scenario. Prior to the conclusion of the transaction, and as part of the financial and corporate adjustments agreed upon with Banco do Brasil, Votorantim Finanças (i) acquired Banco Votorantim s total capital (consisting of 74,126,202,673 common shares); (ii) converted 7,412,620,267 common shares of Banco Votorantim into an equal number of preferred shares; and (iii) proceeded with the incorporation of BV Participações S.A., subscribing and paying-up with the shares of Votorantim Finanças subsidiaries BV Sistemas de Tecnologia da Informação S.A., CP Promotora de Vendas S.A. and Votorantim Corretora de Seguros S.A. On September 28, 2009, (i) Banco do Brasil acquired 50% shareholding of BV Participações S.A.; (ii) Votorantim Finanças transferred to Banco Votorantim the remaining shares of our subsidiary VBL not already held by us, which has been approved by the Central Bank and by the Central Bank of The Bahamas; and (iii) Votorantim Finanças approved a distribution of dividends and interest on capital by Banco Votorantim in the total amount of R$750 million. See Ownership and Capital Structure. In compliance with the conditions set forth in the Share Purchase Agreement, on September 28, 2009, the R$3.0 billion cash portion of the purchase price was deposited in escrow accounts at Banco Votorantim (R$2,160 million) and Banco do Brasil (R$840 million). The portion of the purchase price held in escrow at Banco Votorantim was released to Votorantim Finanças in three installments each of R$720 million on July 9, 2009, January 9, 2010 and July 12, 2010. The deposit at Banco do Brasil was released to Votorantim Finanças upon the satisfactory conclusion of post-closing due diligence. Through anticipated synergies between Banco Votorantim and Banco do Brasil, we believe we are able to obtain better funding conditions in the interbanking, financial and capital markets and benefit from the origination and distribution capabilities of Banco do Brasil in all segments in which we operate. Banco do Brasil Banco do Brasil is a mixed-capital company controlled by the Brazilian government. Banco do Brasil is currently the largest bank in Latin America in terms of assets and in 2009 recorded the highest net income of any Brazilian bank in history, according to data published by Economática in February 2010, with a significant presence throughout Brazil and operations in 23 countries that are key global economic and financial centers, including: Argentina, Bolivia, Chile, Paraguay, Peru, Uruguay and Venezuela in South America; Panama and the Cayman Islands in Central America; Mexico and the United States in North America; England, France, Germany, Italy, Portugal, Spain and Austria in Europe; the United Arab Emirates in the Middle East; China (Hong Kong and Shanghai), South Korea (Seoul) and Japan (Tokyo) in Asia; and Angola in Africa. In addition to its own network, Banco do Brasil also has partnerships with correspondent banks around the world. 15

As of December 31, 2010, Banco do Brasil had over 54.4 million individual clients. Banco do Brasil has the largest retail network in Brazil, with approximately 18,359 points of service, including 5,087 branches located in 4,352 Brazilian municipalities. Additionally, Banco do Brasil has more than 45,000 automated teller machines that, together with Banco do Brasil s call centers and mobile banking services, enabled clients to carry out outside of the traditional branch environment approximately 93.0% of all transactions they conducted with Banco do Brasil in the year ended December 31, 2010. Based on data available as of December 31, 2010, Banco do Brasil was the leading financial institution in Brazil, in terms of: total assets, according to data published by the Central Bank; total number of checking accounts with 35.9 million accounts, according to public filings by Banco do Brasil, including accounts held at Banco Nossa Caixa S.A. ( Nossa Caixa ) and Banco Popular do Brasil S.A. ( Banco Popular ), of which 33.7 million were held by individuals and 2.2 million were held by legal entities/corporations; size of branch network, according to data published by the Central Bank; total deposits, according to data published by the Central Bank, amounting to R$760.4 billion; credit portfolio balance, with a total balance of R$358.4 billion, of which R$338.0 billion represented loans made in Brazil, and constituting 21.0% of the total credit extended by financial institutions in the Brazilian market, according to data published by the Central Bank; third-party assets under management, with a market share of 21.2% of the total asset management market in Brazil, according to data published by the Brazilian Finance and Capital Markets Entities Association (Associação Brasileira das Entidades dos Mercados Financeiro e de Capitais or ANBIMA ); total number of clients with access to banking products and services through the Internet (11.0 million); payroll deduction loans, with a portfolio of R$45.0 billion, representing a market share of 32.7% of the Brazilian payroll deduction loan market, according to data published by the Central Bank; and agricultural credit, with a total loan portfolio of R$75.0 billion, representing 60.6% of the total balance of agricultural credit loans in Brazil, according to data published by the Central Bank. As a multiple-service bank, Banco do Brasil offers a full range of financial products and certain non-financial products, including personal and corporate credit transactions, financing for the Brazilian agribusiness sector, credit and debit cards, insurance and private pension plans, international banking services (such as foreign exchange and foreign trade financing), treasury transactions, financial and capital markets transactions and third-party asset management. Banco do Brasil also provides vehicle and real estate financing and credit services to account holders and non-account holders through licensed dealers and multibrand stores registered with Banco do Brasil. In addition to operating as a multiple-service bank, Banco do Brasil s conglomerate includes several subsidiaries that offer additional products and services. Through its investment bank, BB Banco de Investimento S.A., Banco do Brasil holds equity interests in companies involved in insurance, pension plans and capitalization (which is a form of savings account entitling holders to participate in periodic drawings for cash prizes). Banco do Brasil also sponsors two entities for the benefit of its employees, Caixa de Previdência dos Funcionários do Banco do Brasil, a private pension fund funded by Banco do Brasil and its employees, and Caixa de Assistência dos Funcionários do Banco do Brasil, a general welfare fund for Banco do Brasil s employees. 16

Effects on operations and strategies and expected benefits Management The Shareholders Agreement governs certain aspects of the relationship between Banco do Brasil and Votorantim Finanças, including their respective participation in our management. In particular, the parties will rotate annually the designation of the chairman and vice-chairman of our board of directors. Following the closing of the transaction on September 28, 2009, our shareholders approved, inter alia, changes to our by-laws and elected the new members of our board of directors. Our board of directors is comprised of up to six members (three appointed by Banco do Brasil, including the initial chairman, and three appointed by Votorantim Finanças, including the initial vice chairman). Our board of executive officers was not replaced as a result of the partnership with Banco do Brasil, nor were there any changes in the structure of our committees (Audit, Credit Risk, Liquidity and Technology Committees). See Management. Strategies and Expected Benefits Funding: We have secured and expect to continue to secure funding at more favorable rates and longer tenors, have experienced improved liquidity and increased our revenues through a number of transactions entered or to be entered into with Banco do Brasil and its subsidiaries and other conditions resulting from our association with Banco do Brasil. Among the measures implemented, on September 28, 2009 we entered into a revolving credit facility agreement with Banco do Brasil for general working capital purposes, under which we may borrow, at market rates (generally equivalent to the average rate of our funding), an amount equivalent to up to our current net worth. This agreement is valid for three years from September 28, 2009 and provides for automatic renewal for additional three-year terms unless either we or Banco do Brasil send a termination notice in writing to the other party no later than 90 days from the relevant renewal date. Branding: We believe our association with Banco do Brasil combines two of the strongest brands in Brazil. We believe this has resulted in improved origination capabilities and greater market awareness of our products and brand. Following the public announcement of our strategic partnership with Banco do Brasil, Moody s upgraded our rating, on October 19, 2009, for long-term local currency deposits from Baa1 to A3 and mentioned the strategic partnership in their rating report as one of the factors justifying the upgrade. We also have benefitted, and expect to continue to benefit, from increased credit limits with clients and counterparties in respect to funding and structured transactions. Platforms: We are reinforcing our business platforms and taking advantage of Banco do Brasil s presence in areas where Banco do Brasil traditionally operates to expand our businesses. For instance, our consumer finance activities have benefitted, and are expected to continue to benefit, from the distribution capabilities of Banco do Brasil, and B.V. Financeira, our main consumer finance subsidiary, has shared in, and is expected to continue to share in, the expertise of Banco do Brasil in the financing of new cars. We have benefitted, and expect to continue to benefit, from Banco do Brasil s base in the middle market segment, in particular in corporate lending and access to clients to cross sell our investment banking products, principally mergers and acquisitions and advisory services. We have explored, and expect to continue to explore, ways in which, through Banco do Brasil s extensive network of branches and representatives, we can offer our asset management and private banking products. Additionally, because Banco do Brasil does not have a brokerage firm in Brazil, we have expanded the 17

brokerage activities and revenues of our subsidiary Votorantim Corretora through the channeling of orders from Banco do Brasil and its customer base. Furthermore, we have taken advantage of cross-selling opportunities and have integrated platforms in payroll deductible loans and insurance (offering Banco do Brasil products). Expansion objectives, operations and management. Except as described herein, the partnership with Banco do Brasil has had no effects on our expansion objectives, and neither Votorantim Finanças nor Banco do Brasil has changed the operating or management activities of Banco Votorantim. Accounting, operational limits, regulation and credit decisions Due to Brazilian banking regulations, Banco do Brasil is required to consolidate our results of operations as to its 50% interest in us. Accordingly, all determinations made by Banco do Brasil in relation to capital adequacy, exposure limits and other applicable operational limits recognize our operations on a consolidated basis to the extent of Banco do Brasil s interest in us. See The Brazilian Financial System and Banking Regulation. We continue to be regulated and account for our transactions on the same basis we were regulated prior to the partnership with Banco do Brasil. We do not expect our operations to materially affect Banco do Brasil s operational limits, but our management continuously assesses the effects of our operations on Banco do Brasil s operational limits and recommends any necessary adjustments. We have recently implemented a general credit policy which includes a requirement that any credit transaction in excess of R$750 million (or less if certain credit rating requirements are not met) be subject to prior approval by our board of directors (which includes three members appointed by Banco do Brasil). See Business Credit and Risk Control Policy Credit Risk Management. With a view to allowing us to continue to expand our activities, Banco do Brasil and Votorantim Finanças have agreed in the Shareholders Agreement that, whenever our risk-weighted capital ratio is less than 2% above the minimum requirement applicable to us, our shareholders or board of directors (if then within the powers of the board of directors to review this matter) will consider proposals for new levels of risk-weighted capital. The risk-weighted capital ratio applicable to us and all other banks in Brazil is currently 11.0% of riskbased exposure. Our risk-weighted capital ratio was 13.1% as of December 31, 2010. Competition between us and Banco do Brasil The agreements governing our partnership with Banco do Brasil contain no express restrictions on competition between us and Banco do Brasil. Our intention, however, is to maximize our synergies by coordinating the strengths of each institution. As a result, we serve, directly or through our subsidiaries, as the primary platform for vehicle financing and other consumer finance transactions, investment banking, private banking and brokerage activities. Our strategy in relation to future lines of business will depend on the then existing market conditions and the respective strengths of each institution in such particular areas. Commitment as to rates Votorantim Finanças and Banco do Brasil have committed with the Central Bank to lower by at least 25% the registration fee charged by B.V. Financeira with respect to its consumer financing transactions upon the granting of a financing and the overall cost of such transactions by at least 9.1%, which reductions are to be achieved by December 31, 2012. 18

Personnel At present, we have not experienced and do not anticipate any transfers of personnel among us, Banco do Brasil and our subsidiaries. In addition, our remuneration policies have been, and will continue to be, driven by market standards, with no express limitations or alterations on our remuneration structure. Our Strategy The Brazilian banking industry has experienced certain changes since the implementation of the Real Plan in mid-1994. The large margins earned from arbitrage activities during the hyperinflationary period preceding the implementation of the Real Plan have diminished and gradually led banks to expand lending and fee-based services. As a result, we have successfully diversified into advisory services, including local and international underwriting and project finance, consumer finance, fund management and private banking. Presently, in addition to the strategies directly related to our association with Banco do Brasil, our strategy is to: continue our successful diversification into consumer, corporate and middle-market banking, seeking a more balanced and diversified earnings profile; increase our market share in the consumer finance business by expanding regional coverage, in particular through our partnership with Banco do Brasil, seeking continued strong growth in vehicle financing, including expansion of our new car financing operations, and continuing to expand our credit card business, personal loans and payroll deductible loans; continue to expand our credit portfolio and diversify lending operations from our traditional base in the large corporate sector to the higher margin Brazilian corporate and middle market sectors; maintain the profitability of our treasury operations and continue to offer treasury products through our Corporate and Investment Banking units; continue to grow our asset management business, which had over R$31.9 billion in assets under management as of December 31, 2010; continue to maintain strong asset quality through consistent risk management, collection policies and sophisticated credit risk modeling techniques; continue to maintain a strong efficiency ratio (a measure of our operational efficiency), which is consistently above the industry average; improve our market share and ranking position in local and international underwriting; and diversify our sources of funding, including increasing our access to funds outside of Brazil, and seek better funding conditions in the interbank, financial and capital markets, in part through our partnership with Banco do Brasil. 19

The Offering Issuer: Arrangers: Dealers: Program Amount: Offering: Currency: Issuance in Series: Final Terms: Banco Votorantim S.A., acting through its principal office in São Paulo. Banco Votorantim S.A. and Votorantim Bank Limited. Banco Votorantim S.A. and Votorantim Bank Limited, together with such other dealers as may be appointed by the Issuer with respect to a particular tranche of Notes. U.S.$5,000,000,000 (or the equivalent as of the respective dates of issue in other currencies or such greater amount as shall be agreed between the Arrangers and the Issuer). Notes will only be offered and sold: (1) to QIBs in compliance with Rule 144A, or (2) outside the United States to non-u.s. persons in reliance upon Regulation S under the Securities Act as specified in the relevant Final Terms. See Plan of Distribution. Each note will be denominated in U.S. dollars or in any other currency as specified in the relevant Final Terms. Notes will be issued in series. All Notes denominated in the same currency, having the same maturity date, bearing interest, if any, on the same basis and at the same rate and the terms of which are otherwise identical, except for the issue date, the issue commencement date and/or the issue price, will constitute a series. Each series may be comprised of one or more tranches issued on different issue dates. Each series will be the subject of Final Terms which, for the purposes of that series only, completes the Terms and Conditions of the Notes contained in these Listing Particulars, and these Listing Particulars must be read in conjunction with the relevant Final Terms (including any supplement thereto). The terms and conditions applicable to any particular series of Notes are the Terms and Conditions of the Notes, as completed by the relevant Final Terms. Maturities: The Notes of each series may have a maturity ranging from 30 days to 30 years, as specified in the relevant Final Terms, but subject, in relation to specific currencies, to compliance with all applicable legal and/or regulatory requirements. Notes issued under the Program will not have a maturity of less than 30 days or greater than 30 years. Interest: Notes may bear interest at a fixed or floating rate, be issued on a fully discounted basis and not bear interest, or be indexed, as specified in the relevant Final Terms. Denominations: The relevant Final Terms will specify the minimum denominations and any other denominations for each series of the 20

Notes. If the principal, premium, if any, and interest, if any, on any of the Notes denominated in a specified currency are to be payable at our or the holder s option in any other currency, the relevant Final Terms will provide the denominations and additional information, including any relevant exchange rate information, pertaining to the terms of such Notes. Negative Pledge: Events of Default: Use of Proceeds: Status and Ranking: Redemption: Tax Redemption: Foreign Currency Constraint: Subject to certain exceptions described herein and so long as any note remains outstanding, we will not create, or allow to be created, and none of our Significant Subsidiaries will create or permit to subsist, any Security (as defined herein) upon any of our or its present or future properties. See Terms and Conditions of the Notes Condition 7. The agency agreement and the Notes will contain certain events of default, which are subject to a number of important qualifications and limitations. See Terms and Conditions of the Notes Condition 15. Additional events of default may be provided for any tranche of Notes in the relevant Final Terms. Unless otherwise specified in the Final Terms relating to any series of Notes, the net proceeds of the issue of a series of Notes will be used by the Issuer for general banking purposes. The Notes constitute our direct, unconditional, unsubordinated and unsecured obligations and will rank pari passu without any preference among themselves. The Notes will rank equally with all our other present and future unsecured and unsubordinated obligations. See Terms and Conditions of the Notes Condition 6. The Final Terms relating to a series of Notes will indicate whether the Notes can be redeemed prior to maturity, and, if so, the terms on which the Notes will be redeemable at either our or the holder s option. The Notes will be redeemable in whole at their principal amount, plus accrued and unpaid interest and additional amounts, if any, to the date of redemption, at our option, at any time only in the event of certain changes affecting taxation. See Terms and Conditions of the Notes Condition 11. The Notes may contain a Foreign Currency Constraint provision as more fully described herein and in the applicable Final Terms. Under certain circumstances restricting or preventing the Issuer from paying the Specified Currency for amounts owing under Notes that contain a Foreign Currency Constraint Provision (each a Foreign Currency Constraint Event as described herein) payments on such Notes will be payable, at the holder s election, subject to certain conditions, in Brazil in the lawful currency of Brazil on the due date for such payment as further described under Terms and Conditions of the Notes Condition 25. 21

Withholding Tax; Additional Amounts: Governing Law: Listing: Terms and Conditions: All payments in respect of the Notes will be made free and clear of, and without withholding or deduction for or on account of, any present or future taxes, duties, assessments, fees or other governmental charges of whatever nature imposed, levied, collected, withheld or assessed by or within Brazil or any political subdivision thereof or taxing authority therein, unless such withholding or deduction is required by law or as provided in Terms and Conditions of the Notes Condition 14. In that event, subject to the exceptions set forth in Terms and Conditions of the Notes Condition 14, the Issuer will pay to each holder such additional amounts as may be necessary in order that every net payment made by us on each note after such deduction or withholding will not be less than the amount then due and payable by us. See Terms and Conditions of the Notes Condition 14. The Notes and the agency agreement and other related documentation will be governed by, and construed in accordance with, English law. Application has been made to the Irish Stock Exchange for any Notes issued under the Program for the period of 12 months from the date of these Listing Particulars to be listed on the Official List of the Irish Stock Exchange and to be admitted for trading on its Global Exchange Market in accordance with its rules. The Final Terms applicable to a series of Notes will specify whether or not the Notes of such series will be listed and admitted to trade on the Irish Stock Exchange (Global Exchange Market) or any other stock exchange. In March 2003, the European Commission published a proposal for a Directive of the European Parliament and of the Council on the harmonization of transparency requirements with regard to information about issuers whose securities are admitted to trading on a regulated market in the European Union (2004/109/EC), known as the Transparency Directive. While the Irish Stock Exchange (Global Exchange Market) is not a regulated market for the purposes of Directive 2004/39/EC, if the Transparency Directive becomes effective in a form which would require us to publish financial information either more regularly than we otherwise would be required to, or according to accounting principles which are materially different from the accounting principles which we would otherwise use to prepare our published financial information under the rules of the Central Bank and the CVM, the Issuer may seek an alternative admission to listing, trading and/or quotation for the Notes by another listing authority, stock exchange and/or quotation system outside the European Union, or, alternatively, the Issuer may opt not to have the Notes listed, traded and/or quoted by any listing authority, stock exchange and/or quotation system. The terms and conditions applicable to each series of Notes will be as agreed between the Issuer and the relevant dealer(s) at or prior to the time of issuance of such series of Notes and will be specified in the Final Terms prepared in respect of such series of Notes. The terms and conditions applicable to each series of 22

Notes will accordingly be those set out in these Listing Particulars, as completed by the relevant Final Terms. Form of Notes: Notes of each series to be issued in bearer form will initially be represented by interests in a temporary global Note or by a permanent global Note, in either case in bearer form without interest coupons. Interests in a temporary global Note will be exchangeable, in whole or in part, for interests in a permanent global Note on or after the date 40 days after the later of the commencement of the offering and the relevant issue date, upon certification as to non-u.s. beneficial ownership (as required by Regulation S and U.S. Treasury Regulation 1.163-5(c)(2)(i)(D)(3)). Definitive bearer Notes will only be available in certain limited circumstances. Notes of each series to be issued in registered form and which are sold in an offshore transaction within the meaning of Regulation S under the Securities Act will initially be represented by interests in a Regulation S unrestricted global Note in registered form, without interest coupons. Notes of each series to be issued in registered form and which are sold to a qualified institutional buyer within the meaning of Rule 144A under the Securities Act will initially be represented by interests in a Rule 144A restricted global Note in registered form, without interest coupons. Definitive certificated Notes will only be available in certain limited circumstances. In respect of each series of Notes where the relevant Final Terms specifies that a Foreign Currency Constraint provision is applicable, such series of Notes shall include an exchange permanent global Note, an exchange Regulation S unrestricted global Note and/or an exchange Rule 144A restricted global Note into which interests in the original permanent global Note, Regulation S unrestricted global Note and/or Rule 144A restricted global Note, respectively, of such series of Notes may be exchanged in accordance with the foreign currency constraint provisions. Clearing and Settlement: Each temporary global Note or permanent global Note, as the case may be, will be deposited with a common depositary on behalf of Clearstream, Luxembourg and Euroclear Bank S.A./N.V. on the relevant issue date. Each Regulation S unrestricted global Note will be deposited with a common depositary for, and registered in the name of a common nominee of, Clearstream, Luxembourg and Euroclear on its issue date. Each Rule 144A restricted global Note will be deposited with a custodian for, and registered in the name of a nominee of, DTC on its issue date. Ratings: Tranches of Notes may be rated or unrated. Where a tranche of Notes is rated, such rating will be specified in the relevant Final Terms. A rating is not a recommendation to buy, sell or hold 23

securities and may be subject to suspension, reduction or withdrawal at any time by the assigning rating agency. Selling Restrictions: Fiscal Agent: Principal Paying Agent: Registrar: New York Paying Agent and Transfer Agent London Paying Agent and Transfer Agent: Irish Paying Agent and Listing Agent The offer and sale of Notes will be subject to selling restrictions, including, in particular, but without limitation, restrictions relating to the United States of America, the European Economic Area, the United Kingdom, Ireland and Brazil. The selling restrictions applicable to each tranche of Notes will be those set forth in Notice to Investors, as supplemented by the relevant Final Terms. See Notice to Investors. The Bank of New York Mellon, London Branch. The Bank of Tokyo-Mitsubishi UFJ, Ltd. The Bank of New York Mellon, New York. The Bank of New York Mellon, New York. The Bank of New York Mellon, London Branch. The Bank of New York Mellon (Ireland) Limited. 24

Selected Historical Financial Data The following tables set forth our summary financial information on a consolidated basis. The financial data contained in these tables that is related to our balance sheets and statements of income have been derived from our audited consolidated financial statements as of and for the years ended December 31, 2010, 2009 and 2008, except for the financial data presented in U.S. dollars. Such annual financial statements were prepared in accordance with Brazilian GAAP, which differs in certain significant respects from U.S. GAAP. Brazilian Central Bank rules and regulations differ in certain aspects from CVM accounting rules applicable to financial institutions which are listed on the BM&FBOVESPA or the Novo Mercado. Accordingly, our financial statements may not be comparable to financial statements of such financial institutions. On December 28, 2007, the Brazilian government enacted Law No. 11,638, which, together with Law No. 11,941, amended the Brazilian corporations law and introduced the process of conversion of financial statements into IFRS. In accordance with Central Bank Communication No. 14,259, financial institutions will be required to apply IFRS accounting standards starting with their accounting and financial statements for the year ending December 31, 2010. We have not yet published our financial statements for the year ending December 31, 2010 prepared in accordance with IFRS accounting standards. IFRS differs, in certain material respects, from Brazilian GAAP. We have identified but not quantified such differences and have not prepared any reconciliation between IFRS and Brazilian GAAP for any of our financial statements in connection with these Listing Particulars or for any other purpose. In addition, in accordance with CMN Resolution No. 3,604, dated August 29, 2008, starting with their accounting and financial statements for the year ending December 31, 2008, financial institutions are required to publish their statements of cash flow. Our financial statements as of and for the years ended December 31, 2010, 2009 and 2008 were prepared in accordance with Brazilian GAAP with the adoption of the modifications introduced by Law No. 11,638, Law No. 11,941, Resolution No. 3,604 and additional regulations issued by the CMN and the Central Bank. The main difference between these statements and those prepared prior to the effectiveness of these new rules is the presentation of statements of cash flows instead of statements of changes in financial position. Our consolidated financial statements and accompanying notes as of and for each of the years ended December 31, 2010, 2009 and 2008 together with the independent auditors reports, appear elsewhere in these Listing Particulars. The summary financial information presented below is not necessarily indicative of the results of future operations and should be read in conjunction with Management s Discussion and Analysis of Financial Condition and Results of Operations and our financial statements, reports and the notes thereto, and other financial information appearing elsewhere in these Listing Particulars. Solely for the convenience of the reader, real amounts as of and for the year ended December 31, 2010 have been translated into U.S. dollars at the rate as reported by the Central Bank on December 31, 2010 of R$1.6662 per U.S.$1.00. The U.S. dollar equivalent information should not be construed to imply that the real amounts represent, or could have been or could be converted into, U.S. dollars at such rates or at any other rate. See Exchange Rates. 25

Consolidated Statement of Income Data Selected Historical Financial Data Financial operations income For the year ended December 31, 2010 (1) 2010 2009 2008 (U.S.$ in millions) (R$ in millions) Loans... 5,289 8,813 6,982 8,542 Leasing... 1,587 2,644 1,803 502 Securities and derivative financial instruments... 1,382 2,303 2,486 2,884 Foreign exchange operations... 25 42 577 Compulsory investments... 197 329 108 Total financial operations income... 8,481 14,131 11,271 12,613 Financial operations expenses Deposit, money market and interbank funds... (3,817) (6,360) (4,858) (6,830) Borrowings, assignments and repasses... (125) (209) 617 (1,776) Leasing... (1,184) (1,973) (1,330) (295) Foreign exchange operations... - - (240) Provision for loan losses... (714) (1,189) (1,535) (830) Total financial operations expenses... (5,840) (9,731) (7,346) (9,731) Gross income from financial operations... 2,641 4,400 3,925 (2,882) Other operating income (expenses) - Services income... 747 1,244 817 689 Personnel expenses... (465) (775) (564) (427) Other administrative expenses... (922) (1,536) (1,037) (846) Tax expenses... (274) (457) (364) (288) Other operating income... 1,254 2,090 1,317 905 Other operating expenses... (1,754) (2,923) (2,721) (1,772) Total other operating income (expense)... (1,415) (2,357) (2,552) (1,739) Operating results... 1,226 2,043 1,374 1,143 Non-operating results... (50) (83) (86) (56) Income before taxation and profit sharing... 1,176 1,960 1,288 1,087 Income tax and social contribution... (328) (547) (284) 88 Profit sharing... (239) (398) (201) (273) Net profit before minority interest... 609 1,015 803 902 Minority interest... - - (1) Net profit... 609 1,0 15 802 902 Notes: (1) Translated from reais at the rate of R$1.6662 per U.S.$1.00, the exchange rate prevailing on December 31, 2010. 26

Consolidated Balance Sheet Data Assets Current assets As of December 31, 2010 (1) 2010 2009 2008 (U.S.$ in millions) (R$ in millions) Bank and cash... 91 151 240 99 Money market... 7,709 12,844 18,564 4,013 Interbank deposits... 712 1,186 1,387 1,724 Foreign currency deposits... 52 87 178 37 Securities and derivative financial instruments... 10,922 18,199 13,157 18,198 Interbank accounts... 3,787 6,310 93 38 Loans and lease operations... 15,080 25,126 18,215 16,388 Other receivables... 2,290 3,816 2,066 6,023 Other assets... 110 184 128 122 Total current assets... 40,753 67,903 54,029 46,640 Long-term assets Interbank funds applied... 531 885 1,297 1,192 Securities and derivative financial instruments... 4,180 6,964 5,038 3,388 Loans and lease operations... 17,820 29,692 22,169 19,882 Other receivables... 1,021 1,701 1,854 774 Other assets... 279 465 253 346 Total long-term assets... 23,831 39,707 30,611 25,582 Permanent assets... 124 207 161 88 Total assets... 64,708 107,817 84,801 72,310 Liabilities and shareholders equity Current liabilities Demand deposits... 185 309 135 109 Interbank deposits... 386 643 1,681 4,173 Time deposits... 10,444 17,401 18,390 9,835 Other deposits... - - 2 5 Money market repurchase commitments... 18,157 30,253 21,854 11,774 Acceptances and endorsements... 1,950 3,249 1,276 1,564 Borrowings and repasses... 3,803 6,337 3,675 7,074 Interbank accounts... 19 32 40 63 Other liabilities... 6,367 10,608 4,182 8,833 Total current liabilities 41,311 68,832 51,235 43,430 Long-term liabilities Interbank deposits... 50 83 60 9 Time deposits... 3,098 5,162 4,210 4,801 Money market repurchase commitments... 2,477 4,127 2,913 4,850 Acceptances and endorsements... 4,231 7,049 4,994 4,738 Borrowings and repasses... 2,951 4,917 3,627 3,611 Other liabilities... 5,532 9,217 10,581 4,445 Total long-term liabilities... 18,338 30,555 26,385 22,454 Deferred income... 25 42 35 24 Minority interest... 41 27

Shareholders equity As of December 31, 2010 (1) 2010 2009 2008 (U.S.$ in millions) (R$ in millions) Domestic capital... 2,417 4,027 3,545 3,380 Capital reserves... 351 585 617 32 Revenue earnings... (34) (57) (77) (137) Retained reserves... 2,301 3,834 3,060 3,086 Total shareholders equity... 5,035 8,389 7,145 6,361 Total liabilities and shareholders equity... 64,708 107,817 84,801 72,310 Notes: (1) Translated from reais at the rate of R$1.6662 per U.S.$1.00, the exchange rate prevailing on December 31, 2010. Ratios Profitability and performance As of December 31, 2010 2009 2008 Net interest margin (1)... 6.00% 7.08% 5.87% Return on average interest-earning assets (2)... 1.09% 1.04% 1.43% Return on average shareholders equity (3)... 12.75% 11.96% 14.33% Capital adequacy Average shareholders equity as a percentage of average total assets... 7.98% 8.04% 8.63% Capital adequacy ratio (4)... 13.10% 13.20% 13.51% Asset quality (11) Non-performing loans and lease operations (5) as a percentage of total loans and lease operations (6)... 2.75% 4.51% 2.88% Allowance for loan losses (7) as a percentage of non-performing loans and lease operations... 73.67% 71.12% 70.43% Allowance for loan losses as a percentage of total loans and lease operations... 2.03% 3.21% 2.03% Non-performing loans and lease operations as a percentage of shareholders equity... 18.66% 26.80% 17.3% Efficiency Efficiency ratio (8)... 33.81% 25.51% 28.92% Liquidity Deposits (9) as a percentage of total assets... 21.89% 28.87% 26.2% Total loans and lease operations after allowance for loan losses as a percentage of total assets... 52.70% 50.05% 52.81% Total loans and lease operations after allowance for loan losses as a percentage of total funding (10)... 65.73% 63.17% 68.91% Notes: (1) Gross income from financial operations before allowance for loan losses as a percentage of average interest-earning assets. Interest-earning assets are assets generating income from financial operations. See 28

Selected Statistical Information Average Balances and Rates of Interest-Earning Assets and Interest-Bearing Liabilities for a table setting forth interest-earning assets. For a discussion of the calculation of Allowance for loan losses, see Management s Discussion and Analysis of Financial Condition and Results of Operations. (2) Net profit as a percentage of average interest-earning assets. Interest-earning assets are assets generating income from financial operations calculated in accordance with the methodology set forth in Selected Statistical Information Average Balance Sheet and Financial Data. (3) Net profit as a percentage of average shareholders equity calculated in accordance with the methodology set forth in Selected Statistical Information Average Balance Sheet and Financial Data. (4) Shareholders equity as a percentage of risk-weighted assets according to the CMN resolutions on capital adequacy. (5) Non-performing loans and lease operations consist of loans and lease operations rated H according to CMN resolutions (note 8 to our audited consolidated financial statements as of and for the years ended December 31, 2010, 2009 and 2008). See The Brazilian Financial System and Banking Regulation Regulation by the Central Bank Treatment of Overdue Debts. (6) Total loans and lease operations consist of loans and lease operations (note 8 to our audited consolidated financial statements as of and for the years ended December 31, 2010, 2009 and 2008) before allowance for loan losses (note 7 below). (7) Total allowance for loan losses classified from rating A through H divided by total loan operations classified from rating D through H. (8) The efficiency ratio is defined as the ratio, expressed as a percentage, of (i) the sum of personnel expenses and other administrative expenses less depreciation and amortization (included within other administrative expenses) and (ii) the sum of gross income from financial operations before allowance for loan losses and service income. (9) Deposits consist of demand deposits, interbank deposits and time deposits. (10) Total funding consists of demand deposits, interbank deposits, time deposits, money market repurchase commitments, interbank accounts, borrowings and repasses, acceptances and endorsements and subordinated debt. (11) Because of recent substantial growth in our loan portfolio, the various asset quality ratios presented may not be representative of, or comparable to, ratios of a seasoned credit portfolio. The asset quality ratios in future periods could be materially higher than the current ratios presented in this document as the portfolio becomes seasoned and some of our more recently originated loans become due. 29

RISK FACTORS As a general matter, investing in the securities of Brazilian issuers, like us, involves risks not normally associated with investing in securities issued by United States, European or other similar companies. Prospective purchasers of the Notes should consider carefully certain factors regarding us and the Notes. Accordingly, prospective purchasers of the Notes offered hereby should consider carefully, in light of their financial circumstances and investment objectives, all of the information in these Listing Particulars and, in particular, the Risk Factors set forth below. Prospective investors should further note that the Risk Factors described below are not the only risks that we face. These are the risks we currently consider material. There may be additional risks that we currently consider immaterial or of which we are currently unaware, and any of these risks could have similar effects to those set forth below. The occurrence of one or more of the circumstances described below could lead to a material and long-term decline in the price of the Notes or, in extreme cases, to a loss of the value of the Noteholders entire investment or part of it, as the case may be. Risks Relating to the Brazilian Banking Industry and Us We are controlled by a small group of shareholders who have the power to control all our subsidiaries and us. We are controlled by the Ermírio de Moraes family and Banco do Brasil, which together control all of our outstanding common voting shares. Banco do Brasil is controlled by the Brazilian government. Consequently, our controlling shareholders have the power to control all of our subsidiaries and us, including the power to: elect our directors and officers; and determine the outcome of any action requiring shareholder approval, including related party transactions, corporate reorganizations and dispositions and the timing and payment of any future dividends. We engage in, and expect from time to time in the future to engage in, commercial and financial transactions with our controlling shareholders or their affiliates. Commercial and financial transactions between our affiliates and us create the potential for, or could result in, conflicts of interests, which could have an adverse effect on our financial condition, results of operations and capitalization. See Business Strategic Partnership with Banco do Brasil and Related Party Transactions. We are a member of the Votorantim Group and partially controlled by Banco do Brasil. If these shareholders cease to control and/or own us this could potentially have a material adverse effect on our business, results of operations and financial condition. We are a member of the Votorantim Group and partially owned by Banco do Brasil. As a result, our business benefits from our association with the Votorantim Group and Banco do Brasil and from the cross-selling of our products to customers of other companies in the Votorantim Group and Banco do Brasil. There can be no assurance that the Votorantim Group or Banco do Brasil will continue to directly or indirectly control and/or own us and that we will continue to benefit from our association with either. Any such event could potentially have a material adverse effect on our results of operations and financial condition. We may not be successful in implementing our strategy and, in particular, the strategies relating to the strategic partnership with Banco do Brasil. Our ability to implement our business strategy, including, but not limited to, our strategies relating to the strategic partnership with Banco do Brasil, depends on several factors, including the regulatory and economic scenarios, the growth of the Brazilian banking sector and our continued ability to maintain our capitalization 30

level, develop our technology infrastructure, increase our operating efficiency and benefit from the distribution network of Banco do Brasil. See Business Our Strategy and Strategic Partnership with Banco do Brasil. We cannot assure you that we will be successful in implementing our business strategy, which may materially adversely affect our financial condition and results of operations. Our implementation of operational limitations as a result of Banco do Brasil consolidating our results could adversely affect us. Due to Brazilian banking regulations, Banco do Brasil consolidates our results of operations as to its 50% equity interest in us. Accordingly, all assessments made by Banco do Brasil in relation to capital adequacy, exposure limits and other applicable operational limits recognize our operations on a consolidated basis to the extent of Banco do Brasil s interest in us. See Business Strategic Partnership with Banco do Brasil and The Brazilian Financial System and Banking Regulation. We continue to be regulated and account for our transactions on the same basis as we were regulated prior to our partnership with Banco do Brasil. However, depending on the effects of our operations in Banco do Brasil s operational limits, we may be required to implement controls and limitations on our operations. For instance, we recently implemented a general credit policy which includes a requirement that any credit transaction in excess of R$750 million (or less if certain credit rating requirements are not met) be subject to prior approval by our board of directors (which includes three members appointed by Banco do Brasil). See Business Credit and Risk Control Policy Credit Risk Management. No assurance can be given that we will not be required to adopt further operational limits as a result of the consolidation of our results into Banco do Brasil. The adoption of any such limitations could potentially have a material adverse effect on our results of operations and financial condition. We may not be successful in expanding our credit operations, and our inability to implement our expansion strategy may have an adverse effect on our business, results of operation and financial condition. Our present growth strategy includes expanding our lending operations from our traditional base in the large corporate sector to the Brazilian corporate and middle market sectors. Borrowers in the corporate and middle market segments are analyzed in light of different credit criteria. Our growth strategy also includes increasing our market share in consumer finance operations by: expanding our regional coverage; increasing our market share in new car financings while maintaining our portfolio of used car financings; and increasing our operations in other personal credit transactions, such as payroll deductible loans and construction materials financing. We cannot assure you that we will be successful in expanding our focus in these new markets or that such strategies will not negatively impact our business and results of operations. In addition, expansion within the corporate and middle market segments and to a broader range of personal credit transactions involves lending to a new client base, often with lower credit ratings. This may result in an increased risk of credit losses. While we generally earn higher interest margins on such transactions and have increased our loan loss provisions to reflect the credit ratings of the relevant customers, we cannot assure you that our loan losses will not increase beyond our increased level of provisions. The continued expansion of our consumer finance operations may increase the risk of our loan portfolio. Our growth strategy includes increasing our market share in consumer finance operations, which are more risky in comparison to the lending we have traditionally engaged in because it is either unsecured or it involves cumbersome collateral. Many of these products are relatively new in Brazil and therefore potentially more vulnerable to market volatility. This additional increase in riskier loans may increase the overall risk of our credit portfolio, which may subject us to loan defaults, including defaults that may trigger repurchase obligations of assigned credits, that could have an adverse effect on our results of operations. 31

Our growing extension of payroll deduction loans is subject to changes in laws and regulations, interpretation by the courts and public entities policies relating to payroll deductions. Since the repayment of payroll deduction loans (which we have been increasingly extending) is directly deducted from the salaries of public servants and private sector employees or from INSS retiree or pension benefits, our credit risk practically is that of the entity to which borrowers are related. This feature enables us to extend loans at rates lower than those charged in connection with other products offered by financial institutions in Brazil, including us. This payment deduction mechanism is regulated by a number of laws and regulations, at the federal, state and municipal levels, which establish deduction limits and provide for the irrevocability of the authorization given by a public servant, private sector employee or INSS beneficiary to deduct the amount for purposes of settlement of the loan. Additionally, the extension of payroll deduction loans to public servants and INSS retirees and pensioners depends on the authorization by public entities to which these persons are related. The Brazilian government or other governmental entities may change the regulations governing these authorizations and other government agencies may impose future regulations that restrict or prevent us from offering payroll deduction loans to their employees. Part of our credit portfolio is composed of payroll deduction loans granted to public servants and INSS retirees and pensioners, and we intend to continue to expand our portfolio of payroll deduction loans to these borrowers. Accordingly, a change in law or regulation or the interpretation of existing laws and regulations may increase the risk profile of our credit portfolio by increasing the interest rate of our personal loans and resulting in a greater amount of loan losses. Any such change could adversely affect our business, financial conditions and results of operations. In June 2004, the Brazilian Superior Court of Justice determined that an authorization for direct payroll deduction given by a public servant in the State of Rio Grande do Sul could be revoked, and that an irrevocable authorization would be abusive and, accordingly, null and void. Even though in June 2005 the Brazilian Superior Court of Justice issued a new decision recognizing that the irrevocability of these authorizations is legal and valid, we can make no assurances that the Brazilian Superior Court of Justice will not reach a different conclusion in any future proceedings. Our ability to collect payments due from payroll deduction loan transactions depends on the effectiveness and validity of agreements entered into with, and the credit risk of, private employers and public sector entities, as well as on borrowers keeping their jobs. We have been entering into an increasing number of payroll deduction loan transactions and intend to continue to enter into these transactions as part of our growth strategy. To the extent that this expansion continues, part of our revenues will result from payments due from payroll deduction loan transactions, which will be directly deducted from employees or retirees paychecks. These deductions could be suspended if the agreements entered into with employers or public sector entities are terminated, or if an employee of either private or public sector entities has his or her employment contract terminated by the employer or otherwise ceases employment. In the case of termination of these agreements, our collection system of payroll deduction loans will be compromised and a new collection system may be necessary, which may not be as effective as the current one, or which may have high operating costs. If an employee has his or her employment contract terminated by the employer, leaves the job, or dies, the payment of the payroll deduction loan may depend exclusively on the financial ability of the borrower or his/her successors to repay the loan. Similarly, if private employers suffer losses or any type of bankruptcy or liquidation event, they may not be able to pay their employees. We cannot assure that we will recover our credit under these circumstances. 32

These developments could increase the risk of our consumer finance portfolio and could result in a higher percentage of losses in transactions of this nature, an increase in administrative expenses and other expenses related to collection of payments due, including the implementation of a new collection system caused by termination of agreements and a contraction in our consumer loan portfolio, among other things. Any such development could adversely affect our business, results of operation and financial conditions. It may be difficult for us to repossess and realize value from collateral with respect to defaulted loans. Upon default by our clients, it may be difficult for us to repossess and to realize value from collateral with respect to the underlying loans. Some of our loans, such as vehicle financing, are secured by assets that are expensive to repossess and difficult and cumbersome to store and manage or in respect of which security has not been properly taken or registered. This increases the difficulty in realizing value from such assets. If we experience higher rates of default on our loans that are secured with these types of assets, provisioned amounts may be inadequate and we would incur higher losses from the defaulted loans. Interest rate changes by the COPOM could adversely affect us. The COPOM periodically establishes the special overnight clearance and custodial rate (Sistema Especial de Liquidação e Custódia or the SELIC rate ), which is the base interest rate for the Brazilian banking system and an important policy instrument for meeting inflation targets that were formally adopted on July 1, 1999. The COPOM has frequently adjusted the target SELIC rate, increasing the rate numerous times in response to economic uncertainties and to achieve the goals of the Brazilian government s economic policies. As of December 31, 2010, 2009 and 2008, the SELIC rate was 10.66%, 8.65% and 13.66%, respectively. The COPOM raised the SELIC rate during the first quarter of 2011 and, as of the date of these Listing Particulars, the target SELIC rate was 11.75%. Increases in the base interest rate could adversely affect our business, results of operation and financial conditions, by reducing demand for credit, increasing our cost of funds to the extent these effects are not offset by increased margins and increasing the risk of client default. Decreases in the base interest rate could also adversely affect our results of operations, by decreasing the interest income we earn on our assets tied to the average SELIC rate and by lowering margins. The Brazilian constitution used to establish a ceiling on bank loan interest rates, and the impact of the subsequent legislation regulating the subject is uncertain. Article 192 of the Brazilian Constitution, enacted in 1988, established a 12.0% per year ceiling on bank loan interest rates. However, since the enactment of the constitution, this rate had not been enforced, as the regulation regarding the ceiling was pending. Several attempts have been made to regulate the limitation on bank loan interest, but none of the proposals has been implemented. On May 29, 2003, Constitutional Amendment No. 40 (or EC 40/03) was enacted and revoked all subsections and paragraphs of Article 192 of the Brazilian constitution. This amendment allows the Brazilian financial system to be regulated by specific laws for each sector of the system rather than by a single law relating to the system as a whole. With the enactment of the New Civil Code (or Law No. 10,406 of January 10, 2002), unless the parties to a loan have agreed to use a different rate, in principle the interest rate ceiling has been pegged to the base rate charged by the Fazenda Nacional (or the National Treasury Office). Currently, this base rate is the target SELIC rate, which, as of the date of these Listing Particulars, was 11.75% per annum. However, there is presently some uncertainty as to whether the target SELIC rate or the 12.0% per annum interest rate established in the Brazilian tax code should apply. 33

The impact of EC 40/03 and the provisions of the New Civil Code are uncertain at this time but any substantial increase or decrease in the interest rate ceiling could have a material effect on the financial condition, results of operations or prospects of Brazilian financial institutions, including us. Additionally, certain Brazilian courts have issued decisions in the past limiting interest rates on consumer financing transactions that are considered abusive or excessively onerous in comparison with market practice. Brazilian courts future decisions as well as changes in legislation and regulations restricting interest rates charged by financial institutions could have an adverse effect on our business, results of operation and financial conditions. We trade in the securities, foreign exchange and derivative markets, which can cause losses in our operations. We engage in the trading of securities, mainly Brazilian government debt, principally to sell these securities in the near term with the objective of generating profits on short-term differences in the price. These investments could expose us to possible material financial losses in the future, as securities are subject to fluctuations in value which may generate losses. We enter into foreign exchange and derivative transactions mainly to manage our exposure to interest rate and exchange rate risk. Although most foreign exchange and other derivative transactions are entered into with a view to hedging our risk position, and although losses on such transactions are generally compensated by gains in other assets or liabilities in our portfolio, we still are exposed to the risk of material financial losses on speculative or unmatched transactions. In addition, in respect of most derivative transactions, we bear the credit and performance risk of our counterparties. Any failure or refusal of counterparties to fulfill their contractual obligations could cause us to sustain material financial losses. There can be no assurance that we will not suffer losses in connection with these securities and derivative transactions which may adversely affect our business, results of operations and financial condition. Exposure to Brazilian government debt could have an adverse effect on our business, results of operations and financial condition. Like many other large Brazilian banks, we invest in debt securities of the Brazilian government, most of which are short-term and highly liquid. As of December 31, 2010, 13.0% of our total assets, and 56.0% of our securities portfolio, were comprised of debt securities issued by the Brazilian government. Any failure by the Brazilian government to make timely payments under the terms of these securities would have a material adverse effect on our financial condition and results of operations. A significant decrease in the market value of Brazilian government securities and derivatives held by us could have a material adverse effect on our financial condition, results of operations and capitalization. The Brazilian government regulates the operations of Brazilian banks, and any changes in existing laws and regulations or the imposition of new laws and regulations may negatively affect us. Brazilian banks, including us, are subject to extensive and continuous regulatory oversight by the Central Bank. We have no control over government regulations, which govern all facets of our operations, including regulations that impose: minimum capital requirements; compulsory deposit/reserve requirements; investment requirements in fixed assets; lending limits and other credit restrictions; and 34

accounting and statistical requirements. The regulatory structure governing Brazilian financial institutions is continually evolving. Existing laws and regulations may be amended, the manner in which existing laws and regulations are enforced or interpreted could change and new laws or regulations could be adopted. In particular, the Brazilian government has historically promulgated regulations affecting banks in an effort to implement economic policy. These regulations have been used by the Brazilian government to control the availability of credit and reduce or increase consumption in Brazil. Changes in existing laws or enactment of new laws could adversely affect our business, results of operations and financial condition. Changes in existing banking laws and regulations, including those applicable to minimum compulsory deposits, may adversely affect us. The levels of compulsory deposits that Brazilian financial institutions must maintain with the Central Bank have frequently changed. There can be no assurance that the Central Bank will not increase or impose new compulsory deposit requirements. We could be materially and adversely affected by these changes because monies held as compulsory deposits generally do not yield the same return as our other investments and deposits, because: a portion of our compulsory deposits do not bear interest; a portion of our compulsory deposits must be held in Brazilian government securities; and a portion of our compulsory deposits must be used to make loans to support the housing and the agricultural sectors. An increase in compulsory deposit requirements may reduce our ability to lend and invest and execute our strategy which in turn may have an adverse effect on us. For further information, see The Brazilian Financial System. Minimum capital adequacy requirements imposed on us following the implementation of the Basel II Accord may adversely affect us. In June 2004, the Basel Committee on Banking Regulations and Supervisory Practices (the Basel Committee ) approved a new framework for risk-based capital adequacy, commonly referred to as the Basel II Accord. The Basel II Accord sets out the details for adopting more risk-sensitive minimum capital requirements for financial institutions. As part of its implementation, the Central Bank has proposed new capital adequacy regulations, which among other provisions contain changes to the risk weighting for different categories of loans. According to Communication No. 16,137 of the Central Bank, the requirements for use of certain capital calculation models included in the Basel II Accord are to be implemented by 2012, with emphasis on changes in the allocation of capital for credit risk and the allocation of capital for operating risk. In addition, pursuant to Resolution No. 3,490 of August 29, 2007 of the CMN, and Central Bank Circular No. 3,383 of April 30, 2008, the Central Bank requires banks to set aside a portion of their equity to cover operational risks (i.e., losses arising from failures, deficiency or inadequacy of internal procedures, personnel or systems, including due to external events). Resolution No. 3,490 became effective as of July 1, 2008 and the equity to cover operational risks varies from 12% to 18% of average income from financial intermediation. The risk-weighted capital ratio required by us and all other banks in Brazil is currently 11.0% of risk-based exposure. Our Basel ratio was 13.1% as of December 31, 2010, 13.2% as of December 31, 2009 and 13.5% as of December 31, 2008. This decrease reflects higher levels of risk-weighted assets due to increased default in 35

our loan portfolio resulting from the global economic crisis and other macroeconomic effects and other factors discussed herein. On January 20, 2010, we issued U.S.$750 million of subordinated notes due 2020 (the Subordinated Notes ). The Central Bank authorized the qualification of the Subordinated Notes as Tier 2 capital on March 2, 2010. We issued an additional U.S.$400 million of subordinated notes on July 26, 2010 (the Additional Subordinated Notes ) which are fungible with the Subordinated Notes. The Central Bank authorized the qualification of the Additional Subordinated Notes as Tier 2 capital on September 20, 2010. See Management s Discussion and Analysis of Financial Condition and Results of Operations. On December 16, 2010, the Basel Committee issued its new Basel III framework ( Basel III ). Basel III complements the existing rules. It sets out higher minimum capital requirements and new conservation and countercyclical buffers, revised risk-based capital measures, and the introduction of a new leverage ratio and two liquidity standards. The new rules will be introduced gradually and, as with other Basel directives, these will not be self-effectuating. Rather, each country must adopt them by legislation or regulation to be imposed upon that country s home banks. On February 17, 2011, the Central Bank issued Notice No. 20,615 containing preliminary guidance and a schedule for the implementation of Basel III in Brazil. It is intended that the new rules will be implemented in Brazil two years earlier than the time frame established by the Basel Committee. We may be unable to meet the minimum capital adequacy requirements required by the Central Bank. We may also be compelled to limit our lending, dispose of our assets and/or take other measures that may adversely affect our business, results of operations and financial condition. We operate in a highly competitive market and some of our competitors are much larger than we are and have access to lower-cost funding. The market for financial and banking services in Brazil is competitive and we face substantial competition in all of our areas of operations. We compete with multinational banks operating in Brazil and larger retail financial institutions, which have low cost deposits as a source of funding. In addition, we have experienced increased competition in the market for corporate banking services and consumer finance as other Brazilian banks have shifted the focus of their activities away from interest rate arbitrage and toward traditional banking activities in response to the stabilization of the Brazilian economic environment. The Brazilian banking industry has also experienced a trend toward consolidation, as evidenced by our strategic partnership with Banco do Brasil, recent acquisitions of Brazilian financial institutions by other banks and privatizations, involving both established Brazilian banking institutions and new foreign entrants. The Brazilian banking sector is now dominated by a few large institutions, including us, competing aggressively for market share. We expect the trends of increased competition and consolidation to continue and to result in the formation of new large financial groups that may become our competitors. The Brazilian banking industry also faces increasing competition from investment banks and other financial intermediaries that can provide larger companies with access to the capital markets as an alternative to bank loans. In our corporate and investment banking activities, we compete with other Brazilian banks offering similar services, as well as with foreign investment banks that operate in Brazil. In respect of fund management activities, we face considerable competition from other Brazilian and international banks, as well as independent asset managers. The competitive environment in which we operate may adversely affect our business, results of operations and financial condition. In September 2006, the CMN enacted new regulations to increase competition among Brazilian commercial banks. As a result of these new regulations: (a) banks are prohibited from charging customers fees for services in connection with salary, pension and other income payment accounts that customers are required to maintain with a bank designated by such customer s employer, pension fund or income payor, (b) financial institutions and leasing companies must accept prepayment of loans and leasing transactions by customers who have elected to refinance such debt with other financial institutions, (c) customers will have the right to request 36

that a financial institution disclose their credit history to another financial institution, and (d) changes occurred in the regulation of the FGC, a government fund established as part of the federal depositary insurance regime which guarantees payment of funds deposited with financial institutions in case of intervention, administrative liquidation, bankruptcy or other state of insolvency. By creating mechanisms that will make it easier for customers to open new accounts and transfer funds from one institution to another, new regulations aim to increase competition among financial institutions by facilitating a customer s ability to switch between financial institutions. Greater consumer choice is likely to result in a more competitive environment and pressure on our fees and margins. A reduction of our credit rating may increase our borrowing costs, which may adversely affect us. Our borrowing costs depend on several factors, including some beyond our control, such as macroeconomic conditions and the regulatory environment for banks in Brazil. Any unfavorable change in these factors may adversely affect our credit rating which in turn may limit our ability to borrow funds or issue securities under favorable conditions, thereby increasing our borrowing costs. The factors and contingencies that may affect our borrowing costs are frequently the same ones that may lead us to raise additional capital. We have been rated for many years by the main national and international risk classification agencies. Our most important ratings, on a global scale in foreign currency, are BBB- by Fitch Ratings, BB+ by Standard and Poor s, and Baa3 by Moody s. Following the public announcement of our strategic partnership with Banco do Brasil, Moody s upgraded our rating, on October 19, 2009, for long-term local currency deposits from Baa1 to A3, and the partnership was mentioned in the rating report as one of the factors justifying the upgrade. The disruptions experienced in the international capital markets commencing in 2008 have led to reduced liquidity and increased credit risk premiums for certain market participants and could give rise to a decline in credit quality, increases in defaults and non-performing debt and could adversely affect our business, results of operations and financial condition. The disruptions experienced in the international capital markets commencing in 2008 have led to reduced liquidity, increased credit risk premiums and a reduction of available financing. Banks, such as us, located in emerging markets may be particularly susceptible to these disruptions which could result in financial difficulty. In addition, the availability of credit to entities, such as us, operating within emerging markets is significantly influenced by levels of investor confidence in such markets as a whole and so any factors that impact market confidence (for example, a decrease in credit ratings or state or central bank intervention in a market) could affect the price or availability of funding for entities within any emerging market. It is difficult to predict how long these conditions will persist and how our assets and operations will be adversely affected. Furthermore, it is not possible to predict what structural and/or regulatory changes may result from the current market conditions or whether such changes may be materially adverse to us. While there has been some recovery in market conditions in 2009 and 2010, if market conditions and circumstances do not experience a sustained recovery or further deteriorate, this may lead to a decline in credit quality, increases in defaults and non-performing debt, among other things, which may have an adverse effect on our business, results of operations and financial condition. Amendments to Brazilian tax and welfare legislation could adversely affect us. The Brazilian government regularly implements changes to tax, social security and other laws and tax assessment regimes that affect us and our clients. These changes include changes in applicable assessment rates and, occasionally, enactment of temporary taxes, the proceeds of which may be earmarked for designated governmental programmes. For a description of certain recent changes in tax regulations implemented by the 37

Brazilian government, see The Brazilian Financial System and Banking Regulation Taxation of Financial Transactions. Some of these measures may result in increases in our tax payments, which could adversely impact our profitability and our ability to conduct certain business operations. In addition, changes in tax regulations have previously produced, and could in the future produce, uncertainty in the Brazilian financial system, have previously increased, and could in the future increase, funding costs and have previously contributed, and can in the future contribute, to additional non-performing loans. We have not quantified, and cannot quantify, the effects of any changes in tax regulations that may be implemented by the Brazilian government in the future. There can be no assurance that any future changes in tax regulations will not have an adverse effect on the results of our operations. There may be less publicly available information about us than is regularly published by or about listed companies in certain countries with highly developed capital markets. A principal objective of the securities laws of the United States, Brazil and other countries is to promote full and fair disclosure of all material information of companies issuing securities. As a Brazilian bank, we are subject to extensive regulation by the Central Bank, which requires us (to a greater extent than non-bank entities) to disclose information concerning our operations and financial condition. However, there may be less publicly available information about us that is regularly published by or about listed companies in certain countries with highly developed capital markets, such as the United Kingdom or the United States. Risks Relating to Brazil The Brazilian government has exercised, and continues to exercise, significant influence over the Brazilian economy. This influence, as well as Brazilian political and economic conditions, could adversely affect us and the market price of our Notes. The Brazilian economy has been characterized by frequent, and occasionally substantial, intervention by the Brazilian government, which often changes monetary, credit, fiscal and other policies to influence Brazil s economy. The Brazilian government s actions to control inflation and effect other policies have involved, among others, wage and price controls, currency devaluations, controls on the flow of capital and certain limits on imported goods and services. We have no control over, and cannot predict what measures or policies the Brazilian government may take in the future. Our business, financial condition and results of operations, as well as the market price of the Notes, may be adversely affected by changes in public policy at federal, state and municipal levels with respect to public tariffs and exchange controls, as well as other factors, such as: exchange rates; inflation; interest rates; liquidity of the domestic financial, capital and lending markets; fiscal policy and the tax regime; and other political, social and economic developments in or affecting Brazil. Uncertainty over whether the Brazilian government will implement changes in policy or regulations affecting these or other factors in the future may contribute to economic uncertainty in Brazil and to heightened volatility in the Brazilian securities markets and in the securities issued abroad by Brazilian issuers. In October 2010, presidential elections took place in Brazil, with Dilma Vana Rousseff winning the election and succeeding Luiz Inácio Lula da Silva. It is not possible to predict whether the government elected in 2010 or any succeeding governments will have an adverse effect on the Brazilian economy, and, consequently, on our 38

business. Uncertainties with respect to the economic and policy frameworks to be adopted by the new president of Brazil may also increase market price volatility for securities issued by Brazilian issuers, which could adversely affect us and the market price of the Notes. We cannot predict whether Brazilian governmental actions will result in adverse consequences to the Brazilian economy, our business, results of operations or financial condition or prospects, or impact our ability to satisfy payment obligations under the Notes. Developments and the perception of risk in other countries, such as the recent developments in the global financial markets, and particularly in emerging market countries, may adversely affect the market price of Brazilian securities, including our Notes. The market value of securities of Brazilian companies is affected to varying degrees by economic and market conditions in other countries, including other Latin American and emerging market countries. Although economic conditions in these countries may differ significantly from economic conditions in Brazil, investors reactions to developments in these other countries, such as the recent developments in the global financial markets, may have an adverse effect on the market value of securities of Brazilian issuers. Crises in other emerging market countries may diminish investor interest in securities of Brazilian issuers, including ours, which could adversely affect the market price of our Notes. See Risks Relating to the Brazilian Banking Industry and Us The disruptions recently experienced in the international capital markets have led to reduced liquidity and increased credit risk premiums for certain market participants and could give rise to a decline in credit quality, increases in defaults and non-performing debt and could adversely affect our business results of operations and financial condition. Inflation, and the Brazilian government s measures to combat inflation, may contribute to economic uncertainty in Brazil, adversely affecting us and the market price of our Notes. Brazil has historically experienced high rates of inflation. Inflation and certain actions taken by the Brazilian government to combat it have had negative effects on the Brazilian economy, especially in the period before 1995. Inflation as measured by the Brazilian General Market Price Index (Índice Geral de Preços-Mercado IGP-M ) reached 2,567.3% in 1993. Although Brazilian inflation has substantially decreased since 1994, inflationary pressures may persist. Inflation rates were 9.81% in 2008 and 11.32% in 2010, whereas Brazil had a deflation rate of 1.71% in 2009, as measured by the IGP-M. The Brazilian government s measures to control inflation have often included maintaining a tight monetary policy with high interest rates, thereby restricting the availability of credit and reducing economic growth. The COPOM has frequently adjusted the interest rate in situations of economic uncertainty and to achieve objectives under the economic policy of the Brazilian government. Inflation, along with government measures to combat inflation and public speculation about possible future government measures, has had significant negative effects on the Brazilian economy, and contributed to economic uncertainty in Brazil and heightened volatility in the Brazilian securities market, which may have an adverse effect on us. If Brazil experiences substantial inflation or deflation in the future, our business, results of operations and financial condition may be adversely affected, negatively affecting our ability to comply with our obligations. Such pressures may also affect our ability to access foreign financial markets and may lead to policies that may adversely affect the Brazilian economy, us and the market price of our Notes. Exchange rate instability may adversely affect us and the market price of our Notes. Brazil s currency has been characterized historically by high degrees of volatility. Despite appreciation of the Brazilian real against the U.S. dollar in 2006 and 2007, the Brazilian currency has depreciated periodically in relation to the U.S. dollar and other foreign currencies during recent decades and did so again in 2008. At different points over this period, the Brazilian government has implemented various economic plans and exchange rate policies, including sudden devaluations, periodic mini-devaluations during which the frequency of adjustments has ranged from daily to monthly, floating exchange rate systems, exchange controls and dual 39

exchange rate markets. The current floating exchange rate system has also contributed to significant fluctuations in the exchange rate between the Brazilian currency and the U.S. dollar and other currencies. As of December 31, 2008, the exchange rate was R$2.34 to U.S.$1.00, representing a depreciation of the real of 32.2% as compared to the rate prevailing as of December 31, 2007. During 2009, the real appreciated significantly against the U.S. dollar and the exchange rate was R$1.74 to U.S.$1.00 as of December 31, 2009. As of December 31, 2010, the exchange rate was R$1.67 to U.S.$1.00. There can be no assurance that the real will not continue to fluctuate significantly against the U.S. dollar. Although most of our transactions are denominated in Brazilian reais, part of our assets and liabilities are denominated in other currencies, particularly in U.S. dollars. As of December 31, 2010, our consolidated foreign exchange exposure (the difference between our assets and liabilities denominated in currencies other than the real, including derivatives) totaled R$(72) million representing (0.91)% of our reference shareholders equity (patrimônio de referência). The Central Bank requires that financial institutions in Brazil maintain consolidated foreign exchange exposure (including assets and liabilities denominated in currencies other than the real and gold) not exceeding 30.0% of their reference shareholders equity. A depreciation of the real relative to the U.S. dollar or other foreign currencies could create additional inflationary pressures in Brazil and lead to increases in interest rates, which may adversely affect us. Also, a depreciation of the real may restrict our ability to access foreign financial markets and may cause government intervention in the market. Such intervention could involve restrictive policies. Conversely, a significant appreciation of the real relative to the U.S. dollar or other foreign currencies could negatively affect Brazil s balance of external payments and hinder export growth. Fluctuations in the exchange rate between the Brazilian currency and the U.S. dollar or other foreign currencies may (i) increase or decrease our funding costs in foreign currencies or arising from funding linked to foreign currencies; (ii) increase or decrease the demand of our clients for credit denominated in foreign currency or loans linked to foreign currency; (iii) increase or decrease the percentage of our credits indexed to foreign currencies; and (iv) significantly affect the value of our assets and liabilities linked to foreign currency. Any of these developments could have an adverse effect on our business, results of operations and financial condition, which could affect the market price of our Notes. Our ability to make timely payments may be restricted by liquidity constraints in Brazil. The Brazilian economy has been subject to a number of developments or conditions that have significantly affected the availability of credit. External and internal factors, including the Russian economic crisis of 1998, the Argentine economic crisis in 2001 and elections in Brazil in 2002 have from time to time resulted in significant outflows of funds and reductions in the amount of foreign currency being invested in Brazil, notwithstanding significant increases in interest rates designed to stem capital outflow. In addition, to control inflation in general, the Brazilian government has maintained a tight monetary policy, with associated high interest rates, and has constrained the growth of credit. The combination of these developments has made it difficult at times for certain companies and financial institutions in Brazil to obtain cash and other liquid assets and has resulted in the failure of a number of weaker financial institutions in Brazil. In addition, concerns as to the stability of some financial institutions have caused significant transfers of deposits from smaller banks to larger banks since the beginning of 1995. No assurance can be given that developments in the Brazilian economy will not adversely affect the ability of certain of our direct and indirect clients to make timely payments on their obligations to us or otherwise adversely affect our business financial condition or results of operations. The profitability of our businesses could be adversely affected by a worsening of domestic or global economic conditions. 40

Our profitability could be adversely affected by a worsening of general economic conditions domestically or globally. Factors such as interest rates, inflation, investor sentiment, the availability and cost of credit, the liquidity of the global financial markets and the level and volatility of equity prices could affect the activity level of clients. Gross domestic product growth in Brazil was 7.5%, (0.6)% and 5.2% in 2010, 2009, and 2008, respectively. Average unemployment in Brazil was 6.7%, 8.1% and 7.9% as of December 31, 2010, 2009 and 2008, respectively, according to the estimates of the Brazilian Geography and Statistics Institute (Instituto Brasileiro de Geografia e Estatística or IBGE ). There may be significant differences between accounting principles applicable to listed companies under the jurisdiction of the CVM and financial institutions subject to regulation by the Brazilian Central Bank, which could have a material impact on our consolidated financial statements. Accounting principles and standards generally applicable in Brazil and applied by us in the presentation of our consolidated financial statements included in these Listing Particulars are established in accordance with Brazilian GAAP, and interpretative statements issued by the IBRACON. The Central Bank provides additional industry specific requirements that apply to us. We are not a listed company and are not subject to complementary instructions of the CVM. There may be significant differences between accounting principles applicable to listed companies under the jurisdiction of the CVM and financial institutions subject to regulation by the Central Bank, which could have a material impact on our consolidated financial statements. We have made no attempt to identify or quantify the impact of those differences. No reconciliation to the rules of the CVM of any of the financial statements presented in these Listing Particulars has been prepared for the purposes of these Listing Particulars or for any other purpose. There can be no assurance that a reconciliation would not identify material quantitative differences as well as disclosure and presentation differences between our consolidated financial statements as prepared in accordance with the guidelines of the Central Bank and such financial statements as prepared on the basis of the rules of the CVM. There are significant differences between accounting standards used by us and IFRS or U.S. GAAP. There are significant differences between IFRS, U.S. GAAP and Brazilian GAAP. Our financial statements contained herein differ from those that would be prepared had they been prepared based upon IFRS or U.S. GAAP. No reconciliation to IFRS or U.S. GAAP of any of the financial statements presented in these Listing Particulars has been prepared for the purposes of these Listing Particulars. There can be no assurance that such a reconciliation would not identify material quantitative differences between our financial statements as prepared on the basis of the accounting principles determined by Brazilian GAAP and such financial statements as prepared on the basis of IFRS or U.S. GAAP. Risks Relating to the Notes Payments on Notes that contain a Foreign Currency Constraint provision may be restricted upon the occurrence of a Foreign Currency Constraint Event. Upon the occurrence of a Foreign Currency Constraint Event, all or a portion of the payments of principal, interest or any other amounts due under Notes that contain a Foreign Currency Constraint provision will either, at the election of the holder of such Notes, be paid in Brazil in the lawful currency of Brazil or be paid in the currency due on the Notes at such time as such payment is no longer so restricted or prevented. We cannot assure you that mechanisms for obtaining in Brazil the U.S. dollars or other specified currency necessary for the performance of our obligations under the Notes will remain legally or commercially available at the time of payment, or that a more restrictive control policy, including restrictions or delays on payments of external debt, which could affect our ability to make payments under the Notes in such currency, will not be instituted in the future. If those financial mechanisms are not available, we will have to rely on a special authorization from the Central Bank to make payments under the Notes in such currency. We cannot assure you that such Central Bank approval will be obtained or that such approval will be obtained on a timely basis. 41

We cannot assure you as to when, if ever, any such event triggering the Foreign Currency Constraint will occur, or, in the event it occurs, when it will cease to restrict or prevent the payment of obligations under the Notes. Controls and restrictions on foreign currency remittance, or remittance to foreign investors generally, could impede our ability to make payments under the Notes. The purchase and sale of foreign currency in Brazil is subject to governmental control. The Brazilian economy has experienced balance of payment deficits and shortages in foreign currency reserves to which the Brazilian government has responded by restricting the ability to convert Brazilian currency into foreign currency. Brazilian law provides that whenever a serious imbalance in Brazil s balance of payments exists or is anticipated, the Brazilian government may impose temporary restrictions on the remittance to foreign investors of the proceeds of their investments in Brazil. For example, in 1989 and early 1990, the Brazilian government restricted fund transfers that were owed to foreign equity investors and held by the Central Bank, in order to conserve Brazil s foreign currency reserves. These amounts were subsequently released. However, similar measures could be taken by the Brazilian government in the future. Even though the Brazilian foreign exchange market has recently experienced a de-regulation process, the Brazilian government may in the future: restrict companies, including financial institutions, such as us, from paying amounts denominated in foreign currencies (such as payments under the Notes), or require that any of those payments be made in reais. The likelihood of such restrictions may be determined by the extent of Brazil s foreign currency reserves, the availability of foreign currency in the foreign exchange markets on the date a payment is due, the size of Brazil s debt service burden relative to the economy as a whole, Brazil s policy toward the International Monetary Fund, political constraints to which Brazil may be subject and other factors. To date, the Brazilian government has not imposed any restrictions on payments by Brazilian issuers in respect of debt securities issued in the international capital markets, but we cannot assure you that such restrictions will not be imposed by the Brazilian government. There is currently no public trading market for the Notes and your ability to sell the Notes is limited. The Notes are new debt securities, and there is no existing public market for them. We have applied to list the Program and may list Notes of certain series on the Irish Stock Exchange (Global Exchange Market). We cannot assure you that an active trading market for the Notes will ever develop or be sustained. If an active market for the Notes does not develop or is interrupted, the market price and liquidity of the Notes may be adversely affected. We also cannot assure you as to the liquidity of any markets that may develop for the Notes, the ability of holders of the Notes to sell their Notes, or the price at which holders would be able to sell their Notes. Future trading prices of the Notes will depend on many factors, including, among other things, prevailing interest rates, our operating results, our financial condition, the prospects for other companies in the banking industry, and the market for similar securities. Judgments of Brazilian courts enforcing our obligations under the Notes or the agency agreement would be expressed in real-equivalent amounts. If proceedings were brought in Brazil seeking to enforce our obligations under the Notes or the agency agreement, any judgment obtained thereunder against us would be expressed in the amount in reais equivalent on the date of remittance from Brazil to the relevant non-brazilian currency denominated amount due and unpaid under such Notes. Accordingly, absent the imposition hereafter of any law, regulation or directive otherwise restricting the exchange of reais into, or the remittance from Brazil of, the non-brazilian currency in 42

which the Notes are denominated dictated by economic, market or other disruptive circumstances, the amount of reais made available as a result of such judgment would be applied towards the exchange into, and the remittance from Brazil of, such amount of non-brazilian currency due and unpaid under the Notes. Our obligations under the Notes are subordinated to certain statutory liabilities. Under Brazilian law, our obligations under the Notes and the agency agreement are subordinated to certain statutory preferences. In the event of our extrajudicial liquidation or bankruptcy, such statutory preferences, such as claims for salaries, wages, social security and other taxes, court fees and expenses, will have preference over any other claims. We may not be able to obtain necessary governmental authorizations. The issue of Notes through our principal office in Brazil is subject to certain registrations with and requirements of the Central Bank, namely (i) the registration of the main financial terms under the relevant Electronic Declaratory Registry Registry of Financial Transactions (Registro Declaratório Eletrônico Registro de Operações Financeiras or ROF ) on the Sisbacen for the issue of any series of Notes by us, which shall be obtained prior to any such issuance; (ii) the registration of the schedule of payments in connection with any such issuance, which shall be obtained after the entry of the related proceeds into Brazil; and (iii) the further authorization from the Central Bank required to enable us to remit payments abroad in foreign currency under any series of Notes other than scheduled payments of principal, interest, commissions, costs and expenses contemplated by the relevant ROF or to make any payment provided for in such ROF earlier than the due date thereof or on a date after the 120th day from the payment dates scheduled therein. We cannot assure you that any such registration with or approval of the Central Bank will be obtainable at a future date. Risks Relating to Real-denominated or Inflation-indexed Notes If the Brazilian real depreciates against the U.S. dollar, the effective yield on real-denominated Notes (in U.S. dollar terms) will decrease below the interest rate on such Notes, and the amount payable on an interest payment date, at maturity or upon acceleration may result in a loss to you. Rates of exchange between the U.S. dollar and the Brazilian real have varied significantly over time. See Exchange Rates below. However, historical trends do not necessarily indicate future fluctuations in rates and should not be relied upon as indicative of future trends. Currency exchange rates can be volatile and unpredictable and may be affected by macroeconomic factors and speculation. If the Brazilian real depreciates against the U.S. dollar, the effective yield on real-denominated Notes (in U.S. dollar terms) will decrease below the interest rate on the Notes and the amount payable on an interest payment date, at maturity or upon acceleration may result in a loss to you. Also, depreciation of the Brazilian real against the U.S. dollar may adversely affect the market value of such Notes. The value of Notes may be affected by changes in rates of inflation in Brazil. The interest rate on Notes may be linked to a Brazilian inflation index. The Brazilian government sets inflation targets and attempts to manage the Brazilian economy to, among other goals, control inflation. There can be no assurance that the target levels of inflation set by the Brazilian government will be achieved, or that current levels of inflation will continue. The market price of inflation-indexed Notes may be affected by investors perceptions of the impact of inflation on the value of the currency in which the Notes are denominated on the one hand, and the increase or decrease in the interest rate on such Notes, on the other. There can be no assurance that the market price of such Notes will not be negatively affected by a decrease in the relevant inflation rate if potential investors do not view such diminished interest to be offset by a correspondingly greater value of the currency in which the Notes are denominated or, to the contrary, if the 43

investors view is that increases in the rate of interest do not cover the diminished value of the currency resulting from increased inflation. There is no existing significant secondary market for real-denominated or inflation-indexed Notes nor assurance regarding the future development of a significant secondary market for such Notes. A significant secondary market for real-denominated and inflation-indexed Notes has not developed, and there can be no assurance that any such market will develop in the future. The absence of a significant secondary market for Notes linked to the real and/or Brazilian inflation indices may have a material negative impact on the ability of holders to resell such Notes, which may negatively affect the market price for such Notes. 44

EXCHANGE RATES Before March 14, 2005 there were two foreign exchange markets in Brazil, the commercial rate exchange market and the floating rate exchange market, where exchange positions of Brazilian banks in the commercial market and the floating market were unified and differentiated solely for regulatory purposes. The commercial market was reserved primarily for foreign trade transactions and transactions that generally require prior registration with the Central Bank, such as the purchase and sale of registered investments by foreign persons and related remittances of funds abroad. Purchases of foreign exchange in the commercial market could be carried out only through a financial institution in Brazil authorized to buy and sell currency in that market. The commercial market rate was the commercial selling rate for converting Brazilian currency into U.S. dollars, as reported by the Central Bank. The floating market rate generally applied to specific transactions for which Central Bank approval was not required. Prior to the implementation of the Real Plan, the commercial market rate and the floating market rate differed significantly at times. However, since the introduction of the real in 1994, the two rates have not differed significantly. On March 4, 2005, the CMN unified the commercial market and the floating market through the enactment of Resolution No. 3,265, effective March 14, 2005, thereby producing a single exchange market in place of the previous two. The unified exchange market is intended to simplify both inbound and outbound foreign exchange transactions by permitting exchange contracts to be executed by those local institutions that are authorized to deal in foreign exchange. The Brazilian foreign exchange rules were recently made more flexible. For example, on March 23, 2010 the CMN enacted Resolution No. 3,844 consolidating the general provisions relating to foreign capital entering Brazil through direct investments and financial transactions. Such rule governs the registry of flows of direct investments, credits, royalties, transfers of technology and foreign leasing, among other things. The Central Bank, by means of Circular No. 3,491 dated March 29, 2010, also simplified the registry of transactions. The new rules were included in the Regulation of the Exchange Market and Foreign Capital (Regulamento do Mercado de Câmbio e Capitais Internacionais) and several outdated rules were revoked. The main aspects of the abovementioned rules are the following: financial transfers (to and from Brazil), in reais or foreign currency, related to the flow of foreign capital pursuant to Resolution No. 3,844, are regulated by the Brazilian exchange market; specific approvals or prior consent of the Central Bank are no longer required; and the Central Bank has waived some requirements for presentation of information relating to a transaction. Exchange rates for the real can be highly volatile. The real appreciated during 2006 and 2007 from R$2.34 per U.S.$1.00 on December 31, 2005, to R$2.14 per U.S.$1.00 on December 31, 2006, and to R$1.77 per U.S.$1.00 on December 31, 2007. Although the Brazilian real appreciated against the U.S. dollar in both 2006 and 2007, the appreciation was more significant in 2007 (17.2%) than in 2006 (8.7%). In 2008, mainly as a result of the negative impact of the global financial crisis on the Brazilian economy, the real depreciated significantly against the U.S. dollar. The real/u.s. Ptax 800 selling exchange rate on December 31, 2008 was R$2.34 per U.S.$1.00, a 31.9% increase in relation to the December 31, 2007 rate. In 2009, the real stabilized and then commenced appreciating against the U.S. dollar and, as of December 31, 2009, the U.S. dollar/real exchange rate was R$1.74 per U.S.$1.00. In 2010, the real fluctuated against the U.S. dollar and, as of December 31, 2010, the U.S. dollar/real exchange rate was R$1.67 per U.S.$1.00, an appreciation of 4.0% compared to December 31, 2009. 45

As of April 4, 2011, the rate for purchasing U.S. dollars was R$1.61 to U.S.$1.00. We cannot assure you that the real will not devalue substantially or that it will not continue to appreciate against the U.S. dollar. The following table shows the real/u.s. Ptax 800 selling rate for U.S. dollars for the periods and dates indicated: Closing Selling Rates of R$ per U.S.$1.00 Year Ended Low High Average (1) Period End December 31, 2006... 2.06 2.37 2.18 2.14 December 31, 2007... 1.73 2.16 1.95 1.77 December 31, 2008... 1.56 2.50 1.84 2.34 December 31, 2009... 1.70 2.42 1.99 1.74 December 31, 2010... 1.66 1.88 1.76 1.67 Month Ended Low High Average (1) Period End September 2010... 1.69 1.74 1.72 1.69 October 2010... 1.66 1.71 1.68 1.70 November 2010... 1.68 1.73 1.71 1.72 December 2010... 1.67 1.71 1.69 1.67 January 2011... 1.65 1.69 1.67 1.67 February 2011... 1.66 1.67 1.67 1.66 March 2011... 1.63 1.68 1.66 1.63 Note: (1) Represents the average of exchange rates on each day of each respective month during the periods indicated. Source: Central Bank. 46

USE OF PROCEEDS Unless otherwise specified in the Final Terms relating to any tranche of Notes, the net proceeds of the issue of the Notes will be used by us for general banking purposes. 47

CAPITALIZATION The following table presents our capitalization as of December 31, 2010. This table should be read in conjunction with Summary Selected Historical Financial Data, Management s Discussion and Analysis of Financial Condition and Results of Operations and our audited and consolidated financial statements included elsewhere in these Listing Particulars. As of December 31, 2010 (U.S.$ in millions) (1) (R$ in millions) Long-term liabilities Deposits... 3,148 5,245 Money market repurchase commitments... 2,477 4,127 Acceptance and endorsement... 4,231 7,049 Borrowings and repasses... 2,951 4,917 Other liabilities... 5,532 9,217 Total long-term liabilities... 18,338 30,555 Deferred income... 25 42 Shareholders equity Domestic capital (2)... 2,417 4,027 Capital reserves... 351 585 Revenue reserves... (34) (57) Retained earnings... 2,301 3,834 Total shareholders equity... 5,035 8,389 Total capitalization... 23,398 38,986 Risk-based capital ratios Risk-based capital ratio (consolidated total basis) (3)... 13.1% Notes: (1) Translated from reais at the rate of R$1.6662 per U.S.$1.00, the exchange rate prevailing on December 31, 2010. (2) On December 31, 2010, our domestic capital consisted of 81,538,822,950 shares without par value. (3) Calculated based on CMN Resolution No. 2,723, of June 1, 2000 (or Resolution No. 2,723) and other applicable regulations and presented on a consolidated total basis including our non-financial subsidiaries. Since July 31, 2000, as required by Resolution No. 2,723, we have also been required to measure our capital compliance on a consolidated total basis (which includes both our financial and non-financial subsidiaries). See The Brazilian Financial System and Bank Regulations. 48

MANAGEMENT S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following discussion contains an analysis of our consolidated results for the years ended December 31, 2010, 2009 and 2008. The following discussion should be read in conjunction with our audited consolidated financial statements and audit reports and notes thereto included elsewhere in these Listing Particulars. The preparation of the financial statements referred in this section required the adoption of assumptions and estimates that affect the amounts recorded as assets, liabilities, revenue and expenses in the years and periods addressed and are subject to certain risks and uncertainties. Our future results may vary substantially from those indicated as a result of various factors that affect our business, including, among others, those mentioned in the sections Forward-Looking Statements and Risk factors, and other factors discussed elsewhere in these Listing Particulars. Introduction The following discussion should be read in conjunction with our financial statements, reports and the notes thereto included elsewhere in these Listing Particulars. These financial statements were prepared in accordance with Brazilian GAAP, which differs in certain significant respects from U.S. GAAP. Factors Affecting Financial Condition and Results of Operations Our results of operations for the years ended December 31, 2010, 2009 and 2008 were mainly affected by the significant growth in the size of our consolidated credit portfolio, including the credit portfolio of our subsidiary B.V. Financeira. The growth in our consolidated credit portfolio increased both our financial income and financial expenses, reflecting our overall strategy to increase both our consumer financing and corporate lending operations. In addition to those factors relating specifically to the development and expansion of our business operations, our results of operations were also affected by macro-economic and regulatory factors. Brazilian Economic Environment As a bank with most of our operations in Brazil or related to Brazil, we are significantly affected by economic, political and social conditions within Brazil. In particular, our financial performance has been affected by fluctuations in growth rates, inflation rates, the real/u.s. dollar exchange rate and government measures to control inflation, especially through interest rate setting mechanisms. See Risk Factors Risks Relating to Brazil. Global Financial Crisis Over the past three years, and in particular since mid-2008, the global banking industry has been severely impacted by the global financial crisis, which has contributed to significant write-downs of asset values by financial institutions, including government-sponsored entities and major commercial and investment banks. The effects of the global financial crisis in Brazil in 2008, 2009 and 2010 have been relatively moderate compared to the effects in the United States and Europe. While liquidity in the Brazilian banking industry was to some extent affected by the global financial crisis, the Central Bank enacted various measures, particularly in the fourth quarter of 2008, to ensure the availability of sufficient liquidity in the Brazilian market. See The Brazilian Financial System and Banking Regulation. To date, the primary effects of the global financial crisis on the Brazilian banking system have been an increase in loan delinquency rates and reduced liquidity, which have affected mainly a number of smaller and mid-sized banks. At the same time, the Brazilian market has experienced a movement of funds towards larger financial institutions recognized as having greater stability and safer forms of investments. Since the 49

announcement of our association with Banco do Brasil in January 2009, we have benefited from such a movement of funds. Rates of Inflation Inflation in Brazil has in past years been volatile, although inflation rates have tended to be more stable since 2005. This stability is largely a result of the Brazilian government s monetary policy, including periodic changes in interest rates, and the appreciation of the real against the U.S. dollar during the period. Inflation, as measured by the IGP-M, was 9.81% in 2008. The effects of the global financial crisis and the resulting decrease in economic activity in Brazil lead to deflation of 1.71% in 2009. The inflation rate in 2010 was 11.32%. Since 2005, lower and more stable levels of inflation have contributed to reduced economic uncertainty in Brazil and reduced volatility in the Brazilian securities markets. While this represents an improved lending environment, there are correspondingly fewer arbitrage opportunities in securities trading. Interest Rates As a banking institution in Brazil, our results of operations are significantly affected by interest rate fluctuations, which affect the cost of our funding and income derived from our credit and securities trading operations. To control inflation, the Brazilian government has from time to time introduced policies aimed at tightening credit and reducing consumption, primarily by raising interest rates. As a result, the SELIC rate has varied significantly in recent years. During 2008, the SELIC rate increased from 11.18% as of December 31, 2007 to 13.66% as of December 31, 2008. Largely in response to accelerating economic activity, the COPOM began raising the target SELIC rate from 11.25% in May 2008 to 13.75% in September 2008. However, as a response to the 2008 global financial crisis, the COPOM lowered the target SELIC rate in 2009 and, as of December 31, 2009, the SELIC rate was 8.65%. Following the improvement in economic conditions in 2010, the COPOM increased the target SELIC and, as of December 31, 2010, the SELIC rate was 10.66%. As a consequence of these movements, average interest rates were lower in 2009 compared to 2008 and lower in 2010 compared to 2009. The following table sets forth the low, high, average and period-end SELIC rate, as reported by the Central Bank for the years ended December 31, 2010, 2009 and 2008. Period Low High Average (1) Period-end 2010... 8.64% 10.66% 9.82% 10.66% 2009... 8.64% 13.67% 10.03% 8.65% 2008... 11.13% 13.67% 12.45% 13.66% Note: (1) Average of month-end rates during the period. Source: Central Bank. Foreign Exchange Rates Our financial performance is affected by the volatility of the real. Fluctuations in the value of the real may, among other things (i) increase or decrease the cost of our foreign currency denominated or linked funding, (ii) increase or decrease the demand for and costs to our clients of foreign currency denominated or linked loans, (iii) increase or decrease the non-performance rate of such loans and (iv) significantly affect the value of our foreign currency denominated or linked assets and liabilities as they are expressed in our accounts in reais. 50

Although we make significant use of derivative financial instruments to limit the effect of foreign currency fluctuations on our assets and liabilities, the inclusion of the effects of foreign currency fluctuations in our various income and expense accounts makes the period-on-period comparison of individual account items more difficult. Exchange rates for the real can be highly volatile. In 2008, mainly as a result of the negative impact of the global financial crisis on the Brazilian economy, the real depreciated significantly against the U.S. dollar from R$1.77 per U.S.$1.00 as of December 31, 2007 to R$2.34 per U.S.$1.00 as of December 31, 2008 representing a depreciation of 32.2%. During 2009, the real stabilized and then commenced appreciating against the U.S. dollar and, as of December 31, 2009, the U.S. dollar/real exchange rate was R$1.74 per U.S.$1.00 representing an appreciation of 24.4%. As of December 31, 2010, the U.S. dollar/real exchange rate was R$1.67 per U.S.$1.00. See Risk Factors Risks Relating to Brazil and Exchange Rates for a more detailed discussion of the changes in the real to U.S. dollar exchange rate for the periods covered herein. Reserve Requirements The level of the Central Bank s reserve requirements is another important factor affecting the results of operations of banks in Brazil. Raising or lowering reserve requirements will have a significant impact on our results of operations by (i) limiting or increasing funds available for lending operations and (ii) affecting our return on average assets. During the periods under discussion, Central Bank reserve requirements have been subject to periodic adjustment. For instance, recent temporary changes in Central Bank regulations, introduced mainly since the fourth quarter of 2008, which were intended to improve liquidity in the Brazilian financial system and were focused mainly on mid-sized and small banks, reduced the level of compulsory deposits that financial institutions are required to maintain. Any significant future adjustments in reserve requirements could have a material adverse effect on our business, results of operation and financial condition. Critical Accounting Policies Our principal accounting policies are described in note 3 to each of our consolidated financial statements as of and for the years ended December 31, 2010, 2009 and 2008 included elsewhere in these Listing Particulars. The application of these policies affects our financial condition and results of operations. Certain of those policies are required by the Central Bank. See The Brazilian Financial System and Banking Regulation. Our critical accounting policies: (1) are based on estimates and assumptions that we judge to be reasonable, relevant and reliable; (2) are essential to evaluate our financial condition and results of operations; and (3) require a detailed analysis, decisions and judgments of our management, which may be subjective and complex. These judgments involve estimating the uncertain effects of events that are inherent to our business and affect the carrying value of our assets and liabilities, and consequently, our results of operations. Our financial condition and results of operations could be significantly affected if estimates and assumptions used by our management were modified. The following is a brief description of our consolidated procedures and critical accounting practices. Statement of Income Income and expense items are recorded on an accrual basis. Operations involving pre-fixed rates are recorded at the redemption values and the income and expenses that refer to future periods are recorded as reductions against the respective assets and liabilities. Financial income and expenses are recorded on a daily pro rata basis, and calculated using compound interest, except for those related to overseas transactions, which are calculated on a straight-line basis. Transactions involving post fixed rates or indexed to foreign currencies are adjusted to the balance sheet date. 51

Cash and Cash Equivalents Cash and cash equivalents are represented by available funds, open market investments and interbank deposits, which have an insignificant risk of change of value and mature within a period of 90 days from the date of acquisition, and are used to manage of our short-term commitments. Interbank Funds Applied Interbank funds applied are recorded at the investment values, plus accrued income to the balance sheet date, recorded on a daily pro rata basis, calculated based on the variation in the index or the interest rate agreed. Securities Securities are recorded at the amount paid and classified, based on management s intention, between three separate categories: (i) (ii) (iii) Securities for trading: Securities acquired to be actively and frequently traded. They are adjusted by market value in the statements of income for the period; Securities available for sale: Securities that are not intended for trading nor to be held through to maturity. They are adjusted by market value in the shareholders equity account, net of tax impacts; and Securities held to maturity: Securities for which there is the intention and financial capacity to hold in portfolio up to their maturity. They are recorded at cost of purchase, plus accrued income in the statements of income for the period. The market valuation methodology for securities is based on consistent and verifiable criteria, which take into consideration the average price of quoted transactions on an exchange on the date of the calculation, or in the absence thereof, transactions in future markets disclosed by ANBIMA, BM&FBOVESPA and Central Bank of the probable net realizable value obtained from using interest rate future value curves, exchange rates, price and currency indices, and any adjustments to prices of securities with low liquidity in order to determine the most appropriate fair market value. Accrued income from securities, irrespective of the category to which they are classified, is calculated on a daily pro rata basis, based on the variation in the index or interest rate agreed, using the exponential method or straight line method, until the maturity date or the actual sale of the security, and is recognized directly to income for the period. Securities classified as securities for trading are reported in the balance sheet as current asset, independent of the maturity dates of the respective securities. Derivative Financial Instruments Derivative financial instruments are stated at market value, based on consistent and verifiable criteria, based on the average price of quoted transactions on the date of calculation, or in the absence of such data, conventional and proven valuation methodologies. Increases or decreases in value are recorded to income or expense accounts for the respective financial instruments. Derivative financial instruments are classified according to management s intention, taking into consideration their purpose. Financial instruments used to compensate all or part of the risks arising from exposure to variations in the market value of assets or liabilities are considered to be hedge instruments and are classified according to their nature, between: 52

(i) Market risk hedge : the market value adjustments for financial instruments classified to this category, and for the hedge item are recorded to income for the period. (ii) Cashflow hedge: the market value adjustments for derivative financial instruments classified in this category, are recorded to shareholders equity account, net of tax impacts. The market value adjustments for derivative financial instruments that do not fulfill hedge criteria are recorded directly to income for the period. For financial instruments traded in association with funding operations, both the financial instrument and the liability are recorded according to the terms of the contract, and are not adjusted at market value. Loans, Leasing and Advances on Foreign Exchange Contracts, Other Credits Characterized as Credit Assignment and Provision for Loan Allowances. Transactions involving credit, leasing and advances on foreign exchange contracts and other credits characterized as credit assignments are classified based on management s judgment of the risk levels involved, taking into consideration the economic situation, past experience and the specific risks in relation to the transaction, the debtors and guarantors and the overdue payment period, observing the parameters established by the Central Bank, which require that the portfolio be analyzed and classified between nine levels, from AA (minimum risk) through H (maximum risk). In factoring in the period for which payments are overdue, the actual period in arrears is doubled for transactions that have more than 36 months to maturity. Income from loans overdue for more than 60 days, independent of the risk level, is only recognized as income when actually received. Transactions classified to level H remain with this classification for six months, when they are then written off against the existing provision and controlled in memorandum accounts. Any renegotiated transactions are recorded, at a minimum, to the same level in which they were classified. Renegotiations of credit transactions that have been written off against provisions, and recorded to memorandum accounts, are classified as H and any gains from the renegotiated credits are recognized as income when actually received. Credit operations that are hedged by derivative financial instruments are valued at their market values based on verifiable criteria. The market value adjustments from these operations are registered, when positive, to other credits other, and when negative, to other liabilities other, as the corresponding entries for income from loan operations. Prepaid Expenses Prepaid expenses are recorded as investments by way of prepayments, for which the benefits or services will occur in future periods. Thus, based on Brazilian GAAP, prepaid expenses include costs incurred that relate to assets that will generate income in subsequent periods, which are appropriated to results based on the periods and values of the expected benefits, and written off directly to results when the corresponding goods or rights are no longer part of our assets or the future expected benefits can no longer be realized. Accounting Estimates The preparation of financial statements in accordance with accounting practices adopted in Brazil requires that management uses its judgment in determining and recording accounting estimates, when applicable. Liquidation of the transactions involving these estimates could result in values that differ from the estimates, as a result of the inaccuracies inherent to the process for determining such. We review the estimates and premises at least monthly. 53

Permanent Assets (i) (ii) (iii) (iv) Investments in subsidiaries are valued using the equity method. Other permanent assets are stated at cost of purchase, less any provisions for loss, when applicable. Property, plant and equipment are stated at cost, less depreciation. Depreciation is calculated using the straightline method, based on the following annual rates: facilities, furniture and equipment for use 10%, communication system/security/transportation 10%, data processing system 20%. Deferred charges are shown at acquisition or formation cost, when registered prior to BACEN Circular Letter No. 3357/08 came into force, which restricted the recording of deferred charges, less the respective amortization. Amortization is calculated by the straight-line method, based on the period over which the benefit is generated. Intangible assets include the rights to intangible assets, used for maintaining the company or exercised for this purpose. Amortization is calculated by the straight-line method, based on the period over which the benefit is generated. Income Tax and Social Contribution Income tax has been calculated at the rate of 15% plus a surtax of 10% applicable to taxable profit. Social contribution has been calculated at the rate of 9% until April 30, 2008 and as from May 1, 2008, at the rate of 15%, in accordance with Law No. 11707/08, on taxable profit. The tax asset from income tax and social contribution is recorded based on studies determining the realization of this asset, prepared by management. In our subsidiary B.V. Leasing, deferred income tax has been recognized, calculated at the rate of 25%, on the adjustment for excess depreciation from the leasing portfolio. Contingent Assets and Liabilities and Legal Obligations Recognition, measurement and disclosure of contingent assets, contingent liabilities and legal obligations are made based on the criteria defined in CMN Resolution No. 3,535/2008, which made it compulsory to adopt NPC Statement 22, issued by IBRACON. (i) (ii) (iii) Contingent assets: these are recognized in the financial statements only when there is evidence that ensures they will be realized, and for which no more appeals can be made, with the gain considered almost certain. Contingent liabilities: these are recognized in the financial statements when, based on the opinion of the legal advisors and management, the risk of loss from a legal or administrative claim is considered probable, and when it is probable that funds will be required to settle the obligations, and when the amounts involved can be measured with sufficient accuracy. Contingent liabilities classified as representing possible losses are not recognized in the accounts, but only have to be disclosed in the notes to the accounts, and those classified as remote do not require a provision nor do they have to be disclosed. Legal obligations Tax and social security: these are legal processes related to tax or social security obligations, with these claims questioning the legality or constitutional nature of such, which, independent of the probability of a successful outcome from the legal processes in progress, are recognized in full in the financial statements. 54

Other Assets and Liabilities Assets are shown at their realizable values, including, when applicable accrued income and inflation and foreign exchange adjustments (on a pro rata daily basis) and provisions for losses, when considered necessary. Liabilities are stated at known or calculated amounts, plus charges and monetary and foreign exchange variations incurred (on a pro rata daily basis). Assets and liabilities that do not have a defined period, for purposes of the balance sheet, are classified as long term assets and current liabilities. Changes to Accounting Rules On December 28, 2007, the Brazilian government enacted Law No. 11,638, which, together with Law No. 11,941, amended the Brazilian corporations law and introduced the process of conversion of financial statements into IFRS. In accordance with Central Bank Communication No. 14,259, financial institutions will be required to apply IFRS accounting standards starting with their accounting and financial statements for the year ending December 31, 2010. Following the amendment, the Central Bank issued resolutions and adopted interpretative statements issued by the CPC. We have implemented these changes without significant effect on our financial statements and results. The CPC has recently issued new interpretative statements that, if adopted by the Central Bank, may materially affect our financial statements. In addition, in accordance with CMN Resolution No. 3,604, dated August 29, 2008, starting with their accounting and financial statements for the year ending December 31, 2008, financial institutions are required to publish their statements of cash flow. Our financial statements as of and for the years ended December 31, 2010, 2009 and 2008 were prepared in accordance with Brazilian GAAP with the adoption of the modifications introduced by Law No. 11,638, Law No. 11,941, Resolution No. 3,604 and additional regulations issued by the CMN and the Central Bank. The main difference between these statements and those prepared prior to the effectiveness of these new rules is the presentation of statements of cash flows instead of statements of changes in financial position. 55

Results of Operations for the Year Ended December 31, 2010 Compared to the Year December 31, 2009 Net Profit The following table presents the principal components of our net profit for the years ended December 31, 2010 and 2009: For the year ended December 31, 2010 2009 (R$ in millions) Financial operations income... 14,130 11,272 Financial operations expenses before allowance for loan losses... (8,541) (5,811) Gross income from financial operations before allowance for loan losses... 5,589 5,461 Allowance for loan losses... (1,189) (1,535) Gross income from financial operations after allowance for loan losses... 4,400 3,926 Other operating (expenses) income... (2,357) (2,552) Operating results... 2,043 1,374 Non-operating results... (83) (86) Income before taxation and profit sharing... 1,960 1,288 Income tax and social contribution... (547) (284) Profit sharing... (398) (201) Minority Interests... - (1) Net profit... 1,015 802 Our net profit increased 26.6% from R$802 million in the year ended December 31, 2009 to R$1,015 million in the year ended December 31, 2010. Our gross income from financial operations before allowances for loan losses increased 2.3% to R$5,589 million, representing a net interest margin of 6.0%, in the year ended December 31, 2010 from R$5,461 million, representing a net interest margin of 7.1%, in the year ended December 31, 2009, reflecting the expansion of our credit operations. Our net profit increased mainly as a result of the expansion of our credit operations and a reduction in our allowance for loan losses, which increase was partially offset by an increase in administrative and personnel expenses associated with the expansion of our consumer financing, and middle market operations and the strengthening of our corporate governance and risk management structures. Our return on average interest-earning assets increased from 1.0% in the year ended December 31, 2009 to 1.1% in the year ended December 31, 2010 as a result of our 26.6% increase in net profit, which was partially offset by the 20.8% increase in our average interest earning assets from R$77 billion in the year ended December 31, 2009 to R$93 billion in the year ended December 31, 2010. Our return on average shareholders equity increased from 12.0% in the year ended December 31, 2009 to 12.8% in the year ended December 31, 2010, reflecting the 26.6% increase in our net profit, which was partially offset by the increase of 18.6% in our average shareholders equity from R$6.7 billion in the year ended December 31, 2009 to R$8.0 billion in the year ended December 31, 2010. Financial Operations Income The following table presents the principal components of our financial operations income for the years ended December 31, 2010 and 2009: 56

57 For the year ended December 31, 2010 2009 (R$ in millions) Loans... 8,813 6,982 Leasing... 2,644 1,803 Securities... 4,307 2,934 Derivative financial instruments... (2,004) (447) Foreign exchange operations... 42 - Compulsory investments... 328 - Total financial operations income... 14,130 11,272 Total financial operations income increased 25.4% from R$11,272 million in the year ended December 31, 2009 to R$14,130 million in the year ended December 31, 2010. This increase reflected higher income from lending operations, leasing operations and securities transactions in the year ended December 31, 2010 compared to the year ended December 31, 2009, which was partially offset by higher expenses from derivative operations. Income from lending operations increased 26.2% from R$6,982 million in the year ended December 31, 2009 to R$8,813 million in the year ended December 31, 2010. This increase was mainly due to an increase in the average balance of our loan portfolio in the year ended December 31, 2010 compared to the year ended December 31, 2009, which was partially offset by lower average interest rates prevailing in Brazil and negative effects of mark-to-market hedge adjustments in relation to our loan portfolio. The following table presents a breakdown of our credit portfolio as of December 31, 2010 and 2009: As of December 31, 2010 2009 (R$ in millions) Corporate/middle market... 19,602 16,193 Consumer financing... 37,214 26,251 Total credit operations... 56,816 42,444 Income from leasing operations increased 46.6% from R$1,803 million in the year ended December 31, 2009 to R$2,644 million in the year ended December 31, 2010. This increase mainly reflected a significant increase in the average volume of our leasing operations, from R$2.4 billion in the year ended December 31, 2009 to R$4.2 billion in the year ended December 31, 2010, which was partially offset by lower average interest rates. The increase in the average volume of our leasing operations was primarily due to our emphasis on new vehicle financing, in respect of which leasing represents a more significant component of the market than is the case with used vehicle financing. Income from securities transactions includes interest income, capital gains and losses, and gains and losses resulting from mark-to-market accounting with respect to our securities portfolio and interbank investments. It consists primarily of income, net of losses, generated by investments in cash equivalents, interbank investments and marketable securities. Income from securities transactions increased 46.8%, from R$2,934 million in the year ended December 31, 2009 to R$4,307 million in the year ended December 31, 2010. This increase was due mainly to (i) a significant increase in the average volume of our portfolio of fixed interest rate-linked securities in the year ended December 31, 2010 compared to the year ended December 31, 2009 resulting in additional revenue of R$821 million, and (ii) an increase of R$288 million relating to

transactions linked to the Turkish lira during the year ended December 31, 2010, compared to an expense generated in the year ended December 31, 2009 as a result of the depreciation of the Turkish lira during such period; and (iii) an increase of R$142 million related to transactions linked to the U.S. dollar during the year ended December 31, 2010 as a result of the appreciation of the real against the U.S. dollar during such period. Income (loss) from derivative financial instruments is comprised of the income or expense arising in connection with swaps, futures and other derivative transactions that we enter into on a regular basis for the purpose of hedging our positions. The results of derivative financial instruments reflect the effects of interest rate and foreign exchange rate volatilities, and these results offset the effects of these volatilities on our core banking operations. Expenses from derivative financial instruments increased significantly, from R$447 million in the year ended December 31, 2009 to R$2,004 million in the year ended December 31, 2010. This result was primarily due to the following additional net expenses in the year ended December 31, 2010 compared to the year ended December 31, 2009: (i) exposure to interest rate derivatives associated with our credit portfolio, securities, foreign exchange operations, repasses and investments abroad (R$472 million); (ii) operations linked to the Turkish lira, which are used as hedge instruments to our foreign exchange and securities portfolios (R$138 million); (iii) hedge instruments associated with our credit portfolio, lease operations and part of our securities portfolio (R$386 million); and (iv) operations linked to the Brazilian consumer price index (Índice Nacional de Preços ao Consumidor Amplo IPCA) (R$109 million). Income from foreign exchange operations represents the net result of our foreign exchange transactions (including advances on our foreign exchange portfolio) and the results of foreign exchange fluctuations related to interbank foreign exchange operations (including foreign currency deposits). Foreign exchange operations represented a net expense in the year ended December 31, 2009, compared to an income of R$42 million in the year ended December 31, 2010, mainly reflecting gains associated with our long positions in transactions involving the Turkish lira and U.S. dollar due to the appreciation of the real against these currencies in the year ended December 31, 2010. Gains or losses in our foreign exchange portfolio are largely offset by corresponding gains or losses on our derivatives contracts. Income from compulsory investments includes income derived from securities deposited with the Central Bank to satisfy reserve requirements on time deposits. Income from compulsory deposits increased from R$0 in the year ended December 31, 2009 to R$328 million in the year ended December 31, 2010. This increase was due to a change in Central Bank regulations as of February 24, 2010, by means of Circular No. 3,485, which increased the level of compulsory deposits that financial institutions are required to maintain with the Central Bank after the level had been temporarily reduced to increase liquidity in the Brazilian financial system in response to the global financial crisis. Financial Operations Expenses The following table presents the principal components of our financial operations expenses for the years ended December 31, 2010 and 2009: Funding operations For the year ended December 31, 2010 2009 (R$ in millions) Deposits... (2,587) (2,178) Money market repurchase commitments... (3,190) (2,632) Funds from acceptance and issuance of securities... (551) (22) Contribution to fund guarantee of credit (FGC)... (32) (27) 58

For the year ended December 31, 2010 2009 (R$ in millions) Leasing... (1,973) (1,130) Foreign exchange operations... - (240) Total funding operations... (8,333) (6,428) Borrowings, assignments and repasses Foreign borrowings... 139 991 Domestic repasses... (348) (374) Total borrowings, assignments and repasses... (209) 617 Total financial operations expenses before provision for loan losses... (8,542) (5,811) Provision for loan losses... (1,189) (1,535) Total financial operations expenses... (9,731) (7,346) Total financial operations expenses increased 32.5% from R$7,346 million in the year ended December 31, 2009 to R$9,731 million in the year ended December 31, 2010, primarily as a result of an increase in expenses from funding operations and expenses from borrowings, assignments and repasses. Expenses in respect of funding operations increased 29.6% from R$6,428 million in the year ended December 31, 2009 to R$8,333 million in the year ended December 31, 2010, as a result of significant increases in expenses related to funds from leasing operations, money market repurchase commitments, funds from acceptances and issuance of securities and deposits, mainly as a result of the increase in the average volume of such funding operations. Our deposit base consists primarily of time deposits. Expenses in respect of deposits increased 18.8% from R$2,178 million in the year ended December 31, 2009 to R$2,587 million in the year ended December 31, 2010. Our average deposit base increased from R$23.3 billion in the year ended December 31, 2009 to R$23.9 billion in the year ended December 31, 2010. The increase in deposits expenses is due to the increase of the average yield/cost of deposits from 9.5% the year ended December 31, 2009 to 11.0% in the year ended December 31, 2010. Expenses in respect of money market repurchase commitments ( repos ) increased 21.2% from R$2,632 million in the year ended December 31, 2009 to R$3,190 million in the year ended December 31, 2010, due to the higher average volume of such operations during the year ended December 31, 2010. The average balance of repurchase commitments increased 23.7% from R$25.3 billion in the year ended December 31, 2009 to R$31.3 billion in the year ended December 31, 2010, reflecting opportunities in the market for trading in securities and our strategy to maintain a high level of liquidity. Such increase was largely offset, however, by the effect of lower average interest rates paid on our repurchase commitments due to lower prevailing interest rates in Brazil in the year ended December 31, 2010 compared to the year ended December 31, 2009. Expenses in respect of funds from acceptance and issuance of securities are comprised of interest accrued and the effects of foreign exchange fluctuations on securities issued by us outside of Brazil. Expenses in respect of funds from acceptance and issuance of securities increased 2,404.5% from R$22 million in the year ended December 31, 2009 to R$551 million from such operations in the year ended December 31, 2010. This result mainly reflected an increase in the average balance of funds from acceptances and issuance of securities, including subordinated debt, from R$9,443 million in the year ended December 31, 2009 to R$14,099 million in the year ended December 31, 2010, which was partially offset by the effect of lower average interest rates 59

paid on such operations due to lower prevailing interest rates in Brazil in the year ended December 31, 2010 compared to the year ended December 31, 2009. Foreign exchange gains or losses on our funding operations are largely offset by corresponding gains or losses on other financial operations, including derivative contracts which are discussed under Financial Operations Income above. Expenses from leasing operations increased 74.6% from R$1,130 million in the year ended December 31, 2009 to R$1,973 million in the year ended December 31, 2010, mainly reflecting an increase in the average portfolio of such operations from R$2,654 million in the year ended December 31, 2009 to R$4,266 million in the year ended December 31, 2010, due to our increased use of leasing as a financing alternative for consumer financing transactions. Expenses from foreign exchange operations represent the net result of our foreign exchange transactions (including advances on our foreign exchange portfolio) and the results of foreign exchange fluctuations related to interbank foreign exchange operations (including foreign currency deposits). We recorded a net expense from foreign exchange operations of R$240 million in the year ended December 31, 2009, but did not record net expense from foreign exchange operations in the year ended December 31, 2010, since we had a net income from foreign exchange operations in the year ended December 31, 2010 as discussed above. The result for the year ended December 31, 2009 reflected losses on long positions in U.S. dollars and yen resulting from the appreciation of the real against these currencies in the period, which were partially offset by gains from our portfolio indexed to the Turkish lira. Gains or losses in our foreign exchange portfolio are largely offset by corresponding gains or losses in derivative contracts which are discussed under Financial Operations Income above. Expenses on borrowings, assignments and repasses consist primarily of interest and expenses accrued on amounts borrowed from foreign correspondent banks and government resources, such as Banco Nacional de Desenvolvimento Econômico e Social (the National Bank for Economic and Social Development BNDES ) and the Agência Especial de Financiamento Industrial (the Industrial Finance Agency FINAME ). With respect to foreign borrowings, interest expense also includes the effects of foreign exchange fluctuations between the real and the foreign currency denomination in relation to the outstanding principal amount of such borrowings. We recorded income from borrowings, assignments and repasses of R$617 million in the year ended December 31, 2009, compared to an expense from borrowings, assignments and repasses of R$209 million in the year ended December 31, 2010. This result mainly reflects: (i) an increase in expenses related to our U.S. dollar denominated borrowings resulting from the relatively weak appreciation of the real against the U.S. dollar in the year ended December 31, 2010 compared to the strong appreciation of the real against the U.S. dollar in the year ended December 31, 2009, which was partially offset by a decrease in the average volume of these operations; and (ii) an increase in expenses related to the yen denominated borrowings due to the increase in the average volume of those operations in the year ended December 31, 2010. Allowance for Loan Losses The following table shows the movement with respect to our allowance for loan losses for the years ended December 31, 2010 and 2009. As of and for the year ended December 31, 2010 2009 (R$ in millions) Opening balance... 1,362 774 Allowance for loan losses... 1,189 1,535 Write-off for losses... (1,398) (946) 60

Closing balance... 1,153 1,362 Our allowance for loan losses (increase/reversal net during period) decreased 15.3% from R$1,362 million in the year ended December 31, 2009 to R$1,153 million in the year ended December 31, 2010. Our allowance for loan losses reflects both the aggregate value of our credit portfolio and the credit risk assigned to credits within the portfolio. Our allowance for loan losses decreased for the year ended December 31, 2010, despite the increase in the volume of our credit operations, mainly due to (i) a decrease in defaults due to the improved economic conditions in Brazil and internationally in 2010 and (ii) the transfer of credits in arrears to a FIDC in December 2010. The closing balance of our allowance for loan losses as a percentage of our total loans and lease operations was 2.0% as of December 31, 2010 compared to 3.2% as of December 31, 2009. In 2008 we began to enter into assignments of loans in respect of which we retain the credit risk. Consequently, we began to take provisions in respect of such contingent obligations in 2008. Provisions established in respect of such contingent obligations are accounted for as other operating expenses. Other Operating (Expenses) Income The following table presents information with respect to our other operating (expenses) income for the years ended December 31, 2010 and 2009. For the year ended December 31, 2010 2009 (R$ in millions) Service income... 440 358 Banking fees... 804 459 Personnel expenses... (775) (564) Other administrative expenses... (1,536) (1,037) Tax expenses... (457) (364) Other operating income... 2,090 1,317 Other operating expenses... (2,923) (2,721) Total other operating expenses... (2,357) (2,552) Service income (excluding banking fees in respect of consumer financing transactions) in the years ended December 31, 2009 and 2010 consisted primarily of management fees in respect of mutual funds administered by us, fees generated from credit operations, fee income from guarantees provided by us on behalf of our clients and fees and commissions generated by our underwriting operations. Service income increased 22.9%, from R$358 million in the year ended December 31, 2009 to R$440 million in the year ended December 31, 2010, mainly due to an increase in our income from underwriting operations of R$39 million in the year ended December 31, 2009 to R$70 million in the year ended December 31, 2010. Banking fees income consists of fees charged on consumer financing operations pursuant to the standardized table for priority services and a basic standardized tariff package (Custo Efetivo Total or CET ) introduced by Circular No. 3,371 of December 6, 2007. In accordance with CMN Resolution No. 3,518 of December 6, 2007, which governs the charging of tariffs for services provided by financial institutions, and CET, as from April 30, 2008 B.V. Financeira no longer charges a fee for opening lines of credit and now charges banking fees. Banking fees income increased 75.2%, from R$459 million in the year ended December 31, 2009 to R$804 million in the year ended December 31, 2010, mainly due to the significant increase in our consumer financing credit origination in the year ended December 31, 2010. 61

Personnel expenses increased 37.4% from R$564 million in the year ended December 31, 2009 to R$775 million in the year ended December 31, 2010. This increase was mainly related to the hiring of employees by Banco Votorantim and B.V. Financeira to support the continued expansion of our consumer financing, corporate and middle-market credit operations. Other administrative expenses in the years ended December 31, 2009 and 2010 consisted primarily of technology, data processing and related expenses, financial system expenses, communications costs, expenses related to promoting financing operations of B.V. Financeira and outsourced services. Other administrative expenses increased 48.1% from R$1,037 million in the year ended December 31, 2009 to R$1,536 million in the year ended December 31, 2010 as a result of the continued expansion of the activities of Banco Votorantim and B.V. Financeira and a number of strategic projects initiated in 2010, focusing primarily on (i) generating gains from increasing scale through the growth of our middle market operations and (ii) improving our corporate governance and risk management structure. The main tax expenses that we incur are social contributions on revenue (Programa de Integração Social or PIS and Contribuição para o Financiamento da Seguridade Social or COFINS ). We also incur tax expenses on certain services rendered (Imposto sobre Serviços de Qualquer Natureza or ISS ). Tax expenses increased 25.5% from R$364 million in the year ended December 31, 2009 to R$457 million in the year ended December 31, 2010. This increase mainly reflected an increase in PIS/COFINS expenses from R$314 million in the year ended December 31, 2009 to R$385 million in the year ended December 31, 2010, as a result of the increase in financial operations income upon which such tax expenses are calculated. Other operating income in the years ended December 31, 2009 and 2010 consisted primarily of certain CET related charges and expenses prepaid by our clients in our consumer financing transactions. As explained in relation to service income and banking fees above, as from April 30, 2008 we implemented CET in our consumer financing transactions, which corresponds to all of the charges and expenses of such transactions including fees and commissions paid to third parties and insurance installments. Such charges are recognized as other operating income when they are prepaid at the time of the financing. We then incur other operating expenses when prepaid charges and expenses are actually incurred by us during the term of the consumer financing contract. Other operating income increased 58.7% from R$1,317 million in the year ended December 31, 2009 to R$2,090 million in the year ended December 31, 2010, mainly due to an increase in CET related income from R$1,173 million in the year ended December 31, 2009 to R$1,903 million in the year ended December 31, 2010. Other operating expenses in the years ended December 31, 2009 and 2010 consisted primarily of fees and commissions paid to third parties, the effect of foreign exchange fluctuation over external investment (capital of our subsidiary Votorantim Bank Limited - VBL and of the Bahamian Branch), discounts granted in accordance with our collection policy for overdue credits (to the extent they exceed provisions taken in respect of such credits) and the monetary restatement of tax risk and taxes payable. Other operating expenses increased 7.4% from R$2,721 million in the year ended December 31, 2009 to R$2,923 million in the year ended December 31, 2010. This increase was mainly due to an increase in expenses associated with our credit transactions, including commissions paid to retailers expensed in accordance with CET, from R$1,041 million in the year ended December 31, 2009 to R$1,610 million in the year ended December 31, 2010, which was partially offset by the positive effect of foreign exchange fluctuation on our external investment, the effect of which generated income of R$255 million. Non-operating Results Our non-operating expenses, net, decreased 3.5% from R$86 million in the year ended December 31, 2009 to R$83 million in the year ended December 31, 2010, mainly as a result of a decrease in the non-operating loss suffered on the resale of repossessed vehicles. Once a vehicle is repossessed, it is recorded as a non-operating asset with an assumed accounting value, which may not be achieved when it is resold, resulting in a nonoperating loss. 62

Income Tax and Social Contribution Our income tax expense consists of two components, the corporate income tax (assessed at a base rate of 15% of net income and a surcharge of 10% of net income) and the social contribution (assessed at 9% of adjusted net income). In the year ended December 31, 2010, we accrued income tax and social contribution expenses of R$547 million, a 92.6% increase compared to the year ended December 31, 2009, during which we accrued income tax and social contribution expenses of R$284 million. This increase was due to an increase in our income before taxation and social contribution and variations in the applicable additions and exclusions from taxes and availability of tax credits. Results of Operations for the Year Ended December 31, 2009 Compared to the Year Ended December 31, 2008 Net Profit The following table presents the principal components of our net profit for 2009 and 2008. For the year ended December 31, 2009 2008 (R$ in millions) Financial operations income... 11,272 12,613 Financial operations expenses before allowance for loan losses... (5,811) (8,901) Gross income from financial operations before allowance for loan losses.. 5,461 3,712 Allowance for loan losses... (1,535) (830) Gross income from financial operations after allowance for loan losses... 3,926 2,882 Other operating (expenses) income... 2,552 1,739 Operating results... 1,374 1,143 Non-operating results... (86) (56) Income before taxation and profit sharing... 1,288 1,087 Income tax and social contribution... (284) 88 Profit sharing... (201) (273) Minority interest... (1) - Net profit... 802 902 Our net profit decreased 11.1% from R$902 million in 2008 to R$802 million in 2009. Our gross income from financial operations before allowance for loan losses increased 47.1% to R$5,461 million, representing a net interest margin of 7.1%, in 2009, from R$3,712 million, representing a net interest margin of 5.9%, in 2008. In 2009, we benefited from a significant increase in the volume of our lending operations, particularly in relation to our consumer financing portfolio upon which we earn higher margins. Our return on average interest-earning assets decreased from 1.4% in 2008 to 1.0% in 2009 as a result of the decrease in our net profit and the increase in our average interest earning assets from R$63 billion in 2008 to R$77 billion in 2009. Our return on average shareholders equity decreased from 14.3% in 2008 to 12.0% in 2009, reflecting both our decrease in net profit and an increase of 6.7% in our average shareholders equity from R$6.3 billion in 2008 to R$6.7 billion in 2009. 63

Financial Operations Income The following table presents the principal components of our financial operations income for 2009 and 2008. For the year ended December 31, 2009 2008 (R$ in millions) Loans... 6,982 8,542 Leasing... 1,803 502 Securities... 2,934 3,743 Derivative financial instruments... (447) (859) Foreign Exchange Operations... - 577 Compulsory investments... - 108 Total financial operations income... 11,272 12,613 Total financial operations income decreased 10.6% from R$12,613 million in 2008 to R$11,272 million in 2009. This decrease was mainly a result of a decrease in income from our lending operations, our securities portfolio and our foreign exchange operations, which was partially offset by an increase in income from leasing operations and a decrease in expenses related to derivative transactions, as explained below. Income from lending operations decreased 18.3% from R$8,542 million in 2008 to R$6,982 million in 2009. This decrease was mainly due to lower average interest rates on our lending operations in 2009 compared to 2008 due to the lower average interest rates prevailing in Brazil, negative effects of foreign exchange fluctuation over our U.S. dollar-denominated and yen-denominated credit portfolio and negative effects of mark-to-market hedge adjustments in relation to our loan portfolio. This decrease was partially offset by an increase in the average volume of lending operations from R$31,732 million in 2008 to R$35,983 million in 2009. The following table presents a breakdown of our credit portfolio, comprising corporate and middle market operations which are conducted by Banco Votorantim, and our consumer financing operations, which are conducted by our subsidiary B.V. Financeira, as of December 31, 2009 and 2008. For the year ended December 31, 2009 2008 (R$ in millions) Corporate/middle market... 16,193 17,474 Consumer financing... 26,252 20,710 Total credit operations... 42,444 38,184 Income from leasing operations increased 259.2% from R$502 million in 2008 to R$1,803 million in 2009. This increase mainly reflected the significant increase in the average portfolio of such operations from R$641 million in 2008 to R$2,654 million in 2009, due to our increased use of leasing as a financing alternative for consumer financing transactions. Income from securities transactions includes interest income, capital gains and losses and gains and losses resulting from mark-to-market accounting with respect to our securities portfolio and interbank investments. It consists primarily of income, net of losses, generated by investments in cash equivalents, interbank investments and marketable securities. Income from securities transactions decreased 27.6% from R$3,743 64

million in 2008 to R$2,934 million in 2009. The decrease was mainly due to (i) the depreciation of the Turkish lira against the real in 2009, which generated an expense of R$733 million and (ii) the depreciation of 25.5% of the U.S. dollar against the real in 2009 compared to an appreciation of 31.9% in 2008, which generated an expense of R$487 million. The decrease was partially offset by an increase in our income from Brazilian interest rate-linked securities which, despite the lower average interest rates in Brazil in 2009 compared to 2008, increased from R$1.1 billion to R$1.7 billion as a result of the significant increase in the average volume of the portfolio. Income (loss) from derivative financial instruments is comprised of income or expense arising in connection with swaps, futures and other derivative transactions that we enter into on a regular basis for the purpose of hedging our positions. The results of derivative financial instruments reflect the effects of interest rate and foreign exchange rate volatilities, and these results offset the effects of these volatilities on our core banking operations. Losses from derivative financial instruments decreased 47.9% from a loss of R$859 million in 2008 to a loss of R$447 million in 2009. This result was primarily due to a reduction in net expenses in 2009 compared to 2008 related to the effects of our higher exposure to interest rate derivatives, which reflected economic hedging operations related to our increased volume of lending operations, and the consistent appreciation of the real against the U.S. dollar in 2009 compared to 2008. Income from foreign exchange operations represents the net result of our foreign exchange transactions (including advances on our foreign exchange portfolio) and the results of foreign exchange fluctuations related to interbank foreign exchange operations (including foreign currency deposits). Foreign exchange operations represented a net expense in 2009, compared to a net gain of R$577 million in 2008. As described below in Financial Operations Expenses, we had a loss on foreign exchange operations in 2009 which reflected losses on long positions in U.S. dollars and yen resulting from the appreciation of the real against these currencies in 2009. Gains or losses in our foreign exchange portfolio are largely offset by corresponding gains or losses in derivatives contracts. Income from compulsory investments includes income derived from securities deposited with the Central Bank to satisfy reserve requirements on time deposits. Income from compulsory deposits decreased 100% to R$0 in 2009 from R$108 million in 2008. This decrease was due to a decrease in the average volume of compulsory deposits we were obliged to maintain in 2009 as a result of a change in Central Bank regulations made on December 19, 2008 intended to improve liquidity in the Brazilian financial system. 65

Financial Operations Expenses The following table presents the principal components of our financial operations expenses for 2009 and 2008. For the year ended December 31, 2009 2008 (R$ in millions) Funding operations Deposits... (2,178) (2,060) Money market repurchase commitments... (2,632) (2,521) Funds from acceptance and issuance of securities... (22) (2,226) Contribution to fund guarantee of credit (FGC)... (27) (23) Leasing... (1,330) (295) Foreign exchange operations... (240) - Total funding operations... (6,428) (7,124) Borrowings, assignments and repasses Foreign borrowings... 991 (1,378) Domestic repasses... (374) (398) Total borrowings, assignments and repasses... 617 (1,776) Total financial operations expenses before provision for loan losses... (5,811) (8,901) Provision for loan losses... (1,535) (830) Total financial operations expenses... (7,346) (9,731) Total financial operations expenses decreased 24.5%, from R$9,731 million in 2008 to R$7,346 million in 2009, as a result of reduced expenses in respect of funding operations and a gain from borrowings, assignments and repasses. Expenses in respect of funding operations decreased 9.8% from R$7,124 million in 2008 to R$6,428 million in 2009. The decrease in expenses relating to funding operations was mainly a result of a significant decrease in expenses in respect of funds from acceptance and issuance of securities and also the lower prevailing interest rates in Brazil in 2009 compared to 2008. Our deposit base consists primarily of time deposits. Expenses in respect of deposits increased 5.7% from R$2,060 million in 2008 to R$2,178 million in 2009. The effect of lower average interest rates paid on our deposits due to the lower prevailing interest rates in Brazil in 2009 compared to 2008 was largely offset by the increase in the average volume of deposits from R$19,137 million in 2008 to R$23,309 million in 2009. Since we are not a retail bank, the extent to which we rely on deposits for funding depends in part upon the relative cost of funding of different types in the market and the comparative rate at which we remunerate alternative investments, particularly investment funds. Expenses in respect of money market repurchase commitments ( repos ) increased 4.4% from R$2,521 million in 2008 to R$2,632 million in 2009, due to the increase in the average volume of this source of funding in 2009. The average balance of repurchase agreements increased from R$21,159 million in 2008 to R$25,382 million in 2009, reflecting opportunities in the market and our strategy to maintain a high level of liquidity, which more than offset a decrease in average interest rates. 66

Expenses in respect of funds from acceptance and issuance of securities are comprised of interest accrued and the effects of foreign exchange fluctuations on securities issued by us outside of Brazil. Expenses from such operations decreased 99.0% from R$2,226 million in 2008 to R$22 million in 2009. This result mainly reflected the effect of the significant appreciation of the real against the U.S. dollar in 2009, compared to the significant depreciation of the real against the U.S. dollar in 2008, which contributed to our gain on foreign currency denominated obligations. An increase in the average balance of funds from acceptance and issuance of securities from R$7,787 million in 2008 to R$9,443 million in 2009 increased our foreign currency interest charges, but also had the effect of increasing our gain on foreign currency denominated obligations. Foreign exchange gains or losses on our funding operations are largely offset by corresponding gains or losses on other financial operations, including derivative contracts. Expenses from leasing operations increased 351.6% from R$295 million in 2008 to R$1,330 million in 2009, mainly reflecting an increase in the average portfolio of such operations from R$641 million in 2008 to R$2,654 million in 2009, due to our increased use of leasing as a financing alternative for consumer financing transactions. Expenses from foreign exchange operations represent the net result of our foreign exchange transactions (including advances on our foreign exchange portfolio) and the results of foreign exchange fluctuations related to interbank foreign exchange operations (including foreign currency deposits). We recorded a net expense from foreign exchange operations of R$240 million in 2009, but did not record net expense from foreign exchange operations in 2008, since we had a net income from foreign exchange operations in 2008 as discussed above. The result for 2009 reflected losses on long positions in U.S. dollars and yen resulting from the appreciation of the real against these currencies in 2009, which were partially offset by gains from our portfolio indexed to the Turkish lira. Gains or losses in our foreign exchange portfolio are largely offset by corresponding gains or losses in derivative contracts which are discussed under Financial Operations Income above. Expenses on borrowings, assignments and repasses consist primarily of interest and expenses accrued on amounts borrowed from foreign correspondent banks and government sources, such as BNDES and FINAME. In respect of foreign borrowings, interest expense also includes the effects of foreign exchange fluctuations between the real and the foreign currency denomination in relation to the outstanding principal amount of such borrowings. We recorded an expense from borrowings, assignments and repasses of R$1,776 million in 2008 compared to a gain of R$617 million in 2009. This result mainly reflects a gain related to our U.S. dollar and yen denominated borrowings resulting from the appreciation of the real against these currencies in 2009, which gave rise to a large foreign exchange gain, and contrasted with the depreciation of the real against these currencies in 2008, which had given rise to a foreign exchange loss. Allowance for Loan Losses The following table shows the movement with respect to our allowance for loan losses for 2009 and 2008. As of and for the year ended December 31, 2009 2008 (R$ in millions) Opening balance... 774 556 Allowances for loan losses... 1,535 830 Write-off for loan losses... (946) (622) Closing balance... 1,362 774 67

Our allowance for loan losses (increase/reversal net during period) increased 84.9% from R$830 million in 2008 to R$1,535 million in 2009, mainly due to the increase in the average volume of our credit operations and the increases made to our provisions based on expectations of an increase in loan default rates due to deteriorating domestic and international economic conditions as a result of the global financial crisis in 2009. Our allowance for loan losses reflects both the aggregate value of our credit portfolio and the credit risk assigned to credits within the portfolio. Our allowance for loan losses increased more in 2009, on a proportionate basis, than our credit portfolio. As the portfolio becomes more seasoned, the allowance for loan losses may be expected to increase. The closing balance of our allowance for loan losses as a percentage of our total loans and lease operations was 3.2% as of December 31, 2009 compared to 2.0% as of December 31, 2008. Other Operating (Expenses) Income The following table presents information with respect to our other operating (expenses) income for 2009 and 2008. 68 For the year ended December 31, 2009 2008 (R$ in millions) Service income... 358 500 Banking fees... 459 189 Personnel expenses... (564) (427) Other administrative expenses... (1,037) (846) Tax expenses... (364) (288) Other operating income... 1,317 905 Other operating expenses... (2,721) (1,772) Total other operating expenses... (2,552) (1,739) Service income (excluding banking fees) in 2008 and 2009 consisted primarily of fees generated from credit operations, management fees in respect of mutual funds administered by us, fee income from guarantees provided by us on behalf of our clients, fees and commissions generated by our underwriting operations and brokerage fees. Service income decreased 28.4% from R$500 million in 2008 to R$358 million in 2009, mainly due to a decrease in fees on lending and prepayments of credit operations (decrease of R$221 million), which was partially offset by increases in fee income from guarantees provided by us on behalf of our clients (increase of R$62 million) and underwriting fees (increase of R$16 million). Banking fees income consists of fees charged on consumer financing operations pursuant to CET. Banking fees income increased 142.9%, from R$189 million in 2008 to R$459 million in 2009, mainly due to the significant increase in our consumer financing portfolio in 2009 and the implementation of CET as from April 30, 2008 in respect of our consumer financing transactions. In accordance with CET, as from April 30, 2008, B.V. Financeira no longer charges a fee for opening lines of credit and now charges banking fees. Personnel expenses increased 32.1% from R$427 million in 2008 to R$564 million in 2009. This increase mainly related to the hiring of employees by Banco Votorantim and B.V. Financeira to support the continued expansion of our consumer financing, corporate and middle-market, and asset management activities. Other administrative expenses in 2008 and 2009 consisted primarily of technology, data processing and related expenses, financial system expenses, communications costs and expenses related to promoting financing operations of B.V. Financeira. Other administrative expenses increased 22.6% from R$846 million in 2008 to

R$1,037 million in 2009 as a result of the increase in our activities, particularly in B.V. Financeira, as we continue to expand our operations. In particular, technology, financial systems and outsourced services all showed significant increases. The main tax expenses that we incur are with respect to PIS, COFINS and ISS. Tax expenses increased 26.4% from R$288 million in 2008 to R$364 million in 2009. This increase reflected a large increase in 2009 of PIS/COFINS as a result of the increase in financial operations income upon which such tax expenses are calculated. Other operating income in 2008 and 2009 consisted mainly of the reversal of operating provisions previously established in respect of certain litigation and other contingencies and, in 2009, premium earned on the issuance of debentures. Other operating income increased 45.5% from R$905 million in 2008 to R$1,317 million in 2009, mainly due to an increase in CET income, which increased from R$500 million in 2008 to R$1.2 billion in 2009. Other operating expenses in 2008 and 2009 consisted primarily of fees and commissions paid to third parties, and losses on foreign exchange fluctuation over external investments (capital of VBL and of the Bahamian Branch). Other operating expenses increased 53.6% from R$1,772 million in 2008 to R$2,721 million in 2009. This increase was mainly due to an increase in CET related expenses from R$500 million in 2008 to R$1.1 billion in 2009 and a foreign exchange loss on our external investments due to the more significant appreciation of the real against the U.S. dollar in 2009 compared to 2008 (R$310 million). Non-operating Results Our non-operating results increased 53.6% from a net expense of R$56 million in 2008 to a net expense of R$86 million in 2009, mainly as a result of an increase in the non-operating loss suffered on the resale of repossessed vehicles. Income Tax and Social Contribution Our income tax expense consists of two components, the corporate income tax (assessed at a base rate of 15% of net income and a surcharge of 10% of net income) and the social contribution (assessed at 9% of adjusted net income). In 2009, we accrued an income tax and social contribution expense of R$284 million compared to income of R$88 million in 2008, as a result of year on year variations in the applicable additions and exclusions from taxable income and the availability of tax credits. 69

Analysis of Financial Position Funding As our business is predominantly wholesale banking and direct consumer financing, we do not rely on retail demand deposit accounts for our funding. Our two most important sources of funding are time deposits and money market repurchase commitments relating to government and private fixed-income securities. The composition of deposits in our funding and the use of alternative sources of funding vary according to market conditions. We also obtain funding through the use of interbank deposits and by borrowings, assignments and repasses in the domestic and international markets. We manage our liquidity through the use of cash flow models for each product, enabling us to predict future cash needs. Sources of funds can then be managed to meet these cash requirements and to match currencies and maturities with our interest-bearing assets. See Business Funding below. The following table presents our consolidated sources of funds by type as of December 31, 2010, 2009 and 2008: As of December 31, 2010 2009 2008 (R$ in millions, except percentages) Demand deposits... 309 0.4% 136 0.2% 114 0.2% Time deposits... 22,563 25.8% 22,600 33.6% 14,636 26.1% Interbank deposits... 726 0.8% 1,741 2.6% 4,182 7.6% Money market repurchase commitments... 34,380 39.3% 24,767 36.9% 16,625 30.0% Funds from acceptance and issuance of securities... 18,159 20.8% 10,637 15.8% 9,172 16.6% Borrowings, assignments and repasses... 11,254 12.9% 7,303 10.9% 10,685 19.3% Total funding... 87,391 100.0% 67,185 100.0% 55,414 100.0% Demand Deposits As of December 31, 2010, we had a total of R$309 million in demand deposits, or 0.4% of our total consolidated funding, compared to R$136 million, or 0.2% of our total consolidated funding, as of December 31, 2009 and R$114 million, or 0.2% of our total consolidated funding, as of December 31, 2008. Since we do not operate retail branches, demand deposits are not a significant source of financing. Time Deposits Time deposits, which are evidenced by certificates of deposit ( CDBs ), issued by us to corporate and institutional clients, totaled R$22,563 million as of December 31, 2010 accounting for 25.8% of our total consolidated funding compared to R$22,600 million, or 33.6% of our total consolidated funding, as of December 31, 2009, and R$14,636 million, or 26.4% of our total consolidated funding, as of December 31, 2008. Since we are not a retail bank, the extent to which we rely on deposits for funding depends in part upon the relative cost of funding of different types in the market and the comparative rate at which we remunerate alternative investments, particularly investment funds. In January 2008, we issued subordinated CDBs totaling R$1.1 billion. On February 20, 2008, the Central Bank authorized the qualification of such CDBs as Tier 2 capital. In October, 2009, we issued further 70

subordinated CDBs totaling R$585 million. qualification of such CDBs as Tier 2 capital. On November 6, 2009, the Central Bank authorized the Interbank Deposits We issue Interbank Certificates of Deposit (Certificados de Depósito Interbancário or CDIs ) exclusively to other Brazilian financial institutions. As of December 31, 2010, we had a total of R$726 million in interbank deposits, or 0.8% of our total consolidated funding, compared to R$1,741 million, or 2.6% of our total consolidated funding, as of December 31, 2009 and to R$4,182 million, or 7.5% of our total consolidated funding, as of December 31, 2008. Interbank deposit volumes vary on a daily basis and the funds on deposit as of December 31, 2008 were significantly more than our average volume of such deposits during 2008. Money Market Repurchase Commitments We also obtain funding through our money market repurchase commitments ( repos ), principally deposits subject to sale and repurchase agreements executed between us and other financial institutions and mutual funds. Under these transactions, we sell government or private fixed-income securities and simultaneously agree to repurchase them. Security repurchases are usually overnight transactions represented by book entries cleared through the SELIC, the custody and clearing system for government securities, although repurchases are also entered into on a longer term basis. Repos contribute to our liquidity and when we identify arbitrage opportunities among the different markets in which we operate, we may utilize funds from such operations to take advantage of these opportunities. The funds we obtained from such operations amounted to approximately R$34,380 million, or 39.3% of our total consolidated funding, as of December 31, 2010, compared to R$24,767 million, or 36.9% of our total consolidated funding, as of December 31, 2009, and R$16,625 million, or 30.0% of our total consolidated funding, as of December 31, 2008. Variations in the volume of this source of funding result mainly from opportunities in the market for trading in securities and our strategy to maintain a high level of liquidity. Borrowings, Assignments and Repasses We also raise funds through BNDES loans made available for repass lending, funds from securities issued in the domestic and international markets, borrowings from financial institutions in the international market, assignments, acceptances and endorsements (together, borrowings, assignments and repasses). As of December 31, 2010 we had a total of R$11,254 million, or approximately 12.9%, of our total consolidated funding, from borrowings, assignments and repasses, compared to R$7,303 million, or 10.9% of our total consolidated funding, as of December 31, 2009, and R$10,685 million, or 19.3% of our total consolidated funding, as of December 31, 2008. Variations in the volume of this source of funding reflect changes in market conditions. Our principal sources of local currency funding within the category of borrowings, assignments and repasses are BNDES loans and funds from securities issued in the domestic market. We act as an accredited financial agent for BNDES, onlending special purpose funding obtained from BNDES to targeted groups of borrowers. The source of funds is managed by BNDES, principally on behalf of FINAME. In these circumstances, we borrow funds from BNDES and onlend those funds at a spread determined by BNDES to particular sectors of the economy or for specific purposes determined by BNDES and reflecting Brazilian government policy. We control lending decisions and the application of lending criteria, within certain parameters, which may be set by BNDES. Our lending is principally to the private sector, in respect of which we assume the risk for the funds we onlend. Our policy is to access these funds in circumstances where they are specifically sought by a borrower for a project falling within the guidelines for the applicable source of funding. BNDES funds are typically lent for longer maturities than are our other corporate and middle market loans. 71

Funds from acceptance and issuance of securities The funds obtained from acceptance and issuance of securities, including subordinated debt, amounted to R$18,159 million, or 20.8% of our total consolidated funding, as of December 31, 2010, compared to R$10,637 million, or 15.8% of our total consolidated funding as of December 31, 2009, and R$9,172 million, or 16.6% of our total consolidated funding as of December 31, 2008. One of the sources of local currency funding of our subsidiary, B.V. Leasing, has been the issuance of debentures in the local market. B.V. Leasing has issued three tranches of non-convertible subordinated debentures. The three tranches were issued in 2007 in the total amount of R$15 billion and the placement of such debentures began in 2006. As of December 31, 2010 and December 31, 2009, debenture funding totaled R$3,014 million and R$2,951 million, respectively, on a consolidated basis. In respect of non-domestic funding, we obtain funds through the issue of notes in the international capital markets, borrowings and trade finance lines. In the international capital markets, we issue debt instruments (acting through our principal office in São Paulo, Brazil or the Bahamian Branch) under our U.S.$4.0 billion Global Medium-Term Note Program (Nassau Branch), U.S.$5.0 billion Global Medium-Term Note Program (Brazilian principal office), U.S.$1.6 billion Euro Medium-Term Note Program, Short-Term Note Program and Certificate of Deposit Program. The proceeds have been used primarily to fund local currencydenominated loans indexed to the U.S. dollar pursuant to Resolution No. 2,770 of the Central Bank. As of December 31, 2010, aggregate foreign currency funding amounted to R$9,007 million, or 10.3% of our total consolidated funding (as compared to R$3,558 million, or 5.3% of our total consolidated funding, as of December 31, 2009 and to R$7,577 million, or 13.7% of our total consolidated funding, as of December 31, 2008), of which R$1,886 million was represented by notes outstanding (R$1,395 million and R$1,403 million at year end 2009 and 2008, respectively). In addition, as of December 31, 2010 we had R$4,237 million in foreign borrowings (compared to R$2,163 million and R$6,174 million as of December 31, 2009 and 2008 respectively). Investment Funds in Credit Rights (Fundos de Investimento em Direitos Creditórios or FIDCs ) Depending upon opportunities in the market, we sometimes obtain liquidity through the securitization of consumer financing loans. Such loans are sold to FIDCs. In addition to obtaining liquidity as of the date of such sales, we hold subordinated shares in the FIDCs through which we earn additional financial operations income and, effectively, assume the credit risk associated with the assigned portfolio. As of December 31, 2010, we had a total balance of R$2,410 million in FIDCs compared to R$1,179 million as of December 31, 2009, and on a consolidated basis, as of December 31, 2010, we had subordinated shares in such FIDCs in the amount of R$1,696 million compared to R$969 million as of December 31, 2009. Our subordinated shares in FIDCs are marked to market, which reflects the credit risk associated with the assigned portfolio. The funds raised through such FIDCs represent an alternative source of indirect funding that is similar to regular credit assignments, but at lower costs. Such FIDCs are managed by Votorantim Asset. Credit Assignments to other Financial Institutions Depending on opportunities in the market, we sometimes assign portions of our credit portfolio to other financial institutions. Such sales provide liquidity and represent an alternative source of indirect funding. Credit assignments to other financial institutions generally involve a repurchase commitment on our part in the event of a default in payment by the original client. In the year ended December 31, 2010 and the year ended December 31, 2009, we sold R$13,327 million and R$5,813 million, respectively, of loans to other financial institutions. Since such assignments involve a repurchase obligation on our part in the event of default, we take provisions in respect of such loans on the same basis as our on balance sheet credit portfolio. Such provisions are charged in each fiscal period as other operating expenses and the aggregate amount is recorded in our balance sheet as other obligations. As of December 31, 2010 and December 31, 2009, we had aggregate 72

provisions in respect of our repurchase commitments in the amount of R$55 million and R$25 million, respectively. Funding Directly Derived from Banco do Brasil Banco do Brasil is one of the financial institutions to whom we sometimes assign portions of our credit portfolio as discussed under Analysis of Financial Position Credit Assignments to other Financial Institutions. As an element of our association with Banco do Brasil, on September 28, 2009 we entered into a revolving credit facility agreement with Banco do Brasil for general working capital purposes, under which we may borrow, at market rates, an amount equivalent to up to our then existing net worth (provided that we can only draw 25% of such amount in disbursements carried out in a single week). No drawdowns have been made under the facility. Off-Balance Sheet Financial Obligations In addition to those of our credit operations that are included on our balance sheet, we have credit-related transactions with our clients for attending their financing needs that are not recorded on our balance sheet. These take the form of financial guarantees of (including letters of credit issued in respect of) the obligations of our clients to third parties. As of December 31, 2010, we had a total of R$10,279 million in financial guarantees, compared to R$11,143 million as of December 31, 2009 and to R$8,022 million as of December 31, 2008. The following table sets out the maturity of these financial guarantees as of December 31, 2010: Payments due as of December 31, 2010 Less than 1 year 1 to 3 years 3 to 5 years More than 5 years Total (R$ in millions) Guarantees 1,402 1,508 622 6,707 10,279 We earn a fee for the provision of such financial guarantees. In addition, we have the right to seek reimbursement from our clients for any amounts we have to pay thereon. These agreements are subject to the same credit processes and criteria, including security requirements and provisioning, as credit operations that are included on our balance sheet. Besides financial guarantees, we have off-balance sheet contingent financial obligations relating to our repurchase obligations of loans that we have assigned to other financial institutions, but in respect of which we have a repurchase commitment (and thus retain the credit risk). As of December 31, 2010, we had a total of R$11,137 million of such contingent obligations, compared to R$4,938 million at December 31, 2009. Exchange Rate Sensitivity Most of our operations are denominated in reais. In addition, we borrow foreign currency resources through loans from international correspondent banks and through issuing securities into the international capital markets. Such proceeds are generally allocated to U.S. dollar-linked credit operations and securities. We maintain a policy of avoiding material exchange rate mismatches. Our foreign currency position is mainly related to the purchase and sale of foreign currency (primarily U.S. dollars) from the following sources: 73

other financial institutions on the interbank market; and spot and forward currency markets. Interest Rate Sensitivity Our policy is to maintain a close match of our interest rate, maturity and currency exposures. We consider the following factors in establishing the policies and limits: our exposure limits for each market segment and product; and the volatility and correlation across different markets. 74

SELECTED STATISTICAL INFORMATION The following information is included for analytical purposes and should be read in conjunction with our financial statements contained elsewhere herein as well as Management s Discussion and Analysis of Financial Condition and Results of Operations. Average annual volume and balance data has been calculated based upon the average of the sum of balances on the following five dates: at December 31 of the prior year and each of March 31, June 30, September 30 and December 31 of the relevant year. There are limitations in analyzing data computed on the basis of simple averages using quarterly balances only. Data computed using more frequent balances could be significantly different. Similarly, average period rate and average return data have been calculated based upon the income and expenses for the period divided by the average balance or volume computed as stated above. Included in interest income and interest expense are the gains or losses on foreign currency and on securities and related differences in market quotations as well as recoveries of credits previously written-off. For financial reporting purposes, Brazilian GAAP does not distinguish between interest income and market gain or loss on the securities portfolio. Average income statement and balance sheet data has been prepared on a consolidated basis. We believe that the average data set forth herein accurately reflects in all material respects our financial condition and results of operations at the dates and for the periods specified. Average Balance Sheet and Other Financial Data The table below presents the average balances for assets, liabilities and equity, which have been calculated from the year/period balances of the financial statements: For the year ended December 31, 2010 2009 2008 (R$ in millions, except percentages) Averages Average total assets... 99,788 83,536 72,908 Average interest-earning assets (1)... 93,159 77,093 63,227 Average interest-bearing liabilities (2)... 78,748 67,139 56,333 Average stockholders equity... 7,965 6,714 6,291 Profitability and efficiency Net interest margin (3)... 6.00% 7.08% 5.87% Net interest spread (4)... 1.30% 1.39% 1.20% Return on average interest-earning assets (5)... 1.09% 1.04% 1.43% Average rate on average interest-earning assets (6)... 15.17% 14.62% 19.95% Average rate on average interest-bearing liabilities (7)... 13.87% 13.23% 18.75% Return on average shareholders equity (8)... 12.75% 11.96% 14.33% Efficiency ratio (9)... 33.81% 25.51% 28.92% Notes: (1) Interest-earning assets are assets generating income from financial operations, which is recorded as Financial Operations Income. 75

(2) Interest-bearing liabilities are liabilities generating expenses from financial operations, which is recorded as Financial Operations Expenses. (3) Gross income from financial operations before allowance for loan losses as a percentage of average interest-earning assets. Interest-earning assets are described in Note (1) above. See Average Balances and Rates of Interest-Earning Assets and Interest-Bearing Liabilities for a table setting forth interest-earning assets. For a discussion of the calculation of Allowance for loan losses, see Management s Discussion and Analysis of Financial Condition and Results of Operations. (4) The difference between the average yield on total interest-earning assets and the average yield on interest-bearing liabilities. (5) Net profit as a percentage of average interest-earning assets. Interest-earning assets are described in Note (1) above. (6) Financial operations income as a percentage of average interest-earning assets. See Note (1) above. (7) Financial operations expenses before allowance for loan losses as a percentage of average interest-bearing liabilities. See Note (2) above. (8) Net profit as a percentage of average shareholders equity. (9) The efficiency ratio is defined as the ratio, expressed as a percentage, of (i) the sum of personnel expenses and other administrative expenses less depreciation and amortization (included within other administrative expenses) and (ii) the sum of gross income from financial operations before allowance for loan losses and service income. Average Balances and Yield/Cost of Interest-Earning Assets and Interest-Bearing Liabilities Interest-earning assets Average Balance For the year ended December 31, 2010 2009 2008 Income (Expense) Average Rate (1) Average Balance Income (Expense) Average Rate (1) (R$ in millions, except percentages) Average Balance Income (Expense) Average Rate (1) Lending operations (2)... 43,910 8,813 20.07% 35,983 6,982 19.40% 31,733 8,542 26.92% Lease operations (3)... 4,266 671 15.74% 2,654 473 17.83% 641 207 32.31% Securities transactions and derivative financial instruments (4) 41,007 2,303 5.62% 37,286 2,486 6.67% 28,777 2,885 10.02% Foreign exchange operations (5) 622 42 6.70% 1,101-240 -21.78% 1,127 577 51.22% Compulsory investments... 3,354 329 9.80% 66 0 0.00% 1,180 108 9.14% Total interest-earning assets... 93,159 12,157 13.05% 77,050 9,702 12.59% 63,221 12,318 19.48% Interest-bearing liabilities Money market repurchase commitments (6)... 31,309 (3,190) -10.19% 25,382 (2,632) -10.37% 21,559 (2,521) -11.69% Deposits... 23,925 (2,619) -10.95% 23,309 (2,205) -9.46% 19,137 (2,083) -10.88% Funds from acceptance and issuance of securities... 14,099 (551) -3.91% 9,443 (22) -0.231% 7,787 (2,226) -28.59% Total funding operations... 69,333 (6,360) -9.17% 58,133 (4,858) -8.36% 48,483 (6,830) -14.09% Borrowings, assignments and repasses... 60 (5) -8.33% 525 (46) (8.79%) 152 (88) (58.25%) 76

Average Balance For the year ended December 31, 2010 2009 2008 Income (Expense) Average Rate (1) Average Balance Income (Expense) Average Rate (1) (R$ in millions, except percentages) Average Balance Income (Expense) Average Rate (1) Foreign borrowings... 3,689 139 3.77% 4,074 991 24.33% 4,162 (1,378) -33.12% Domestic repasses... 5,666 (343) -6.06% 4,402 (328) -7.45% 3,536 (309) -8.74% Total borrowings, assignments and repasses... 9,415 (209) -2.22% 9,001 617 6.86% 7,851 (1,776) -22.63% Total interest-bearing liabilities... 78,748 (6,569) -8.34% 67,134 (4,241) -6.32% 56,333 (8,606) -15.28% Gross income from financial operations (before provisions)... 5,589 5,461 3,712 Notes: (1) Average rates includes interest income or expenses, capital gains or losses and mark-to-market on securities, assets and liabilities divided by respective average balance. (2) Average balance consists of lending operations and other receivables included as part of our total credit portfolio and income includes financial income in respect of both lending operations and such other receivables. (3) Represents the average balance of these operations as defined for purposes of calculating our total credit portfolio. (4) Average balance consists of securities and interbank funds applied. (5) Represents the average balance of these operations as defined for purposes of calculating our total credit portfolio. (6) Money market repurchase commitments as shown on our balance sheets. 77

Balance Sheet Maturity As part of our asset and liability management, we try to minimize the negative impact on financial results of interest rate fluctuations by the selective matching of assets and liabilities. The following tables present our balance sheet maturity on December 31, 2010. Assets 90 days or less As of December 31, 2010 91 days to 365 days (R$ in millions) After 365 days Total Bank and cash... 151 151 Money market... 7,700 5,144 12,844 Interbank deposits... 671 514 885 2,070 Foreign currency deposits... 87 87 Securities and derivative financial instruments 6,042 3,667 15,454 25,163 Interbank accounts... 6,104 134 6,239 Interbank funds applied... 8 64 71 Loans and lease operations... 10,990 14,136 29,692 54,818 Other receivables... 2,386 1,430 1,701 5,517 Other assets... 42 142 466 650 Permanent assets... 207 207 Total assets... 34,181 25,231 48,405 107,817 Current liabilities Demand deposits... 309 309 Interbank deposits... 304 339 83 726 Time deposits... 5,076 12,325 5,162 22,563 Other deposits... Money market repurchase commitments (1)... 13,306 16,947 4,127 34,380 Acceptances and endorsements... 676 2,574 7,048 10,298 Borrowings, assignments and repasses... 1,727 4,610 4,917 11,254 Derivative financial instruments... 493 4,265 1,663 6,421 Interbank account... 23 9 32 Other liabilities... 3,829 2,020 7,554 13,403 Total liabilities... 25,743 43,089 30,554 99,386 Deferred income... 42 42 Minority interest... Shareholders equity... 8,389 8,389 Total liabilities and shareholders equity... 25,743 43,089 38,985 107,817 Note: (1) Money market repurchase commitments as shown on our balance sheet. 78

Securities Portfolio The following table shows our portfolio of securities and derivative financial instruments at the dates indicated. For the years ended December 31, 2010, 2009 and 2008, securities are valued according to Central Bank regulations for the classification of securities and derivative financial instruments: As of December 31, 2010 % of Total 2009 % of Total 2008 % of Total (R$ in millions, except percentages) Brazilian government securities... 14,046 60% 11,254 68% 11,248 62.4% Corporate debt securities... 1,743 7% 2,141 13% 275 1.5% Marketable equity securities and Others... 7,597 32% 3,172 19% 6,494 36% Total securities... 23,386 100% 16,567 100% 18,017 100% Securities Portfolio by Currency The following table presents our portfolio of securities by currency at December 31, 2010, 2009 and 2008. The amounts shown exclude derivative financial instruments. Our securities portfolio is composed primarily of debt issued by the Brazilian government. As of December 31, 2010 2009 2008 (R$ in millions) Denominated in reais (1)... 19,558 13,178 12,690 Indexed to foreign currency (2)... 2,025 2,158 2,782 Denominated in foreign currency (2)... 1,803 1,231 2,545 Total securities (3)... 23,386 16,567 18,017 Notes: (1) A substantial portion of our securities portfolio is composed of real-denominated, Brazilian government securities. (2) Predominantly U.S. dollars. (3) Derivative financial instruments are not included. 79

Breakdown and Maturity of Securities The following table presents the maturity distribution at December 31, 2010 for our portfolio of securities and derivative financial instruments. 90 days or less As of December 31, 2010 91 days to 365 days After 365 days Total (R$ in millions) Brazilian government securities... 274 2,093 11,679 14,046 Corporate debt securities... 31 155 1,557 1,743 Marketable equity securities and others... 5,706 899 992 7,597 Total securities... 6,011 3,147 14,228 23,386 Central Bank Compulsory Investments We are required to maintain compulsory deposits with the Central Bank. For a discussion of compulsory deposits, see The Brazilian Financial System and Banking Regulation Regulation by the Central Bank. The following table presents the amounts of such deposits at the indicated dates: 2010 % of Total 2009 As of December 31, % of Total 2008 % of Total (R$ in millions, except percentages) Non-interest-earning deposits... 122 2.0% 69 100.0% 32 100.0% Interest-earning deposits (1)... 6,090 98.0% % % Total compulsory investments... 6,213 100.0% 69 100.0% 32 100.0% Note: (1) Consists of Brazilian government securities. Credit Portfolio The following table shows our credit portfolio by type of transaction for each of the periods indicated. Substantially all of our loans were granted to borrowers domiciled in Brazil and are denominated in reais. In addition, the majority of our loan portfolio is indexed to Brazilian interest rates: As of December 31, 2010 2009 2008 (R$ in millions) Discounted trade receivables and loans... 25,195 7,613 8,797 Financing... 25,426 29,869 26,828 Agricultural and agribusiness financing 1,333 559 312 Subtotal 51,953 38,041 35,625 Leasing operations... 4,325 3,948 1,472 Advances on foreign exchange contracts 538 450 1,078 Subtotal... 56,816 42,439 38,175 80

As of December 31, 2010 2009 2008 (R$ in millions) Other receivables... 5 9 Total loan operations... 56,816 42,444 38,184 The following table summarizes our credit portfolio by category of economic activity of the borrowers and the percentage amounts of types of credits to total credit portfolio at the dates indicated: Industry Description As of December 31, 2010 2009 2008 (R$ in millions) Industrial (1)... 9,642 8,416 10,600 Commerce... 3,284 2,151 2,185 Rural... 1,313 559 312 Financial Institutions... - 18 5 Other services (2)... 5,936 4,619 4,370 Individuals (3)... 36,641 26,681 20,710 Total... 56,816 42,444 38,184 Notes: (1) Includes metallurgy, petrochemicals and chemicals, steel, synthetic fiber and packaging. (2) Includes telecommunications and electric utilities. (3) Includes primarily consumer finance loans. Credit Concentration The following table presents the concentrations of our total credit portfolio at the indicated dates. Percentage amounts reflect our total credit portfolio. At December 31, 2010 % of Total 2009 % of Total 2008 % of Total (R$ in millions, except percentages) 10 largest credits... 3,129 5.5% 3,941 9.3% 4,852 12.7% Next 50 largest credits... 4,751 8.0% 5,017 11.8% 5,875 15.4% Next 100 largest credits... 3,626 6.4% 3,173 7.5% 3,694 9.7% The following table shows a breakdown of the rating of our credit transactions by risk levels for the periods indicated, where AA represents the lowest credit risk and H represents the highest credit risk (in accordance with applicable regulations issued by the Central Bank) as of December 31, 2010: 81

Risk Level Loans Overdue Loans Falling Due Total % (R$ in millions, except percentages) AA... - 12,710 12,710 22.4% A... - 38,395 38,395 67.6% B... 1,398 1,621 3,019 5.3% C... 923 204 1,127 2.0% Subtotal... 2,321 52,930 55,251 97.2% D... 384 30 414 0.7% E... 180 14 194 0.3% F... 139 101 240 0.4% G... 102 29 131 0.2% H... 463 123 586 1.0% Subtotal... 1,268 297 1,565 2.8% Total on December 31, 2010... 3,589 53,227 56,816 100.0% %... 6.3% 93.7% 100.0% The following table shows the balance of our allowance for loan losses as of December 31, 2010, broken down by risk level: Minimum Requirement Specific Risk Level % Minimum Required Provision Loans Falling Due Loans Overdue Total Additional (2) Existing Actual Provision (1) (R$ in millions, except percentages) AA... 0% 12,710 12,710 0% A... 0.5% 38,395 38,395 192 1% B... 1% 1,621 1,398 3,019 30 1% C... 3% 204 924 1,128 34 3% Subtotal... 52,930 2,322 55,252 256 D... 10% 30 383 413 41 10% E... 30% 14 180 194 58 30% F... 50% 101 139 240 120 50% G... 70% 29 102 131 92 70% H... 100% 123 463 586 586 100% Subtotal... 297 1,267 1,564 897 Total on December 31, 2010... 53,227 3,589 56,816 1,153 %... 93.7% 6.3% 100.0% 100.0% 82

Notes: (1) Ratio between existing provision and portfolio by risk level. (2) The additional provision is recorded based on Management s experience and expected realization of the loan portfolio, to determine the total provision deemed sufficient to cover specific and general loan risks, linked to the provision calculated based on risk level ratings and the corresponding minimum percentage of provision established by CMN Resolution No. 2,682, of December, 21, 1999, as amended. Allowance for Loan Losses The following table presents the activity in our allowance for loan losses for the periods indicated. As of December 31, 2010 2009 2008 (R$ in millions) Beginning allowance for loan losses... 1,362 774 566 Provisions... 1,189 1,535 830 Charge-offs... (1,398) (947) (622) Period-end allowance for loan losses... 1,153 1,362 774 Recoveries of credits previously charged off... 193 135 126 Charges-offs as a percentage of total credit portfolio... 2.46% 2.23% 1.63% Ending allowance for loan losses as a percentage of total credit portfolio.. 2.03% 3.21% 2.03% Our allowance for loan losses does not include provisions taken in respect of loans that we have assigned, but in respect of which we have repurchase commitments and retain the credit risk. Provisions established in respect of such repurchase commitments are accounted for as other operating expenses and included on our balance sheet as other obligations. As of December 31, 2010 and December 31, 2009, we had aggregate provisions in respect of our repurchase commitments in the amount of R$55 million and R$25 million, respectively. Non-Performing Credits The following table presents a summary of non-performing credits, together with certain asset quality ratios. Our policy for designating credits as non-performing is consistent with Central Bank policies, and represents credits classified as D through H under the Central Bank classification policies. See Summary Selected Historical Financial Data and Management s Discussion and Analysis of Financial Condition and Results of Operations Factors Affecting Financial Condition and Results of Operations Changes in Brazilian Banking Regulations, for a discussion of non-performing credits. As of December 31, 2010 2009 2008 (R$ in millions, except percentages) Total assets... 107,817 84,801 72,310 Total credit portfolio... 56,816 42,444 38,184 Non-performing credits... 1,564 1,915 1,099 Non-performing credits as a percentage of total credit portfolio... 2.75% 4.51% 2.88% Non-performing credits as a percentage of total assets... 1.45% 2.25% 1.52% Allowance for loan losses... 1,153 1,362 774 83

Allowance for loan losses as a percentage of: As of December 31, 2010 2009 2008 (R$ in millions, except percentages) Total credit portfolio... 2.03% 3.21% 2.03% Non-performing credits... 73.72% 71.12% 70.43% Foreign Exchange Portfolio and Liabilities Our foreign exchange portfolio consists primarily of credits from outstanding foreign exchange contracts. Generally, foreign exchange contracts result in the recording of an asset (cash to be delivered to us on a future date) and a liability (cash to be delivered by us on a future date). We enter into foreign exchange contracts primarily with companies operating in the agriculture, oil manufacture and fertilizers industries. The following tables present our foreign exchange portfolio and liabilities pursuant to foreign exchange contracts at December 31, 2010, 2009 and 2008: As of December 31, 2010 2009 2008 (R$ in millions) Foreign exchange portfolio... 1,293 381 3,722 Foreign exchange liabilities... 1,369 10 2,367 Capital Ratios and Minimum Capital Requirements On August 17, 1994, the CMN issued Resolution No. 2,099 (as amended, Resolution No. 2,099 ), establishing a capital measurement for Brazilian financial institutions based on a risk-weighted asset ratio. The framework of this methodology is based on, but different in certain important aspects from, the 1988 Capital Accord of the Basel Committee (the Basel Accord ). Under Resolution No. 2,099, Brazilian financial institutions, including us, are required to maintain a minimum regulatory capital of at least 11% from January 1, 1999 of total risk-weighted assets valued based on the risk weighing criteria set out in Annex IV to the Resolution. See The Brazilian Financial System and Banking Regulation Regulation by the Central Bank Capital Adequacy and Leverage. We are permitted to report, and in fact do report, our capital adequacy ratios on a combined consolidated basis, including the equity of majority- and minority-owned subsidiaries and affiliates. We calculate our minimum shareholders equity limits required upon consolidation within the parameters provided by Resolution No. 2,099. The ratio between shareholders equity calculated on a consolidated basis and total risk weighted assets was 13.1% on December 31, 2010 compared to 13.2% on December 31, 2009. See Business Capital Adequacy. 84

Average Deposit Balances The following table presents the average balance of deposits for each period presented: Average Balance As of December 31, 2010 2009 2008 Average Rate (1) Average Balance Average Rate (1) Average Balance Average Rate (1) (R$ in millions, except percentages) Non-interest bearing deposits:... 267 0.00% 144 0.00% 168 0.00% Interest-bearing deposits:... 22,697-11.20% 19,706-9.27% 17,096-10.75% Interbank deposits... 960-7.91% 3,459-10.28% 1,873-11.89% Total interest-bearing deposits... 23,658-11.07% 23,165-9.43% 18,969-10.86% Total deposits... 23,925-10.95% 23,309-9.37% 19,137-10.76% Notes: (1) Average rates consists of interest income or expenses, capital gains or losses and mark-to-market on securities, assets and liabilities, divided by respective average balance. 85

Funding The following table presents our funding at each date presented: As of December 31, 2010 2009 2008 (R$ in millions, except percentages) Demand deposits... 309 0.4% 136 0.2% 114 0.2% Time deposits... 22,563 26.1% 22,600 33.6% 14,636 26.1% Interbank deposits... 726 0.8% 1,741 2.6% 4,182 7.6% Money market repurchase commitments... 34,380 39.8% 24,767 36.4% 16,625 30.0% Funds from acceptance and issuance of securities... 17,202 19.9% 10,637 15.8% 9,172 16.6% Borrowings, assignments and repasses... 11,254 13.0% 7,303 10.8% 10,685 19.3% Total funding... 86,434 100.0% 67,185 100.00% 55,414 100.00% 86

BUSINESS Introduction We are a privately held Brazilian bank providing a wide range of financial services. Historically, we operated mainly as a wholesale bank with a focus on treasury, large corporate and investment banking activities. In recent years, we have diversified our operations to include lending to the Brazilian corporate and middle market segments, consumer finance and fund management services. Our headquarters and administrative offices are located in São Paulo and we have 23 branches throughout Brazil. In addition, we have 283 affiliated offices throughout Brazil that support our consumer finance business. Outside of Brazil, we have a full service branch in the Bahamas, a representative office in London and a broker-dealer in New York. Based on total assets, we were ranked the seventh largest private bank in Brazil as of December 31, 2010, according to the Central Bank. Historically, we focused on providing credit, advisory, investment banking and other services to large corporations with annual sales over R$700 million. In recent years, we have implemented a strategy to expand our operations to companies in the Brazilian corporate sector, with annual sales ranging from R$200 million to R$700 million, and companies in the middle market sector, with annual sales ranging from R$10 million to R$200 million. Besides credit, we offer our clients corporate and investment banking tailor-made products and advisory services, such as structuring and advising on mergers and acquisitions, project finance, local and international capital markets and other structured finance transactions. Fund management services are offered to our corporate and institutional clients and to a select client base of high net worth individuals. We also offer treasury products to our clients and carry out risk management transactions and, subject to our internal investment criteria and risk management limits, proprietary trading for our own account. We believe we benefit from an efficient structure that allows us to respond quickly and directly to client demands and business opportunities and to effectively manage risk. Through our subsidiaries B.V. Financeira and B.V. Leasing, we have increased our consumer credit business by providing financing for the purchase and leasing of vehicles, although our main focus is providing financing for purchasing rather than leasing. We are also currently expanding our consumer finance activities through B.V. Financeira in the areas of payroll deductible loans and, to a lesser extent, the financing of the purchase of construction materials and other assets. Payroll deductible loans are extended through advances of amounts to individual employees at certain designated companies or public sector entities or to pension recipients from the INSS. Amounts due are automatically deducted from the employees payroll by the relevant employer or the INSS and credited directly to us. We undertake our fund management activities through our subsidiary, Votorantim Asset, and we undertake brokerage activities through our subsidiary Votorantim Corretora. We are part of the Votorantim Group, one of the largest privately held industrial conglomerates in Latin America. We believe we benefit significantly from relations with other entities within the Votorantim Group. We conduct transactions with other entities within the Votorantim Group on an arm s length basis and compete with other financial institutions for the business of the Votorantim Group. Under Central Bank regulations, we are not allowed to grant loans or credit in any form (including cash advances or guarantees issued to secure obligations of affiliates) to any affiliate of the Votorantim Group. See Related Party Transactions. In January 2009, the Ermírio de Moraes family entered into a strategic partnership with Banco do Brasil, whereby Banco do Brasil acquired 50% of our capital stock. We believe we are able to obtain better funding conditions and benefit from the origination and distribution capabilities of Banco do Brasil in all segments in which we operate as a result of this partnership. See Strategic Partnership with Banco do Brasil below. On December 31, 2010, we had R$107,818 million in total assets (compared to R$84,801 million on December 31, 2009 and R$72,310 million on December 31, 2008) and R$8,389 million in shareholders equity (compared to R$7,145 million on December 31, 2009 and R$6,361 million on December 31, 2008) on a 87

consolidated basis. Net profit for the year ended December 31, 2010 was R$1,015 million (compared to R$802 million for the year ended December 31, 2009 and R$902 million for the year ended December 31, 2008). For the year ended December 31, 2010, our return on average shareholders equity (net profit divided by average shareholders equity) was 12.8% (compared to 12.0% for the year ended December 31, 2009 and 14.3% for the year ended December 31, 2008). See Selected Historical Financial Data and Management s Discussion and Analysis of Financial Condition and Results of Operations. Banco Votorantim s loan portfolio grew from R$0.9 billion as of December 31, 2002 to R$19.6 billion as of December 31, 2010, while B.V. Financeira s loan portfolio grew from R$1.7 billion to R$37.2 billion during the same period. Our headquarters are located at Avenida das Nações Unidas, 14171, Torre A, 18th Floor, 04794-000, São Paulo, SP, Brazil (telephone: +55 11 5185-1700). We are registered with the State of São Paulo Commercial Registry under NIRE (Número de Identificação no Registro de Empresas) number 35300525353. History We were originally incorporated under the laws of Brazil on August 31, 1988, with indefinite duration. We were organized as a limited liability company (sociedade limitada) under the laws of Brazil under the name Baltar Distribuidora de Títulos e Valores Mobiliários Ltda., and subsequently renamed Votorantim Distribuidora de Títulos e Valores Mobiliários Ltda. We became a corporation (sociedade por ações) under the laws of Brazil on February 25, 1991, a result of our transformation into a multiple service bank. We obtained the authorization from the Central Bank on August 7, 1991 to undertake a full range of banking activities. In August 1995, we commenced our consumer finance operations with the establishment of our subsidiary B.V. Financeira, which operates alongside B.V. Leasing. We commenced fund management activities in November 1995 by acquiring a brokerage company, with operations beginning in June 1996. In 1999, we established a new subsidiary, Votorantim Asset, to carry out fund management transactions. We were originally established by the Ermírio de Moraes family as the financial arm of the Votorantim Group, but since acquiring multiple bank status in 1991, we have actively sought to expand our client base outside the Votorantim Group. Benefiting from the strong recognition of the Votorantim brand, our operations have expanded to meet the needs of corporate clients with sales of over R$700 million per year, including both Brazilian companies and multinational corporations with a presence in Brazil, and an increasing client base of selected high net worth individuals. In recent years, we have implemented a strategy of expanding our lending to the Brazilian corporate, and middle market sectors, as well as consumer finance. See Business Corporate Banking and Strategic Partnership with Banco do Brasil below. One of our goals is to expand our business outside Brazil. In this respect, on February 20, 2002, we obtained a license to carry out banking business in The Bahamas from the Central Bank of The Bahamas through our Bahamian Branch. The Bahamian Branch enables us to raise funds in a more cost-effective manner and to offer our corporate client base a broader range of products. The Ermírio de Moraes Family The Votorantim Group was founded by Mr. José Ermírio de Moraes in 1918. Currently, the member companies of the Votorantim Group are under the common control of the Second Generation. The Second Generation owns, directly or indirectly, all of the voting rights in respect of Hejoassú Administração S.A., which is the holding company for the Votorantim Group. The Votorantim Group The Votorantim Group is one of the largest privately held industrial conglomerates in Latin America. Its core companies are market leaders in Brazil in their respective business segments: cement, non-ferrous metals, pulp 88

and paper and financial services. The Votorantim Group also has significant steel, agribusiness and chemical operations. In addition, it has a presence in the energy sector generating energy for its own consumption. The Votorantim Group companies supply markets around the world. Due to the international expansion of its businesses, its assets now include overseas cement plants in Canada and the United States and zinc plants in China, Peru and the United States which help diversify risk and generate non-brazilian currency revenue flows. The Votorantim Group commenced its operations in 1918 with Fábrica de Tecidos Votorantim, a small textile plant located in the city of Votorantim, in the state of São Paulo, under the direction of Senator José Ermírio de Moraes. In 1936, the Votorantim Group entered the cement business by opening a cement plant in the state of São Paulo. In 1937 and 1938, the Votorantim Group entered the rayon and steel businesses. By the 1940s, Senator José Ermírio de Moraes had created one of the largest industrial conglomerates in Latin America, producing textiles, cement, chemicals and steel. In 1942, the Votorantim Group expanded its cement operations to the state of Pernambuco in the northeast of Brazil. In the 1950s, the Votorantim Group began producing aluminium and hydroelectric power and refining sugar. In the 1960s, the Votorantim Group entered the zinc industry and expanded its hydroelectric power and aluminium production capacities. The Votorantim Group s focus in the 1970s and 1980s was the further expansion of its cement, aluminium, zinc, nickel and energy production capacities. In 1988, the Votorantim Group began its pulp and paper operations and, in 1989, it began producing concentrated orange juice. The Votorantim Group entered the financial sector in 1988 through the incorporation of a broker-dealer, a predecessor of what is today Banco Votorantim. In the 1990s, the Votorantim Group ceased its operations in industries that no longer offered it competitive advantages, including textiles, rayon and sugar refining. Strategic Partnership with Banco do Brasil This section presents a summary of the terms and conditions of our strategic partnership with Banco do Brasil and our assessment of the actions to be taken in respect thereof and expected benefits to be derived therefrom. The implementation of some or all of the actions described below by us and Banco do Brasil is subject to further analysis and market conditions. As a result, no assurance can be given that these actions and benefits will be implemented or achieved. General description of the transaction On January 9, 2009, the Ermírio de Moraes Family, through Banco Votorantim and Votorantim Finanças, entered into a share purchase agreement with Banco do Brasil (the Share Purchase Agreement ) for (i) the sale of 33,356,791,198 common shares of Banco Votorantim held by Votorantim Finanças to Banco do Brasil for R$3.0 billion and (ii) the issuance by Banco Votorantim of 7,412,620,277 new preferred shares and the subscription thereof by Banco do Brasil for R$1.2 billion, of which R$750 million was paid by Banco do Brasil on September 28, 2009 and the balance of R$450 million was paid on March 29, 2010. This acquisition of an interest in Banco Votorantim by Banco do Brasil was approved by the Central Bank on September 11, 2009 and was completed on September 28, 2009, when Banco do Brasil and Votorantim Finanças executed the definitive agreements for the partnership, including a shareholders agreement (the Shareholders Agreement ) and a revolving credit facility agreement. As a result of this transaction, Banco do Brasil shares in the management of Banco Votorantim with Votorantim Finanças and controls 49.9999999925% of the common shares and 50.0000000337% of the preferred shares of Banco Votorantim. Pursuant to the Shareholders Agreement, the shares of Banco Votorantim held by Banco do Brasil and Votorantim Finanças are subject to a three-year lock-up period. The purchase price paid by Banco do Brasil was calculated based on an economic and financial evaluation prepared by consultants contracted by Banco do Brasil, which took into consideration, among other factors, the 89

prospects for our future profitability and our discounted cashflow, adjusted to reflect the existing economic scenario. Prior to the conclusion of the transaction, and as part of the financial and corporate adjustments agreed upon with Banco do Brasil, Votorantim Finanças (i) acquired Banco Votorantim s total capital (consisting of 74,126,202,673 common shares); (ii) converted 7,412,620,267 common shares of Banco Votorantim into an equal number of preferred shares; and (iii) proceeded with the incorporation of BV Participações S.A., subscribing and paying-up with the shares of Votorantim Finanças subsidiaries BV Sistemas de Tecnologia da Informação S.A., CP Promotora de Vendas S.A. and Votorantim Corretora de Seguros S.A. On September 28, 2009, (i) Banco do Brasil acquired 50% shareholding of BV Participações S.A.; (ii) Votorantim Finanças transferred to Banco Votorantim the remaining shares of our subsidiary VBL not already held by us, which has been approved by the Central Bank and by the Central Bank of The Bahamas; and (iii) Votorantim Finanças approved a distribution of dividends and interest on capital by Banco Votorantim in the total amount of R$750 million. See Ownership and Capital Structure. In compliance with the conditions set forth in the Share Purchase Agreement, on September 28, 2009, the R$3.0 billion cash portion of the purchase price was deposited in escrow accounts at Banco Votorantim (R$2,160 million) and Banco do Brasil (R$840 million). The portion of the purchase price held in escrow at Banco Votorantim was released to Votorantim Finanças in three installments each of R$720 million on July 9, 2009, January 9, 2010 and July 12, 2010. The deposit at Banco do Brasil was released to Votorantim Finanças upon the satisfactory conclusion of post-closing due diligence. Through anticipated synergies between Banco Votorantim and Banco do Brasil, we believe we are able to obtain better funding conditions in the interbanking, financial and capital markets and benefit from the origination and distribution capabilities of Banco do Brasil in all segments in which we operate. Banco do Brasil Banco do Brasil is a mixed-capital company controlled by the Brazilian government. Banco do Brasil is currently the largest bank in Latin America in terms of assets and in 2009 recorded the highest net income of any Brazilian bank in history, according to data published by Economática in February 2010, with a significant presence throughout Brazil and operations in 23 countries that are key global economic and financial centers, including: Argentina, Bolivia, Chile, Paraguay, Peru, Uruguay and Venezuela in South America; Panama and the Cayman Islands in Central America; Mexico and the United States in North America; England, France, Germany, Italy, Portugal, Spain and Austria in Europe; the United Arab Emirates in the Middle East; China (Hong Kong and Shanghai), South Korea (Seoul) and Japan (Tokyo) in Asia; and Angola in Africa. In addition to its own network, Banco do Brasil also has partnerships with correspondent banks around the world. As of December 31, 2010, Banco do Brasil had over 54.4 million individual clients. Banco do Brasil has the largest retail network in Brazil, with approximately 18,359 points of service, including 5,087 branches located in 4,352 Brazilian municipalities. Additionally, Banco do Brasil has more than 45,000 automated teller machines that, together with Banco do Brasil s call centers and mobile banking services, enabled clients to carry out outside of the traditional branch environment approximately 93.0% of all transactions they conducted with Banco do Brasil in the year ended December 31, 2010. Based on data available as of December 31, 2010, Banco do Brasil was the leading financial institution in Brazil, in terms of: total assets, according to data published by the Central Bank; total number of checking accounts with 35.9 million accounts, according to public filings by Banco do Brasil, including accounts held at Banco Nossa Caixa S.A. ( Nossa Caixa ) and Banco Popular do Brasil 90

S.A. ( Banco Popular ), of which 33.7 million were held by individuals and 2.2 million were held by legal entities/corporations; size of branch network, according to data published by the Central Bank; total deposits, according to data published by the Central Bank, amounting to R$760.4 billion; credit portfolio balance, with a total balance of R$358.4 billion, of which R$338.0 billion represented loans made in Brazil, and constituting 21.0% of the total credit extended by financial institutions in the Brazilian market, according to data published by the Central Bank; third-party assets under management, with a market share of 21.2% of the total asset management market in Brazil, according to data published by the Brazilian Finance and Capital Markets Entities Association (Associação Brasileira das Entidades dos Mercados Financeiro e de Capitais or ANBIMA ); total number of clients with access to banking products and services through the Internet (11.0 million); payroll deduction loans, with a portfolio of R$45.0 billion, representing a market share of 32.7% of the Brazilian payroll deduction loan market, according to data published by the Central Bank; and agricultural credit, with a total loan portfolio of R$75.0 billion, representing 60.6% of the total balance of agricultural credit loans in Brazil, according to data published by the Central Bank. As a multiple-service bank, Banco do Brasil offers a full range of financial products and certain non-financial products, including personal and corporate credit transactions, financing for the Brazilian agribusiness sector, credit and debit cards, insurance and private pension plans, international banking services (such as foreign exchange and foreign trade financing), treasury transactions, financial and capital markets transactions and third-party asset management. Banco do Brasil also provides vehicle and real estate financing and credit services to account holders and non-account holders through licensed dealers and multibrand stores registered with Banco do Brasil. In addition to operating as a multiple-service bank, Banco do Brasil s conglomerate includes several subsidiaries that offer additional products and services. Through its investment bank, BB Banco de Investimento S.A., Banco do Brasil holds equity interests in companies involved in insurance, pension plans and capitalization (which is a form of savings account entitling holders to participate in periodic drawings for cash prizes). Banco do Brasil also sponsors two entities for the benefit of its employees, Caixa de Previdência dos Funcionários do Banco do Brasil, a private pension fund funded by Banco do Brasil and its employees, and Caixa de Assistência dos Funcionários do Banco do Brasil, a general welfare fund for Banco do Brasil s employees. Effects on operations and strategies and expected benefits Management The Shareholders Agreement governs certain aspects of the relationship between Banco do Brasil and Votorantim Finanças, including their respective participation in our management. In particular, the parties will rotate annually the designation of the chairman and vice-chairman of our board of directors. Following the closing of the transaction on September 28, 2009, our shareholders approved, inter alia, changes to our by-laws and elected the new members of our board of directors. Our board of directors is comprised of up to six members (three appointed by Banco do Brasil, including the initial chairman, and three appointed by Votorantim Finanças, including the initial vice chairman). 91

Our board of executive officers was not replaced as a result of the partnership with Banco do Brasil, nor were there any changes in the structure of our committees (Audit, Credit Risk, Liquidity and Technology Committees). See Management. Strategies and Expected Benefits Funding: We have secured and expect to continue to secure funding at more favorable rates and longer tenors, have experienced improved liquidity and increased our revenues through a number of transactions entered or to be entered into with Banco do Brasil and its subsidiaries and other conditions resulting from our association with Banco do Brasil. Among the measures implemented, on September 28, 2009 we entered into a revolving credit facility agreement with Banco do Brasil for general working capital purposes, under which we may borrow, at market rates (generally equivalent to the average rate of our funding), an amount equivalent to up to our current net worth. This agreement is valid for three years from September 28, 2009 and provides for automatic renewal for additional three-year terms unless either we or Banco do Brasil send a termination notice in writing to the other party no later than 90 days from the relevant renewal date. Branding: We believe our association with Banco do Brasil combines two of the strongest brands in Brazil. We believe this has resulted in improved origination capabilities and greater market awareness of our products and brand. Following the public announcement of our strategic partnership with Banco do Brasil, Moody s upgraded our rating, on October 19, 2009, for long-term local currency deposits from Baa1 to A3 and mentioned the strategic partnership in their rating report as one of the factors justifying the upgrade. We also have benefitted, and expect to continue to benefit, from increased credit limits with clients and counterparties in respect to funding and structured transactions. Platforms: We are reinforcing our business platforms and taking advantage of Banco do Brasil s presence in areas where Banco do Brasil traditionally operates to expand our businesses. For instance, our consumer finance activities have benefitted, and are expected to continue to benefit, from the distribution capabilities of Banco do Brasil, and B.V. Financeira, our main consumer finance subsidiary, has shared, and is expected to continue to share, in the expertise of Banco do Brasil in the financing of new cars. We have benefitted, and expect to continue to benefit, from Banco do Brasil s base in the middle market segment, in particular in corporate lending and access to clients to cross sell our investment banking products, principally mergers and acquisitions and advisory services. We have explored, and expect to continue to explore, ways in which, through Banco do Brasil s extensive network of branches and representatives, we can offer our asset management and private banking products. Additionally, because Banco do Brasil does not have a brokerage firm in Brazil, we have expanded the brokerage activities and revenues of our subsidiary Votorantim Corretora through the channeling of orders from Banco do Brasil and its customer base. Furthermore, we have taken advantage of cross-selling opportunities and have integrated platforms in payroll deductible loans and insurance (offering Banco do Brasil products). Expansion objectives, operations and management. Except as described herein, the partnership with Banco do Brasil has had no effects on our expansion objectives, and neither Votorantim Finanças nor Banco do Brasil has changed the operating or management activities of Banco Votorantim. Accounting, operational limits, regulation and credit decisions Due to Brazilian banking regulations, Banco do Brasil is required to consolidate our results of operations as to its 50% interest in us. Accordingly, all determinations made by Banco do Brasil in relation to capital 92

adequacy, exposure limits and other applicable operational limits recognize our operations on a consolidated basis to the extent of Banco do Brasil s interest in us. See The Brazilian Financial System and Banking Regulation. We continue to be regulated and account for our transactions on the same basis we were regulated prior to the partnership with Banco do Brasil. We do not expect our operations to materially affect Banco do Brasil s operational limits, but our management continuously assesses the effects of our operations on Banco do Brasil s operational limits and recommends any necessary adjustments. We have recently implemented a general credit policy which includes a requirement that any credit transaction in excess of R$750 million (or less if certain credit rating requirements are not met) be subject to prior approval by our board of directors (which includes three members appointed by Banco do Brasil). See Business Credit and Risk Control Policy Credit Risk Management. With a view to allowing us to continue to expand our activities, Banco do Brasil and Votorantim Finanças have agreed in the Shareholders Agreement that, whenever our risk-weighted capital ratio is less than 2% above the minimum requirement applicable to us, our shareholders or board of directors (if then within the powers of the board of directors to review this matter) will consider proposals for new levels of risk-weighted capital. The risk-weighted capital ratio applicable to us and all other banks in Brazil is currently 11.0% of riskbased exposure. Our risk-weighted capital ratio was 13.1% as of December 31, 2010. Competition between us and Banco do Brasil The agreements governing our partnership with Banco do Brasil contain no express restrictions on competition between us and Banco do Brasil. Our intention, however, is to maximize our synergies by coordinating the strengths of each institution. As a result, we serve, directly or through our subsidiaries, as the primary platform for vehicle financing and other consumer finance transactions, investment banking, private banking and brokerage activities. Our strategy in relation to future lines of business will depend on the then existing market conditions and the respective strengths of each institution in such particular areas. Commitment as to rates Votorantim Finanças and Banco do Brasil have committed with the Central Bank to lower by at least 25% the registration fee charged by B.V. Financeira with respect to its consumer financing transactions upon the granting of a financing and the overall cost of such transactions by at least 9.1%, which reductions are to be achieved by December 31, 2012. Personnel At present, we have not experienced and do not anticipate any transfers of personnel among us, Banco do Brasil and our subsidiaries. In addition, our remuneration policies have been, and will continue to be, driven by market standards, with no express limitations or alterations on our remuneration structure. Our Strategy The Brazilian banking industry has experienced certain changes since the implementation of the Real Plan in mid-1994. The large margins earned from arbitrage activities during the hyperinflationary period preceding the implementation of the Real Plan have diminished and gradually led banks to expand lending and fee-based services. As a result, we have successfully diversified into advisory services, including local and international underwriting and project finance, consumer finance, fund management and private banking. 93

Presently, in addition to the strategies directly related to our association with Banco do Brasil, our strategy is to: continue our successful diversification into consumer, corporate and middle-market banking, seeking a more balanced and diversified earnings profile; increase our market share in the consumer finance business by expanding regional coverage, in particular through our partnership with Banco do Brasil, seeking continued strong growth in vehicle financing, including expansion of our new car financing operations, and continuing to expand our credit card business, personal loans and payroll deductible loans; continue to expand our credit portfolio and diversify lending operations from our traditional base in the large corporate sector to the higher margin Brazilian corporate and middle market sectors; maintain the profitability of our treasury operations and continue to offer treasury products through our Corporate and Investment Banking units; continue to grow our asset management business, which had over R$31.9 billion in assets under management as of December 31, 2010; continue to maintain strong asset quality through consistent risk management, collection policies and sophisticated credit risk modeling techniques; continue to maintain a strong efficiency ratio (a measure of our operational efficiency), which is consistently above the industry average; improve our market share and ranking position in local and international underwriting; and diversify our sources of funding, including increasing our access to funds outside of Brazil, and seek better funding conditions in the interbank, financial and capital markets, in part through our partnership with Banco do Brasil. Principal Business Units We are divided into eight business units: Corporate Banking; Treasury; Brokerage; Consumer Finance; Investment Banking; International Division; Fund Management; and Private Banking. 94

Each business unit reports to one of our two vice presidents. See Management. In addition, the Administration and Control unit provides administrative and management support to each of the business units and has responsibility for monitoring and implementing internal controls. See Administration and Control below. The activities of each of these units are described in more detail below. Corporate Banking The Corporate Banking unit provides services to companies established within our target markets, which are currently composed of large companies with annual sales in excess of R$700 million (the so-called large corporate segment), and increasingly to mid-size companies with annual sales ranging from R$200 million to R$700 million (the so-called corporate segment) and from R$10 million to R$200 million (the so-called middle market segment). We estimate that there are approximately 500 companies within the large corporate segment in Brazil, and estimate that approximately 300 have been our clients and approximately 180 are currently active clients. We intend to continue to expand our client base, in particular in the middle market segment, as well as our geographical focus, in both cases in part through our partnership with Banco do Brasil, thereby adding new active clients to our portfolio. Our increased focus on the corporate and middle market segments was implemented in 2004, and we expect our lending operations in these areas to continue to increase over the next few years. See Strategic Partnership with Banco do Brasil. The Corporate Banking unit is responsible for identifying new customers, cross-selling and for organizing and coordinating our client relationships. The account officers of this unit offer all of our services and products (including tailor-made products), referring any customers who are interested in specific products to the relevant unit for that product. Our clients are offered alternative financial structures which are designed to meet their needs and which are often not available from the larger commercial banks. The Corporate Banking unit focuses on repeat transactions, such as hedges, swaps and vendor transactions. In addition, the Corporate Banking unit is responsible for managing our commercial loan portfolio. See Credit below. In addition to our directly funded credit operations, we act as financial agent for the BNDES, onlending funding from BNDES to large companies. The source of funds is determined by BNDES, and is usually lent under the FINAME or BNDES-EXIM programs. We then onlend these borrowed funds to large companies meeting certain criteria established by BNDES. We exclusively control the decision as to whether to onlend BNDES funds to a particular borrower and apply our standard lending criteria. We assume the credit risk for these onlendings and earn a spread based on our assessment of this risk. Treasury General: We derive a significant portion of our consolidated operating income from the Treasury unit. The main functions of the Treasury unit are: to ensure adequate liquidity for our operations through asset and liability management (in respect of currency, maturity and interest rates); to provide pricing parameters for the products offered to clients; to manage our proprietary foreign exchange and derivatives activities; and to coordinate trading of foreign fixed-income securities by VBL and the Bahamian Branch. Until the Real Plan was instituted in mid-1994, we made a significant portion of our profits from arbitrage operations in Brazil s hyperinflationary environment. Since then, however, margins from arbitrage have diminished and we have sought to diversify our business and client base. Despite changing and challenging 95

market conditions, our treasury activities have remained profitable over the four years ended December 31, 2010. Our Treasury unit also manages our portfolio of fixed-income securities composed mainly of U.S. dollar-denominated Brazilian sovereign and corporate bonds. The majority of the Treasury unit s business relates to the management of assets, liabilities and derivatives in the interbank market, principally on behalf of our corporate and asset management clients. Our Treasury unit is also responsible for the management of the Brazilian government debt securities held by us, traded on the over-the-counter and exchange derivative markets. We are also a highly active participant in repurchase transactions involving Brazilian government and other securities. We are also an active participant in the foreign exchange markets. We were ranked 8th among 144 financial institutions in Brazil in terms of volume of foreign exchange trading, according to a Central Bank survey in January 2011. Our foreign exchange transactions are mainly in respect of reais and U.S. dollars, for both our proprietary account or on behalf of clients. Any mismatched position undertaken by us in a currency other than the real or U.S. dollar is usually hedged by us either in reais or U.S. dollars against fluctuations in the market. In coordination with the International Division, the Treasury unit is responsible for our foreign currency funding activities and for providing secondary market liquidity for debt instruments underwritten by us in the international markets. We have historically maintained adequate levels of liquidity by concentrating our investments in highly liquid assets. As of December 31, 2010, interbank deposits (short-term) and marketable securities (short- and longterm) totaled R$24.6 billion, representing 22.8% of our total assets, as compared to a total of R$18.0 billion or 21.2% of our total assets as of December 31, 2009 and R$19.7 billion or 27.3% of our total assets as of December 31, 2008. These investments are mostly comprised of government securities. As of December 31, 2010, our marketable securities totaled R$23.4 billion, or 95.1% of our total amount of interbank deposits and marketable securities as of such date, R$14.0 billion of which were government securities. As of December 31, 2010, all of our derivatives, repurchase and securities positions were held on a proprietary basis. All of our treasury operations are subject to limits on unmatched positions. The aggregate amount of these limits is determined by unanimous decision at the regular monthly meetings of the Treasury Risk Management Group and compliance is monitored on a daily basis. See Administration and Control and Credit and Risk Control Policy below. Brokerage We provide brokerage services through our subsidiary Votorantim Corretora. We offer services primarily to domestic and international financial institutions related to the main trading activities of BM&FBOVESPA. These services include stocks, U.S. dollar future contracts, Brazilian domestic interest rate future contracts, BOVESPA future contracts, as well as tailor-made derivative instruments on foreign exchange and interest rates. Votorantim Corretora is a member of BM&FBOVESPA. The notional amount of contracts closed by Votorantim Corretora amounted to approximately R$1.3 trillion in the year ended December 31, 2009 and R$1.9 trillion in the year ended December 31, 2010. As of December 2010, Votorantim Corretora ranked 11th among 61 Brazilian brokerage firms in terms of volume of derivative transactions carried out on the BM&F. We expect to expand the operations of Votorantim Corretora through the channeling of orders from Banco do Brasil. See Strategic Partnership with Banco do Brasil and Ownership and Capital Structure. In addition, on December 12, 2005, we received the Central Bank s approval for establishing a broker-dealer in the United States, which was organized under the laws of Delaware and duly incorporated on March 6, 2006 and is authorized to do business in New York. On August 16, 2006, Banco Votorantim Securities Inc. ( BVS ) was duly authorized by the National Association of Securities Dealer, Inc. ( NASD ) to commence 96

business. BVS carries on business as an introducing broker-dealer and has applied to the Financial Industry Regulatory Authority ( FINRA ) to expand its activities. Consumer Finance We commenced our consumer finance operations in August 1995 with the establishment of our wholly owned subsidiary B.V. Financeira. This entity operates alongside B.V. Leasing, a non-financial institution acting as a captive service firm which is also wholly owned by us. See Ownership and Capital Structure. We consider this sector a very important component of our strategy of fostering new and more stable income streams to complement our treasury and corporate and investment banking operations. As of December 31, 2010, our total credit portfolio for this unit amounted to R$37,214 million or 34.5% of our consolidated total assets, as compared to R$22,303 million or 26.3% and R$17,779 million or 24.6% as of December 31, 2009 and 2008, respectively. See Principal Business Units Credit below. The growth of our consumer finance operations over the last several years has been a key factor in the growth of our banking operations as a whole, as well as in our results of operations. We estimate that we currently hold a market share of approximately 22.3% and 6.4% in the Brazilian vehicle loan and payroll deductible loan markets, respectively. The activities of B.V. Financeira principally comprise the financing of vehicles. We have agreements with car dealers and independent dealers to finance the purchase or lease of new and second-hand cars, predominantly manufactured in Brazil. As of December 31, 2010, the average percentage of the asset value of the vehicles financed by B.V. Financeira was approximately 87%, while the average term for this type of financing was 51 months. The majority of the vehicles financed by B.V. Financeira are second-hand cars sold by independent dealers, with the remainder sold by the authorized dealers of car manufacturers. The proportion of the financing portfolio relating to new cars has grown in recent years, particularly following our partnership with Banco do Brasil, as a result of which B.V. Financeira assumed the new car financing operations of Banco do Brasil. We experience high competition in this area, but expect to remain competitive by using our extensive sales network and expanding our operations. B.V. Financeira also has motorcycle and truck financing operations. Its activities are currently conducted in all of Brazil s 26 states and the Distrito Federal. The total number of employees of B.V. Financeira has increased from 4,496 on December 31, 2009 to 5,733 on December 31, 2010. As retail credit generally comprises many small transactions requiring swift credit decisions, we rely on internal auditing, reassessment of credits extended, compliance mechanisms and continuous monitoring by means of detailed control reports. All of our consumer loans are subject to a standardized credit review process which we have implemented specifically for consumer credit. Information with respect to the prospective borrower is scored. Because of standardized procedures, we are able to make consumer credit decisions generally within one day. Our strategy in this area is to maintain recurrent business, thus reducing (insofar as possible) the risks inherent in individual transactions. During the two years ended December 31, 2010, our consumer finance segment, including the operations of B.V. Financeira and BV Leasing, experienced an average non-performance ratio of approximately 2.9%, representing those loans that are 90 days or more overdue, as a percentage of its consumer finance loan portfolio. Reminders, both by mail and by telephone, are provided to non-performing borrowers five days after a missed payment. If payment is not made within 30 days, we contract third party collection agencies to pursue collection on our behalf, including by court proceedings if the payment is not made after a period of 70 days. B.V. Financeira is supported by our Administration and Control unit. See Administration and Control, Credit and Risk Control Policy and Related Party Transactions below. We are also currently increasing our consumer finance activities through B.V. Financeira in the areas of payroll deductible loans and, to a lesser extent, the financing of the purchase of construction materials and other assets. Payroll deductible loans are advances to an individual employee at certain designated companies 97

or public sector entities or pension recipients from the INSS, which advances are repaid through deductions from the borrower s paycheck or benefits check. Amounts due are automatically deducted from the employee s payroll by the relevant employer or the INSS and credited directly to us. This activity is promoted by independent third-parties and credit analysis is carried out by means of a standardized credit review process. Our consumer finance activities are expected to benefit from the distribution capabilities of Banco do Brasil. See Strategic Partnership with Banco do Brasil. We recently began issuing co-branded credit cards (carrying Visa or MasterCard logos for general usage). We intend to strengthen our relationship with our clients and encourage them to use our products and services, particularly through frequent use of our credit cards. We are also strengthening our marketing campaigns to distribute our credit cards and improve our client base. Our credit card products are offered through our branches, the internet and our central service center. Votorantim Finanças and Banco do Brasil have committed with the Central Bank to lower the registration fee charged by B.V. Financeira with respect to its consumer financing transactions upon the granting of a financing by at least 25% and the overall cost of such transactions by at least 9.1%, which reductions are to be achieved by December 31, 2012. Investment Banking Since 2007, we have been developing our activities as an investment bank to increase the range of services offered. Our Investment Banking unit has been focusing on providing mergers and acquisitions advice, corporate advisory services and arranging and underwriting debt and equity securities in Brazil, whereas our international underwriting activities are carried out by our International Division. See International Division below. Advisory Services: The mergers and acquisitions team offers a full range of services including advising on the valuation, planning and execution of mergers, acquisitions and corporate restructurings, structuring investments and divestitures, and providing access to strategic investors and alternative sources of capital. In the six-month period ended June 30, 2009, we ranked 4 th in advisory services in mergers and acquisition transactions in terms of volume of deals according to ANBIMA (Associação Brasileira das Entidades dos Mercados Financeiro e de Capitais), having completed two transactions in the banking and infrastructure sectors. Local Underwriting: Our underwriting activities commenced in 1996, mainly through partnerships with other banks and rendering services to companies within the Votorantim Group. Over the last several years, we have increased our participation in the underwriting and distribution of debentures, commercial paper issuances, FIDCs and shares of major Brazilian companies outside the Votorantim Group. On the debt side, we are involved in the issuance of fixed income instruments in the local and international markets, securitizations and asset backed transactions. On the equity side, we are involved in initial public offers, primary issues and secondary market block trades, and voluntary and mandatory share tender offerings. We seek to continue to expand our local underwriting franchise by obtaining new mandates for equity issuances, in particular in the corporate segment, and by making use of our relationships with other market participants in order to secure partnerships and participation in a larger number of transactions. We have been participating (as lead manager, co-lead manager or co-manager) in underwriting transactions since December 31, 2001. In 2008, we participated in debenture transactions totaling R$413.2 million. In addition, we participated in commercial paper transactions totaling R$1.6 billion, U.S.$350 million in bond transactions and R$27 million in Certificates of Real Estate Receivables (Certificados de Recebíveis Imobiliários). In equities, we were coordinator and bookrunner in 2008 of four initial public offerings and one follow-on totaling R$8.7 billion. In 2009, we participated in debenture transactions totaling R$3.3 billion, commercial paper transactions totaling R$7.6 billion and issuance of Certificates of Real Estate Receivables (Certificados de Recebíveis Imobiliários) totaling R$9.2 billion. In equities we were coordinator and/or bookrunner and/or 98

participated together with other financial institutions in 2009 in two initial public offerings and two follow-ons totaling R$9.4 billion. In 2010, we participated in debenture transactions totaling R$8.3 billion and commercial paper transactions totaling R$2.0 billion. During the same period, we were co-manager in two initial public offerings and joint bookrunner in four follow-ons, totaling R$135 billion. The following table sets forth certain capital markets transactions in which we have been involved either as lead underwriter, arranger or a member of a syndicate for the periods indicated: 2008 Debentures Company Name Aggregate principal amount of the transaction or program (R$ in millions) Energipe... 73.2 Even... 100 Trisul... 200 Rossi... 40 Initial Public Offers and Follow-Ons Hypermarcas... 612 Copasa (follow-on)... 460 OGX... 6,712 Le Lis Blanc... 150 Commercial Papers Votorantim Finanças... 450 Votorantim Finanças... 450 Votorantim Finanças... 700 Votorantim Finanças... 483 CRI (Certificados de Recebíveis Imobiliários) Química Amparo... 27 2009 CRI (Certificados de Recebíveis Imobiliários) Abidown/VCP... 9 PDG... 30 Debentures Tractebel... 600 Cremer... 100 MMX... 96 BNDES Par... 1,250 Ampla... 250 Battistella... 115 Light... 300 Gafisa... 250 MRV... 112 99

Company Name Aggregate principal amount of the transaction or program (R$ in millions) Alupar... 250 Initial Public Offers and Follow-Ons Visanet... 8,397 MRV (follow-on)... 722 Tivit... 661 PDG (follow-on)... 1,058 Commercial Paper Votorantim Finanças... 1,000 Tractebel... 300 OHL... 200 MRV... 100 Santos Brasil... 200 Light... 100 Sabesp... 600 Votorantim Finanças... 1,050 OHL... 120 Iochpe-Maxion... 330 CEMIG... 2,700 Sabesp... 900 Battistella... 47 Metro RIO... 100 2010 Debentures CEMIG... 2,700 AES Tietê... 900 Sabesp... 1,215 Rodobens... 300 PDG Realty... 600 BNDESPar... 1,500 Cetip... 900 Ecopart... 39 Ciberpar... 140 Isolux... 100 Hidrotermica... 115 Locamérica... 100 Commercial Paper Votorantim Finanças... 500 CART... 400 100

Company Name Aggregate principal amount of the transaction or program (R$ in millions) Metro RIO... 390 Iochpe Maxion... 140 Isolux Energia e Part... 100 Metro RIO... 390 Rodobens... 70 Initial Public Offers and Follow-Ons OSX... 2,450 Gafisa (follow-on)... 1,064 JBS (follow-on)... 1,600 Julio Simões... 447 Petrobras (follow-on)... 120,361 CRI (Certificados de Recebíveis Imobiliários)... Gafisa... 100 Queiroz Galvão Desen. Imob.... 135 Lojas Renner... 350 Braskem... 588 BV Financeira IV... 2,000 BV Financeira V... 678 FIDC (Fundos de investimento em direitos creditórios)... CAESB... 120 BV Financeira III... 500 PDG Realty... 405 Gafisa... 120 Otavio Lage... 17 Project Finance: Our project finance unit provides structuring and coordination services in connection with projects mainly in the Brazilian electricity sector (in particular, the construction of hydro-electric power plants) which in certain cases also present opportunities for us to participate in the local underwriting for such projects. We typically charge a monthly retainer fee and a success fee. If BNDES is providing financing, our remuneration also includes a spread over the total amount lent. We seek to participate in projects involving amounts of at least R$100 million. Since 1996, we have participated in various transactions, including as financial advisor to the AHE Foz do Chapecó project, and as advisor and arranger to the Machadinho Energética S.A. project, both of which involved the construction of hydro-electric power plants. International Division Created in 1994, the International Division operates in conjunction with our Treasury, Corporate and Investment Banking units to provide clients with international products and services and international underwriting. Our International Division s main activities include: foreign exchange services; 101

trade finance products; fixed-income trading in U.S. dollar, euro and yen-denominated Brazilian sovereign and corporate bonds; arranging interest rate and foreign exchange protection to clients through the use of swaps and derivative instruments; and foreign currency funding activities for our corporate clients, through international underwriting transactions and for ourselves through the issuance of notes (acting through our principal office in Brazil or the Bahamian Branch) under our U.S.$4.0 billion Global Medium-Term Note Program (Nassau Branch), U.S.$5.0 billion Global Medium-Term Note Program (Brazilian principal office) or U.S.$1.6 billion Euro Medium-Term Note Program, Short-Term Note Program and Certificate of Deposit Program. As of December 31, 2010, these Programs had a total of U.S.$3.1 billion in aggregate principal amount of medium-term notes, short-term notes and certificates of deposit outstanding. Over the past several years, the International Division has been providing our clients with working capital financing, structured products such as credit-linked notes and trade-related transactions, and derivative products, in addition to international underwriting and distributing notes and commercial paper. We participated in the international underwriting and/or distribution of medium term notes, commercial paper and structured notes, as shown in the following table: 2008 Company Name Aggregate principal amount of the transaction (U.S. dollars in millions, except where indicated) Banco Industrial e Comercial S.A.... 130 Banco Panamericano S.A.... 130 Banco Daycoval S.A... 100 2009 TAM S.A.... 300 2010 Banco Votorantim S.A.... 750 Banco do Brasil... 1,000 Banco Industrial e Comercial S.A.... 275 Banco Bradesco S.A... 750 Banco Daycoval S.A... 300 Banco Votorantim S.A.... 500 Banco Votorantim S.A.... 400 Banco Votorantim S.A.... CHF 250 Banco do Brasil... 450 Banco Panamericano S.A.... 500 Banco ABC Brasil S.A.... 300 Banco Panamericano S.A.... 500 Banco do Brasil.... EUR750 Banco Nordeste do Brasil S.A... 300 102

Source: Central Bank. The Bahamian Branch was established in order to offer our client base a broader range of products. Since its establishment, we have transferred the assets and portfolio of VBL to the Bahamian Branch, which concentrates its activities on asset trading, long-term securities investments, money-market activities, foreign exchange and, to a lesser extent, credit lending. We also believe that the Bahamian Branch enables us to raise funds in a more cost-effective manner. The Bahamian Branch is now responsible for most of the activities previously carried out by VBL. VBL acts as a broker-dealer and investment manager in relation to our international activities, in particular to complement our asset and wealth management business. On September 30, 2003, we obtained the Central Bank s approval for the establishment of a representative office in London. The representative office started operations on November 11, 2003, and is currently staffed by two employees. It is mainly involved in marketing activities for raising our profile, and allowing us to further develop relationships with existing clients as well as to promote our services to new clients, in order to develop further business opportunities in Brazil. In addition, on December 12, 2005, we received the Central Bank s approval for the opening of a broker-dealer in the United States, which was organized under the laws of Delaware and duly incorporated on March 6, 2006 and authorized to do business in New York. On August 16, 2006, BVS was duly authorized by the NASD to commence business. BVS carries on business as an introducing broker-dealer and has applied to FINRA to expand its activities. We seek to continue to expand the activities of our International Division through the expansion of our distribution capabilities with institutional investors located in the United States and Europe through our representative office in London and our broker-dealer in the United States. Fund Management We commenced our fund management activities by acquiring a brokerage company in November 1995, which commenced operations in June 1996. In 1999, our management decided to concentrate these activities in a newly formed subsidiary, Votorantim Asset. See Ownership and Capital Structure Subsidiaries and Affiliates. Currently, we are involved in the administration of approximately 200 different open and closed ended funds, mostly in the fixed-income market, and, to a lesser extent, foreign exchange, interest rates and equity index derivatives. We intend to continue to expand our client base, in particular with respect to high net worth individuals in the private banking segment, by improving our sales mechanisms through the introduction of internet banking and new points of sale, including by means of the distribution network of Banco do Brasil. See Strategic Partnership with Banco do Brasil. Under Brazilian law, Votorantim Asset may not guarantee any rate of return to investors on the funds it administers. According to data provided by ANBIMA, on December 31, 2010, total assets under our management were approximately R$31.9 billion, as compared to R$19.1 billion on December 31, 2009 and R$15.7 billion on December 31, 2008. Private Banking Our Private Banking division was established in 2003 in response to increasing demand for private banking services from high net-worth individuals associated with our core corporate clients. Currently, the Private Banking division is comprised of 65 professionals located in São Paulo, Salvador, Recife, Rio de Janeiro, Porto Alegre, Curitiba, Belo Horizonte, Campinas and Caxias do Sul. Asset management, in particular investment funds, is the most important service we offer to private bank clients, together with that of providing financial management solutions. These services are offered in conjunction with Votorantim Asset. Portfolios 103

are generally managed on a discretionary basis, subject to parameters agreed upon with the particular client, through an investment policy based on (i) risk appetite and (ii) tenor for investments. We earn fees from our private banking clients that are generally based on the value of assets under management. Credit We have traditionally provided credit lines to our corporate banking clients in order to generate business in more structured and tailor-made activities. Corporate lending activity has increased significantly over the last three years, particularly in 2008, as has our consumer finance business. Our corporate lending operations have traditionally focused on large corporate clients with sales of R$700 million or more per year, including both Brazilian companies and multinational corporations with a presence in Brazil. More recently we have implemented a strategy of expanding our corporate lending operations to companies in the Brazilian corporate sector, with sales ranging from R$200 million to R$700 million, and companies in the middle market sector, with sales ranging from R$10 million to R$200 million. The Corporate Banking unit is responsible for managing our commercial loan portfolio, which has grown 323.2% since December 31, 2005 (from R$4,632 million on December 31, 2005 to R$19,602 million on December 31, 2010). Commercial loans include short-term working capital and other structured loans such as receivables drawn against the Votorantim Group. Commercial loans represented approximately 34.5% of our total consolidated loan portfolio on December 31, 2010, while consumer loans represented the remaining 65.5%. On December 31, 2010, our total consolidated loan portfolio amounted to R$56,816 million, representing 52.7% of our total assets, as compared to R$42,444 million, or 50.1% of our total assets, on December 31, 2009 and R$38,184 million, or 52.8% of our total assets, on December 31, 2008. Our consumer finance operations comprise the largest component of our consolidated loan portfolio. We provide consumer financing through our wholly owned subsidiary B.V. Financeira. See Consumer Finance and Management s Discussion and Analysis of Financial Condition and Results of Operations above. The following table presents a breakdown of our outstanding total consolidated loan portfolio by sector on the dates indicated: Industry Description... As of December 31, 2010 (R$ in millions) As of December 31, 2009 Industrial (1)... 9,642 8,416 Commerce... 3,284 2,151 Rural... 1,313 559 Financial institutions... 18 Other services (2)... 5,936 4,619 Individuals (3)... 36,641 26,681 Total... 56,816 42,444 Note: (1) Includes metallurgy, petrochemicals and chemicals, steel, synthetic fiber and packaging. (2) Includes telecommunications and electric utilities. (3) Includes primarily consumer finance loans. 104

In line with the Brazilian market generally, our practice has been to generally limit credit exposures to the short term. As we increase our credit portfolio in the corporate and middle market segments and our consumer loans, however, we expect that the average tenor of our portfolio will increase. On December 31, 2010, the average term of our outstanding loan portfolio was 545 days. The following table presents a more detailed breakdown of our loan portfolio by maturity on the dates indicated: As of December 31, 2010 As of December 31, 2009 (Percentage of total loan portfolio (R$ in millions) (Percentage of total loan portfolio (R$ in millions) Overdue more than 15 days... 1.2% 709 2.7% 1,138 Up to 90 days... 13.1% 7,469 14.1% 5,979 91 to 365 days... 27.7% 15,757 27.3% 11,569 1 to 3 years... 45.2% 25,675 39.5% 16,757 3 to 5 years... 12.5% 7,074 11.9% 5,040 5 to 15 years... 0.2% 132 4.6% 1,961 Total... 100.0% 56,816 100.0% 42,444 Administration and Control Our Administration and Control unit is primarily responsible for our support areas, as well as for certain internal controls such as capital adequacy, credit and risk control and loan losses. It provides general administrative and management assistance to our other various businesses, including records administration, accounting, information management, bank controls, the development of new products and standard operating procedures. In addition, it is responsible for recruiting personnel and overseeing training and human resources. With respect to our partnership with Banco do Brasil, our Administration and Control unit works closely with our management to address specific administrative and management issues arising from this partnership. See Strategic Partnership with Banco do Brasil. Capital Adequacy We are required to comply with capital adequacy and other requirements of the Central Bank. Pursuant to Brazilian capital adequacy rules, financial institutions, including us, are required to maintain risk-weighted capital equal to at least 11% of total risk-weighted assets, calculated in accordance with specific criteria set forth by the Central Bank. On December 31, 2010, our level of risk-weighted capital was 13.1% of our total risk-weighted assets compared to 13.2% on December 31, 2009 and 13.5% on December 31, 2008. Since December 31, 2008, our risk-weighted assets have increased more rapidly than our capital. The reduction in our risk-weighted capital ratio since December 31, 2008 mainly reflects (i) the rapid growth of our credit portfolio, particularly our consumer financing portfolio which, in general, involves a higher credit risk weighting, (ii) as a result of worsened economic conditions in Brazil and abroad in 2008 and 2009, a higher level of non-performing loans which also results in a higher credit risk weighting, and (iii) growth in our securities and derivatives portfolios which results in a higher market risk weighting. As described above, with a view to allowing us to continue to expand our activities, Banco do Brasil and Votorantim Finanças have agreed in the Shareholders Agreement that, whenever our risk-weighted capital ratio is less than 2% above the minimum requirement applicable to us, our shareholders or board of directors (if then within the powers of the board of directors to review this matter) will consider proposals for new levels of risk-weighted capital. On January 20, 2010, we issued U.S.$750 million of subordinated notes due 2020. The Central Bank authorized the qualification of the Subordinated Notes as Tier 2 Capital on March 2, 2010. We issued an additional U.S.$400 million of subordinated notes on July 26, 2010 (the Additional Subordinated Notes ) which are fungible with the Subordinated Notes. The Central Bank authorized the 105

qualification of the Additional Subordinated Notes as Tier 2 capital on September 20, 2010. The issuance of the Subordinated Notes and the Additional Subordinated Notes is a part of our strategy to increase our capital to allow for continued expansion. Credit and Risk Control Policy General Our internal risk management system is divided as follows: Credit Risk Management covers borrower risk, custody risk, counterparty risk and performance risk. It establishes operating limits in accordance with criteria detailed in our credit policy. Treasury Risk Management relates to liquidity risks and potential losses associated with our dealings in all types of assets. Fiduciary and Regulatory Risk consists mainly of processes for formalizing contracts, guarantees and the verification of documents. We have set up various committees to manage our systems, controls and business in general, which include the credit and risk management committees, described in more detail below, and the liquidity, financial, technology and products committees. The liquidity committee meets twice a month and is responsible for planning future cash flow needs and our borrowing and lending availability, while the financial committee meets daily to assess currency position, cash availability, results and expected market conditions for the following day. We did not change the policies and structure of our committees as a result of our partnership with Banco do Brasil; except for a general policy under which we are required to obtain the prior approval of our board of directors (including three members appointed by Banco do Brasil) for any transaction in excess of R$750 million (or less if certain credit rating requirements are not met). See Strategic Partnership with Banco do Brasil. Credit Risk Management We believe we apply strict rules in analyzing the creditworthiness of every prospective client, including of our Investment Banking department. The credit policy was developed to provide the appropriate tools to assess and evaluate credit risks associated with lending activities. Credit and portfolio analysis are conducted by the credit department, which also coordinates review by the relevant credit committee. Credit evaluation and assessment is divided among the following credit committees: Board of Directors: Our board of directors is responsible for the review of credit facilities in excess of R$750 million (for clients with a rating of B+ or higher), R$500 million (for clients with a rating of B) or R$400 million (for clients with a rating of B- or lower). A quorum of four members is required and all decisions must be unanimous. Corporate, Large Corporate and Structured Transactions (Senior III Committee): The Senior III Committee, comprised of a director, a corporate vice-president, a commercial vice-president, a credit officer, a treasury officer, a corporate and investment banking officer, a risk officer and a legal superintendent, carries out the review for credit facilities to corporate clients (with annual sales between R$200 million and R$700 million), large corporate clients (with annual sales in excess of R$700 million) and structured transactions, in each case in excess of R$150 million (or a lower value in circumstances where the client rating, collateral or maximum term are not within the parameters which permit a review by the Senior II Committee). Meetings of the Senior 106

III Committee require a quorum of five permanent members (including a director, a vice-president and a credit officer and, in the case of structured transactions, a legal superintendent) and all decisions must be unanimous. Corporate and Large Corporate (Senior II Committee): The Senior II Committee, comprised of a corporate vice-president, a credit officer, a corporate and investment banking officer, a superintendent of investment banking and a superintendent of private equity, carries out the review for credit facilities to corporate clients (with annual sales between R$200 million and R$700 million) and large corporate clients (with annual sales in excess of R$700 million), in each case up to R$150 million, depending on certain criteria relating to client rating, collateral and maximum term. Meetings of the Senior II Committee require a quorum of three permanent members (including a corporate vice-president, a credit officer, a corporate and investment banking officer) and all decisions must be unanimous. Corporate and Large Corporate (Senior I Committee): The Senior I Committee, comprised of a credit officer, a corporate and investment banking officer, a superintendent of investment banking and a superintendent of private equity, carries out the review for credit facilities to corporate clients (with annual sales between R$200 million and R$700 million) and large corporate clients (with annual sales in excess of R$700 million), in each case up to R$50 million, depending on certain criteria relating to client rating, collateral and maximum term. Meetings of the Senior I Committee require a quorum of two permanent members (including a credit officer and a corporate and investment banking officer) and all decisions must be unanimous. Corporate Committees: The corporate segment focuses on clients with annual sales between R$200 million and R$700 million. One of four different committees conducts the credit review process for corporate clients, depending on the size of the credit facility. The Corporate Pleno Committee is comprised of a credit officer, a corporate and investment banking officer, a commercial supervisor and a credit manager and carries out the review for credit facilities between R$7.5 million and R$15 million. Credits between R$3 million and R$7.5 million are approved by the Corporate Matriz Committee, comprised of a credit manager and a commercial supervisor. The Corporate Filial Committee II is comprised of a credit coordinator, a credit manager, a platform head and a commercial supervisor and carries out the review for credit facilities between R$1 million and R$3 million. Credits up to R$1 million are approved by the Corporate Filial Committee I, comprised of a credit coordinator and a platform head. Meetings of the committees in the corporate segment require a quorum of all members (other then the Corporate Pleno Committee, which requires a quorum of three members) and decisions are taken by a majority of voting members. Middle Market Committees: The middle market focuses on clients with annual sales between R$10 million and R$200 million. Borrowers in this segment are analyzed in light of credit criteria which require the provision of collateral, mainly liquid receivables. Client data are submitted to credit bureaus and an internal credit systems analysis before being reviewed by the relevant committee. The credit review procedure in respect of middle market clients is carried out by one of eight different committees, each of which has authority to approve transactions depending on the terms of the relevant transaction, as set forth in the table below: Committee Platform Credit Committee I Members Senior Credit Analyst Head of Platform Amount (R$ in millions) Term of the transaction (months) 0.7 6 Platform Credit Committee II Coordinator Head of Platform 1.5 18 Branch Credit Committee I Branch Credit Committee II Coordinator Regional Commercial Officer Credit Manager Regional Commercial Officer Regional Expansion 2.5 24 4.0 36 107

Committee Matrix Credit Committee Pleno Credit Committee I Pleno Credit Committee II Senior Credit Committee Members Officer Credit Executive Manager Middle Executive Officer Credit Executive Manager Middle Executive Officer Credit Executive Officer Superintendent of Property Investments Regional Expansion Manager Credit Executive Manager Middle Executive Officer Credit Executive Officer Superintendent of Property Investments Regional Expansion Manager Credit Executive Manager Middle Executive Officer Credit Executive Officer Superintendent of Property Investments Regional Expansion Manager Vice President Amount (R$ in millions) Term of the transaction (months) 7.0 48 10.0 60 15.0 60 40.0 Unlimited Retail: The credit analysis for retail clients includes procedures designed to ensure that the client s credit record is fully checked before any funds are disbursed. The in-house credit rating system used in this segment includes an analysis of personal information, such as age, gender, income and professional history. A score is then computed on a scale from 10 (low risk) to 1 (high risk). Retail credit facilities, which focus on used vehicle financing, are usually secured by the vehicle itself. As of December 31, 2010, 2009 and 2008, approximately 97%, 93% and 91%, respectively, of our consumer finance credit was ranked 5 to 10. Credit Committees: Other than with respect to consumer finance, credit committees define standards for policies and approve lines of credit based on reviews and recommendations submitted by the Credit Department. The committees make decisions on the risks to be managed and set exposure limits in accordance with procedures covering all the main categories of operating risk. Rating: Initial credit analyses are performed by relevant account officers together with credit analysts, who prepare credit reports to be reviewed by the relevant credit committee. These reports include, among other things, internal credit ratings. We employ different credit rating parameters for each segment. These ratings are mainly based on quantitative criteria, such as an analysis of the client s most recent financial statements, financial ratios and projections and qualitative criteria such as corporate governance, management, market position and industry, among others. We also maintain distinct rating systems for financial institutions and the retail segment. The relevant credit committee, based on client rating and segment, determines the frequency of credit reviews, which can vary from 90 to 360 days. Credit reviews include financial data analysis and periodic due diligence. In addition, all officers are required to report any material information concerning a client s credit quality to the relevant credit committee. In that event, no further credit is extended by us to the reported client until any such reports have been investigated. 108

In addition to our own credit score method, we are required to classify our credit transactions in accordance with criteria set forth by the Central Bank. Pursuant to CMN Resolution No. 2,682 of December 21, 1999, as amended by Resolution No. 2,697 of February 24, 2000, as of (a) March 31, 2000, for credit transactions which exceed R$500,000, and (b) July 31, 2000, for credit transactions which amount to less than R$500,000 but exceed R$50,000, financial institutions are required to classify credit transactions in accordance with their level of credit risk as: AA, A, B, C, D, E, F, G, or H. Such credit classifications are determined in accordance with criteria set forth from time to time by the Central Bank relating to: (i) the condition of the debtor and any guarantor, such as their economic and financial situation, level of indebtedness, capacity for generating profits, cash flow, administration and quality of controls, punctuality/delay in payments, sector of activity, contingencies and credit limits; and (ii) the characteristics of the transaction, such as its nature and purpose, type, sufficiency and level of liquidity of collateral and the total amount of the credit. Credit transactions involving a client in a particular industry sector must be analyzed in light of individual credit transactions of such client, as well as similar transactions within that sector that represent the greatest credit risk to the financial institution in question. Credit transactions of up to R$50,000 may be classified either by the financial institution s own evaluation method or according to the number of days such transaction is past due, whichever is the more stringent. See The Brazilian Financial System and Banking Regulation Regulation by the Central Bank Treatment of Overdue Debts below. The following table shows a percentage breakdown of our consolidated total loan portfolio classified in accordance with CMN s rating system on the dates indicated: Consumer As of December 31, Commercial As of December 31, Total As of December 31, Rating 2010 2009 2010 2009 2010 2009 AA... 1.80% 1.70% 61.43% 45.49% 22.37% 18.42% A... 88.32% 84.70% 28.20% 25.06% 67.58% 61.93% B... 3.98% 4.94% 7.85% 21.71% 5.31% 11.34% C... 2.57% 3.01% 0.86% 5.07% 1.98% 3.80% D... 1.08% 1.42% 0.06% 0.75% 0.73% 1.16% E... 0.49% 0.78% 0.07% 0.02% 0.34% 0.49% F... 0.33% 0.61% 0.61% 0.16% 0.42% 0.44% G... 0.27% 0.51% 0.15% 1.19% 0.23% 0.77% H... 1.16% 2.34% 0.78% 0.55% 1.03% 1.65% Total... 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% According to our credit policy, we generally do not require collateral from large corporate borrowers to whom we provide credit as such borrowers are considered to be AA credits. However, corporate and middle market lending operations are secured by liquid receivables or assets. In respect of our consumer finance operations, the financed vehicles are usually pledged to us as collateral. Allowance for Loan Losses: The Central Bank specifies a minimum allowance for each rating category of loan, measured as a percentage of the total amount of the credit. See The Brazilian Financial System and Banking Regulation Regulation by the Central Bank Treatment of Overdue Debts. Our policy is to fully comply with these regulations. 109

The following table presents the composition of our total loan portfolio by risk levels in accordance with CMN s rating system, and respective loan loss allowance at the dates indicated: Amount Provision As of December 31, As of December 31, Risk Level 2010 2009 2008 2010 2009 2008 (R$ in millions) (R$ in millions) AA... 12,710 7,803 11,655 A... 38,395 26,300 20,054 192 131 109 B... 3,019 4,814 4,194 30 48 42 C... 1,127 1,611 1,182 34 48 36 D... 413 494 362 41 50 36 E... 195 210 142 58 63 42 F... 240 186 122 120 93 61 G... 131 325 83 92 228 58 H... 586 701 390 586 701 390 Total... 56,816 42,444 38,184 1,153 1,362 774 Treasury Risk Management: Our Treasury Risk Management division manages both liquidity risk and potential losses in relation to positions taken by us due to unexpected changes in prices or rates. For purposes of liquidity risk management, the time required to close out or offset a position in an adverse scenario is estimated by maturity or exercise date, taking into consideration the market, the size of the portfolio compared to the market, and the relative share of each security or instrument held. Limits are approved by our risk management committee, comprised of our first vice president, the vice president and executive officers, the officer of credit and risk and the controller. The risk management committee meets at least once a month to review limits on foreign exchange and interest rates in light of market trends, or more frequently if necessary. Limits are set based on various assumptions regarding market performance and an assessment of a worst case position. Transactions that would otherwise fall outside established limits must be approved by the risk management committee and be fully matched. Counterparty credit risks are determined in accordance with our overall credit policies for each product, and counterparty exposure is not determined on a net basis. Treasury risk management is monitored on a daily basis by considering the closing position of the previous day and statistical parameters. The methodology is substantially based on the Value at Risk, or the VaR calculation method adapted to the Brazilian environment and to the Bank for International Settlements, or BIS recommendations. The VaR model analyzes the correlation between interest rates, indices and historic market price volatility to estimate the potential one-day loss in a portfolio s value from adverse market variations. The VaR model also analyzes the correlation between market rates and price volatility, utilizing data from the past 60 trading days, and estimates the potential maximum loss within a confidence interval. In our case, this interval has been set at 95%. Our positions are also stress tested by simulating market scenarios and backtesting daily results. During the year ended December 31, 2010, we experienced an average VaR of R$17,731 million and a maximum VaR of R$42,744 million. During the year ended December 31, 2009, we experienced an average VaR of R$19,430 million and a maximum VaR of R$36,532 million. During the year ended December 31, 2008, our average VaR was R$17,438 million and our maximum VaR was R$35,116 million. 110

In addition, we also test the integrity of pricing of assets and derivatives on a daily basis. The pricing policy for assets and derivatives is defined by the risk management committee, which considers the prices officially published by ANBIMA and BM&FBOVESPA and official rates and premium calculations for options and other risks in accordance with conventionally accepted methodologies. Operations are verified by our internal audit. Legal Proceedings We are involved in several tax-related judicial and administrative actions. As of December 31, 2010, we have contested tax charges of the Brazilian government related to COFINS in the amount of R$1,400.4 million. These amounts have been entirely provisioned for or deposited in judicial or administrative accounts. In addition to the above, we and our subsidiaries are contesting collections resulting from various tax-related tribunal decisions. As of December 31, 2010, the amounts in question total R$6.4 million and are fully provisioned. Our provisioning policy for such actions is based on an analysis of each individual case and is developed in consultation with outside counsel. Judicial deposits in respect of our tax-related proceedings amounted to R$77.4 million as of December 31, 2010, including a deposit of approximately R$65.0 million relating to a tax assessment related to the corporate income tax (Imposto sobre Renda de Pessoa Jurídica or IRPJ ) and social contribution on net profit (Contribuição Social sobre o Lucro Líquido or CSLL ) on a COFINS provision currently under judicial discussion. Such tax assessment involved the non-deductibility, for corporate income taxes purposes, of the principal amount of COFINS under judicial discussion. As the deductibility of the interest amount related to the COFINS under judicial discussion was not questioned, we filed a judicial lawsuit, questioning the deductibility of the principal amount of COFINS and its interest and made the corresponding judicial deposit. Notwithstanding the filing of the lawsuit and the judicial deposit, the tax authorities issued a tax assessment dated December 15, 2010, in the amount of R$37.8 million, challenging the deductibility of the interest amount of the COFINS under judicial discussion. We have not made a corresponding provision as we believe that chances of loss are remote. On the same date, the tax authorities also issued a tax assessment involving the calculation, for deductibility purposes, of payment of interest on capital. The amount involved is R$68.0 million and the administrative proceeding is ongoing. We have not made a corresponding provision as we believe that chances of loss are remote. We and our subsidiaries, like certain other Brazilians banks, are also party to various civil and labor-related proceedings. These proceedings are incidental to our normal course of business. As of December 31, 2010, provisions related to these actions amounted to R$107.3 million and judicial deposits amounted to R$47.6 million. Our provisioning policy for such actions takes into consideration previous tribunal decisions in similar cases. Due to the level of provisioning and based on our analysis of the individual cases, we believe that any liabilities related to such lawsuits or proceedings will not have a material effect on our financial condition or results of operations. Property Our principal executive offices are comprised of approximately 8,500 square meters of office space, which we lease, in São Paulo. We lease all of our branches. 111

Competition General The market for financial and banking services in Brazil is highly competitive, and we face significant competition in all of our principal areas of operation. The Brazilian banking industry is comprised of several types of public and private sector financial institutions. Since 1988, the Brazilian government has authorized the creation of multiple-service banks, which provide a full range of commercial banking, consumer finance, investment banking and other services as a single legal entity. Public-sector banking institutions play an important role in the Brazilian banking industry, the largest segment of the financial system. Banco do Brasil and Caixa Econômica Federal ( CEF ), the two largest public-sector banks in Brazil, accounted for 39.8% of the Brazilian banking system s total deposits and 27.1% of total assets as of December 31, 2010. Corporate Lending We compete for commercial customers with other large Brazilian banks. Our primary banking competitors are Banco do Brasil, Itaú Unibanco, Bradesco and Santander (including the former Banespa and Banco Real). The Brazilian banking industry has undergone considerable consolidation in recent years through acquisitions and privatization. For example, over the last several years, Banco Itaú has acquired BankBoston and BBA Creditanstalt and merged with Unibanco in 2008, Banco Real, which has been acquired by Santander, had in turn previously acquired Banco Sudameris S.A., Banco HSBC has acquired Lloyds TSB group s Brazilian operations, and Banco Bradesco has acquired Banco Zogbi S.A. In addition, in recent years, certain large foreign banks, such as Citibank, have established a substantial presence in Brazil and certain foreign-owned banks, such as HSBC, have acquired Brazilian financial institutions, thereby increasing competition. See Risk Factors Risks Relating to the Banking Industry and Us. Vehicle Finance The automobile financing market in Brazil is dominated by banks, especially the large private-sector banks such as Itaú Unibanco, Bradesco, and ourselves and by finance and leasing companies owned by car manufacturers, such as General Motors and Volkswagen. Besides rates, the key competitive factors in this market are application approval time and the efficiency with which a vehicle can be inspected prior to the approval of the financing. Financial Services The financial services industry includes a diversity of operations such as treasury, asset management, investment banking services, brokerage services and custody. Most of these sectors have grown substantially since the implementation of the Real Plan, but are still in the early stages of development. Although we have focused on niche markets within the financial services industry, we face competition in every banking area in Brazil, not only from the largest Brazilian banks but also from the foreign-owned banks. Asset Management The Brazilian asset management industry has grown significantly in recent years as customers have shifted increasingly away from traditional investment products such as savings accounts and CDBs to mutual funds. Until the mid-1990s, the asset management industry was dominated by commercial banks offering fixedincome funds to their retail bank customers. However, banks moved their asset management areas to independent legal entities, such as Votorantim Asset, in order to segregate their asset management and treasury operations to comply with banking regulations. Other companies specializing in asset management, generally affiliated with foreign banks, were established in Brazil during the 1990s. As a result, competition in the asset management industry has increased dramatically since 1995. Our primary competition in this sector includes 112

Itaú Unibanco, Bradesco, Banco BTG Pactual, BNP Paribas, Banco Safra, HSBC, Banco Santander (now including Banco Real) and Citibank. Material Contracts On September 28, 2009 we entered into a revolving credit facility agreement with Banco do Brasil for general working capital purposes, under which we may borrow, at market rates (generally equivalent to the average rate of our funding), an amount equivalent to up to our then existing net worth. We also provide various services to members of the Votorantim Group in the ordinary course of business. We are prohibited by Central Bank regulations from extending credit to members of the Votorantim Group. There are no material contracts that are not entered into in the ordinary course of our business, which could result in our or our subsidiaries being under an obligation or entitlement that is material to our ability to meet our obligations to Noteholders in respect of the Notes. Employees As of December 31, 2010, we had 8,808 employees on a consolidated basis, including 7,117 employees of B.V. Financeira (including CP Promotora, B.V. Leasing and Votorantim Corretora de Seguros) and 212 employees of Votorantim Corretora and Votorantim Asset combined. Of the 1,479 employees of Banco Votorantim, 283 hold managerial positions and 1,196 hold technical positions or work in finance and accounting. The employees of Banco Votorantim are affiliated with the Sindicato dos Bancários e Financiários de São Paulo (the Banking and Financial Employees Union of São Paulo). Banco Votorantim is itself represented by the Sindicato dos Bancos do Estado de São Paulo, Mato Grosso e Mato Grosso do Sul (the Union of Banks of the State of São Paulo, Mato Grosso and Mato Grosso do Sul). Our management believes that we have good relations with our employees. We have never suffered any interruption in our operations due to strikes or other labor problems. We employ a highly selective recruitment and selection process. We also invest in training and development programs in order to increase the qualifications and competencies of our employees. We maintain several corporate social responsibility programs, including a program to employ the disabled and a program to assist young people between the ages of 14 to 18 prepare for the workforce. We seek to retain our staff through an attractive compensation program. Our employee profit participation plan links compensation to productivity and results, and assists in promoting a high level of employee motivation. Our employees also receive additional benefits, including life and health insurance, assistance in pursuing language and graduate courses and meal coupons. We, like other certain Brazilian banks, are currently defending several labor-related lawsuits. We have made provisions in the amount of R$84.0 million (including B.V. Financeira) as of December 31, 2010 for the possible outcomes of these proceedings, which our internal counsel has advised us to be satisfactory given the prospective chances of liability in these proceedings. Due to the level of provisioning and based on our analysis of the individual cases, we believe that any liabilities related to such lawsuits or proceedings will not have a material effect on our financial condition or results of operations. Insurance and Business Disruption We maintain insurance policies in relation to our property at levels that our management considers appropriate and that are consistent with market standards. To provide further protection against business disruption, we 113

have set up a physically separate back-up system for our front and back office operations situated at the offices of B.V. Financeira in São Paulo, which are separate from ours. The back-up system caters to online real time synchronization of our critical systems and database. The same security has been set up at our premises in São Paulo in respect of B.V. Financeira s critical systems and databases. In addition, workstations have been set up at both premises in case business disruptions render either premise unworkable. We have a policy of investing, maintaining and upgrading our software and hardware systems to be competitive. In 2010 and 2009, we invested approximately R$28 million and R$20 million, respectively, in upgrading our equipment in order to service our increased activity and trading volumes. Our 2011 budget anticipates a corresponding investment of R$50 million. 114

OWNERSHIP AND CAPITAL STRUCTURE We are currently owned by the Votorantim Group and Banco do Brasil as a result of the strategic partnership with Banco do Brasil. See Business Strategic Partnership with Banco do Brasil. On December 31, 2010, we had an authorized and subscribed share capital of R$3,995 million, consisting of 81,538,822,950 shares, divided in 66,713,582,406 common shares and 14,825,240,544 preferred shares with no par value. Each common share is entitled to one vote. Our preferred shares do not have voting rights but shall have priority in the reimbursement of capital, without premium. There are no other classes of shares, and our common and preferred shares are not listed on any stock exchange. As a result of the strategic partnership with Banco do Brasil, the Votorantim Group and Banco do Brasil will have the right to elect the same number of members of the board of directors and certain matters will require the vote of both major shareholders groups. See Shareholders Agreement below. Our shareholders on December 31, 2010 are as follows: Number of Number of Name common shares (%) preferred shares (%) Votorantim Finanças S.A. (1)... 33,356,791,208 50.0000000075 7,412,620,267 49.9999999663 Banco do Brasil... 33,356,791,198 49.9999999925 7,412,620,277 50.0000000337 Note: Total... 66,713,582,406 100.00 14,825,240,544 100.00 (1) A wholly owned subsidiary of the Votorantim Group. Shareholders Agreement On September 28, 2009, we as consenting party, Votorantim Finanças and Banco do Brasil entered into the Shareholders Agreement setting forth the rights and obligations of each party with respect to their ownership of our shares, which are summarized below: We are in the process of establishing a board of directors with six members. Banco do Brasil has the right to appoint three of those members and Votorantim Finanças has the right to appoint the other three members. Each member is elected for a two-year term and the positions of chairman and vice-chairman will rotate annually, appointed by Votorantim Finanças and Banco do Brasil. No member shall have a casting vote on decisions to be made by the board. Our board of directors will meet on a monthly basis and except for, inter alia, the matters listed below, which shall be approved by the favorable vote of at least four members, all matters are approved by the majority of the members present at any meeting of the board of directors: our annual budget; the opening of new lines of business; the acquisition, sale, lien or disposal of our fixed assets amounting to more than 1% of our net worth; certain related party transactions; the choice and substitution of our auditors; and our business plan. 115

Our board of executive officers will be comprised of between two and fifteen members, which includes the president, one to three vice-presidents and one to eleven other officers for a two-year term. Our Fiscal Council will be comprised of four effective members and four deputy members. Banco do Brasil will have the right to elect two effective and two deputy members and Votorantim Finanças will have the right to elect the other two effective and two deputy members; The following matters, inter alia, may only be approved by the favorable votes of 75% of our shareholders: distribution of dividends at a rate above 25%; merger, incorporations and certain other corporate reorganizations; certain amendments to our by-laws, such as increase of capital, changes to the rights of the shares, changes to the number of members of our board of directors and social purposes; filing for bankruptcy and certain other insolvency events; and any public offer of securities issued by us. Banco do Brasil and Votorantim Finanças granted to each other the right of first refusal in respect of increase in our capital (in a pro rata proportion of their interest in our shares) and sales and transfers of our shares, in addition to tag along rights in the event of sale and transfer to third parties. Any new shareholder must abide by the rules of the Shareholders Agreement; There is a lock-up period of three years imposed on both Banco do Brasil and Votorantim Finanças in relation to the sale and transfer of our shares; Votorantim Finanças may not acquire a stock interest in any company or incorporate a new company, which competes with us during the term of the Shareholders Agreement. The Shareholders Agreement is valid for a period of ten years and automatically renewed for additional periods of five years. We have amended our by-laws to reflect certain of theses changes. Dividends In recent years, our policy has been to reinvest profits to increase our capital in order to expand our business and gain market share in accordance with our strategic objectives. Pursuant to our by-laws and Brazilian corporations law, we are required to distribute a mandatory minimum dividend of 25% of adjusted annual net profit. Under Brazilian corporations law, shareholders of a privately held company like Banco Votorantim may, by unanimous vote, reduce or eliminate payment of the minimum annual compulsory dividend. Under Brazilian law, we may make distributions to our shareholders in the form of interest on capital or dividends, depending on our tax position. In 2008, our shareholders approved the distribution of R$375.2 million in the form of interest on capital. Despite our policy in recent years to reinvest most of our profits, as part of the financial and corporate adjustments agreed upon with Banco do Brasil, and prior to the completion of the strategic partnership, on September 28, 2009, our shareholders approved the payment of interest on capital and dividend distributions to 116

Votorantim Finanças in the amounts of R$750 million, paid on September 28, 2009, and R$450 million, paid on March 29, 2010. The Votorantim Group We are part of the Votorantim Group, one of the largest privately held industrial conglomerates in Latin America. The Votorantim Group was founded in 1918 by Senator José Ermírio de Moraes and is controlled by the Ermírio de Moraes Family. The core businesses of the Votorantim Group, besides financial services, are cement, non-ferrous metals and pulp and paper. The Votorantim Group is also involved in other industries, including steel, chemical operations and agribusiness. The following chart presents the financial services-related area of the Votorantim Group ownership within the Votorantim Group on December 31, 2010: ORGANOGRAMA SOCIETÁRIO BANCO DO BRASIL S.A. VOTORANTIM FINANÇAS S.A. 50% 50% BV PARTICIPAÇÕES S.A. BANCO VOTORANTIM S.A. BV TRADING S.A. 99,99% CP PROMOTORA DE VENDAS S.A. 100% BV FINANCEIRA S.A. 100% VSP PARTICIPAÇÕES S.A. 99,99% BV LEASING S.A. BV SISTEMAS DE TEC. DA INFO. S.A. VOTORANTIM CORRETORA DE SEGUROS S.A. 100% 100% VOTORANTIM ASSET DTVM LTDA. 99,99% VOTORANTIM CTVM LTDA. BVIP BV INVEST. E PART. S.A. BV EMPREEND. E PART. S.A. 99,99% 99,98% 100% 100% 99,99% 100% 100% VOTORANTIM BANK LIMITED VOTORANTIM SEC (UK) LIMITED BANCO VOTORANTIM SECURITIES VOTORANTIM INT. BUSINESS LTD. 100,00% BVIA BV INV. ALTERN. E GESTÃO DE REC. S.A. 100% 117

Banco do Brasil Our shareholder Banco do Brasil is a mixed-capital company controlled by the Brazilian government. Banco do Brasil is currently the largest bank in Latin America in terms of assets, according to data published by Economática in February 2010, with a significant presence throughout Brazil and operations in 23 countries. As of December 31, 2010, Banco do Brasil had over 54.4 million individual clients. Banco do Brasil has the largest retail network in Brazil, with approximately 18,359 points of service, including 5,087 branches located in 4,352 Brazilian municipalities. Additionally, Banco do Brasil has more than 45,000 automated teller machines that, together with Banco do Brasil s call centers and mobile banking services, enabled clients to carry out outside of the traditional branch environment approximately 93.0% of all transactions they conducted with Banco do Brasil in 2010. See Business Strategic Partnership with Banco do Brasil. Subsidiaries The following information is presented on an unconsolidated basis for each of our subsidiaries. B.V. Financeira B.V. Financeira was established in August 1995 and is the company responsible for our retail consumer finance activities. B.V. Financeira is wholly owned by us and is fully consolidated in our financial statements. The following tables present the principal financial information of B.V. Financeira for the years ended December 31, 2010, 2009 and 2008: As of and for the year ended December 31, 2010 (1) 2009 2008 (R$ in millions except for percentages) Gross operating revenues... 2,870.5 5,817.0 5,248.4 Shareholders equity... 1,334.9 947.8 663.2 Total assets... 36,822.6 24,558.6 22,209.9 Net profit... 507.6 381.8 420.7 Return on assets ROA (1)... 1.4% 1.6% 2.1% Return on equity ROE (2)... 38.0% 40.3% 63.4% Notes: (1) Net profit for the year as a percentage of total assets at year-end. Were such percentages computed using average balances, the measure of performance could be materially different. (2) Net profit for the year as a percentage of total shareholders equity at year-end. Were such percentages computed using average balances, the measure of performance could be materially different. Votorantim Bank Limited ( VBL ) Our subsidiary VBL was established in January 1995 in The Bahamas and was originally the company responsible for our activities in the international financial markets. Since the establishment of our Bahamian Branch in February 2002, VBL s activities have been and will continue to be more focused on the management of funds for third parties, while the Bahamian Branch accounts for most of the asset trading and fund raising activities. Most of the activities previously carried out by VBL are now undertaken by the Bahamian Branch. Our management has reviewed VBL s role in relation to our international activities, and decided to also use it as an investment manager and advisor, in order to complement our fund management business. VBL is 118

currently authorized by the Bahamian authorities to act as a broker-dealer and to manage funds for third parties. For more information, see Business Principal Business Units International Division above. Prior to the implementation of our partnership with Banco do Brasil, we owned only 4.03% of the total shares issued by VBL, but 100% of the ordinary shares, which gave us full control of VBL. As part of the implementation process of the partnership with Banco do Brasil, Votorantim Finanças transferred to us additional shares of VBL, which transfer has been approved by the Central Bank and by the Central Bank of The Bahamas. After the final approval by the Central Bank of The Bahamas, we became the owners of 99.9% of the total shares of VBL. The following tables present the principal financial information of VBL for the years ended December 31, 2010, 2009 and 2008: As of and for the year ended December 31, 2010 2009 (1) 2008 (1) (R$ in millions except for percentages) Gross operating revenues... 0.0 1.0 2.2 Shareholders equity... 32.6 33.0 42.2 Total assets... 42.0 76.7 56.2 Net profit... 1.5 1.0 2.1 Return on assets ROA (1)... 3.5% 0.3% 3.7% Return on equity ROE (2)... 4.4% 6.3% 5.0% Notes: (1) Net profit for the year as a percentage of total assets at year-end. Were such percentages computed using average balances, the measure of performance could be materially different. (2) Net profit for the year as a percentage of total shareholders equity at year-end. Were such percentages computed using average balances, the measure of performance could be materially different. Votorantim Asset Management Distribuidora de Títulos e Valores Mobiliários Ltda. Votorantim Asset was established in 1999 and is the company responsible for our fund management activities. Votorantim Asset is 99.99% owned by us and is fully consolidated in our financial statements. The following tables present the principal financial information of Votorantim Asset for the years ended December 31, 2010, 2009 and 2008: As of and for the year ended December 31, 2010 2009 2008 (R$ in millions except for percentages) Gross operating revenues... 5.7 12.7 13.8 Shareholders equity... 57.5 38.8 19.0 Total assets... 95.1 59.8 150.6 Net profit... 24.5 19.8 26.5 Return on assets ROA (1)... 26% 33.1% 17.6% Return on equity ROE (2)... 43% 51.1% 139.5% 119

Notes: (1) Net profit for the year as a percentage of total assets at year-end. Were such percentages computed using average balances, the measure of performance could be materially different. (2) Net profit for the year as a percentage of total shareholders equity at year-end. Were such percentages computed using average balances, the measure of performance could be materially different. B.V. Leasing We provide private commercial leasing finance through our subsidiary B.V. Leasing, which was established in October 1996. B.V. Leasing is wholly owned by us and is fully consolidated in our financial statements. The following tables present the principal financial information of B.V. Leasing for the years ended December 31, 2010, 2009 and 2008: As of and for the year ended December 31, 2010 2009 2008 (R$ in millions except for percentages) Gross operating revenues... 4,100.3 2,908.6 3,122.4 Shareholders equity... 1,311.0 1,279.6 1,273.8 Total assets... 27,737.3 25,935.1 22,610.0 Net profit... 41.2 5.8 72.5 Return on assets ROA (1)... 0.2% 0.3% Return on equity ROE (2)... 3.1% 0.5% 5.7% Notes: (1) Net profit for the year as a percentage of total assets at year-end. Were such percentages computed using average balances, the measure of performance could be materially different. (2) Net profit for the year as a percentage of total shareholders equity at year-end. Were such percentages computed using average balances, the measure of performance could be materially different. Votorantim Corretora de Títulos e Valores Mobiliários Ltda. Votorantim Corretora was acquired in November 1995 by Banco Votorantim and in June 1996 it received authorization from the Central Bank to start operations. Votorantim Corretora is our brokerage unit and has 76 employees undertaking client interface, brokerage and operational activities. The substantial majority of Votorantim Corretora s services are currently provided to Banco Votorantim. However, management intends to expand Votorantim Corretora s operations in respect of brokerage services provided to third parties. We expect the operations of Votorantim Corretora to experience a material increase through the channeling of orders from Banco do Brasil s substantial clientele. See Business Strategic Partnership with Banco do Brasil. Votorantim Corretora is 99.98% owned by us and is fully consolidated in our financial statements. The following tables present the principal financial information of Votorantim Corretora for the years ended December 31, 2010, 2009 and 2008: 120

As of and for the year ended December 31, 2010 2009 2008 (R$ in millions except for percentages) Gross operating revenues... 26.6 34.8 29.2 Shareholders equity... 249.5 241.8 223.3 Total assets... 389.4 450.8 683.4 Net profit... 10.1 18.5 20.0 Return on assets ROA (1)... 2.6% 4.1% 2.9% Return on equity ROE (2)... 4.0% 7.7% 9.0% Notes: (1) Net profit for the year as a percentage of total assets at year-end. Were such percentages computed using average balances, the measure of performance could be materially different. (2) Net profit for the year as a percentage of total shareholders equity at year-end. Were such percentages computed using average balances, the measure of performance could be materially different. Banco Votorantim Securities, Inc. On December 12, 2005, we received the Central Bank s approval for the opening of a broker-dealer in the United States, which was organized under the laws of Delaware and duly incorporated on March 6, 2006 and authorized to do business in New York. On August 16, 2006, BVS was duly authorized by the NASD to commence business. BVS carries on business as an introducing broker-dealer and has applied to FINRA to expand its activities. The following tables present the principal financial information of BVS for the years ended December 31, 2010, 2009 and 2008: As of and for the year ended December 31 2010 2009 2008 (R$ in millions except for percentages) Shareholders equity... 14.0 2.7 4.7 Total assets... 14.0 2.3 5.2 Net loss... (0.1) (1.7) (1.9) BVIP BV Investimentos e Participações ( BVIP ) BVIP was established in May 2010 for the purposes of holding interests in other companies and investment funds, as a quotaholder or shareholder. BVIP is wholly owned by us. BV Empreendimentos e Participações S.A. ( BVEP ) On September 16, 2010, we entered into a sale and purchase agreement with Votorantim Finanças S.A. to acquire BVEP. BVEP renders business advisory services and hold interests in real estate projects, companies and investment funds, as a quotaholder or shareholder. BVEP is wholly owned by us. 121

BVIA BV Investimentos Alternativos e Gestão de Recursos S.A. ( BVIA ) BVIA was established in October, 2010 and is responsible for asset management and business and investment advisory services. It also holds interests in other companies and investment funds, as a quotaholder or shareholder. BVIA is wholly owned by us. Votorantim Securities (UK) Limited ( VSL ) VSL is a broker-dealer, incorporated on August 12, 2010, with its registered office in England. VSL is wholly owned by us. 122

MANAGEMENT Pursuant to our by-laws (estatuto social) and Brazilian corporations law, we are currently managed by a board of directors (conselho de administração) and a board of executive officers (diretoria). Board of Directors Our board of directors is comprised of six members (three appointed by Banco do Brasil, including the chairman, and three appointed by Votorantim Finanças, including the vice chairman). The members of the board of directors are appointed for a two-year term, and the positions of chairman and vice-chairman rotate annually, appointed by Votorantim Finanças and Banco do Brasil. Set forth below are the names, positions, and brief biographical descriptions of the current members of our board of directors. We are not aware of any potential conflicts of interest between the duties to us of the persons listed below and their private interests or duties. The business address of each member of our board of directors is at our registered office in São Paulo, Brazil. Name José Ermírio de Moraes Neto Aldemir Bendine Marcus Olyntho de Camargo Arruda Wilson Masao Kuzuhara Paulo Rogério Caffarelli Ivan de Souza Monteiro Position Chairman Vice Chairman Director Director Director Director The following are summary biographies of each member of our board of directors: José Ermírio de Moraes Neto was born on June 17, 1952, holds a degree in Business Administration and has been our president since February 1991. Mr. Moraes is also president of Votorantim Participações S.A. and holds executive offices in other companies forming part of the Votorantim Group. His principal positions outside the Votorantim Group are officer of CIESP Centro das Indústrias do Estado de São Paulo (São Paulo State Industries Association) since 1986; president of the National Association of Portland Cement since 1988 and vice president of the SNIC or the Sindicato Nacional da Indústria do Cimento (Cement Manufacturers National Union) since 1988. Aldemir Bendine was born on December 10, 1963, holds a degree in Business Administration and is Vice- Chairman of the Board of Directors, CEO and President of the Banco do Brasil s Executive Board. Mr. Bendine was the Vice-President of Credit and Debt Cards and New Business in Retail Services and, prior to this, was in charge of the BB s Executive Office and was also the executive manager of the department of cards of the Retail Office of Banco do Brasil. Marcus Olyntho de Camargo Arruda was born on April 13, 1946 and holds degrees in Business Administration and Law. Mr. Arruda also holds executive offices in other companies forming part of the Votorantim Group, including Votorantim Participações S.A. He joined us in August 1991. Wilson Masao Kuzuhara was born on July 19, 1951 and holds a degree in mechanical engineering production with post-graduate studies in economics. Mr. Kuzuhara also holds executive offices in other companies forming part of the Votorantim Group. Mr. Kuzuhara joined us in August 1991, prior to which he worked for Votorantim Participações S.A. since 1975. Paulo Rogério Caffarelli was born on September 19, 1965. Mr. Caffarelli holds a degree in law from Pontifícia Universidade Católica do Paraná PUC/PR in 1988, a Master s degree in Economic Business Management from Universidade de Brasília UNB in 2004, a post-graduate degree in Foreign Trade from FAE/CDE Curitiba in 1996 and International Trade Law from IBEJ Curitiba in 1997, and an MBA in 123

Corporate and Finance Law from Fundação Getúlio Vargas FGV/RJ in 2000. Mr. Caffarelli has been a member of the board of directors of Votorantim Participações S.A. and Banco Votorantim since March 2010. Ivan de Souza Monteiro was born on November 15, 1960. Mr. Monteiro graduated with a degree in engineering from Instituto Nacional de Telecomunicações INATEL and received an Executive MBA in Finance from Ibmec/RJ and in Management from Pontifícia Universidade Católica do Rio de Janeiro PUC/RJ. He was also an administrative and financial officer of the Pension Fund of the Government of the Rio de Janeiro State from 2000 to 2001 and a member of the Board of Directors of the Brazilian Insurer of Export Credit from 2004 to 2006. Mr. Monteiro has been a member of the board of directors of Votorantim Participações S.A. and Banco Votorantim since March 2010. Board of Executive Officers Our board of executive officers may be comprised of between two and fifteen members, which includes the president, one to three vice presidents and one to eleven other officers. Currently, our board of executive officers is comprised of thirteen members, including the president, two vice presidents and ten other officers. The executive officers are appointed by the board of directors for a two-year term, which may be renewed. All officers must be resident in Brazil. The business address of each of our executive offices is at our registered office in São Paulo, Brazil. The president and the vice presidents also hold executive offices in other companies of the Votorantim Group, including B.V. Financeira, B.V. Leasing, Votorantim Asset, Votorantim Corretora, BV Participações, CP Promotora, BV Sistemas, BVS and BVL. The board of executive officers primarily establishes corporate strategy, reviews business plans and policies, and supervises and directs our activities. Day-to-day management is delegated to several committees and to individual officers in respect of their particular areas of responsibility. See Business Credit and Risk Control Policy above. Set forth below are the names, positions, and brief biographical descriptions of the current members of our board of executive officers. Name Wilson Masao Kuzuhara Walter Guilherme Piacsek Junior Milton Roberto Pereira José Manoel Lobato Barletta Vivaldo Monteiro C. da Silva Pedro Paulo Mollo Neto Marcelo Parente Vives Mario Antonio Thomazi Silvio Alfredo Frugoli Celso Marques de Oliveira Laércio Goulart Paiva Junior Carlos Montone Abraham Bragança de Vasconcellos Weintraub Marcos Lima Monteiro Position President Vice President Vice President Officer (Credit and Risk) Officer (Product Development/ Tax) Officer (Treasury) Officer (Strategic Planning/External Relationship) Officer (Administration) Officer (Commercial Development) Officer (Human Resources) Officer (Information Technology) Officer (Middle-Market) Officer (International Area) Officer (Accounting/Finance) The following are summary biographies of each member of the board of executive officers: Wilson Masao Kuzuhara see Board of Directors above. Walter Guilherme Piacsek Junior was born on October 3, 1968 and is a vice president. He also holds executive offices in other Votorantim Group companies. He joined us on January 2009, prior to which he 124

worked at Boston Consulting Group BCG (1996-2008), where he was appointed president of BCG in Brazil, and for Citibank N.A. (1989-1994), where he was appointed Relationship Manager of the Corporate Banking Group. Mr. Piacsek holds a bachelor s and graduate studies degree in business administration, as well as a master in business administration (MBA). Milton Roberto Pereira was born on March 5, 1957 and is a vice president responsible for our Administration and Control. He is also officer of certain of our subsidiaries. Mr. Pereira holds a degree in mechanical engineering and has been with us since 1991. Mr. Pereira has been working in Brazilian and multinational financial institutions in Brazil for the last 32 years, primarily in the areas of administration, control and human resources. José Manoel Lobato Barletta was born on March 10, 1955 and is the officer responsible for our credit and risk areas since 2001. Before joining us in 1995, Mr. Barletta worked for BCN Barclays Banco de Investimentos S.A. (1989-1995) as executive officer in charge of the credit risk and control areas, and of market risk monitoring, for Banco Iochpe de Investimentos S.A. (1983-1989) as senior credit analyst and national manager for the credit risk area, and for Banco Maisonnave de Investimentos S.A. (1980-1985) as a finance and credit risk analyst, financial analyst and planning manager. Mr. Barletta holds a degree in economics. Vivaldo Monteiro C. da Silva was born on November 13, 1954 and has been our officer for product development - tax since 2001. Before joining us in 1993, Mr. Silva worked for Citibank N.A. (1986-1993), where he was appointed vice president of the financial consultancy, tax planning and products division, and for PricewaterhouseCoopers Auditores Independentes (1978-1985), where he was appointed supervisor for the corporate auditing area. Mr. Silva holds a degree in economics and accounting science. Pedro Paulo Mollo Neto was born on June 29, 1970 and has been treasurer since 2001. Before joining us in 1989, Mr. Mollo Neto worked for Metrobanco S.A. (1989) as a trainee analyst in management information. Mr. Mollo Neto holds a degree in economics. Since February 2002, Mr. Mollo Neto is also in charge of running our overall treasury operations, including international and local money market, equity investments and foreign exchange as well as derivatives activities. Marcelo Parente Vives was born on May 17, 1970 and is currently the officer responsible for strategic planning, external relationships and business analysis. He has been with us since December 1994, and was previously our officer of managerial information and of financial planning and administration. Mr. Vives holds degrees in electrical engineering and has a master s degree in business administration. Mario Antonio Thomazi was born on July 17, 1959 and is currently the officer responsible for our administration. Mr. Thomazi joined us in 1991, working in various areas such as managerial information, asset management and accounting. Before joining us, Mr. Thomazi worked for Banco Santander (1989 1991) where he was responsible for managerial information and operational proceedings, and for Banco Iochpe (1987-1989) where he helped establish methods of assessing transactions, products and costs. Mr. Thomazi holds degrees in accounting and business management. Silvio Alfredo Frugoli was born on April 14, 1958 and joined us in 2000, managing our corporate sector in São Paulo until July 2005, when he assumed responsibility for commercial development, unifying the strategy of the Corporate, Investment and Distribution sectors. Mr. Frugoli has 23 years experience in local and international financial and commercial institutions and holds degrees in economics and marketing. Celso Marques de Oliveira was born on October 11, 1952 and is our officer of human resources, an area in which he has 32 years domestic and foreign experience. Before joining us in 1989, Mr. Oliveira worked for Banco Operador (1992-1994), where he was appointed officer of Human Resources, for Banco BCN e BCN Empreendimentos e Serviços S.A. (1982-1989) where he was appointed head of the Management Information sector (BCN), and for Fiat Automóveis (1975-1982) in the employee training sector. Mr. Oliveira holds a degree in sociology with post-graduate studies in business performance. 125

Laércio Goulart Paiva Junior was born on March 16, 1971, and is the officer responsible for our information technology area since 2008. Mr. Paiva joined us in 1999, where he worked for Votorantim Asset Management as an officer in charge of operational and administrative management (1999-2000). Before joining us in 1999, Mr. Paiva worked for Banco de Investimentos Credit Suisse Garantia (1996-1999) as an assistant vice president, and for Banco Nacional S.A. (1992-1993) as information technology project manager. Mr. Paiva holds a degree in data processing technology and has a master s degree in business and administration. Carlos Montone was born on January 24, 1953, and is the officer responsible for middle-market banking since 2008. Before joining us in 2002, Mr. Montone worked for Banco Noroeste S.A./Banco Santander S.A. (1981-1999) as a officer in charge of commercial, leasing, consumer finance, credit, treasury and human resources areas. Mr. Montone holds a degree in business administration and in accounting. Abraham Bragança de Vasconcellos Weintraub was born on October 11, 1971, and is the officer responsible for our international area since 2008. Before joining us in 1994, Mr. Weintraub worked for FIPE and FIA (foundations related to University of São Paulo) (1993-1994) in research. Mr. Weintraub holds a degree in economics and has a master s degree in business administration. Marcos Lima Monteiro was born on March 8, 1971 and is the officer responsible for the operations and finance departments. Before joining us in 2008, Mr. Monteiro worked for Banco Santander S.A. (2003-2008), where he was responsible for the operations department and for Santander Brasil S.A. CTVM (2007-2008) where he was director. He has also worked for Bank of America NA (2001-2003) as manager of operations, ING Bank NV (1994-2001), Banco Norchem S.A. (1990-1994) and Banco Bradesco S.A. (1986-1990). Mr. Monteiro holds degrees in economics. Fiscal Council Our Fiscal Council may be comprised of eight members of which four are effective members (membros efetivos) and four are deputy members (membros suplentes). The members of the Fiscal Council are appointed for a one-year term mandate. The effective members of our Fiscal Council are Pedro Carlos de Mello (President), Daniel André Stieler, João Batista Donizete de Souza and Antonio Joaquim Ferreira Custódio and the deputy members of our Fiscal Council are Alexandre Ronald de Almeida Cardoso, Eduardo Cesar Pasa, Paulo Alberto Schibuola and José Luiz Gimenes Caiafa. Committees Audit Committee Due to recent legislative changes in Brazil, on June 3, 2004, we established an audit committee to ensure compliance with CMN Resolution No. 3,198 of May 27, 2004, as amended. The Audit Committee is responsible for the oversight of the activities of our internal auditors and the activities of our external independent auditors. The members of the Audit Committee are Marcos Lima Monteiro, Mario Antonio Thomazi, Rolf Von Paraski and Antonio Carlos Correia. The deputy members of the Audit Committee are Ardêmio João Brixner and Marcelo Parente Vives. Credit Risk Committees We have credit risk committees in respect of our lending operations to each of the large corporate, corporate and middle market sectors. Each credit risk committee is responsible for establishing risk policies relating to the approval of limits, loans, credit classifications, client follow-up and billing processes and is also responsible for managing limits, concentrations, counterparty and market risks in relation to credit operations in their respective sectors. The extension and monitoring of major credit facilities are based on our own risk models, adapted to the specific requirements of the Brazilian market. 126

Liquidity Committee The Liquidity Committee is responsible for the management of structural risks in connection with our liquidity gap. The liquidity committee meets twice a month and is responsible for planning future cash flow needs and our borrowing and lending availability, while the financial committee meets daily to assess currency position, cash availability, results and expected market conditions for the following day. See Business Credit and Risk Control Policy. The Technology Committee The Technology Committee is responsible for the approval of budgets, definition of strategies and the management of our technological environment. This committee meets monthly. Claims Department (Ouvidoria) The Claims Department (Ouvidoria) complies with the regulatory requirements of CMN Resolution 3,477 dated as of July 26, 2007 and of Central Bank Circular 3,370 dated as of October 23, 2007. The Claims Department is responsible for monitoring all our clients claims, by receiving and addressing these claims and suggesting any eventual solutions. Claims are monitored on a daily basis by the Claims Department. A report containing detailed information on the claims is made available semi-annually. The Internal Audit department, the Audit Committee and the Executive Officers are informed of the status of the ongoing work of the Claims Department on a semi-annual basis. Compensation For the year ended December 31, 2010, the aggregate compensation paid to our board of executive officers was R$129 million. 127

RELATED PARTY TRANSACTIONS As a company of the Votorantim Group, certain of our strategic decisions are made within the context of the Votorantim Group as a whole. We maintain an arm s-length relationship with the operating companies of the conglomerate. Under Central Bank regulations, we are not allowed to grant loans or credit in any form (including cash advances or guarantees issued to secure obligations of affiliates) to any affiliate of the Votorantim Group. Such prohibition also applies to our managers and shareholders and managers and shareholders of our affiliates. See The Brazilian Financial System and Banking Regulation Principal Limitations and Restrictions on Financial Institutions Restrictions on the Extension of Credit. Votorantim Asset manages several investment funds, mostly in the fixed rate markets, in which the Votorantim Group invests. In addition, certain companies within the Votorantim Group buy CDBs issued by us. We have acted as an advisor to the Votorantim Group on several of its financial operations. We deal with the Votorantim Group on an arm s-length basis and we compete with other financial institutions for any of the Votorantim Group s business. Furthermore, we retain B.V. Sistemas S.A., a company controlled by Votorantim Finanças S.A. (our controlling shareholder), on a regular basis to provide services related to the operation, development and maintenance of our computer systems and operations network. All contracts we have with B.V. Sistemas S.A. are on arm s-length terms and in accordance with market practices. In compliance with the conditions set forth in the Share Purchase Agreement, on September 28, 2009, Banco do Brasil deposited in escrow R$2,160 million of the total R$3.0 billion purchase price on behalf of Votorantim Finanças with Banco Votorantim. The amount was released to Votorantim Finanças in three installments each of R$720 million on July 9, 2009, January 9, 2010 and July 12, 2010. In addition, on September 28, 2009 we entered into a revolving credit facility agreement with Banco do Brasil for general working capital purposes, under which we may borrow, at our average cost of funding, an amount equivalent to up to our then current net worth. On September 30, 2009, we sold an aggregate amount of R$1,586 million in automobile loans to Banco do Brasil pursuant to a credit assignment agreement. Banco do Brasil is a mixed capital company controlled by the Brazilian government. Although public sector lending is not a focus of our business, we do grant credit to other entities in which the Brazilian government has a direct or indirect ownership interest. Note 33 of our financial statements as of and for the years ended December 31, 2010, 2009 and 2008, respectively, provides certain additional information in relation to transactions between Banco Votorantim and its subsidiaries. In accordance with Brazilian GAAP applicable to the preparation of our financial statements, transactions with related parties other than our subsidiaries are not disclosed in those notes. 128

THE BRAZILIAN FINANCIAL SYSTEM AND BANKING REGULATION The basic structure of the Brazilian financial system (Sistema Financeiro Nacional) was established by Law No. 4,595, which created the CMN and granted the Central Bank, among other things, the powers to issue money and control credit. Main Regulatory Agencies The Brazilian financial system consists of the following regulatory and fiscal bodies: the CMN; the Central Bank; the CVM; the Superintendence of Private Insurance (Superintendência de Seguros Privados or SUSEP ); and the Complementary Pensions Secretariat (Secretaria de Previdência Complementar). The CMN and the Central Bank regulate the Brazilian banking sector. The CVM is responsible for the policies of the Brazilian securities market. Below is a summary of the main attributes and powers of each of these regulatory bodies. The CMN Currently, the CMN is the highest authority in the system and is responsible for Brazilian monetary and financial policy and for the overall formulation and supervision of monetary, credit, budgetary, fiscal and public debt policies. The CMN is responsible for: adjusting the volume of forms of payment to the needs of the Brazilian economy; regulating the domestic value of the currency; regulating the value of the currency abroad and the country s balance of payments; regulating the constitution and operation of financial institutions; directing the investment of the funds of financial institutions, public or private, taking into account different regions of the country and favorable conditions for the stable development of the national economy; supervising Brazil s reserves of gold and foreign exchange; enabling the improvement of the resources of financial institutions and instruments; monitoring the liquidity and solvency of financial institutions; coordinating monetary, credit, budgetary, fiscal and public debt policies; and establishing the policy used in the organization and operation of the Brazilian securities market. 129

The Minister of Finance is the Chairman of the CMN, which also consists of the Minister of Planning, Budgeting and Management and the President of the Central Bank. The Central Bank Law No. 4,595 granted the Central Bank powers to implement the monetary and credit policies established by the CMN, as well as to supervise public and private sector financial institutions and to apply the penalties provided for in law, when necessary. According to Law No. 4,595, the Central Bank is also responsible for, among other activities, controlling credit and foreign capital, receiving mandatory payments and voluntary demand deposits from financial institutions, carrying out rediscount operations and providing loans to banking institutions, in addition to functioning as the depositary for official gold and foreign currency reserves. The Central Bank is also responsible for controlling and approving the operations, the transfer of ownership and the corporate reorganization of financial institutions, as well as the establishment of transfers of principal places of business or branches (whether in Brazil or abroad) and requiring the submission of periodical and annual financial statements by financial institutions. The President of the Central Bank is appointed by the President of Brazil, subject to ratification by the Federal Senate, and holds office for an indefinite period of time. The CVM The CVM is a government agency of the Ministry of Finance, with its headquarters in Rio de Janeiro and with jurisdiction over the whole Brazilian territory. The agency is responsible for implementing the securities policies of the CMN and is able to regulate, develop, control and supervise this market strictly in accordance with the Brazilian Corporate Law and securities laws. The CVM is responsible for regulating the supervision and inspection of publicly-held companies (including with respect to disclosure criteria and penalties applicable to violations in the securities market), the trading and transactions in the securities and derivatives markets, the organization, functioning and operations of the stock exchanges and the commodities and futures exchanges and the custody of securities. According to Law No. 10,303 of October 31, 2001 ( Law No. 10,303 ) the regulation and supervision of financial and investment funds (originally regulated and supervised by the Central Bank) were transferred to the CVM. The CVM is managed by a president and four directors, appointed, after ratification by the Federal Senate, by the President of Brazil. The term of office of CVM directors is five years, they may not be re-appointed and one fifth of the members of the board must be substituted each year. Legal Reform of the Brazilian Financial System Amendment to the Brazilian Constitution Former Article 192(3) of the Brazilian Constitution, enacted in 1988, established a ceiling of 12% per year on bank loan interest rates. Since the enactment of the Brazilian Constitution, however, such rates have not been enforced, as the regulation of such provision was pending. Several attempts were made to regulate the limitation on bank loan interest, but none of them was implemented. In May 2003, Constitutional Amendment (Emenda Constitucional) 40/03 ( EC 40/03 ) was passed to replace all sub-sections and paragraphs of Article 192 of the Brazilian Constitution. EC 40/03 replaced these restrictive constitutional provisions with a general permission to regulate the Brazilian financial system through specific laws. With EC 40/03, the Brazilian Congress may now vote on several bills dealing with the regulation of the Brazilian financial system, something they would have been unable to do without the enactment of this constitutional amendment. 130

With the enactment of the Civil Code in 2002, unless the parties to a loan have agreed to use a different rate or another rate is provided for by law, in principle, the ceiling of the interest rate has been pegged to the SELIC rate. However, there is presently some uncertainty as to whether the SELIC rate or the 12% per annum interest rate established in the Brazilian tax code should apply and whether such ceiling should apply to financial institutions. Financial Bills (Letras Financeiras) Provisional Measure (Medida Provisória) No. 472, enacted by the Brazilian government on December 15, 2009, later converted into Law No. 12,249 on June 11, 2010, among other items, created a long-term debt security (letra financeira or LF ), enabling a new category of fund raising by Brazilian financial institutions. On February 25, 2010 the CMN issued Resolution No. 3,836 (or Resolution No. 3,836 ) regulating the issuance of LFs. Pursuant to Resolution No. 3,836, LFs must have a minimum nominal amount of R$300,000 and a minimum tenor of 24 months. LFs may be publicly offered in the Brazilian capital markets in accordance with applicable CVM regulations. Principal Limitations and Restrictions on Financial Institutions The activities carried out by financial institutions are subject to several limitations and restrictions. In general terms, such limitations and restrictions are related to credit granting, risk concentration, investments, sales under repurchase agreements, loans in and trading with foreign currency, investment funds management, micro-credit and payroll deduction credit. Restrictions on the Extension of Credit Financial institutions may not grant loans to, or guarantee the transactions of, their affiliates, except in some limited circumstances. For this purpose, the law defines an affiliate as: any company or individual that holds more than 10% of the capital stock of the financial institution; any entity whose board of executive officers is made up of the same, or substantially the same, members as that of the financial institution s board of executive officers; any company in which the financial institution holds more than 10% of the capital stock, or which is under common control with the financial institution; or the executive officers and directors of the financial institution and their family members, and any company in which these persons hold more than 10% of the capital stock, or in which they are also managers. The restrictions with respect to transactions with related parties do not apply to transactions entered into with financial institutions in the interbank market. Moreover, there are currently certain restrictions imposed on financial institutions limiting the extension of credit to public sector entities, such as government subsidiaries and governmental agencies, which are in addition to certain limits on indebtedness to which these public-sector entities are already subject. Repurchase Transactions Repurchase transactions (operações compromissadas) are transactions involving assets that are sold or purchased subject to the occurrence of certain conditions. Upon the occurrence of any such conditions, and depending on the terms of the particular agreement, the seller or the buyer may be required to repurchase, or 131

resell the assets, as the case may be. The conditions triggering the repurchase or resale obligation vary from one transaction to the other, and typically must occur within a particular time frame. Repurchase transactions executed in Brazil are subject to operational capital limits, based on the financial institution s shareholders equity, as adjusted in accordance with Central Bank regulations. A financial institution may only hold repurchase transactions in an amount up to 30 times its reference shareholders equity. Within this limit, repurchase transactions involving private securities may not exceed five times the amount of the reference shareholders equity. Limits on repurchase transactions involving securities backed by Brazilian governmental authorities vary in accordance with the type of security involved in the transaction and the perceived risk of the issuer, as established by the Central Bank. Foreign Currency Loans Upon registering with the Central Bank, financial institutions may borrow foreign currency-denominated funds in the international markets without the prior written consent of the Central Bank, including onlending such funds in Brazil to Brazilian corporations and other financial institutions. Banks make those onlending transactions through loans payable in Brazilian currency and denominated in such foreign currency. The terms of the onlending must mirror the exact terms and conditions of the original transaction. The interest rate charged on the underlying foreign loan must also conform to international market practices. In addition to the original cost of the transaction, the financial institution may only charge an onlending commission. The Central Bank may establish limitations on the term, interest rate and general conditions of foreigncurrency loans. Asset Management Regulation Asset management was previously regulated by the Central Bank and the CVM. Pursuant to Law No. 10,198, of February 14, 2001, and Law No. 10,303, the regulation and supervision of both financial mutual funds and variable income funds were transferred to the CVM. On July 5, 2002, the CVM and the Central Bank entered into a memorandum of understanding under which they agreed on the general terms and conditions for the transfer of such duties to the CVM. According to CVM Instruction No. 306 of May 5, 1999, as amended, only individuals or entities authorized by the CVM may act as managers of third-party assets. Financial institutions must segregate the management of third-party assets from their other activities. These institutions must appoint an officer as the agent responsible for the management and supervision of such assets and a specialized technical department to perform asset management activities. The Central Bank, except in very specific circumstances, has prohibited institutions that manage third-party assets and their affiliated companies from investing in fixed rate income funds that they also manage. The CVM allows investments in equity funds. There are specific rules regarding mutual fund portfolio diversification and composition, which aim to reduce exposure to certain types of risk. Pursuant to a change introduced by the Central Bank in February 2002, fund managers are required to mark their fixed-income securities to market and results in such fund s portfolio assets must be accounted for at their fair market value. On August 18, 2004, the CVM enacted Instruction No. 409, as amended, which consolidated the rules applicable to investment funds (except in relation to certain structured investment funds, which are regulated by a distinct set of rules). The asset management industry is also self-regulated by ANBIMA, which enacts additional rules and policies, primarily with respect to marketing and advertising. 132

Micro-credit Regulation The Brazilian government has taken several measures intended to encourage lower-income individuals to have greater access to the Brazilian financial system. Such measures include the requirement for providing credit allocation, the simplification of banking procedures and the liberalization of credit union (cooperativas de crédito) regulations. Since 2003, commercial banks, full service banks licensed to provide commercial banking services, and the CEF must allocate 2% of their cash deposits to low-interest-rate loan transactions designated for lower-income individuals, small companies and informal entrepreneurships, following a specific methodology. According to Resolution No. 3,422 dated November 30, 2006, as amended by Resolution No. 3,706 dated March 27, 2009, interest rates on these loans cannot exceed 2% per month (or 4% per month in specific production finance transactions), the repayment term cannot be less than 120 days, except in specific circumstances, and the principal amount of the loan cannot exceed R$2,000 for individuals and R$5,000 for micro-enterprises (or R$15,000 in specific production finance transactions). Regulations Aimed at Ensuring the Strength of the Brazilian Financial System Restrictions on Risk Concentration Brazilian law prohibits financial institutions from concentrating their risk in only one person or group of related persons. The law prohibits a financial institution from extending credit to any person or group of related persons in an aggregate amount equivalent to 25% or more of the financial institution s reference capital. This limitation applies to any transaction involving the extension of credit, including those involving: loans and advances; guarantees; and the underwriting, purchase and renegotiation of securities. Restrictions to Investment Financial institutions may not: hold, on a consolidated basis, permanent assets that exceed 50% of their reference shareholders equity; own real property, other than property for its own offices and service outlets; or acquire equity investments in other financial institutions abroad, without prior approval by the Central Bank. When a bank receives real estate in satisfaction of a debt, such property must be sold within one year. Such one-year limit may be extended for two additional periods of one year, subject to the Central Bank s approval. Internal Compliance Procedures All financial institutions must establish internal policies and procedures to control their: activities; financial, operational and management information systems; and 133

compliance with all applicable regulations. The board of executive officers of a financial institution is responsible for implementing an effective structure of internal controls by defining responsibilities and control procedures and establishing corresponding goals at all levels of the institution. The board of executive officers is also responsible for verifying compliance with internal procedures. An internal audit department, which reports directly to the company s board of directors, must be responsible for monitoring the internal control system. Independent Auditors and Audit Committee Resolution No. 3,198, issued by the CMN on May 27, 2004, as amended by CMN Resolution No. 3,271 dated March 3, 2005, CMN Resolution No. 3,416 dated October 24, 2006 and CMN Resolution No. 3,606 dated September 11, 2008 ( CMN Resolution No. 3,198 ) established certain requirements in respect of financial institutions independent accountants and required financial institutions to have an audit committee. Independent accountants must audit the financial statements of all financial institutions. Independent accountants can only be hired if they are registered with the CVM, certified in specialized banking analysis by IBRACON and if they meet several requirements that assure their independence. Moreover, financial institutions must replace the person, officer, manager, supervisor or any of its members responsible for their independent accounting firm work at least every five consecutive years (requirement established by CMN Resolution No. 3,606, enacted on September 11, 2008. Former accountants can be reassigned to the audit team only after three complete years have passed since their prior service. The financial institutions must designate a technically qualified senior manager to be responsible for compliance with all regulations regarding financial statements and auditing. Pursuant to CMN Resolution No. 3,198, all financial institutions (i) with a reference capital or a consolidated reference capital equal to or greater than R$1 billion, (ii) managing third party assets in the amount equal to or greater than R$1 billion or (iii) managing third party assets and deposits in the aggregate amount equal to or greater than R$5 billion, must create an internal audit committee within one year from indicating in its financial statements that any such parameter has been reached. The audit committee must be created pursuant to the financial institution s by-laws and must be composed of, at a minimum, three individuals, at least one of whom is an expert in accounting and auditing. The audit committee must report directly to the board of directors. The independent accountants, in the course of their audit or review procedures, and the audit committee should notify the Central Bank of the existence or evidence of error or fraud within a maximum period of three business days from the respective identification of the same, represented by: non compliance with legal and regulatory norms that place the continuity of the audited entity at risk; fraud of any amount perpetrated by the administration of said institution; relevant fraud perpetrated by entity employees or third parties; or errors that result in significant errors in the accounting records of the entity. Audit Committee Audit committee members of financial institutions with shares traded on a stock exchange may not be or have been in the previous twelve months: (i) the officer of the institution or its affiliates; (ii) an employee of the 134

institution or its affiliates; (iii) the technician responsible, officer, manager, supervisor or any other member of a management post of the team involved in auditing activities at the institution; or (iv) a member of the institution s audit council or that of its affiliates; including as a spouse, blood relative, surety, affinity and second degree relatives of such persons. Audit committee members of open capital financial institutions are also forbidden from receiving any other kind of remuneration from the institution or its affiliates other than that relating to their respective post as a member of the audit committee. In the event an audit committee member of the institution is also a member of the board of directors of the institution or its affiliates, such member must opt for remuneration related to one of the posts. The audit committee should report to the board of directors or officers, as applicable and its main duties are: nominate the independent auditor to be elected by the board of directors; supervise the work of the independent auditor; request that the independent auditor be substituted whenever deemed necessary; revise the financial records for each half year period as well as the administrative and auditing reports; supervise accounting and auditing, including compliance with in-house procedures and applicable regulations; evaluate the compliance of the financial institution s administration with the guidelines provided by the independent auditor; establish procedures for receiving and disclosing information in the event of any noncompliance with in-house procedures or applicable regulations; offer guidance to officers and directors with regard to in-house controls and procedures to be adopted; and meet every three months with officers and directors, independent auditors and in-house accountants to verify compliance with its guidelines. Furthermore, Brazilian regulation also permits the creation of a single audit committee for an entire group of companies. In this particular case, the audit committee should be responsible for any and all financial institutions belonging to the same group. Financial Reporting and Auditing Requirements Brazilian law requires financial institutions to prepare their financial statements in accordance with certain standards established by the Brazilian Corporate Law and other applicable regulations. As a financial institution, we are required to have our financial statements audited every six months. Quarterly financial information, as required by Central Bank and CVM regulations, is subject to review by independent accountants. New CMN Regulation for Credit Assignment Resolution No. 3,533 dated January 31, 2008 ( Resolution No. 3,533 ) provides changes to the manner in which assigned credit rights are to be treated in our books (pursuant to CMN Resolution No. 3,809 of October 135

28, 2009, as amended by Resolution No. 3,895 dated July 29, 2010, such changes will come into effect as from January 1, 2012) and cannot be adopted by Brazilian banks prior to such date. In accordance with Resolution No. 3,533, if the assignor substantially retains the risks and benefits of the assigned credits, such credits may not be recorded as off-balance sheet loans. This provision shall also be applicable to (i) assignments with repurchase commitments; (ii) assignments in which the assignor undertakes the obligation to compensate the assignee for losses; and (iii) assignments made jointly with the acquisition of subordinate shares of FIDCs. Capital Adequacy Guidelines Brazilian financial institutions must comply with guidelines established by the Central Bank and the CMN that are similar to those of the Basel II Accord on risk-based capital adequacy, which is currently being implemented. The banks provide the Central Bank with the information necessary for it to perform its supervisory functions, which include supervising the movements in the solvency or capital adequacy of banks. The main principle of the Basel II Accord as implemented in Brazil is that a bank s own resources must cover its principal risks, including credit risk, market risk and operational risk. Brazilian financial institutions, including us, are required to maintain technical capital equal to at least 11% of total risk-weighted assets, calculated according to specific criteria set forth by the Central Bank. As of December 31, 2010, our level of technical capital on a consolidated financial basis, which excluded our non financial subsidiaries, was 13.1% of total risk weighted assets, above the 11% level required by the Central Bank. The requirements imposed by the Central Bank and the CMN differ from the Basel II Accord in several aspects. Among other differences, the Central Bank and the CMN: impose a minimum capital requirement of 11% in lieu of the 8% minimum capital requirement of the Basel II Accord; require an additional amount of capital with respect to off-balance sheet interest rate and foreign currency swap operations; assign different risk weighting and credit conversion factors to some assets, including a risk weighting of 300% on deferred tax assets other than temporary differences; require calculation and report on the minimum capital and capital ratios on a consolidated basis; require banks to set aside a portion of their equity to cover operational risks as from July 1, 2008. The required portion of the equity varies from 12% to 15% of average income amounts from financial intermediation; and do not allow the use of external rating to calculate the minimum capital required. The Central Bank adopts a conservative approach to defining the capital demand of corporate exposures. Regulatory capital, or the reference capital, is considered for the determination of operating limits of Brazilian financial institutions and is represented by the sum of the following two tiers: Tier 1 capital is represented by the net shareholders equity plus the balance of positive income accounts and of the deposit in the linked account for making up for capital deficiency, less the amounts corresponding to the balances of negative income accounts, revaluation reserves, contingency reserves, and special profit reserves concerning mandatory dividends not distributed, preferred shares issued with a redemption clause and preferred shares with cumulative dividends, certain tax credits, deferred fixed assets (less the premiums paid on acquiring the investments), and the balance of non-accounted gains or losses resulting from 136

mark-to-market securities classified in the securities available for sale category and derivative financial instruments used for hedging cash flow. Tier 2 capital is represented by revaluation reserves, contingency reserves, special reserves of profits concerning mandatory dividends not distributed, in addition to preferred cumulative stock issued by financial institutions authorized by the Central Bank, preferred redeemable stock, subordinated debt and hybrid debt capital instruments and the balance of nonaccounted gains or losses resulting from mark-to-market securities classified in the securities available for sale category, and derivative financial instruments used for hedging the cash flow. The total amount of Tier 2 capital is limited to the total amount of Tier 1 capital, provided that (i) the total amount of revaluation reserves is limited to 25% of the Tier 1 capital; (ii) the total amount of subordinated debt plus the total amount of redeemable preferred shares with an original term to maturity below 10 years is limited to 50% of the total amount of the Tier 1 capital; and (iii) a 20% reduction shall be applied to the amount of the subordinated debt and preferred redeemable stock in Tier 1 capital annually for the five years preceding the respective maturities. Financial institutions must calculate the reference capital on a consolidated basis. As of July 2007, the balances of assets represented by shares, hybrid equity and debt instruments, subordinated debt instruments and other financial instruments authorized by the Central Bank for inclusion in Tier 1 and Tier 2, issued by financial institutions authorized by the Central Bank, must be deducted from the reference capital. In addition, investment fund shares proportional to these instruments must also be deducted from the reference capital, as well as amounts relating to (i) equity in financial institutions which information the Central Bank does not have access to; (ii) excess funds applied to permanent assets pursuant to the current regulation; and (iii) funds delivered or available to third parties for related transactions. In addition to the minimum limits of realized capital and shareholders equity set forth in the legislation in force, financial institutions must keep their reference shareholders equity compatible with the exposure of their assets, liabilities, and offsetting accounts. Financial institutions may only distribute income on any account in amounts that exceed the amounts that may be required by law or by the applicable regulation when such distribution does not prevent compliance with the capital and shareholders equity standards. Resolution No. 3,825, issued by the CMN on December 16, 2009, revoked CMN Resolution No. 3,674 of December 30, 2008. As a result, commencing April 1, 2010, provisions made by Brazilian banks to cover possible losses arising from credit transactions that exceed the requirements set forth by CMN Resolution No. 2,682 will no longer be eligible to be accounted for as Tier 1 capital. On June 28, 2010, the Central Bank issued Circular No. 3,498, establishing new rules for calculation of the daily amount of minimum capital maintained by financial institutions to avoid market risks. The new calculation rules will result in an increase in the financial institution s capital requirements. Further, Circular No. 3,498 established a timeline for the implementation of such changes, providing for a gradual increase in the minimum capital requirements as of January 2012. Pursuant to the notice published by the Central Bank jointly with Circular No. 3,498, the new rules are intended to enhance the Brazilian financial system in a manner that reflects international regulatory standards agreed by the G-20 and that stimulates developments in market risk management of financial institutions. On December 16, 2010, the Basel Committee issued Basel III. Basel III sets out higher minimum capital requirements and new conservation and countercyclical buffers, revised risk-based capital measures, and the introduction of a new leverage ratio and two liquidity standards. The new rules will be introduced gradually and, as with other Basel directives, these will not be self-effectuating. Rather, each country must adopt them by legislation or regulation to be imposed upon that country s home banks. 137

Basel III will require banks to maintain: (i) a minimum common equity capital ratio of 4.5%, (ii) a minimum Tier 1 capital ratio of 6% and (iii) a minimum total capital ratio of 8%. In addition to the minimum capital requirements, Basel III will require a capital conservation buffer of 2.5% and each national regulator is given discretion to institute a countercyclical buffer if it perceives a greater system-wide risk to the banking system as the result of a build-up of excess credit growth in its jurisdiction. The capital conservation buffer and the countercyclical buffer, if implemented, would restrict discretionary distributions, and, in the case of the countercyclical buffer, require retention of up to an additional 2.5% of risk-weighted assets. The three basic minimum requirements will be phased in first, beginning on January 1, 2013, with a longer implementation period for the capital conservation buffer and other requirements, beginning on January 1, 2016. Basel III also introduces a new leverage ratio. A supervisory monitoring period will begin in 2011 and a parallel testing run of a minimum Tier 1 leverage ratio of 3% will begin in 2013. Basel III will require banks to disclose their leverage ratio and its components beginning January 1, 2015. In addition, Basel III aims to improve risk coverage by reforming the treatment of counterparty credit risk ( CCR ). Going forward, affected banks generally will, among other things, (i) be required to determine their capital requirement for CCR using stressed inputs, (ii) be subject to a capital charge for potential mark-tomarket losses associated with counterparties deteriorating credit-worthiness, (iii) have to apply longer margining periods to determine their capital requirements with respect to large and illiquid derivative exposures, and (iv) be incentivized to move collateral and mark-to-market exposures to central counterparties. In relation to liquidity, Basel III implements a net stable funding ratio (the NSFR ) and a liquidity coverage ratio (the LCR ). The NFSR establishes a minimum amount of stable funding a bank will be required to maintain based on the liquidity of the bank s assets and activities over a one year period. The ratio of available stable funding to the amount of required stable funding must be greater than 100%. The LCR will require affected banks to maintain sufficient high-quality liquid assets to cover 100% of the net cash outflows that could be encountered under an acute stress scenario assuming (i) a significant downgrade of the bank s credit rating, (ii) a partial loss of deposits, (iii) a loss of unsecured wholesale funding, (iv) a significant increase in secured funding haircuts, and (v) increases in derivative collateral calls and substantial calls on off-balance sheet exposures. Expected inflows eligible for netting against outflows will be capped at a maximum of 75% of expected outflows. Basel III provides for an observation period to begin in 2011 and it is contemplated that the NSFR and the LCR, including any revisions, will be introduced as minimum standards beginning January 1, 2018 and 2015, respectively. In addition, on January 13, 2011, the Basel Committee expanded on the Basel III capital rules with additional requirements (the January 13 Annex ) applicable to non-common Tier 1 or Tier 2 instruments issued by internationally active banks. The January 13 Annex imposes further requirements on Additional Tier 1 and Tier 2 capital instruments issued by internationally active banks. To be included in Additional Tier 1 or Tier 2 capital, the January 13 Annex requires an instrument issued by an internationally active bank to have a provision that requires such instruments, at the option of the relevant authority, to either be written off or converted to common equity upon a trigger event. A trigger event is the earlier of: (1) a decision that a write-off, without which the bank would become non-viable, is necessary, as determined by the relevant authority; and (2) the decision to make a public sector injection of capital, or equivalent support, without which the bank would have become non-viable, as determined by the relevant authority. The additional requirements imposed by the January 13 Annex will apply to all instruments issued after January 1, 2013; otherwise, qualifying instruments issued prior to that date will be phased out over a ten years period, beginning in 2013. On February 17, 2011, the Central Bank enacted Notice No. 20,615 containing preliminary guidance and schedule for the implementation of Basel III in Brazil. It is intended that the higher minimum capital requirements and new conservation and countercyclical buffers, the revised risk-based capital measures, and the introduction of a new leverage ratio and two liquidity standards will be implemented in Brazil two years earlier than the time frame established by the Basel Committee. 138

The Basel ratio would be increased from the current 11% to the maximum of 13%. The total ratio will be calculated by the sum of three parts: the regulatory capital (patrimônio de referência), the conservation capital (to deal with the absorption of losses) and the countercyclical capital (to deal with risks of the macroeconomic environment). The regulatory capital will continue to be composed by two tiers. Tier I capital will have a 6% floor, divided into two portions: common equity (corporate capital and profit reserves) of at least 4.5% and additional equity (hybrid debt and capital instruments authorized by the Central Bank). Current hybrid instruments and subordinated debt approved by the Central Bank as additional capital or Tier II capital are expected to be maintained as such if they also comply with Basel III requirements, including the mandatory conversion clauses into equity as directed by the Basel Committee. If such instruments do not comply with Basel III requirements, it is estimated that there will be a yearly deduction of 10% on the nominal value of such instruments, starting as from January 1, 2013. The Basel III requirements also provide for new metrics for analysis of banks. The leverage ratio limits the banks to enter into transactions exceeding a ratio calculated by the division of Tier I capital by the bank s total exposure. Such leverage ratio will be capped in 3% of the risk weighted assets as from 2018. The short and long term liquidity ratios are intended to regulate the cash funds of banks by creating an obligation to maintain liquid assets of 30 days for stress scenarios of the financial system and funding with solid and stable capital. The following table presents an estimate of the implementation schedule of the main changes related to capital adequacy and leverage expected with respect to Basel III, as indicated by the Central Bank: Parameters 1/1/2013 1/1/2014 1/1/2015 1/1/2016 1/1/2017 1/1/2018 1/1/2019 4.5% 4.5% 4.5% 4.5% 4.5% 4.5% 4.5% Common Equity... 5.5% 5.5% 6.0% 6.0% 6.0% 6.0% 6.0% Tier I... 11.0% 11.0% 11.0% 9.875% 9.25% 8.625% 8.00% Regulatory Capital... - - - 0.625% 1.25% 1.875% 2.5% Conservative Capital... - Countercyclical Capital... Up to 0.625% Up to 1.25% Up to 1.875% Up to 2.5% Up to 2.5% Up to 2.5% The new rules are expected to start being enacted by the Central Bank at the end of 2011. Currently, the rules in force remain the same, as described above. The Role of the Public Sector in the Brazilian Banking System In light of the global financial crisis, on October 6, 2008, the Brazilian President enacted provisional regulations related to the use of internal reserves of foreign currencies by the Central Bank in order to provide financial institutions with liquidity by means of rediscount and loan transactions. Furthermore, on October 21, 2008, the Brazilian President enacted Provisional Measure No. 443 increasing the role of the public sector in the Brazilian banking system. These regulations authorize (i) Banco do Brasil and CEF to directly or indirectly acquire controlling and non-controlling participations in private and public financial institutions in Brazil, including insurance companies, social welfare institutions and capitalization companies; (ii) the 139

creation of Caixa Banco de Investimentos S.A., a wholly-owned subsidiary of CEF, with the purpose of conducting investment banking activities; and (iii) the Central Bank to carry out currency swap transactions with the central banks of other countries. Such provisional measure was converted into Law No. 11,908, enacted on March 3, 2009. Additionally, through Resolution No. 3,656 of December 17, 2008, the CMN amended the by-laws of the Credit Guarantee Fund (Fundo Garantidor de Créditos or FGC ), so that it can invest up to 50% of its net worth in: (i) the acquisition of credit rights of financial institutions and leasing companies; (ii) banking deposits with or without issuance of certificates, leasing bills (letra de arrendamento mercantil) and bills of exchange accepted by affiliated institutions, secured by: (a) credit rights constituted or to be constituted from respective transactions, or (b) other credit rights with an in rem or a personal guarantee; and (iii) linked transactions (operações vinculadas), pursuant to CMN Resolution No. 2,921 of January 17, 2002. The FGC may sell any assets acquired in transactions described in items (i), (ii) and (iii) of this paragraph. Corporate Structure Except for the cases set forth as exceptions in the law, financial institutions must be organized as corporations (sociedades por ações) and be subject to the provisions under the Brazilian Corporate Law and the regulations issued by the Central Bank, and to inspections by the CVM if they are registered as publicly held corporations. The capital stock of financial institutions may be divided into voting or non-voting shares, where non-voting shares may not exceed 50% of the total capital stock. Classification of Credit and Allowance for Loan Losses Under Central Bank regulations, financial institutions are required to classify their loan transactions with companies into nine categories, ranging from AA to H, in accordance with their risks. Risk assessment includes an evaluation of the borrower, the guarantor and the relevant loans. Credit classifications are determined in accordance with Central Bank criteria relating to: Loan category characteristics of the debtor and the guarantor, such as their economic and financial situation, level of indebtedness, capacity for generating profits, cash flow, delay in payments, contingencies and credit limits; and characteristics of the transaction, such as its nature and purpose, the sufficiency of the collateral, the level of liquidity and the total amount of the loan. The regulations specify, for each loan category, a minimum loss provision as follows: Minimum provision AA... 0% A... 0.5% B... 1% C... 3% D... 10% E... 30% F... 50% G... 70% H (1)... 100% 140

Notes: (1) Banks must write off any loan within six months after it is ranked H. In general, banks must review their loan classifications annually. However, except for loans amounting to less than R$50,000, banks must review loans: semi-annually, in any case where the aggregate amount of loans extended to a single borrower or economic group exceeds 5% of the bank s reference shareholders equity; and monthly, in case the loans become overdue. A loan may be upgraded if it has a credit support or downgraded if it is in default. Banks must write off loans within six months after they are ranked H. In case of loan transactions with individuals, the loan is graded based on data including the individual s income, net worth and credit history (as well as other personal data). For loans that are past due, the regulations establish maximum risk classifications, as follows: Number of Days Past Due(1) Maximum Classification 15 to 30 days... B 31 to 60 days... C 61 to 90 days... D 91 to 120 days... E 121 to 150 days... F 151 to 180 days... G More than 180 days... Notes: (1) The period may be doubled in the case of loans with maturity in excess of 36 months. Financial institutions are required to determine, on a monthly basis, whether any loans must be reclassified as a result of these maximum risk classifications, and, if so, must adjust their loss provisions in accordance with the regulations relating to minimum provisions described above. In addition, financial institutions are required to make their lending and loan ranking policies available to the Central Bank and to their independent accountants. They must also provide information relating to their loan portfolio along with their financial statements, including: a breakdown of lending activities and nature of the borrower; maturity of the loans; amounts of rolled-over, written-off and recovered loans; loan portfolio diversification, in accordance with the risk classification; and overdue loans, divided between those up to 15 days overdue and those that are more than 15 days overdue. H 141

Central Bank Credit Risk System Financial institutions are required to provide information to the Central Bank concerning the extension of credit and guarantees rendered to clients. The information is used to: strengthen the Central Bank s supervisory capacity; make information concerning debtors available to other financial institutions (however, other institutions can only access information upon the client s authorization); and prepare macro-economic analyses. If the aggregate amount of a client s transactions exceeds R$5,000, the financial institution must provide the Central Bank with: the identity of such client; a breakdown of the client s transactions, including any guarantees rendered by the bank with respect to his/her obligations; and information regarding the client s credit risk classification, based on the credit risk classification policy described above. For those transactions whose total value is equal to or less than R$5,000, the financial institution must inform the Central Bank of all transactions for the client. In addition, the CMN, through Resolution No. 3,721, dated April 30, 2009, established new standards related to the internal credit risk management structure of financial institutions, which were adopted on October 29, 2010. Anti-money Laundering Law Law No. 9,613, of March 3, 1998 ( the Anti-Money Laundering Law ) plays a major role for those engaged in banking and financial activities in Brazil. The Anti-Money Laundering Law sets forth the definition and the penalties to be incurred by persons involved in activities that comprise the laundering or concealing of property, rights and assets, as well as a prohibition on using the financial system for these illicit acts. Pursuant to the Anti-Money Laundering Law, financial institutions must: identify and maintain up-to-date records regarding their clients; maintain internal controls and records; review transactions or proposals with characteristics which may indicate the existence of a money laundering crime; keep records of transactions involving electronic transfers and checks for a period of at least five years; keep records of transactions that exceed R$10,000 in a calendar month, or reveal a pattern of activity that suggests a scheme to avoid identifications, for a period of at least five years; 142

keep records of transfers involving electronic transfers, checks, administrative checks or payment orders that exceed R$1,000; and inform the appropriate authorities (without the client s knowledge) of any suspicious transaction or set of transactions performed by individuals or entities pertaining to the same group of companies. In addition, the Brazilian anti-money laundering law created the Financial Activity Control Council. The main role of the Financial Activity Control Council is to promote cooperation among the Brazilian governmental bodies responsible for implementing national anti-money laundering policies, in order to stem the performance of illegal and fraudulent acts. Their activities also include imposing administrative fines and examining and identifying suspected illegal activities pursuant to the Anti-Money Laundering Law. On July 24, 2009, the Central Bank issued Circular No. 3,461, consolidating the procedures required of financial institutions in order to prevent the crimes set forth in the Anti-Money Laundering Law. Circular No. 3,461 sets forth requirements for financial institutions relating to (i) internal policies and controls systems, (ii) records of customer information, (iii) records of financial services and transactions, (iv) records of checks and transfer of funds, (v) records of prepaid cards, (vi) records of handling of resources in excess of R$100,000, and (vii) reports of material information to the Financial Activity Control Council. Furthermore, the CMN enacted, on February 11, 2010, Circular No. 3,430, clarifying concepts relating to customers and politically exposed persons, as well as procedures to be followed in connection with the identification of such customers or persons. Politically-Exposed Individuals According to Circular No. 3,461, which revoked Circular No. 3,339 of December 22, 2006, and Circular No. 2,852 of December 3, 1998, as amended, which sets out certain procedures to be adopted in the prevention and avoidance of activities relating to the crimes described in Law No. 9,613 of March 3, 1998, financial institutions and other institutions authorized to operate by the Central Bank must take certain actions to establish business relationships with, and to follow-up on financial transactions of clients who are deemed to be politically-exposed individuals. For purposes of such regulation, politically-exposed individuals include public agents as well as the immediate family members, spouses, life partners and stepchildren of public agents. Under such regulation, a public agent is defined as a person who occupies or has occupied a relevant public office or position over the past five years in Brazil or other countries, territories and foreign jurisdictions. The five-year term runs retroactively from the initial date of the business relationship or from the date when the client became a politically-exposed individual. Such institutions must also adopt reinforced and continuous surveillance actions with regard to business relationships with politically-exposed individuals, paying special attention to proposed relationships and transactions of such individuals originating from countries with which Brazil has a large volume of financial and commercial transactions, common borders or ethnic, language or political proximity. Anti-tax Evasion Law Generally, information protected by bank secrecy laws can only be furnished in compliance with a court order or an order by a Federal Congressional Inquiry Committee (Comissão Parlamentar de Inquérito). However, the Central Bank is authorized to require financial institutions to provide information generally protected by bank secrecy without judicial authorization within the performance of its supervisory powers, as long as they have strong circumstantial evidence that a client has engaged in tax evasion. Such evidence may be represented by, among others: 143

declarations by the client of transactions with a value lower than their market value; loans acquired from sources outside the financial system; transactions involving tax havens ; expenses or investments which exceed the declared available income; overseas currency remittances through non-resident accounts in amounts which exceed the declared available income; and legal entities that have their registration with the General Taxpayers Registry cancelled or declared invalid. Additionally, in accordance with Administrative Ruling No. 811/2008 of the Brazilian Revenue Service, financial institutions must report certain information relating to transactions carried out in Brazil, such as payments and deposits, among others. Regulations Affecting Liquidity in the Financial Market The Central Bank imposes compulsory deposit and other related requirements upon Brazilian financial institutions from time to time. The Central Bank uses reserve requirements on demand deposits, savings deposits and time deposits as a mechanism to control the liquidity of the Brazilian financial system. Historically, those imposed reserves have accounted for substantially all amounts required to be deposited with the Central Bank. In response to the global financial crisis in 2008 and 2009, the CMN and the Central Bank enacted the following measures to provide the Brazilian financial system with greater stability: increasing the rate for demand deposit reserve requirements from 42.0% to 43.0% from July 2010 to July 2012, 44.0% from July 2012 to July 2014, and 45.0% as of July 2014, 45.0% being the rate that was in effect prior to the global financial crisis; restoring the rate for time deposit reserve requirements from 13.5% to 15.0% effective March 29, 2010, and further from 15.0% to 20.0%, effective as of December 2010; restoring the additional rate applicable to time deposit and demand deposit reserve requirements from 4.0% and 5.0%, respectively, to 8.0% in both cases effective March 8, 2010, and further increasing such rates to 12%, effective as of December 2010; limiting the deductibility from financial institutions time deposit reserve requirements of certain transactions with smaller financial institutions with a consolidated Level 1 Capital of no more than R$2.5 billion; and introducing the requirement that reserve amounts be funded entirely in cash, with time deposit reserve amounts earning interest at the SELIC rate and demand deposit reserve amounts earning no interest. Circular No. 3,427 allows a financial institution to deduct the amount of its foreign currency acquisition transactions with the Central Bank from reserve requirements regarding interbank deposits of commercial leasing companies. Some of the current reserves required under Brazilian law include: 144

Demand Deposits. Pursuant to Circular No. 3,274 of February 10, 2005, as amended, banks and other financial institutions are generally required to deposit 43.0% of the daily average balance of their demand deposits, bank drafts, collection of receivables, collection of tax receipts, debt assumption transactions and proceeds from the realization of guarantees granted to financial institutions in excess of R$44.0 million with the Central Bank on a non-interest bearing basis (which will increase to 44.0% from July 2012 to July 2014, and to 45.0% as of July 2014). At the end of each day, the balance in such account must be equivalent to at least 80.0% of the reserve requirement for the respective calculation period, which begins on Monday of one week and ends on Friday of the following week. Savings Deposits. Pursuant to Circular No. 3,128 dated June 24, 2002 and Circular No. 3,130 of June 27, 2002, the Central Bank established that Brazilian financial institutions are generally required to deposit in an interest-bearing account with the Central Bank, on a weekly basis, an amount in cash equivalent to 20.0% of the average aggregate balance of savings accounts during the prior week. In addition, a minimum of 65.0% of the total amount of deposits in saving accounts must be used to finance the real estate sector, being 80.0% of that percentage necessarily allocated to residential real estate or the housing construction sector, as determined by CMN Resolution No. 3,932 of December 16, 2010. Pursuant to Resolution No. 3,023 of October 11, 2002, the Central Bank established an additional reserve requirement of 10% on the savings account funds captured by the entities of the Brazilian Savings and Loan System (SBPE). CMN Resolution No. 3,843 of March 10, 2010, revoking CMN Resolution No. 3,634 of November 13, 2008, prohibits financial institutions from using securities issued by the Brazilian federal government to satisfy this additional reserve requirement. Time Deposits. In accordance with Central Bank Circular No. 3,091 of March 1, 2002, as amended by Circular No. 3,427 of December 19, 2008, Circular 3,468, of September 28, 2009, Circular No. 3,485 of February 24, 2010, Circular No. 3,513 of December 3, 2010, Circular 3,528, of March 23, 2011, banks are subject to a mandatory reserve of 20% of the average daily balance of their time deposits and certain other amounts, after a deduction of R$30.0 million, in the amount exceeding: (i) R$3.0 billion, for financial institutions with Level I component of the reference equity below R$2.0 billion; (ii) R$2 billion, for financial institutions with Level I component of the reference equity equal or higher than R$2.0 billion and below R$5.0 billion; (iii) R$1 billion, for financial institutions with Level I component of the reference equity equal or higher than R$5.0 billion and below R$7.0 billion; and (iv) zero, for financial institutions with Level I component of the reference equity higher than R$7.0 billion. If the applicable reserve requirement of a financial institution is below R$0.5 million, such financial institution will be exempt from the reserve requirements set forth by Circular No. 3,091 and amendments therein. Amounts subject to this reserve requirement shall be deposited in cash on a specific account and, at the end of each day, deposited amounts shall be equivalent to 100% of the applicable reserve requirement. Additional Reserve Requirement (Demand Deposits, Saving Deposits and Time Deposits). On August 14, 2002, the Central Bank, by means of Circular No. 3,144, as amended, established an additional reserve requirement on deposits captured by multiple-service banks, investment banks, commercial banks, development banks, credit, financing and investment companies, real estate companies and savings and loan associations. Pursuant to that regulation, the aforesaid entities are required to deposit in an interest-bearing account with the Central Bank, on a weekly basis, the cash equivalent of the sum of the following amounts in excess of R$3 billion for financial institutions with an adjusted Level I component of the reference equity below R$2.0 billion, R$2.0 billion for financial institutions with Level I component of the reference equity below R$5.0 billion and equal to or higher than R$2.0 billion, R$1.0 billion for financial institutions with Level I component of the reference equity below R$7.0 billion and equal to or higher than R$5.0 billion or zero for financial institutions with a Level I component of the reference equity equal to or higher than R$7.0 billion: (i) 12.0% of the arithmetic average of the time deposits funds and certain other amounts subject to the respective reserve requirement, (ii) 10.0% of the arithmetic average of the savings deposits funds subject to the respective reserve requirement, and (iii) 12.0% of the arithmetic average of the demand deposits funds subject to the respective reserve requirement. The reserve requirements must be met in cash on a specific account and, at the end of each day, the balance in the interest-bearing account must be equivalent to 100% of the additional reserve requirement. 145

Foreign Currency and Gold Exposure Pursuant to CMN Resolution No. 3,488, the total consolidated exposure of a financial institution in foreign currencies and gold cannot exceed 30% of its reference shareholders equity. Pursuant to Circular No. 3,520 dated January 6, 2011, 60% over the final sale day trade of foreign exchange of financial institutions (deducted from the lower of (i) US$3,000,000,000 or (ii) the arithmetic average of amounts corresponding to the Level I of the reference net worth of financial institutions, calculated in accordance with Circular No. 3,520) are generally required to be deposited in an account in the Central Bank. Financial institutions which amount to be deposited is lower than R$100,000 are exempt from such deposit. Rural Lending According to the Manual of Rural Lending, as published by the Central Bank, financial institutions are required to maintain a daily average balance of rural lending not less than 25% of the daily balance of all accounts subject to compulsory reserve requirements. Financial institutions must provide the Central Bank with evidence of compliance with such requirement by the fifth business day of each month. A financial institution that does not meet this requirement will be subject to payment of fines calculated over the daily difference between the requirement and the portion actually used for rural lending and a pecuniary penalty or, at the financial institution s discretion, to deposit the unused amount until the last business day of the subsequent month in a non-interest-bearing account maintained with the Central Bank. Repurchase Agreements, Export Notes, Etc. The Central Bank at times has established a reserve requirement for certain types of financial transactions, such as repurchase agreements, export notes, derivative transactions and certain types of assignments. Central Bank Circular No. 2,820 dated May 27, 1998 currently sets this reserve requirement at zero. Guarantees The Central Bank at times has established a reserve requirement that a financial institution deposit in a noninterest-bearing account with the Central Bank an amount equivalent to 60% of the total amount of guarantees given by such financial institution in relation to loans and financings entered into by non-financial legal entities and individuals. However, such percentage was reduced to zero by Central Bank Circular No. 2,704 of July 3, 1996. Reinvestment of Deposits Linked to Interbank Rates Pursuant to CMN Resolution No. 2,172, dated June 30, 1995 (further revoked by CMN Resolution No. 3,454, dated May 30, 2007), financial institutions were permitted to accept deposits with interest calculated by reference to an Average Interbank Interest Rate (Taxa Básica Financeira), subject to a reserve requirement and provided that such deposits are made for a minimum of 90 days. In addition, in the past, the Central Bank has imposed on other types of transactions certain compulsory deposit requirements that are no longer in effect, and could re-impose these requirements or impose similar restrictions in the future. For more information on Central Bank restrictions, see Risk Factors Risks Relating to the Brazilian Banking Industry. Taxation of Financial Transactions Financial transactions in Brazil are generally subject to income tax and to financial transactions tax (Imposto sobre Operações Financeiras or IOF ). 146

The income tax assessed on the income received on financial transactions by Brazilian residents generally depends on: (i) the type of investment (fixed or variable income, as defined by Brazilian law; variable income investments usually being treated more favorably); and (ii) the term of the investment (long-term investments usually have a more favorable treatment). The income tax assessed on income deriving from financial transactions (a) is considered for Brazilian legal entities as a prepayment of the corporate income tax due by them and (b) is exclusive for individuals that are Brazilian residents. Investments in Brazilian financial and capital markets by individuals or legal entities resident or domiciled abroad are generally subject to the same taxation rules applicable to Brazilian residents, except for foreign investments made in accordance with the rules set forth by the CMN, which currently benefit from a favorable taxation regime. Tax on Financial Transactions (IOF) IOF is a tax levied on foreign exchange, securities/bonds, credit and insurance transactions. The IOF rate may be changed by an Executive Decree (rather than a law). In addition, the IOF rate is not subject to the ex post facto principle, which provides that laws increasing the rate of existing taxes or creating new taxes will only come into effect as of the latter of (i) the first day of the year following their publication and (ii) 90 days after their publication. An Executive Decree increasing the IOF rate will therefore take effect from its publication date. Pursuant to Decree No. 6,306 of December 14, 2007, as amended, foreign exchange transactions are subject to the IOF. Under the IOF regulations currently in force, the Minister of Finance is empowered to establish the applicable IOF rate. Such IOF rate can be increased at any time up to a rate of 25%. The above mentioned Decree sets out that the current general IOF is 0.38%, although there are some exceptions, such as: (i) (ii) (iii) (iv) (v) (vi) (vii) (viii) foreign exchange transactions for the inflow of funds related to external credits, subject to registration with Brazilian Central Bank, involving direct external credits or credits obtained by means of issuance of notes in the international market, with a minimum average term of up to 360 days, in which case the rate is 6%; foreign exchange transactions for the inflow and outflow of funds related to external credits, excluding the transactions mentioned in item (i) above, in which case the rate is 0%; foreign exchange transactions for the acquisition of goods or services outside Brazil with credit cards, in which case the rate is 6.38% of the amount of the transaction; foreign exchange transactions for the acquisition of goods or services outside Brazil with credit cards by the Federal Union, States, Municipalities, Federal District, as well as its foundations and autarchies, in which case the rate is 0%; foreign exchange transactions related to export of goods and services, in which case the rate is 0%; foreign exchange transactions for the inflow and outflow of funds related to investments made by investment funds that invest in non-brazilian markets in accordance with the rules set forth by the CVM, in which case the rate is 0%; foreign exchange transactions for the inflow of funds related to investments made by nonresidents in the Brazilian financial market executed on the BM&FBOVESPA in accordance with the rules set forth by the CVM (except for derivative transactions with pre-defined earnings), in which case the rate is 2%; foreign exchange transactions for the inflow of funds related to investments made by nonresidents in the Brazil capital market, for the acquisition of shares on stock exchanges and other similar transactions and investments in shares issued by Brazilian private equity and venture capital funds, in which case the rate is 2%; 147

(ix) (x) (xi) (xii) (xiii) (xiv) (xv) foreign exchange transactions for the inflow of funds related to investments made by nonresidents in the Brazilian financial and capital markets, other than transactions described in items (vii) and (viii) above, in which case the rate is 6%; foreign exchange transactions for the return (outflow) of funds related to the investments made by non-residents in the Brazilian financial and capital markets mentioned in items (vi), (viii) and (ix) above, in which case the rate is 0%; foreign exchange transactions for the remittance of interest on net equity and dividends earned by foreign investors, in which case the rate is 0%; foreign exchange transactions performed between financial institutions, in which case the rate is 0%; foreign exchange transactions made by international air transportation companies, domiciled abroad, for purposes of remitting resources derived from its local revenues, in which case the rate is 0%; foreign exchange transactions for the inflow of funds to cover expenses incurred in the country with credit cards issued abroad, in which case the rate is 0%; and foreign exchange transaction related to the acquisition of foreign currency by financial institutions simultaneously contracted with a foreign currency sale transaction, in which case the rate is 0%. IOF tax may also be levied on issuances of bonds or securities, including transactions carried out on Brazilian stock, futures or commodities exchanges ( IOF/Títulos ). The rate of IOF/Títulos tax with respect to many securities transactions is currently 0%, although certain transactions may be subject to specific rates. The Minister of Finance, however, has the legal authority to increase the rate to a maximum of 1.5% per day of the amount of the taxed transaction, during the period in which the investor holds the securities, up to the amount equal to the gain made on the transaction and only from the date of its increase or creation. IOF/Títulos is assessed on gains realized in transactions with terms of less than 30 days consisting of the sale, assignment, repurchase or renewal of fixed-income investments or the redemption of shares of investment funds or investment pools. The maximum rate of IOF/Títulos payable in such cases is 1% per day, up to the amount equal to the gain made on the transaction, and decreases with the duration of the transaction, reaching zero for transactions with maturities of at least 30 days, except that the rate for the following types of transactions is currently 0%: (i) (ii) (iii) (iv) (v) transactions carried out by financial institutions and other institutions chartered by the Central Bank as principals; transactions carried out by mutual funds or investment pools themselves; transactions carried out in the equity markets, including those performed in stock, futures and commodities exchanges and similar entities; redemptions of shares in equity funds; and transactions carried out by governmental entities, political parties and worker s syndicates. 148

IOF also applies to credit transactions, except for foreign credit. The IOF levied on credit transactions is generally assessed at a daily rate of 0.0041%, up to a limit of 1.5%. Additionally, a flat IOF surtax of 0.38% is currently applicable to most credit transactions. In addition, IOF tax is levied on insurance transactions at the rate of: (i) 0% in the operations of reinsurance, relating to export credits or to the international transport of goods and in operations in which the premiums are allocated to the financing of life insurance plans with coverage for survival, among others; (ii) 0.38% of premiums related to life insurance plans without coverage for survival, among others; (iii) 2.38% of premiums paid in the case of health insurance; and (iv) 7.38% of premiums paid in the case of other types of insurance. Rural insurance, among certain other specific insurance transactions, is exempt from IOF. Taxation of Brazilian Corporations Brazilian companies income tax is made up of two components, a federal income tax and social contribution on taxable profits, which is known as the Social Contribution on Net Profits. In turn, the federal income tax includes two components: a federal income tax and an additional income tax. The federal income tax is assessed at a combined rate of up to 25% of adjusted net income (the normal rate for Brazilian legal entities is 15% plus 10% for legal entities with annual profits exceeding R$240,000). The social contribution on net profits is currently assessed at a rate of 15% for financial institutions and 9% for non-financial institutions, pursuant to Law No. 11,727. Companies are taxed based on their worldwide income rather than on income produced solely in Brazil. Therefore, profits, capital gains and other income obtained abroad by Brazilian entities will be computed in the determination of their net profits. In addition, profits, capital gains and other income obtained by foreign branches or income obtained from subsidiaries or foreign corporations controlled by a Brazilian entity will also be computed in the calculation of such entity s profits, in proportion to its participation in such foreign companies capital. The Brazilian entity is allowed to deduct any income tax paid abroad, up to the amount of Brazilian income taxes imposed on such income. As of January 1, 2002, Provisional Measure No. 2,158-35 determined that such profits, capital gains and other income obtained abroad by a controlled or affiliate company shall be subject to taxation on an accrual basis by the Brazilian entity on December 31 of every fiscal year, unless the Brazilian entity is liquidated before the date of its year-end balance sheet, in which case the profits are taxed at the time of its liquidation. Dividends deriving from profits generated as from January 1, 1996 are not subject to withholding income tax when paid, nor to corporate income tax or individual income tax on the person receiving the dividend. However, as the payment of dividends is not tax deductible for the company distributing them, there is an alternative regime for shareholder compensation called interest on equity which allows companies to deduct any interest paid to shareholders from net profits for tax purposes. Law No. 9,249 dated December 26, 1995 allows a corporation to deduct from its net profits for tax purposes any interest paid to shareholders as remuneration of the shareholders equity called interest on net equity or interest on shareholders capital. Distributions may be paid in cash. The interest is calculated on the net equity accounts in accordance with the daily pro rata variation of the TJLP, as determined by the Central Bank from time to time, and cannot exceed the greater of: 50% of the net income after social contributions on profit and (before the federal income tax reserve and the deduction of the interest amount attributable to shareholders) related to the period in respect of which the payment is made; or 50% of the sum of retained profits and profits reserves as of the date of the beginning of the period in respect of which the payment is made. 149

Any payment of interest to shareholders is subject to withholding income tax at the rate of 15%, or 25% in the case of a shareholder who is domiciled in a tax haven jurisdiction. These payments may be qualified, at their net value, as part of any mandatory dividend. Tax losses carried forward are available for offset up to 30% of the annual taxable income. No time limit is currently imposed on the application of tax losses to offset future taxable income. Two federal contributions are imposed on the gross revenues of corporate entities: the PIS and the COFINS. In May 2003, the Brazilian Congress approved an increase in the rate of COFINS, payable by the financial services sector. Since September 2003, the PIS and COFINS have been imposed over financial institutions gross revenues at a combined rate of 4.65%, but some specific costs, such as funding cost, are authorized to be deducted from the PIS and COFINS tax bases. The COFINS and the PIS rate for some non-financial companies have increased from 3% to 7.6% and from 0.65 to 1.65%, respectively, resulting in a combined rate of 9.25%, although certain deductions for expenses are authorized (non-cumulative PIS and COFINS regime). Pursuant to Section 1 of Decree No. 5,442 of September 5, 2005, the PIS and COFINS non-cumulative rates applicable to financial revenues received by legal entities (non-financial institutions) is zero per cent. Law No. 12, 249 of June 11, 2010 The Brazilian government has introduced thin capitalization provisions, effective as of January 1, 2010, through the enactment of Provisional Measure (Medida Provisória) No. 472, enacted by the Brazilian government on December 15, 2009, later converted into Law No. 12,249 of June 11, 2010 ( Law No. 12,249 ). As a general rule, thin capitalization provisions are intended to limit the tax deductibility of interest payments made by a Brazilian company to (i) related parties, as set forth in the Brazilian transfer pricing rules, or to a (ii) beneficiary that is domiciled or incorporated in a tax haven jurisdiction or that benefits from a privileged tax regime. Thin capitalization rules applicable to transactions with a foreign related party: the interest paid or credited to a foreign related party is deductible for IRPJ and CSLL purposes if, concurrently: (i) (ii) (iii) in the case of indebtedness to a related party that holds a direct equity stake in the Brazilian entity, the relevant indebtedness of the Brazilian legal entity, on the interest accrual date, does not exceed twice the value of the stake held by the related party in the net worth of the Brazilian legal entity (individual limit); in the case of indebtedness to a related party that does not hold a direct equity stake in the Brazilian entity: the relevant indebtedness of the Brazilian legal entity, on the interest accrual date, does not exceed twice the value of the net worth of the Brazilian legal entity (individual limit); in either (i) or (ii) above, the sum of the indebtedness of the Brazilian legal entity to all related parties, on the interest accrual date, does not exceed twice the aggregate value of the stakes of all related parties in the net worth of the Brazilian legal entity (collective limit). However, pursuant to Law 12,249, this item (iii) does not apply in the event of indebtedness exclusively to foreign related parties which do not hold direct equity stakes in the Brazilian entity, in which case the total indebtedness cannot exceed twice the value of the net worth of the Brazilian legal entity. In cases where the lender is located in a tax haven jurisdiction or benefits from a privileged tax regime, the interest paid or credited to a lender (entity or individual) resident or domiciled in a tax haven jurisdiction or that benefits from a privileged tax regime is deductible for IRPJ and CSLL purposes, if the total indebtedness of the Brazilian legal entity to residents in located tax haven jurisdictions or that benefit from privileged tax regimes does not exceed 30% of the net worth of the Brazilian legal entity. 150

Moreover, pursuant to Law 12,249, interest payments or credits to an entity or individual resident or domiciled in a tax haven jurisdiction or that benefits from a privileged tax regime will not be deductible unless the following requirements are fulfilled, concurrently: (i) identification of the actual beneficiary abroad; (ii) evidence of the operational capacity of the foreign lender; and (iii) documentary evidence of payment of the respective price or receipt of the assets and rights or use of the service. For such purposes, the actual beneficiary is deemed to be (i) an entity that is not incorporated with the sole or main purpose of achieving tax savings and (ii) which receives such payments on its own account (rather than on behalf of a third party, as an agent or fiduciary manager, etc.). Since the provisions introduced by Law No. 12,249 are very recent, it is still unclear how the tax authorities will interpret and apply such provisions. These new regulations may have an impact on the transactions performed by any Brazilian company. Regulations Affecting the Relationship Between Financial Institutions and Their Clients The relationship between financial institutions and their clients is regulated in general by laws applicable to all commercial transactions, and by the Brazilian Civil Code in particular. However, regulations established by the CMN and the Central Bank address specific issues relating to banking activity and contracts, complementing the general regulation. The Consumer Defense Code and the Banking Client Defense Code In 1990, the Brazilian Consumer Defense Code (Código de Defesa do Consumidor) was enacted to establish rigid rules to govern the relationship between product and service providers and consumers and to protect final consumers. In June 2006, the Brazilian Supreme Court of Justice ruled that the Brazilian Consumer Defense Code also applies to transactions between financial institutions and their clients. Financial institutions are also subject to specific regulation of the CMN, which specifically regulates the relationship between financial institutions and their clients. CMN Resolution No. 3,694 dated March 26, 2009, and by CMN Resolution No. 3,518 of December 6, 2007, as amended by Resolution No. 3,693, dated March 26, 2009, established new procedures with respect to the settlement of financial transactions and to services provided by financial institutions to clients and the public in general, aiming at improving the relationship between market participants by fostering additional transparency, discipline, competition and reliability on the part of financial institutions. The new regulation consolidates all the previous related rules. The main changes introduced by the Brazilian Consumer Defense Code are described below: financial institutions must ensure that clients are fully aware of all contractual clauses, including responsibilities and penalties applicable to both parties, in order to protect the counterparties against abusive practices. All queries, consultations or complaints regarding agreements or the publicity of clauses must be promptly answered, and fees, commissions or any other forms of service or operational remuneration cannot be increased unless reasonably justified (in any event these cannot be higher than the limits established by the Central Bank); financial institutions are prohibited from transferring funds from their clients various accounts without prior authorization; financial institutions cannot require that transactions linked to one another must be carried out by the same institution. If the transaction is dependent on another transaction, the client is free to enter into the latter with any financial institution it chooses; financial institutions are prohibited from releasing misleading or abusive publicity or information about their contracts or services. Financial institutions are liable for any damages caused to their clients by their misrepresentations; interest charges in connection with personal credit and consumer directed credit must be proportionally reduced in case of anticipated settlement of debts; 151

clients have the right to withdraw up to R$5,000 upon request. For higher amounts, clients are required to give the financial institution at least 24 hours prior notice; and adequate treatment for the elderly and physically disabled. Claims Department (Ouvidoria) The Claims Department (Ouvidoria) complies with the regulatory requirements of CMN Resolution 3,477 dated as of July 26, 2007 and of Central Bank Circular 3,370 dated as of October 23, 2007. The Claims Department is responsible for monitoring all our clients claims, by receiving and addressing these claims and suggesting any eventual solutions. Claims are monitored on a daily basis by the Claims Department. A report containing detailed information on the claims is made available semi-annually. The Internal Audit department, the Audit Committee and the Executive Officers are informed of the status of the ongoing work of the Claims Department on a semi-annual basis. Banking Secrecy Financial institutions must maintain the secrecy of their banking operations and services provided to their clients. According to Supplementary Law No. 105 of January 10, 2001 ( Supplementary Law No. 105 ) the only circumstances in which information about clients, services or operations of Brazilian financial institutions or credit card companies may be disclosed to third parties are the following: (i) disclosure of information with the express consent of the interested parties; (ii) sharing of information on credit history between financial institutions for record purposes; (iii) supply to credit reference agencies of information based on data from the records of subscribers of checks drawn on accounts without sufficient funds and defaulting debtors; and (iv) occurrence or suspicion that criminal or administrative illegal activities have been performed. Supplementary Law No. 105 also allows the Central Bank or the CVM to exchange information with foreign governmental authorities, provided that a specific treaty in that respect must have been previously executed. Auditors of the Brazilian Internal Revenue Service may also inspect an institution s documents, books and financial registry in certain circumstances, provided it obtains permission from the client or by a court order. Bank Failure Intervention, Administrative Liquidation and Bankruptcy The Central Bank may intervene in the operations of a financial institution not controlled by the Brazilian government if there is a material risk for creditors, or if the financial institution frequently violates applicable regulations. The Central Bank may also intervene if liquidation can be avoided or it may perform administrative liquidation or, in some circumstances, require the bankruptcy of any financial institution, except those controlled by the Brazilian government. Administrative Liquidation An administrative liquidation of any financial institution (with the exception of public financial institutions controlled by the Brazilian government) may be carried out by the Central Bank if it can be established that: the debts of the financial institution are not being paid when due; the financial institution is deemed insolvent; the financial institution has incurred losses that could abnormally increase the exposure of the unsecured creditors; 152

management of the relevant financial institution has materially violated Brazilian banking laws or regulations; or upon cancellation of its operating authorization, a financial institution s ordinary liquidation proceedings are not carried out within 90 days or are carried out with delay representing a risk to its creditors, at the Central Bank s discretion. Liquidation proceedings may otherwise be requested, on reasonable grounds, by the financial institution s officers or by the intervener appointed by the Central Bank in the intervention proceeding. Administrative liquidation proceedings may cease: at the discretion of the Central Bank if the parties concerned assume the administration of the financial institution after having provided the necessary guarantees; when the liquidator s final accounts are rendered and approved, and subsequently filed with the competent public registry; when converted to an ordinary liquidation; or when the financial institution is declared bankrupt. Temporary Special Administration Regime In addition to the aforesaid procedures, the Central Bank may also establish the Temporary Special Administration Regime (Regime de Administração Especial Temporaria or RAET ) which is a less restrictive form of intervention by the Central Bank in private and non-federal public financial institutions and which allows institutions to continue to operate normally. The RAET may be imposed by the Central Bank in the following circumstances: continuous practice of transactions contrary to the economic and financial policies established by federal law; the institution fails to comply with the compulsory reserves rules; the institution has operations or circumstances which call for an intervention; reckless or fraudulent management; the institution faces a shortage of assets; and the occurrence of any of the events described above that may result in a declaration of intervention. The main objective of the RAET is to assist with maintaining the solvency and financial conditions of the institution under special administration. Therefore, the RAET does not affect the day-to-day business operations, liabilities or rights of the financial institution, which continues to operate in its ordinary course. There is no minimum term for a RAET, which may cease upon the occurrence of any of the following events: (a) acquisition by the Brazilian government of control of the financial institution, (b) corporate restructuring, merger, spin-off, amalgamation or transfer of the controlling interest of the financial institution, (c) decision of the Central Bank or (d) declaration of extra-judicial liquidation of the financial institution. 153

Repayment of Creditors in Liquidation In case of bankruptcy or liquidation of a financial institution, certain credits, such as credits for salaries up to 150 minimum wages (salários mínimos) per labour creditor, among others, will have preference over any other credits. The FGC is a deposit insurance system which guarantees a maximum amount of R$60,000 of deposits and credit instruments held by an individual against a financial institution (or against financial institutions of the same financial group) and a maximum amount of R$20 million of deposits for banks with deposits, up to R$5 billion per bank. The Credit Insurance Fund is funded principally by mandatory contributions from all Brazilian financial institutions that work with client deposits. The payment of unsecured credit and client deposits not payable under the Credit Insurance Fund is subject to the prior payment of all secured credits and other credits to which specific laws may grant special privileges. In addition, two laws, introduced in 1995, affect the priority of repayment of creditors of Brazilian banks in the event of their insolvency, bankruptcy or similar proceedings. First, Law No. 9,069 of June 29, 1995 confers immunity from attachment on compulsory deposits maintained by financial institutions with the Central Bank. Such deposits may not be attached in actions by a bank s general creditors for the repayment of debts. Second, Law No. 9,450 of March 14, 1997 requires that the assets of any insolvent bank funded by loans made by foreign banks under trade finance lines be used to repay amounts owing under such lines in preference to those amounts owing to the general creditors of such insolvent bank. Cancellation of Banking License The Banking Reform Law, together with specific regulations enacted by CMN Resolution No. 1,065 of December 5, 1985, provides that some penalties can be imposed upon financial institutions in certain situations. Among them, a financial institution may be subject to the cancellation of its license to operate and/or to perform exchange transactions. Such cancellations are applicable under certain circumstances established by the Central Bank as, for instance, in case of repeated: (a) violation of the Central Bank regulations by the management of the financial institution, or (b) negligence of the financial institution in pursuing adequate banking practices concerning its exchange activities. In addition, the Central Bank may, according to CMN Resolution No. 3,040 of November 28, 2002, cancel the authorization to operate granted to the Bank if one or more of the following situations are verified at any time: (a) operational inactivity, without acceptable justification, (b) the institution is not located at the address provided to the Central Bank, (c) failure to send to the Central Bank for over four months, without acceptable justification, the financial statements required by the regulations in effect, and/or (d) failure to observe the timeframe for commencement of activities. The cancellation of a banking license may only occur after the appropriate administrative proceeding is carried out by the Central Bank. Decree-Law No. 2,321 of February 25, 1987, which regulates the RAET, provides that, if such provisional system is decreed, the individuals or legal entities that have a control relationship with the administered institution shall be held jointly liable with the former management for the obligations assumed thereby, irrespective of good or bad faith thereunder. Such joint liability is limited to the overall uncovered liabilities of the institution according to a balance sheet prepared as at the date when the provisional administration system is ordered. Furthermore, law No. 9,447 of March 14, 1997, provides for the liability of controlling persons of the financial institutions under intervention, extrajudicial liquidation or RAET ( Law No. 9,447/97 ). Law No. 9,447/97 determines that the controlling persons of a financial institution under extrajudicial liquidation or intervention are also jointly and severally liable for the obligations assumed by such institution. This same law further establishes that the assets of individuals or legal entities that exercise direct or indirect 154

control over financial institutions under intervention, extrajudicial liquidation or temporary regulatory receivership must be rendered unavailable for disposal or encumbrance in any way, until their liability is eventually verified. Brazilian Payment System In December 1999, the Brazilian government released new rules for the settlement of payments in Brazil, based on the guidelines adopted by the Bank for International Settlements. After a period of tests and gradual implementation, the Brazilian Payment and Settlement System began operating in April 2002. The Central Bank and CVM have the power to regulate and supervise this system. Pursuant to these rules, new clearing houses may be created and all clearing houses are required to adopt procedures designed to reduce the possibility of systemic crises and to reduce the risks currently borne by the Central Bank. The most important principles of the Brazilian Payment System are: the existence of two main payment and settlement systems: real-time gross settlements, using the reserves deposited with the Central Bank; and deferred net settlements, through the clearing houses; the clearing houses, with some exceptions, will be liable for the payment orders they accept; and bankruptcy laws do not affect the payment orders made through the credits of clearing houses, nor the collateral granted to secure those orders. However, clearing houses have ordinary credits against any participant under bankruptcy laws. The systems consisting of the Brazilian clearing systems are responsible for creating safety mechanisms and rules for controlling risks and contingencies, for loss sharing among market participants and for direct execution of participants positions, performance of their agreements and foreclosure of collateral held under custody. In addition, clearing houses and settlement services providers that are considered important to the system are obligated to set aside a portion of their assets as an additional guarantee for the settlement of transactions. Under these rules, responsibility for the settlement of a transaction is assigned to the clearing houses and settlement service providers responsible for it. Once a financial transaction has been submitted for clearing and settlement, it generally becomes the obligation of the relevant clearing house and/or settlement services provider to clear and settle it and it is no longer subject to the risk of bankruptcy or insolvency on the part of the market participant that submitted it for clearing and settlement. Financial institutions and other institutions chartered by the Central Bank are also required under these rules to create mechanisms to identify and avoid liquidity risks, in accordance with certain procedures established by the Central Bank. Under these procedures, institutions are required to: maintain and document criteria for measuring liquidity risks and mechanisms for managing them; analyze economic and financial data to evaluate the impact of different market scenarios on the institution s liquidity and cash flow; prepare reports to enable the institution to monitor liquidity risks; identify and evaluate mechanisms for unwinding positions that could threaten the institution economically or financially and for obtaining the resources necessary to carry out such unwindings; 155

adopt system controls and test them periodically; promptly provide to the institution s management available information and analyses regarding any liquidity risk identified, including any conclusions or remedies adopted; and develop contingency plans for handling liquidity crisis situations. Foreign Investment and the Brazilian Constitution Foreign Banks The Brazilian Constitution prohibits foreign financial institutions from establishing new branches in Brazil, except when duly authorized by the Brazilian government (by means of a presidential decree). A foreign financial institution duly authorized to operate in Brazil through a branch or a subsidiary is subject to the same rules, regulations and requirements that are applicable to any Brazilian financial institution. Foreign Investment in Brazilian Financial Institutions The Brazilian Constitution permits foreign individuals or companies to invest in the voting shares of Brazilian financial institutions only if they have specific authorization from the Brazilian government. Foreign investors may acquire publicly-traded non-voting shares of Brazilian financial institutions negotiated on a stock exchange, or depositary receipts offered abroad representing non-voting shares without specific authorization. Consolidation of Exchange Rules On March 23, 2010 the CMN enacted Resolution No. 3,844 consolidating the general provisions relating to foreign capital entering Brazil by way of direct investments and financial transactions. Such rule governs the registry of flows of direct investments, credits, royalties, transfers of technology and foreign leasing, among other things. The Central Bank, by means of Circular No. 3,491 dated March 29, 2010, also simplified the registry of transactions. The new rules were included in the Regulation of the Exchange Market and Foreign Capital (Regulamento do Mercado de Câmbio e Capitais Internacionais) and several outdated rules were revoked. The main aspects of the abovementioned rules are the following: Financial transfers (to and from Brazil), in reais or foreign currency, related to the flow of foreign capital pursuant to Resolution No. 3,844 are regulated by the Brazilian exchange market; Specific approvals or prior consent of the Central Bank are no longer required; and Presentation of certain information relating to the transaction to the Central Bank is no longer required. Furthermore, Circular No. 3,493 dated March 29, 2010, in line with the recent improvement of the Brazilian exchange market made by the Central Bank as discussed above, sets forth the following main changes: Simultaneous exchange agreements are no longer required for payment of premiums for indemnification related to international reinsurance when the flow of funds occurs in a foreign currency account held by an insurance sector company; Certain institutions operating in the exchange market may now maintain more than one foreign currency account at the same site in Brazil; 156

Certain records of exchange transactions no longer need to be maintained given that the anti-money laundering rules already cover such requirement; and Principal offices of financial institutions operating in the exchange market may now carry out the same transactions as branch offices are permitted to carry out. 157

TERMS AND CONDITIONS OF THE NOTES The following is the text of the terms and conditions of the Notes which, as completed by the relevant Final Terms, will be endorsed on each Note in definitive form issued under the Program. The terms and conditions applicable to any Note in global form will differ from those terms and conditions which would apply to the Note were it in definitive form to the extent described under Form, Denomination and Title. 1. Introduction (a) Program: Banco Votorantim S.A., acting through its principal office in São Paulo (the Issuer ) has established a Medium-Term Note Program (the Program ) for the issuance of medium-term Notes (the Notes ). The maximum aggregate amount of all Notes issued under the Program from time to time outstanding at any one time will not exceed U.S.$5,000,000,000 (or the equivalent, as at the respective dates of issue, in other currencies) or such greater amount as shall be agreed between the dealers appointed in respect of the Program and the Issuer. (b) Final Terms: Notes issued under the Program will be issued in series (each a Series ) and each Series may comprise one or more tranches (each a Tranche ) of Notes. Each Series and each Tranche will be the subject of a Final Terms (the Final Terms ) which completes these terms and conditions (the Conditions ). The terms and conditions applicable to any particular Series or Tranche of Notes are these Conditions as completed by the relevant Final Terms. In the event of any inconsistency between these Conditions and the relevant Final Terms, the relevant Final Terms shall prevail. Notes issued under the Program will mature at least 30 days and no more than 30 years from the date of their issuance. (c) Contracts: The Notes will be issued pursuant to an issue and paying agency agreement dated August 15, 2008 (as amended or supplemented from time to time, the Agency Agreement ) between the Issuer, The Bank of New York Mellon, acting through its London Branch, as fiscal agent (the Fiscal Agent, which expression includes any successor fiscal agent appointed from time to time in connection with the Notes), The Bank of New York Mellon as registrar (the Registrar, which expression includes any successor registrar appointed from time to time on connection with the Notes) and The Bank of Tokyo-Mitsubishi UFJ, Ltd. as principal paying agent (the Principal Paying Agent, which expression includes any successor principal paying agent appointed from time to time on connection with the Notes) and the other paying agents and transfer agents named therein (such paying agents together with the Fiscal Agent and the Principal Paying Agent, the Paying Agents and such transfer agents (the Transfer Agents which expressions include any successor or additional paying agents or transfer agents appointed from time to time in connection with the Notes). The Notes have the benefit of a deed of covenant dated August 15, 2008 (as amended or supplemented from time to time, the Deed of Covenant ), executed by the Issuer in relation to the Notes. (d) The Notes: All subsequent references in these Conditions to Notes are to the Notes of a single Series and not to all the Notes which may be issued under the Program. References in these Conditions to Coupons are to interest coupons, if any, attached to interest-bearing Notes in bearer form ( Bearer Notes ) and references to Talons are to talons for further Coupons, if any, attached to Bearer Notes. Copies of the relevant Final Terms are available during normal business hours at the Specified Office (as defined below) of the Fiscal Agent and, in the case of Notes listed on the Global Exchange Market of the Irish Stock Exchange (the Irish Stock Exchange (Global Exchange Market) ), at the Specified Office of the Paying Agent in Ireland. Their initial Specified Offices are set out in the back cover of these Listing Particulars. (e) Summaries: In these Conditions, Noteholder and, in relation to a Note, Coupon or Talon, holder means the bearer of any Bearer Note, Coupon or Talon or the person in whose name a Note in registered form ( Registered Note ) is registered (as the case may be). Noteholders and holders of Coupons and Talons are deemed to have notice of all the provisions of the Agency Agreement and of the relevant Final Terms applicable to them. Copies of the Agency Agreement and the Deed of Covenant are available for inspection by Noteholders during normal business hours at the Specified Offices of each of the Paying Agents. 158

2. Interpretation (a) Definitions: In these Conditions the following expressions have the following meanings: Accrual Yield has the meaning given in the relevant Final Terms; Additional Business Center(s) means the city or cities specified as such in the relevant Final Terms; Additional Financial Center(s) means the city or cities specified as such in the relevant Final Terms; Brazil means the Federative Republic of Brazil; Business Day means: (i) (ii) in relation to any sum payable in euro, a TARGET Settlement Day and a day on which commercial banks and foreign exchange markets settle payments generally in each (if any) Additional Business Center; and in relation to any sum payable in a currency other than euro, a day on which commercial banks and foreign exchange markets settle payments generally in the Principal Financial Center of the relevant currency and in each (if any) Additional Business Center; Business Day Convention, in relation to any particular date, has the meaning given in the relevant Final Terms and, if so specified in the relevant Final Terms, may have different meanings in relation to different dates and, in this context, the following expressions shall have the following meanings: (i) (ii) (iii) (iv) Following Business Day Convention means that the relevant date shall be postponed to the first following day that is a Business Day; Modified Following Business Day Convention or Modified Business Day Convention means that the relevant date shall be postponed to the first following day that is a Business Day unless that day falls in the next calendar month in which case that date will be the first preceding day that is a Business Day; Preceding Business Day Convention means that the relevant date shall be brought forward to the first preceding day that is a Business Day; FRN Convention, Floating Rate Convention or Eurodollar Convention means that each relevant date shall be the date which numerically corresponds to the preceding such date in the calendar month which is the number of months specified in the relevant Final Terms as the Specified Period after the calendar month in which the preceding such date occurred, provided, however, that: (1) if there is no such numerically corresponding day in the calendar month in which any such date should occur, then such date will be the last day which is a Business Day in that calendar month; (2) if any such date would otherwise fall on a day which is not a Business Day, then such date will be the first following day which is a Business Day unless that day falls in the next calendar month, in which case it will be the first preceding day which is a Business Day; and 159

(3) if the preceding such date occurred on the last day in a calendar month which was a Business Day, then all subsequent such dates will be the last day which is a Business Day in the calendar month which is the specified number of months after the calendar month in which the preceding such date occurred; Calculation Agent means the Person specified in the relevant Final Terms as the party responsible for calculating the Rate(s) of Interest and Interest Amount(s) and/or such other amount(s) as may be specified in the relevant Final Terms; Day Count Fraction means, in respect of the calculation of an amount for any period of time (the Calculation Period ), such day count fraction as may be specified in these Conditions or the relevant Final Terms and: (i) if Actual/Actual (ISMA) is so specified, means: (1) where the Calculation Period is equal to or shorter than the Regular Period during which it falls, the actual number of days in the Calculation Period divided by the product of (1) the actual number of days in such Regular Period and (2) the number of Regular Periods in any year; and (2) where the Calculation Period is longer than one Regular Period, the sum of: (A) (B) the actual number of days in such Calculation Period falling in the Regular Period in which it begins, divided by the product of (1) the actual number of days in such Regular Period, and (2) the number of Regular Periods in any year; and the actual number of days in such Calculation Period falling in the next Regular Period, divided by the product of (1) the actual number of days in such Regular Period, and (2) the number of Regular Periods in any year; (ii) (iii) (iv) (v) if Actual/365 or Actual/Actual (ISDA) is so specified, means the actual number of days in the Calculation Period divided by 365 (or, if any portion of the Calculation Period falls in a leap year, the sum of (A) the actual number of days in that portion of the Calculation Period falling in a leap year divided by 366 and (B) the actual number of days in that portion of the Calculation Period falling in a non-leap year divided by 365); if Actual/365 (Fixed) is so specified, means the actual number of days in the Calculation Period divided by 365; if Actual/360 is so specified, means the actual number of days in the Calculation Period divided by 360; if 30/360 is so specified, means the number of days in the Calculation Period divided by 360 (the number of days to be calculated on the basis of a year of 360 days with 12 30-day months (unless (A) the last day of the Calculation Period is the 31st day of a month but the first day of the Calculation Period is a day other than the 30th or 31st day of a month, in which case the month that includes that last day shall not be considered to be shortened to a 30-day month, or (B) the last day of the 160

Calculation Period is the last day of the month of February, in which case the month of February shall not be considered to be lengthened to a 30-day month)); and (vi) if 30E/360 or Eurobond Basis is so specified means, the number of days in the Calculation Period divided by 360 (the number of days to be calculated on the basis of a year of 360 days with 12 30-day months, without regard to the date of the first day or last day of the Calculation Period unless, in the case of the final Calculation Period, the date of final maturity is the last day of the month of February, in which case the month of February shall not be considered to be lengthened to a 30-day month); DTC means The Depository Trust Company; Early Redemption Amount (Tax) means, in respect of any Note, its principal amount or such other amount as may be specified in, or determined in accordance with, the relevant Final Terms; Early Termination Amount means, in respect of any Note (other than a Zero Coupon Note), its principal amount and, in respect of any Zero Coupon Note, an amount calculated in accordance with Condition 11(f), or, in each case, such other amount as may be specified in, or determined in accordance with, these Conditions or the relevant Final Terms; Exchange Act means the U.S. Securities Exchange Act of 1934, as amended; External Indebtedness means Indebtedness which is payable (or may be paid) (i) in a currency other than the currency of Brazil or (ii) to a Person resident, domiciled or having its principal place of business outside Brazil; Extraordinary Resolution has the meaning given in the Agency Agreement; Final Redemption Amount means, in respect of any Note, its principal amount or such other amount as may be specified in, or determined in accordance with, the relevant Final Terms; Guarantee means, in relation to any Indebtedness of any Person, any obligation of another Person to pay such Indebtedness including without limitation: (i) any obligation to pay or purchase such Indebtedness; or (ii) any obligation to lend money or to purchase or subscribe to shares or other securities or to purchase assets or services in order to provide funds for the payment of such Indebtedness; or (iii) any other agreement to be responsible for such Indebtedness; Indebtedness, with respect to any Person, means any amount payable (whether as a direct obligation or indirectly through a Guarantee except that for the purposes of Condition 15(e) only, the meaning of Guarantee shall not include subclauses (ii) and (iii) of the definition of Guarantee) by such Person pursuant to an agreement or instrument involving or evidencing money borrowed or received, the advance of credit, a conditional sale or a transfer with recourse or with an obligation to repurchase or pursuant to a lease with substantially the same economic effect as any such agreement or instrument and which, under U.S. generally accepted accounting principles, would constitute a capitalized lease obligation; provided, however, as used in Condition 15(e), Indebtedness shall not include any Indebtedness owed by the Issuer or any Subsidiary to any other Subsidiary or the Issuer; Interest Amount means, in relation to a Note and an Interest Period, the amount of interest payable in respect of that Note for that Interest Period; Interest Commencement Date means the Issue Date of the Notes or such other date as may be specified as the Interest Commencement Date in the relevant Final Terms; 161

Interest Determination Date has the meaning given in the relevant Final Terms; Interest Payment Date means, in the case of Floating Rate Notes and Index-Linked Interest, the Interest Payment Date(s) determined in accordance with Condition 9(b) and, in the case of Fixed Rate Notes, the date or dates specified as such in, or determined in accordance with the provisions of, the relevant Final Terms and, in each case, if a Business Day Convention is specified in the relevant Final Terms: (i) (ii) as the same may be adjusted in accordance with the relevant Business Day Convention; or if the Business Day Convention is the FRN Convention, Floating Rate Convention or Eurodollar Convention and an interval of a number of calendar months is specified in the relevant Final Terms as being the Specified Period, each of such dates as may occur in accordance with the FRN Convention, Floating Rate Convention or Eurodollar Convention such Specified Period of calendar months following the Interest Commencement Date (in the case of the first Interest Payment Date) or the previous Interest Payment Date (in any other case); Interest Period means each period beginning on (and including) the Interest Commencement Date or any Interest Payment Date and ending on (but excluding) the next Interest Payment Date; ISDA Definitions means the 2000 ISDA Definitions (as amended and updated as at the date of issue of the first Tranche of the Notes of the relevant Series as published by the International Swaps and Derivatives Association, Inc.); Issue Date has the meaning given in the relevant Final Terms; Margin has the meaning given in the relevant Final Terms; Maturity Date has the meaning given in the relevant Final Terms; Maximum Redemption Amount has the meaning given in the relevant Final Terms; Minimum Redemption Amount has the meaning given in the relevant Final Terms; Net Worth means the sum of paid-in capital, reserves and retained earnings (also referred to as stockholder s equity), as each is determined in accordance with generally accepted Brazilian accounting principles as prescribed by Brazilian corporations law; No Adjustments means that the relevant date shall not be adjusted in accordance with any Business Day Convention; Optional Redemption Amount (Call) means, in respect of any Note, its principal amount or such other amount as may be specified in, or determined in accordance with, the relevant Final Terms; Optional Redemption Amount (Put) means, in respect of any Note, its principal amount or such other amount as may be specified in, or determined in accordance with, the relevant Final Terms; Optional Redemption Date (Call) has the meaning given in the relevant Final Terms; Optional Redemption Date (Put) has the meaning given in the relevant Final Terms; 162

Participating Member State means a Member State of the European Communities which adopts the euro as its lawful currency in accordance with the Treaty; Payment Business Day means: (i) if the currency of payment is euro, any day which is: (A) (B) a day on which banks and foreign exchange markets in the relevant place of presentation are open; and in the case of payment by transfer to an account, a TARGET Settlement Day and a day on which dealings in foreign currencies may be carried on in each (if any) Additional Financial Center; or (ii) if the currency of payment is not euro, any day which is: (A) (B) a day on which banks and foreign exchange markets in the relevant place of presentation are open; and in the case of payment by transfer to an account, a day on which dealings in foreign currencies may be carried on in the Principal Financial Center of the currency of payment and in each (if any) Additional Financial Center; Person means any individual, company, corporation, firm, partnership, joint venture, association, organization, state or agency of a state or other entity, whether or not having a separate legal personality; Principal Financial Center means, in relation to any currency, the principal financial Center for that currency; provided, however, that: (i) (ii) (iii) in relation to euro, it means the principal financial Center of such Member State of the European Communities as is selected (in the case of a payment) by the payee or (in the case of a calculation) by the Calculation Agent; in relation to U.S. dollars, it means New York City; and in relation to Australian dollars, it means either Sydney or Melbourne and, in relation to New Zealand dollars, it means either Wellington or Auckland; in each case as is selected (in the case of a payment) by the payee or (in the case of a calculation) by the Calculation Agent; Public External Indebtedness means any External Indebtedness which is in the form of, or represented by, bonds, debentures, certificates, Notes or other instruments or securities which are for the time being or are capable of being or intended to be quoted, listed or ordinarily dealt in any stock exchange, automated trading system, over-the-counter or other securities market and/or which are or have been the subject of a private placement (or any similar procedure); Put Option Notice means a notice which must be delivered to a Paying Agent by any Noteholder wanting to exercise a right to redeem a Note at the option of the Noteholder; Rate of Interest means the rate or rates (expressed as a percentage per annum) of interest payable in respect of the Notes specified in the relevant Final Terms or calculated or determined in accordance with the provisions of these Conditions and/or the relevant Final Terms; 163

Redemption Amount means, as appropriate, the Final Redemption Amount, the Early Redemption Amount (Tax), the Optional Redemption Amount (Call), the Optional Redemption Amount (Put), the Early Termination Amount or such other amount in the nature of a redemption amount as may be specified in, or determined in accordance with the provisions of, the relevant Final Terms; Reference Banks has the meaning given in the relevant Final Terms or, if none, four (or if the Principal Financial Center is Helsinki, five) major banks selected by the Calculation Agent in the market that is most closely connected with the Reference Rate; Reference Price has the meaning given in the relevant Final Terms; Reference Rate has the meaning given in the relevant Final Terms; Regular Period means: (i) (ii) (iii) in the case of Notes where interest is scheduled to be paid only by means of regular payments, each period from and including the Interest Commencement Date to but excluding the first Interest Payment Date and each successive period from and including one Interest Payment Date to but excluding the next Interest Payment Date; in the case of Notes where, apart from the first Interest Period, interest is scheduled to be paid only by means of regular payments, each period from and including a Regular Date falling in any year to but excluding the next Regular Date, where Regular Date means the day and month (but not the year) on which any Interest Payment Date falls; and in the case of Notes where, apart from one Interest Period other than the first Interest Period, interest is scheduled to be paid only by means of regular payments, each period from and including a Regular Date falling in any year to but excluding the next Regular Date, where Regular Date means the day and month (but not the year) on which any Interest Payment Date falls other than the Interest Payment Date falling at the end of the irregular Interest Period; Regulation S means Regulation S under the Securities Act; Relevant Date means, in relation to any payment, whichever is the later of (i) the date on which the payment in question first becomes due or (if any amount of the money payable is improperly withheld or refused) the date on which payment in full of the amount outstanding is made or (if earlier) the date seven days after that on which notice is duly given to the Noteholders that, upon further presentation of the certificate representing the Note in accordance with the Conditions, such payment will be made, provided that payment is in fact made upon such presentation; Relevant Financial Center has the meaning given in the relevant Final Terms; Relevant Screen Page means the page, section or other part of a particular information service or its successor (including, without limitation, the Reuters Money 3000 Service and Telerate) specified as the Relevant Screen Page in the relevant Final Terms, or such other page, section or other part as may replace it on that information service or such other information service, in each case, as may be nominated by the Person providing or sponsoring the information appearing there for the purpose of displaying rates or prices comparable to the Reference Rate; Relevant Time has the meaning given in the relevant Final Terms; 164

Reserved Matter means any proposal to change any date fixed for payment of principal or interest in respect of the Notes, to reduce the amount of principal or interest payable on any date in respect of the Notes, to alter the method of calculating the amount of any payment in respect of the Notes or the date for any such payment, to change the currency of any payment under the Notes or to change the quorum requirements relating to meetings or the majority required to pass an Extraordinary Resolution and any amendments to this definition; Rule 144A means Rule 144A under the Securities Act; Securities Act means the U.S. Securities Act of 1933, as amended; Security means any mortgage, pledge, lien, hypothecation, security interest, sale-leaseback arrangement, preferential arrangement or other charge or encumbrance, or any similar arrangement, including, without limitation, any equivalent created or arising under the laws of any jurisdiction; Significant Subsidiary means any Subsidiary of the Issuer which has total assets in excess of U.S.$10,000,000 or the equivalent thereof in another currency and all or a substantial part of the business of which concerns the lending of money, the extending of credit, the taking of deposits or the performance of other financial services and any entity into which any of them is merged or consolidated or to which all or substantially all of the assets of any of them are transferred; Specified Currency has the meaning given in the relevant Final Terms; Specified Denomination(s) has the meaning given in the relevant Final Terms; Specified Office has the meaning given in the Agency Agreement; Specified Period has the meaning given in the relevant Final Terms; Subsidiary means (i) any corporation or other entity of which at least a majority of the outstanding securities or other ownership interests having, by the terms thereof, ordinary voting power to elect a majority of the board of directors or other persons performing similar functions of such corporation or other entity (irrespective of whether or not, at the time, securities or other ownership interests of any other class or classes of such corporation or entity shall have or might have voting power by reason of the happening of any contingency) is at the time directly or indirectly owned or controlled by the Issuer and/or one or more of its Subsidiaries; or (ii) in relation to any Person at any particular time, any other Person whose financial statements are, in accordance with applicable law and generally accepted accounting principles, consolidated with those of the first Person; provided, however, that Subsidiary shall not include any corporation or other entity where, by contract, such Person or Persons may not control such corporation or other entity; TARGET Settlement Day means any day on which the Trans-European Automated Real-Time Gross Settlement Express Transfer (TARGET) System is open; Treaty means the Treaty establishing the European Communities, as amended; and United States means the United States of America, including the States and the District of Columbia, and its possessions. (b) Interpretation: In these Conditions: (i) any reference to principal shall be deemed to include the Redemption Amount, any additional amounts in respect of principal which may be payable under Condition 14 any premium payable in respect of a Note and any other amount in the nature of principal payable pursuant to these Conditions; 165

(ii) (iii) (iv) (v) any reference to interest shall be deemed to include any additional amounts in respect of interest which may be payable under Condition 14 and any other amount in the nature of interest payable pursuant to these Conditions; references to Notes being outstanding shall be construed in accordance with the Agency Agreement; if an expression is stated in Condition 2(a) to have the meaning given in the relevant Final Terms, but the relevant Final Terms gives no such meaning or specifies that such expression is not applicable then such expression is not applicable to the Notes; and any reference to the Agency Agreement shall be construed as a reference to the Agency Agreement, as amended and/or supplemented up to and including the Issue Date of the Notes. 3. Form, Denomination and Title (a) Form: Each Series (as defined in Condition 1(b)) of Notes shall comprise Notes of a nominal amount in Specified Denominations and will be represented on issue by one or more Rule 144A Restricted Global Notes, Regulation S Unrestricted Global Notes, Temporary Global Notes or Permanent Global Notes, each as defined below (each, a Global Note ). These Conditions must be read accordingly. The Specified Denomination of any Series of Notes means the denomination or denominations specified on such Notes. Bearer Notes of one Specified Denomination may not be exchanged for Bearer Notes of another Specified Denomination (if any). Each Note may be issued as a Fixed Rate Note, a Floating Rate Note, a Zero Coupon Note, an Index-Linked Interest Note, a Dual Currency Note, a Foreign Currency Constraint Note or a combination of any of the foregoing or any other kind of Note, depending upon the Interest and Redemption/Payment Basis shown thereon. (b) Rule 144A Restricted Global Notes: Registered Notes of any Series offered and sold to qualified institutional buyers under Rule 144A will be issued in the form of one or more registered Notes in global form, without interest coupons bearing a transfer restriction legend in relation to Rule 144A (collectively, in the case of the Notes of each such Series, the Rule 144A Restricted Global Note ). The Rule 144A Restricted Global Note of such Series will be deposited on the original issue date of the Notes of such Series with a custodian for DTC and registered in the name of Cede & Co., as nominee of DTC. Interests in a Rule 144A Restricted Global Note will be available for purchase only by qualified institutional buyers. (c) Regulation S Unrestricted Global Notes: Registered Notes of any Series offered and sold in offshore transactions to non-u.s. persons in reliance on Regulation S will be issued in the form of one or more registered Notes in global form, without interest coupons (collectively, in the case of the Notes of such Series, the Regulation S Unrestricted Global Note ). Except as noted below, each Regulation S Unrestricted Global Note will be deposited upon issuance with a common depositary for Euroclear Bank S.A./N.V. ( Euroclear ) and Clearstream Banking, société anonyme ( Clearstream, Luxembourg ). (d) Certificated Notes: A certificated Note will be issued to each holder of Registered Note(s) in respect of its registered holding or holdings (each, a Certificated Note ) only under the limited circumstances described in Condition 5 below. Each Certificated Note will be numbered serially with an identifying number which will be recorded in the register (the Register ) which the Issuer shall procure to be kept by the Registrar. (e) Temporary and Permanent Global Notes: Bearer Notes of any Series will be issued in the form of one or more Notes in temporary global form ( Temporary Global Notes ) or in permanent global form ( Permanent Global Notes ), in either case in bearer form without interest coupons. Interests in a Temporary 166

Global Note will be exchangeable, in whole or in part, for interests in a Permanent Global Note on or after the date 40 days after the later of the commencement of the offering and the relevant Issue Date, upon certification as to non-u.s. beneficial ownership (as required by Regulation S and U.S. Treasury Regulation 1.163-5(c)(2)(i)(D)(3)). (f) Definitive Bearer Notes: The Permanent Global Note issued in respect of any series of Bearer Notes will only be exchanged for definitive Bearer Notes ( Definitive Bearer Notes ) under the limited circumstances described in Condition 5 below. Each Definitive Bearer Note will be numbered serially with an identifying number. (g) Title: Title to the Registered Notes shall pass by registration in the Register. Title to the Bearer Notes, the Coupons relating thereto and, where applicable, the Talons relating thereto shall pass by delivery. Except as ordered by a court of competent jurisdiction or as required by law, the holder of any Note, Coupon or Talon shall be deemed to be and may be treated as the absolute owner of such Note, Coupon or Talon, for the purpose of receiving payment thereof or on account thereof and for all other purposes, whether or not such Note, Coupon or Talon shall be overdue and notwithstanding any notice of ownership, theft or loss thereof or any writing thereon made by anyone. (h) Legend on Bearer Notes: The following legend will appear on all Permanent Global Notes representing Bearer Notes and all Definitive Bearer Notes and any Receipts, Coupons or Talons in respect thereof: ANY UNITED STATES PERSON WHO HOLDS THIS OBLIGATION WILL BE SUBJECT TO LIMITATIONS UNDER THE UNITED STATES INCOME TAX LAWS, INCLUDING THE LIMITATIONS PROVIDED IN SECTIONS 165(j) AND 1287(a) OF THE INTERNAL REVENUE CODE. 4. Interest in the Notes (a) Interests Through Clearing Systems: Investors may hold their interests in the applicable Global Note directly through Euroclear, Clearstream Luxembourg or, if the Global Note is a Rule 144A Restricted Global Note, DTC, if they are participants in these systems, or indirectly through organizations that are participants in these systems. (b) Transfers: Beneficial interests in the Global Notes may be transferred as described below. Beneficial interests in the Global Notes may not be exchanged for Notes in physical, certificated form, except in the limited circumstances described in Condition 5 below. (c) Transfers of Certificated Notes and Definitive Bearer Notes: One or more Certificated Notes may be transferred in whole or in part in a Specified Denomination upon the surrender (at the Specified Office of the Registrar or any Transfer Agent) of the certificate representing such Notes to be transferred, together with the form of transfer endorsed on it duly completed and executed and any other evidence as the Registrar or Transfer Agent may reasonably require. In the case of a transfer of part only of a holding of Notes represented by one certificate, a new certificate shall be issued to the transferee in respect of the part transferred and a further new certificate in respect of the balance of the holding not transferred shall be issued to the transferor. All transfers of Notes and entries on the Register will be made subject to the detailed regulations concerning transfers of Notes scheduled to the Agency Agreement. These regulations may be changed by the Issuer, with the prior written approval of the Fiscal Agent and the Registrar. A copy of the current regulations will be made available by the Registrar to any holder of Notes. Transfer of the Definitive Bearer Notes, the Coupons relating thereto and, where applicable, the Talons relating thereto, is effected by delivery. (d) Clearing System Procedures: All interests in the Global Notes may be subject to the procedures and requirements of Euroclear, Clearstream, Luxembourg and/or DTC, as the case may be. 167

(e) Transfer Restrictions: Any beneficial interest in one of the Global Notes representing Registered Notes that is transferred to a person who takes delivery in the form of an interest in another Global Note will, upon transfer, cease to be an interest in that Global Note and become an interest in the other Global Note and, accordingly, will then be subject to any transfer restrictions and other procedures applicable to beneficial interests in the other Global Note for as long as it remains such an interest. (f) Closed Periods: No holder of Registered Notes may require the transfer of a Note to be registered (i) during the period of 15 days ending on the due date for redemption of such Note, (ii) during the period of 15 days before any date on which Notes may be called for redemption by the Issuer at its option pursuant to Condition 11(c), (iii) after such Note has been called for redemption or (iv) during the period of seven days ending on (and including) any Record Date. 5. Issuance of Certificated Notes or Definitive Bearer Notes (a) Circumstances for Issuance: If: (1) DTC notifies the Issuer and the Fiscal Agent that it is unwilling or unable to discharge properly its responsibilities as depositary with respect to a Rule 144A Restricted Global Note or ceases to be a clearing agency registered under the Exchange Act or if at any time it is no longer eligible to act as such, and the Issuer is unable to locate a qualified successor within 90 days of such notification or becoming aware of such ineligibility on the part of DTC; (2) in the case of a Regulation S Unrestricted Global Note or Permanent Global Note, Euroclear or Clearstream, Luxembourg is closed for business for a continuous period of 14 days (other than by reason of holidays, statutory or otherwise) or announces an intention to cease business permanently or in fact does so; (3) principal in respect of any Notes is not paid when due and any holder has given notice to the Fiscal Agent of its election for such exchange; or (4) the Issuer has or will become obliged to pay additional amounts as provided or referred to in Condition 14 as a result of a change in, or amendment to, the laws or regulations of Brazil or any political subdivision thereof or taxing authority therein or any change in the official application or official interpretation of such laws or regulations (including a holding by a court of competent jurisdiction) and such obligation would not arise were the Notes represented by Certificated Notes or Definitive Bearer Notes rather than a Global Note; the Issuer will at its sole cost cause Certificated Notes or Definitive Bearer Notes, as the case may be, to be issued in the names and/or to the holders and in the amounts specified by the holder of the relevant Global Note. (b) No Fee: The exchange of interests in the Global Note for Certificated Notes or Definitive Bearer Notes, as the case may be, of a particular Series shall be made free of any fees of the Issuer, the Registrar, the Transfer Agent or the Paying Agent to the holder; provided, however, that such person receiving Certificated Notes or Definitive Bearer Notes, as the case may be, will be obligated to pay or otherwise bear the cost of any tax or other governmental charge, if any, as in relation to any such exchange or registration and if such Certificated Notes or Definitive Bearer Notes are delivered otherwise than at the Specified Office of the Registrar or any Transfer Agent or Paying Agent, any cost of insurance, postage, transportation and the like. (c) Exercise of Options or Partial Redemption: In the case of the exercise of the Issuer s or Noteholder s option in respect of, or a partial redemption of, Notes represented by a single certificate, a new 168

certificate shall be issued to the holder to reflect the exercise of such option or in respect of the balance of the holding not redeemed. In the case of a partial exercise of an option resulting in Notes of the same holding having different terms, separate certificates will be issued in respect of those Notes of that holding that have the same terms. New certificates will only be issued against surrender of the existing certificates to the Registrar or any Transfer Agent. In the case of a transfer of Certificated Notes to a person who is already a holder of Certificated Notes, a new certificate representing the enlarged holding will only be issued against surrender of the certificate representing the existing holding. (d) Delivery of Certificated Notes: Each new Certificated Note to be issued pursuant to Condition 4(c) or 5(c) will, be available for delivery within three Business Days of receipt of the form of transfer or Put Option Notice and surrender of the Certificated Note for exchange. Delivery of the new certificates will be made at the Specified Office of the Transfer Agent or the Registrar (as the case may be) to whom delivery or surrender of such form of transfer or Put Option Notice and Certificated Note shall have been made or, at the option of the holder making such delivery or surrender as aforesaid and as specified in the relevant form of transfer or Put Option Notice or otherwise in writing, be mailed by uninsured post at the risk of the holder entitled to the new Certificated Note to such address as may be so specified, unless such holder requests otherwise and pays in advance to the relevant Agent (as defined in the Agency Agreement) the costs of such other method of delivery and/or insurance as it may specify. In this Condition, Business Day means a day, other than Saturday or Sunday, on which banks are open for business in the place of the Specified Office of the relevant Transfer Agent or the Registrar (as the case may be). (e) Free of Charge: Exchanges and transfers of Certificated Notes on registration, transfer, partial redemption or exercise of an option will be effected without charge by or on behalf of the Issuer, the Registrar or Transfer Agents, but upon payment of the cost of any tax or other governmental charge, if any, which may be imposed in relation to such registration or transfer. 6. Status The Notes and Coupons constitute subject to Condition 7 direct, unconditional, unsubordinated and unsecured obligations of the Issuer which will at all times rank pari passu without any preference among themselves and at least pari passu with all other direct, unconditional, unsubordinated and unsecured obligations of the Issuer present and future (including, without limitation, obligations in respect of deposits), save for such obligations as may be preferred by provisions of law that are both mandatory and of general application subject, in the case of any Foreign Currency Constraint Notes, to certain limitations on payments in the event of a Foreign Currency Constraint Event. 7. Negative Pledge The Issuer agrees that for so long as any Note or Coupon remains outstanding, the Issuer will not create or permit to subsist, and will not permit any Significant Subsidiary to create or permit to subsist, any Security upon the whole or any part of its assets, present or future, to secure (i) any of its or their Public External Indebtedness; (ii) any of its or their Guarantees in respect of Public External Indebtedness; or (iii) the Public External Indebtedness or Guarantees in respect of Public External Indebtedness of any other Person without, at the same time or prior thereto, securing the Notes equally and ratably therewith or providing such other security for the Notes, as shall be approved by the holders of a majority in principal amount of the outstanding Notes. 8. Fixed Rate Note Provisions (a) Application: This Condition 8 is applicable to the Notes only if the Fixed Rate Note Provisions are specified in the relevant Final Terms as being applicable (a Fixed Rate Note ). 169

(b) Accrual of Interest: Each Note bears interest at the Rate of Interest on its outstanding nominal amount from (and including) the Interest Commencement Date in respect thereof payable in arrear on each Interest Payment Date and on the Maturity Date if that date does not fall on an Interest Payment Date, except as provided in Condition 12 (Payments). Each Note will cease to bear interest from the due date for final redemption unless, upon due presentation, payment of the Redemption Amount is improperly withheld or refused, in which case it will continue to bear interest in accordance with this Condition 8 (as well after as before judgment) until the Relevant Date. (c) Fixed Coupon Amounts or Broken Amounts: If a Fixed Coupon Amount or a Broken Amount is specified in the relevant Final Terms, the amount of interest payable on each Interest Payment Date will amount to the Fixed Coupon Amount or, if applicable, Broken Amount so specified and in the case of the Broken Amount, will be payable on the particular Interest Payment Date(s) specified in the relevant Final Terms. 9. Floating Rate Note and Index-Linked Interest Note Provisions (a) Application: This Condition 9 (Floating Rate Note and Index-Linked Interest Note Provisions) is applicable to the Notes only if the Floating Rate Note Provisions or the Index-Linked Interest Note Provisions are specified in the relevant Final Terms as being applicable (a Floating Rate Note or an Index-Linked Redemption Note respectively). (b) Accrual of Interest: Each Note bears interest at the rate per annum (expressed as a percentage) equal to the Rate of Interest on its nominal amount from (and including) the Interest Commencement Date at the Rate of Interest payable in arrear on each Interest Payment Date, subject as provided in Condition 12 (Payments). Such Interest Payment Date(s) is/are either shown hereon as Specified Interest Payment Dates or, if no Specified Interest Payment Dates is/are specified in the relevant Final Terms, Interest Payment Date shall mean each date which falls the number of months or other period specified in the relevant Final Terms as the Specified Period after the preceding Interest Payment Date or, in the case of the first Interest Payment Date, after the Interest Commencement Date. Each Note will cease to bear interest from the due date for final redemption unless, upon due presentation, payment of the Redemption Amount is improperly withheld or refused, in which case it will continue to bear interest in accordance with this Condition 9 (as well after as before judgment) until the Relevant Date. (c) Screen Rate Determination: If Screen Rate Determination is specified in the relevant Final Terms as the manner in which the Rate(s) of Interest is/are to be determined, the Rate of Interest applicable to the Notes for each Interest Period will be determined by the Calculation Agent on the following basis: (i) (ii) (iii) if the Reference Rate is a composite quotation or customarily supplied by one entity, the Calculation Agent will determine the Reference Rate which appears on the Relevant Screen Page as of the Relevant Time on the relevant Interest Determination Date; in any other case, the Calculation Agent will determine the arithmetic mean of the Reference Rates which appear on the Relevant Screen Page as of the Relevant Time on the relevant Interest Determination Date; if, in the case of (i) above, such rate does not appear on that page or, in the case of (ii) above, fewer than two such rates appear on that page or if, in either case, the Relevant Screen Page is unavailable, the Calculation Agent will: (A) request the principal Relevant Financial Center office of each the Reference Banks to provide a quotation of the Reference Rate at approximately the Relevant Time on the Interest Determination Date to prime banks in the 170

Relevant Financial Center interbank market in an amount that is representative for a single transaction in that market at that time; and (B) determine the arithmetic mean of such quotations; and (iv) if fewer than two such quotations are provided as requested, the Calculation Agent will determine the arithmetic mean of the rates (being the nearest to the Reference Rate, as determined by the Calculation Agent) quoted by major banks in the Principal Financial Center of the Specified Currency, selected by the Calculation Agent, at approximately 11.00 a.m. (local time in the Principal Financial Center of the Specified Currency) on the first day of the relevant Interest Period for loans in the Specified Currency to leading European banks for a period equal to the relevant Interest Period and in an amount that is representative for a single transaction in that market at that time, and the Rate of Interest for such Interest Period shall be the sum of the Margin and the rate or (as the case may be) the arithmetic mean so determined; provided, however, that if the Calculation Agent is unable to determine a rate or (as the case may be) an arithmetic mean in accordance with the above provisions in relation to any Interest Period, the Rate of Interest applicable to the Notes during such Interest Period will be the sum of the Margin and the rate (or as the case may be) the arithmetic mean last determined in relation to the Notes in respect of a preceding Interest Period. (d) ISDA Determination: If ISDA Determination is specified in the relevant Final Terms as the manner in which the Rate(s) of Interest is/are to be determined, the Rate of Interest applicable to the Notes for each Interest Period will be the sum of the Margin and the relevant ISDA Rate where ISDA Rate in relation to any Interest Period means a rate equal to the Floating Rate (as defined in the ISDA Definitions) that would be determined by the Calculation Agent under an interest rate swap transaction if the Calculation Agent were acting as Calculation Agent for that interest rate swap transaction under the terms of an agreement incorporating the ISDA Definitions and under which: (i) (ii) (iii) the Floating Rate Option (as defined in the ISDA Definitions) is as specified in the relevant Final Terms; the Designated Maturity (as defined in the ISDA Definitions) is a period specified in the relevant Final Terms; and the relevant Reset Date (as defined in the ISDA Definitions) is either (A) if the relevant Floating Rate Option is based on the London interbank offered rate (LIBOR) for a currency, the first day of that Interest Period or (B) in any other case, as specified in the relevant Final Terms. (e) Index-Linked Interest: If the Index-Linked Interest Note Provisions are specified in the relevant Final Terms as being applicable, the Rate(s) of Interest applicable to the Notes for each Interest Period will be determined in the manner specified in the relevant Final Terms. (f) Margin and Rate Multipliers: If any Margin or Rate Multiplier is specified in the relevant Final Terms (either (A) generally, or (B) in relation to one or more Interest Periods), an adjustment shall be made to all Rates of Interest, in case of (A), or the Rates of Interest for the specified Interest Periods, in the case of (B), calculated in accordance with Condition 9(b), (c) and (d) above by adding (if a positive number) or subtracting (if a negative number) the absolute value of such Margin or multiplying by such Rate Multiplier, subject always to the next paragraph. 171

(g) Maximum or Minimum Rate of Interest: If any Maximum Rate of Interest or Minimum Rate of Interest is specified in the relevant Final Terms, then the Rate of Interest shall in no event be greater than the maximum or be less than the minimum so specified. (h) Calculation of Interest Amount: The Calculation Agent will, as soon as practicable after the time at which the Rate of Interest is to be determined in relation to each Interest Period, calculate the Interest Amount payable in respect of each Note of a Specified Denomination for such Interest Period. The Interest Amount will be calculated by applying the Rate of Interest for such Interest Period to the principal amount of such Note during such Interest Period and multiplying the product by the relevant Day Count Fraction. (i) Calculation of Other Amounts: If the relevant Final Terms specifies that any other amount is to be calculated by the Calculation Agent, the Calculation Agent will, as soon as practicable after the time or times at which any such amount is to be determined, calculate the relevant amount. The relevant amount will be calculated by the Calculation Agent in the manner specified in the relevant Final Terms. (j) Publication: The Calculation Agent will cause each Rate of Interest and Interest Amount determined by it, together with the relevant Interest Payment Date, and any other amount(s) required to be determined by it together with any relevant payment date(s) to be notified to the Issuer, the Fiscal Agent and the Paying Agents and, if required, each stock exchange (if any) on which the Notes are then listed as soon as practicable after such determination but in no event later than (i) in the case of each Rate of Interest, Interest Amount and Interest Payment Date, the first day of the relevant Interest Period if determined prior to that time and (ii) in all other cases, the fourth Business Day after such determination. Notice thereof shall also promptly be given to the Noteholders. The Calculation Agent will be entitled to recalculate any Interest Amount (on the basis of the foregoing provisions) without notice in the event of an extension or shortening of the relevant Interest Period. (k) Notifications, etc.: All notifications, opinions, determinations, certificates, calculations, quotations and decisions given, expressed, made or obtained for the purposes of this Condition by the Calculation Agent will (in the absence of manifest error) be binding on the Issuer, the Paying Agents and the Noteholders, and (subject as aforesaid) no liability to any such Person will attach to the Calculation Agent in connection with the exercise or non-exercise by it of its powers, duties and discretions for such purposes. 10. Dual Currency Note and Zero Coupon Note Provisions (a) Dual Currency Notes: (i) (ii) This Condition 10(a) is applicable to the Notes only if the Dual Currency Note Provisions are specified in the relevant Final Terms as being applicable (a Dual Currency Note ). If the rate or amount of interest falls to be determined by reference to an exchange rate, the rate or amount of interest payable shall be determined in the manner specified in the relevant Final Terms. Each Note will cease to bear interest from the due date for final redemption unless, upon due presentation, payment of the Redemption Amount is improperly withheld or refused, in which case it will continue to bear interest in accordance with this Condition 10 (as well after as before judgment) until the Relevant Date. (b) Zero Coupon Notes: (i) This Condition 10(b) applies to a Note in respect of which the Zero Coupon Note Provisions are specified on such Note as being applicable (a Zero Coupon Note ). 172

(ii) References to the amount of interest payable (other than as provided below) in these Conditions are not applicable. Where a Note becomes repayable prior to its Maturity Date and is not paid when due, the amount due and payable in respect of such Note shall be the Amortized Face Amount (as defined in Condition 11(f). Where a Note is to be redeemed on its Maturity Date, any overdue principal of such Note shall bear interest at a rate per annum (expressed as a percentage) equal to the Accrual Yield. Such interest shall continue to accrue (on the same basis as referred to in Condition 8 (both before and after judgment) to the Relevant Date. 11. Redemption and Purchase (a) Scheduled Redemption: Unless previously redeemed, or purchased and cancelled, the Notes will be redeemed at their Final Redemption Amount on the Maturity Date, subject as provided in Condition 12 (Payments). (b) Redemption for Tax Reasons: The Notes may be redeemed at the option of the Issuer in whole, but not in part: (i) (ii) (iii) at any time (if neither the Floating Rate Note Provisions or the Index-Linked Interest Note Provisions are specified in the relevant Final Terms as being applicable); or on any Interest Payment Date (if the Floating Rate Note Provisions or the Index- Linked Interest Note Provisions are specified in the relevant Final Terms as being applicable), on giving not less than 30 nor more than 60 days notice to the Noteholders (which notice shall be irrevocable), at their Early Redemption Amount (Tax), together with interest accrued (if any) to the date fixed for redemption or, if the Notes are Zero Coupon Notes, at the amount calculated as provided in Condition 11(f), if: (1) the Issuer has or will become obliged to pay additional amounts as provided or referred to in Condition 14 (Taxation) as a result of any change in, or amendment to, the laws or regulations of Brazil or any political subdivision or any authority thereof or therein having power to tax, or any change in the official application or official interpretation of such laws or regulations (including a holding by a court of competent jurisdiction), which change or amendment becomes effective on or after the date on which agreement is reached to issue of the first Tranche of the Notes; and (2) such obligation cannot be avoided by the Issuer taking reasonable measures available to it, provided, however, that no such notice of redemption shall be given earlier than: (1) where the Notes may be redeemed at any time, 90 days prior to the earliest date on which the Issuer would be obliged to pay such additional amounts if a payment in respect of the Notes were then due; or (2) where the Notes may be redeemed only on an Interest Payment Date, 60 days prior to the Interest Payment Date occurring immediately before the earliest date on which the Issuer would be obliged to pay such additional amounts if a payment in respect of the Notes were then due. 173

Prior to the publication of any notice of redemption pursuant to this paragraph, the Issuer shall deliver to the Fiscal Agent (A) a certificate signed by two authorized officers of the Issuer stating that the Issuer is entitled to effect such redemption and setting forth a statement of facts showing that the conditions precedent to the right of the Issuer so to redeem have occurred and (B) an opinion of independent legal advisers of recognized standing to the effect that the Issuer has or will become obliged to pay such additional amounts as a result of any change, amendment, official interpretation or application described above. (c) Redemption at the Option of the Issuer: If a Call Option is specified in the relevant Final Terms as being applicable, the Notes may be redeemed at the option of the Issuer in whole or, if so specified in the relevant Final Terms, in part on any Optional Redemption Date (Call) on the Issuer giving not less than 30 nor more than 60 days notice (or such other period as may be specified in the relevant Final Terms) to the Noteholders (which notice shall be irrevocable) whereupon the Issuer shall redeem the Notes or, as the case may be, the Notes specified in such notice on the relevant Optional Redemption Date (Call) at the Optional Redemption Amount (Call) plus accrued interest (if any) to such date. (d) Partial Redemption: If the Notes are to be redeemed in part only on any date in accordance with Condition 11(c) (Redemption at the option of the Issuer), the Notes to be redeemed shall be in a nominal amount at least equal to the Minimum Redemption Amount (if any) specified in the relevant Final Terms and shall in no event be greater than the Maximum Redemption Amount (if any) so specified. (e) Redemption at the Option of Noteholders: If a Put Option is specified in the relevant Final Terms as being applicable, the Issuer shall, at the option of the holder of any Note, redeem such Note on the Optional Redemption Date (Put) at the relevant Optional Redemption Amount (Put) together with interest (if any) accrued to such date. In order to exercise the option contained in this Condition 11(e), the holder of a Note must, not less than 30 nor more than 60 days before the relevant Optional Redemption Date (Put) (or such other period as may be specified in the relevant Final Terms), deposit with any Transfer Agent or Paying Agent the relevant Certificated Note or Definitive Bearer Note (in the case of Notes in definitive form) or authority to Euroclear, Clearstream, Luxembourg or DTC, as appropriate (in the case of Notes in global form) together with a duly completed Put Option Notice in the form obtainable from any Transfer Agent or Paying Agent. Upon the deposit of a Certificated Note, Definitive Bearer Note or authority to Euroclear, Clearstream, Luxembourg or DTC and a Put Option Notice in accordance with this Condition 11(e), the exercise of such Put Option shall be irrevocable; provided, however, that any Definitive Bearer Note must be deposited with all unmatured Coupons and unexchanged Talons related thereto (if any) and provided further that if, prior to the relevant Optional Redemption Date (Put), any such Note becomes immediately due and payable or, upon due presentation of any such Note on the relevant Optional Redemption Date (Put), payment of the redemption money is improperly withheld or refused, the relevant Paying Agent shall mail notification thereof to the depositing Noteholder at such address as may have been given by such Noteholder in the relevant Put Option Notice and shall hold the Certificated Note, Definitive Bearer Note or authority to Euroclear, Clearstream, Luxembourg or DTC, as the case may be, at its Specified Office for collection by the depositing Noteholder. Notes. (f) Early Redemption of Zero Coupon Notes: This Condition 11(f) applies to only Zero Coupon (i) (ii) The amount payable in respect of any Zero Coupon Note upon redemption of such Zero Coupon Note in full pursuant to Conditions 11(c) or upon it becoming due and payable as provided in Condition 15 (Events of Default), shall be the Amortized Face Amount (calculated as provided below) of such Zero Coupon Note. Subject to Condition 11(f)(iii), the Amortized Face Amount of any Zero Coupon Note shall be the sum of (A) the Reference Price specified on such Zero Coupon Note and (B) the aggregate amortization of the difference between the Reference Price and the nominal amount of such Zero Coupon Note from the Issue Date to the date on which the Zero Coupon Note becomes due and payable calculated at a rate 174

per annum (expressed as a percentage) equal to the Accrual Yield specified on such Zero Coupon Note applied to the Reference Price in the manner specified on such Zero Coupon Note. Where the specified calculation is to be made for a period of less than one year, it shall be made using the applicable Day Count Fraction. (iii) If the amount payable in respect of any Note upon redemption of such Zero Coupon Note pursuant to Condition 11(b) or upon it becoming due and payable as provided in Condition 15 (Events of Default), is not paid when due, the amount due and payable in respect of such Note shall be the Amortized Face Amount of such Zero Coupon Note as defined in Condition 11(f)(ii), except that reference therein to the date on which the Zero Coupon Note becomes due and payable shall be deemed to be replaced by a reference to the Relevant Date. The calculation of the Amortized Face Amount in accordance with this Condition 11(f)(iii) will continue to be made (both before and after judgment) until the Relevant Date unless the Relevant Date falls on or after the Maturity Date, in which case the amount due and payable shall be the nominal amount of such Note together with any interest which may accrue on such Zero Coupon Note in accordance with Condition 10(b). (g) Purchase: The Issuer or any of its Subsidiaries may at any time purchase Notes (provided that in the case of Definitive Bearer Notes they are purchased together with all unmatured Coupons and unexchanged Talons relating to them) in the open market or otherwise and at any price, provided that in any such case such purchase or purchases are in compliance with all relevant laws, regulations and directives. (h) Cancellation: All Notes redeemed in accordance with this Condition 11, and any unmatured Coupons or Talons attached to them, will be cancelled forthwith. Any Notes purchased in accordance with this Condition 11, and any unmatured Coupons or Talons purchased with them, may at the option of the Issuer be cancelled or may be resold. Notes which are cancelled following any redemption or purchase in accordance with this Condition 11 may at the option of the Issuer be re-issued together with any unmatured Coupons or Talons. Any resale or re-issue made pursuant to this Condition 11(h) shall only be made in compliance with all relevant laws, regulations and directives. No Notes may be resold or reissued pursuant to this Condition 11(h) if such resale or reissue would have the effect of extending or causing the recommencement of any restricted period applicable to Notes of the relevant Series pursuant to Rule 144 under the Securities Act or any other applicable U.S. securities law or regulation. (i) Notification to the Irish Stock Exchange (Global Exchange Market): For as long as any Tranche of Notes is listed on the Irish Stock Exchange (Global Exchange Market) and the rules of the Irish Stock Exchange so require, the Issuer shall notify the Irish Stock Exchange of any redemption of any Tranche of Notes. 12. Payments (a) Payments of Principal and Interest: The Principal Paying Agent will distribute all principal, premium, if any, and interest payments that are received by it in respect of the Global Notes to the holders of the Global Notes on the relevant date of payment. The Principal Paying Agent shall have no responsibility to any person for any failure by the Issuer to make payments on or in respect of the Notes or for any delay in receipt of payment due to a delay by the Issuer in sending payment. (b) Registered Notes: Payments of principal and interest in respect of Registered Notes will be made or procured to be made by the Principal Paying Agent to the person shown on the Register at the close of business on (1) in the case of a Series of Notes where some or all of the Notes of such Series are registered in the name of or in the name of a nominee for The Depositary Trust Company ( DTC ), the first day on which DTC is open for business before the due date for payment thereof (each, a DTC business day ) (subject to Condition 12(g)), or (2) in the case of a Series of Notes where such Notes are registered in the name of, or in 175

the name of a nominee of any clearing system or any other entity or person other than DTC, the first day before the due date for payment thereof (in each case, the Record Date ): (i) (ii) by check drawn on, or, upon application (save in case of Global Notes), by transfer to an account in the Specified Currency maintained by the payee with, a bank in the Relevant Financial Center of the Specified Currency or, in the case of euro, in a city in which banks have access to the TARGET System; or as may otherwise be specified on such Notes. In the case of any Note represented by a Certificated Note, payment of principal will only be made against surrender of such Certificated Note at the Specified Office of any Transfer Agent. (c) Bearer Notes: Payments of principal and interest in respect of Bearer Notes will, subject as mentioned below, be made against presentation and surrender of the relevant Bearer Notes or Coupons, as the case may be, at the Specified Office of any Paying Agent outside the United States and its possessions: (i) (ii) (iii) in respect of payments denominated in a Specified Currency other than U.S. dollars, at the option of the holder either by a cheque in such Specified Currency drawn on, or by transfer to an account in such Specified Currency, maintained by the payee with a bank in the Relevant Financial Centre of such Specified Currency, or in the case of euro, in a city in which banks have access to the TARGET System; in respect of payments denominated in U.S. dollars, subject to Condition 12(g), at the option of the holder either by a U.S. dollar cheque drawn on a bank in New York City or by transfer to a U.S. dollar account maintained by the payee with a bank outside the United States; or as may otherwise be specified on such Notes as an alternative payment mechanism. (d) Payments in the United States: Notwithstanding the foregoing, payments in respect of Bearer Notes denominated in U.S. dollars may be made at the Specified Office of any Paying Agent in New York City in the same manner as aforesaid if (1) the Maturity Date of such Bearer Notes is not more than one year from the Issue Date for such Bearer Notes or (2) (a) the Issuer shall have appointed Paying Agents with Specified Offices outside the United States with the reasonable expectation that such Paying Agents would be able to make payment of the amounts on the Bearer Notes in the manner provided above when due, (b) payment in full of such amounts at all such offices is illegal or effectively precluded by exchange controls or other similar restrictions on payment or receipt of such amounts and (c) such payment is then permitted by United States law. If, under such circumstances, a Bearer Note is presented for payment of principal at the Specified Office of any Paying Agent in the United States or its possessions in circumstances where interest (if any is payable against presentation of the Bearer Note) is not to be paid there, the relevant Paying Agent will annotate the Bearer Note with the record of the principal paid and return it to the holder for the obtaining of interest elsewhere. (e) Payments on Business Days: Subject as provided on a Note, if any date for payment in respect of any Bearer Note or Coupon is not a business day, the holder shall not be entitled to payment until the next following business day nor to any interest or other sum in respect of such postponed payment. In this Condition 12(e), business day means a day on which banks are open for business in the relevant place of presentation, in such jurisdictions as shall be specified on such Note as Additional Financial Centres and: (i) in the case of a payment in a currency other than euro where payment is to be made by transfer to an account maintained with a bank in the relevant Specified Currency 176

on which dealings may be carried on in the Relevant Financial Centre of such Specified Currency; or (ii) in the case of payment in euro, a day which is a TARGET Business Day. If the due date for redemption or repayment of any Bearer Note is not a due date for payment of interest, interest accrued from the preceding due date for payment of interest or the Interest Commencement Date, as the case may be, shall only be payable against presentation (and surrender if appropriate) of the relevant Bearer Note. Interest accrued on a Bearer Note the interest basis for which is specified on such Note as Zero Coupon from its Maturity Date shall be payable on repayment of such Bearer Note against presentation thereof. (f) Delay in Payment: Noteholders will not be entitled to any interest or other payment for any delay after the due date in receiving the amount due on a Note if the due date is not a Payment Business Day, if the Noteholder is late in surrendering or cannot surrender its Certificated Note or Definitive Bearer Note or Coupon (if required to do so) or if a check mailed in accordance with this Condition 12 arrives after the due date for payment. (g) Payments Subject to Law, etc.: All payments are subject in all cases to any applicable laws, regulations and directives in the place of payment, but without prejudice to the provisions of Condition 14 (Taxation). No commission or expenses shall be charged to the Noteholders in respect of such payments. (h) Unmatured Coupons and Unexchanged Talons: (i) (ii) (iii) Bearer Notes which are Fixed Rate Notes should be surrendered for payment of principal together with all unmatured Coupons (if any) appertaining thereto, failing which an amount equal to the face value of each missing unmatured Coupon (or, in the case of payment not being made in full, that proportion of the amount of such missing unmatured Coupon which the sum of principal so paid bears to the total principal due) will be deducted from the Redemption Amount due for payment on such Note. Any amount so deducted will be paid in the manner mentioned above against surrender of such missing Coupon within a period of 10 years from the Relevant Date for the payment of such principal (whether or not such Coupon has become void pursuant to Condition 16 (Prescription)). If the date for payment of principal is any date other than a date for payment of interest, the accrued interest on such principal shall be paid only upon presentation of the relevant Note. If so specified on a Bearer Note, upon the due date for redemption of any Bearer Note which is a Floating Rate Note at any time, unmatured Coupons relating to such Note (whether or not attached) shall become void and no payment shall be made in respect of such Coupons. Upon the due date for redemption of any Bearer Note, any unexchanged Talon relating to such Note (whether or not attached) shall become void and no Coupon shall be delivered in respect of such Talon. Where any Bearer Note which is a Floating Rate Note at any time, is presented for redemption without all unmatured Coupons relating to it, and where any Bearer Note is presented for redemption without any unexchanged Talon relating to it, redemption of such Bearer Note shall be made only against the provisions of such indemnity by the Noteholder as the Issuer may require. 13. Indemnification of the Agents 177

The Agency Agreement contains provisions for the indemnification of the Agents. Each Agent and its parent, subsidiaries and affiliates is entitled to enter into business transactions with the Issuer and any entity related to the Issuer without accounting for any profit 14. Taxation (a) Gross up: All payments of principal and interest in respect of the Notes and Coupons by or on behalf of the Issuer shall be made free and clear of, and without withholding or deduction for, any taxes, duties, assessments or governmental charges of whatsoever nature imposed, levied, collected, withheld or assessed by or within Brazil or any political subdivision thereof or taxing authority therein, unless such withholding or deduction is required by law. In that event, the Issuer shall pay such additional amounts as will result in the receipt by the relevant holders of such amounts as would have been received by them if no such withholding or deduction had been required, except that no such additional amounts shall be payable with respect to any Note or Coupon: (i) (ii) (iii) (iv) (v) (vi) (vii) to a holder or to a third party or on behalf of a holder who is liable to such taxes, duties, assessments or governmental charges in respect of such Note or Coupon by reason of its having some connection with Brazil, other than the mere holding of the Note or Coupon; or where such withholding or deduction is imposed on a payment to an individual and is required to be made pursuant to European Council Directive 2003/48/EC or any other European Union Directive on the taxation of savings income or any law implementing or complying with, or introduced in order to conform to, such Directive; or in respect of which the Note or Coupon is presented for payment more than 30 days after the Relevant Date except to the extent that the holder of such Note or Coupon would have been entitled to such additional amounts on presenting it for payment on the last day of such period of 30 days; or where such withholding or deduction is in respect of any taxes that are imposed or withheld by reason of the failure of the holder or beneficial owner of Notes or Coupons, following the Issuer s written request addressed to the holder or beneficial owner or otherwise provided to the holder or beneficial owner (and made at a time which would enable the holder or beneficial owner acting reasonably to comply with that request), to provide certification, information, documents, or other evidence concerning the nationality, residence or identity of the holder or such beneficial owner, whether required or imposed by statute, treaty, regulation or administrative practice of Brazil, as a precondition to exemption from, or reduction in the rate of withholding or deduction of, taxes imposed by Brazil; or where such withholding or deduction is in respect of any estate, inheritance, gift, sales, excise, transfer, personal property or similar taxes; or where such withholding or deduction is in respect of any taxes which are payable otherwise than by withholding or deduction from payments made under or with respect to the Notes or Coupons; or where such withholding or deduction is in respect of any taxes imposed on or with respect to any payment by the Issuer to the holder if such holder is a fiduciary or partnership of any person other than the sole beneficial owner of such payment to the 178

extent that taxes would not have been imposed on such payment had such holder been the sole beneficial owner of such Note or Coupon; or (viii) (ix) by or on behalf of a holder who would have been able to avoid such withholding or deduction by presenting the relevant Note or Coupon to another Paying Agent in a member state of the European Union; or where such withholding or deduction is in respect of any combination of items (i) through (viii). (b) Taxing Jurisdiction: If the Issuer becomes subject at any time to any taxing jurisdiction other than Brazil, the references in Conditions 11 and 14 to Brazil shall be deemed to be to Brazil and such other jurisdiction. (c) Additional Amounts: Any reference in these Conditions to principal and/or interest in respect of the Notes or Coupons shall be deemed also to refer to any additional amounts which may be payable under this Condition 14. Unless the context otherwise requires, any reference in these Conditions to principal shall include any premium payable in respect of a Note, any Redemption Amount and any other amounts in the nature of principal payable pursuant to these Conditions and interest shall include all amounts payable pursuant to Condition 8, Condition 9 or Condition 10 and any other amounts in the nature of interest payable pursuant to these Conditions. 15. Events of Default If any of the following events ( Events of Default ) occurs: (a) Non-payment: the Issuer fails to pay any principal or interest on the Notes or Coupons of the relevant Series on the date when due and such failure with respect to interest continues for a period of five days; or (b) Breach of Other Obligations: the Issuer fails duly to perform or observe in any material respect any other obligations under or in respect of the Notes and such failure continues for a period of 30 days after written notice thereof, addressed to the Issuer by the required Noteholders, has been delivered to the Issuer or to the Specified Office of the Fiscal Agent; or (c) Misrepresentation: any material representation or warranty of the Issuer in the Dealer Agreement or any other document delivered in connection with the Agency Agreement or the issuance of the Notes proves to have been incorrect, incomplete or misleading in any material respect at the time it was made and such default is not cured within 30 days of the date of the issuance of the Notes; or (d) Authorizations: any governmental authorization necessary for the performance of any obligation of the Issuer under the Agency Agreement or the Notes fails to enter into full force and effect or remain valid and subsisting; or (e) Cross-default of Issuer or Subsidiary: (i) (ii) any Indebtedness of the Issuer, or any of its Subsidiaries, is not paid when due or (as the case may be) within any originally applicable grace period; or any such Indebtedness becomes (or becomes capable of being declared) due and payable prior to its stated maturity otherwise than at the option of the Issuer, or the relevant Subsidiary or (provided that no event of default, howsoever described, has occurred) any Person entitled to such Indebtedness; or 179

(iii) the Issuer, or any of its Subsidiaries, fails to pay when due any amount payable by it under any Guarantee of any Indebtedness; provided that the amount of Indebtedness referred to in sub-paragraph (i) and/or sub-paragraph (ii) above and/or the amount payable under any Guarantee referred to in sub-paragraph (iii) above individually or in the aggregate exceeds U.S.$10,000,000 (or its equivalent in any other currency or currencies); or (f) Unsatisfied Judgment: one or more judgment(s) or order(s) from which no further appeal or judicial review is permissible under applicable law for the payment of an aggregate amount in excess of U.S.$5,000,000 (or its equivalent in any other currency or currencies) is rendered against the Issuer and continues unsatisfied and unstayed for a period of 45 days after the date(s) thereof or, if later, the date therein specified for payment; or (g) Security Enforced: a secured party takes possession, or a receiver, manager or other similar officer is appointed, of the whole or a substantial part of the undertaking, assets and revenues of the Issuer or any Subsidiary and is not discharged within 30 days thereof; or (h) Insolvency, etc.: (i) the Issuer or any of its Subsidiaries becomes insolvent or is unable to pay its debts as they fall due, (ii) an administrator or liquidator of the Issuer or any of its Subsidiaries or the whole or a substantial part of the undertaking, assets and revenues of the Issuer, or any of its Subsidiaries is appointed (or application for any such appointment is made), (iii) the Issuer or any of its Subsidiaries takes any action for a readjustment or deferment of any of its obligations or makes a general assignment or an arrangement or composition with or for the benefit of its creditors or declares a moratorium in respect of any of its Indebtedness or (iv) the Issuer or any of its Subsidiaries ceases or threatens to cease to carry on all or any substantial part of its business (otherwise than, in the case of a Subsidiary, for the purposes of or pursuant to an amalgamation, reorganization or restructuring whilst solvent); or (i) Winding up, etc.: an order is made or an effective resolution is passed for the winding up, liquidation or dissolution of the Issuer or any of its Subsidiaries (otherwise than, in the case of a Subsidiary of the Issuer, for the purposes of or pursuant to an amalgamation, reorganization or restructuring whilst solvent); or (j) Analogous Event: any event occurs which under the laws of Brazil has an analogous effect to any of the events referred to in paragraphs (f) to (i) above; or (k) Failure to Take Action, etc.: any action, condition or thing at any time required to be taken, fulfilled or done in order (i) to enable the Issuer lawfully to enter into, exercise its rights and perform and comply with its obligations under and in respect of the Notes, (ii) to ensure that those obligations are legal, valid, binding and enforceable and (iii) to make the Notes admissible in evidence in the courts of Brazil is not taken, fulfilled or done; or (l) Unlawfulness: it is or will become unlawful for the Issuer to perform or comply with any of its obligations under or in respect of the Notes; or (m) Government Intervention: (A) all or any substantial part of the undertaking, assets and revenues of the Issuer or any of its Subsidiaries is condemned, seized or otherwise appropriated by any Person acting under the authority of any national, regional or local government or (B) the Issuer, or any of its Subsidiaries is prevented by any such Person from exercising normal control over all or any substantial part of its undertaking, assets and revenues; then, at least 66⅔% of the Noteholders of the Notes of any Series then outstanding may, by written notice addressed by the holder thereof to the Issuer and delivered to the Issuer or to the Specified Office of the Fiscal Agent, be declared immediately due and payable, whereupon Notes of that Series shall, upon receipt of such 180

written notice by the Issuer or the Fiscal Agent, become immediately due and payable at its Early Termination Amount together with accrued interest (if any) without further action or formality. 16. Prescription Claims for principal or interest in respect of the Notes and Coupons (which for this purpose shall include the Talons) shall become void unless the relevant Notes or Coupons are presented for payment within ten years and five years, respectively, of the appropriate Relevant Date. 17. Replacement of Notes If any Definitive Bearer Note, Coupon, Talon or Certificated Note is lost, stolen, mutilated, defaced or destroyed, it may be replaced at the Specified Office of the Fiscal Agent (in the case of Definitive Bearer Notes, Coupons or Talons) or Registrar (in the case of Certificated Notes) (and, if the Notes are then admitted to listing, trading and/or quotation by any listing authority, stock exchange and/or quotation system which requires the appointment of a Paying Agent or Transfer Agent in any particular place, the Paying Agent or Transfer Agent having its Specified Office in the place required by such listing authority or stock exchange), subject to all applicable laws and listing authority or stock exchange requirements, upon payment by the claimant of the expenses incurred in connection with such replacement and on such terms as to evidence, security, indemnity and otherwise as the Issuer may reasonably require. Mutilated or defaced certificates must be surrendered before replacements will be issued. 18. Agents In acting under the Agency Agreement and in connection with the Notes, the Fiscal Agent, the Registrar, the Principal Paying Agent, the Calculation Agent, the Paying Agents and the Transfer Agents act solely as agents of the Issuer and do not assume any obligations towards or relationship of agency or trust for or with any of the Noteholders or holders of Coupons. The initial Fiscal Agent, Registrar, Principal Paying Agent, Paying Agents and Transfer Agents and their initial Specified Offices are listed below. The initial Calculation Agent (if any) will be specified in the relevant Final Terms. The Issuer reserves the right at any time to vary or terminate the appointment of the Fiscal Agent, Registrar, Principal Paying Agent or any Paying Agent or Transfer Agent upon the terms set out in the Agency Agreement and to appoint additional or other paying agents and transfer agents; provided, however, that: (a) (b) (c) (d) Fiscal Agent: the Issuer shall at all times maintain a Fiscal Agent; Registrar: the Issuer shall at all times maintain a Registrar; Principal Paying Agent: the Issuer shall at all times maintain a Principal Paying Agent; Transfer Agents: the Issuer shall at all times maintain a Transfer Agent; (e) Paying Agent: the Issuer shall maintain at all times a Paying Agent with a Specified Office in a European Union member state that will not be obliged to withhold or deduct tax pursuant to European Council Directive 2003/48/EC or any other European Union Directive implementing the conclusions of the ECOFIN Council meeting of November 26 and 27, 2000 on the taxation of savings income or any law implementing or complying with, or introduced in order to conform to, such Directive; (f) Calculation Agent: if a Calculation Agent is specified in the relevant Final Terms, the Issuer shall maintain a Calculation Agent for so long as the Series of Notes relating to such Final Terms remain outstanding; and 181

(g) Required Agent: if and for so long as any Notes are admitted to listing, trading and/or quotation by any listing authority, stock exchange and/or quotation system, which requires the appointment of a Transfer Agent or Paying Agent in any particular place, the Issuer shall maintain a Transfer Agent or Paying Agent with a Specified Office in the place required by such listing authority, stock exchange and/or quotation system. The Issuer shall notify the Noteholders and, in the case any Tranche of Notes is listed on the Irish Stock Exchange (Global Exchange Market), the Irish Stock Exchange (and, if required, any other stock exchange on which the Notes are admitted to trading or any listing authority that has admitted the Notes to listing) of any such change or any change in any Specified Office. 19. Meetings of Noteholders; Modification and Waiver (a) Meetings of Noteholders: The Agency Agreement contains provisions for convening meetings of Noteholders to consider matters relating to the Notes, including the modification of any provision of these Conditions if sanctioned by an Extraordinary Resolution. Such a meeting may be convened by the Issuer and shall be convened upon the request in writing of Noteholders holding not less than one-tenth of the aggregate nominal amount of the outstanding Notes. The quorum at any meeting convened to vote on an Extraordinary Resolution will be two or more Persons holding or representing one more than half of the aggregate nominal amount of the outstanding Notes or, at any adjourned meeting, two or more Persons being or representing Noteholders, whatever the nominal amount of the Notes held or represented; provided, however, that Reserved Matters may only be sanctioned by an Extraordinary Resolution passed at a meeting of Noteholders at which two or more Persons holding or representing not less than three quarters or, at any adjourned meeting, one quarter of the aggregate nominal amount of the outstanding Notes form a quorum. Any Extraordinary Resolution duly passed at any such meeting shall be binding on all the Noteholders, whether present or not. In addition, a resolution in writing signed by or on behalf of all Noteholders who for the time being are entitled to receive notice of a meeting of Noteholders will take effect as if it were an Extraordinary Resolution. Such a resolution in writing may be contained in one document or several documents in the same form, each signed by or on behalf of one or more Noteholders. (b) Modification: The Notes and these Conditions may be amended without the consent of the Noteholders to correct a manifest error. In addition, the parties to the Agency Agreement may agree to modify any provision thereof, but the Issuer shall not, without the consent of the Noteholders, agree to any such modification unless it is of a formal, minor or technical nature, it is made to correct a manifest error or it could not reasonably be expected to be prejudicial to the interests of the Noteholders. 20. Further Issues The Issuer may from time to time, without the consent of the Noteholders or holders of Coupons or Talons, create and issue further Notes having the same terms and conditions as the Notes in all respects (or in all respects except for the first payment of interest) so as to form a single Series with the Notes. 21. Notices While the Notes are represented by a Global Note and such Global Note is deposited with a depositary or a common depositary for Euroclear and/or Clearstream, Luxembourg and/or DTC and/or any other relevant clearing system, notices to Noteholders may be given by delivery of the relevant notice to Euroclear, Clearstream, Luxembourg, DTC and/or such other relevant clearing system for communication by them to the persons shown in their records as having interests in the Global Notes. In the case of Certificated Notes or Definitive Bearer Notes, notice shall be valid if published in a leading English-language daily newspaper published in London (which is expected to be the Financial Times). If any such publication is not practicable, 182

notice shall be valid if published in a leading English-language daily newspaper having general circulation in Europe. Any notice published in a newspaper as described above shall be deemed to have been given on the date of first publication (or if required to be published in more than one newspaper, on the first date on which publication shall have been made in all the required newspapers). Holders of Coupons and Talons shall be deemed for all purposes to have notice of the contents of any notice to the holders of Definitive Bearer Notes in accordance with this Condition 21. 22. Currency Indemnity If any sum due from the Issuer in respect of the Notes or Coupons or any order or judgment given or made in relation thereto has to be converted from the currency (the first currency ) in which the same is payable under these Conditions or such order or judgment into another currency (the second currency ) for the purpose of (a) making or filing a claim or proof against the Issuer, (b) obtaining an order or judgment in any court or other tribunal or (c) enforcing any order or judgment given or made in relation to the Notes, the Issuer shall indemnify each Noteholder or holder of Coupons, on the written demand of such holder addressed to the Issuer and delivered to the Issuer or to the Specified Office of the Fiscal Agent, against any loss suffered as a result of any discrepancy between (i) the rate of exchange used for such purpose to convert the sum in question from the first currency into the second currency and (ii) the rate or rates of exchange at which such holder may in the ordinary course of business purchase the first currency with the second currency upon receipt of a sum paid to it in satisfaction, in whole or in part, of any such order, judgment, claim or proof. This indemnity constitutes a separate and independent obligation of the Issuer and shall give rise to a separate and independent cause of action. 23. Rounding For the purposes of any calculations referred to in these Conditions (unless otherwise specified in these Conditions or the relevant Final Terms), (a) all percentages resulting from such calculations will be rounded, if necessary, to the nearest one hundred-thousandth of a percentage point (with 0.000005% being rounded up to 0.00001%), (b) all U.S. dollar amounts used in or resulting from such calculations will be rounded to the nearest cent (with one-half cent being rounded up), (c) all Japanese Yen amounts used in or resulting from such calculations will be rounded downwards to the next lower whole Japanese Yen amount, and (d) all amounts denominated in any other currency used in or resulting from such calculations will be rounded to the nearest two decimal places in such currency, with 0.005 being rounded upwards. 24. Redenomination, Renominalization and Reconventioning (a) Application: This Condition 24 is applicable to the Notes only if it is specified in the relevant Final Terms as being applicable. (b) Notice of Redenomination: If the country of the Specified Currency becomes, or announces its intention to become, a Participating Member State, the Issuer may, without the consent of the Noteholders, on giving at least 30 days prior notice to the Noteholders and the Fiscal Agent, the Registrar, the Calculation Agent, the Paying Agents and the Transfer Agents, (the Euro Exchange Notice ) designate a date (the Redenomination Date ), being an Interest Payment Date under the Notes falling on or after the date on which such country becomes a Participating Member State. (c) Redenomination: Notwithstanding the other provisions of these Conditions, with effect from the Redenomination Date: (i) the Notes shall be deemed to be redenominated into euro in the denomination of euro 0.01 with a principal amount for each Note equal to the principal amount of that Note in the Specified Currency, converted into euro at the rate for conversion of such 183

currency into euro established by the Council of the European Union pursuant to the Treaty (including compliance with rules relating to rounding in accordance with European Community regulations); provided, however, that, if the Issuer determines, with the agreement of the Fiscal Agent, that market practice in respect of the redenomination into euro 0.01 of internationally offered securities is different from that specified above, such provisions shall be deemed to be amended so as to comply with such market practice and the Issuer shall promptly notify the Noteholders, each stock exchange (if any) on which the Notes are then listed the Fiscal Agent, the Registrar, the Calculation Agent, the Paying Agents and the Transfer Agents of such deemed amendments; and (ii) if Notes have been issued in definitive form: (1) the payment obligations in respect of Certificated Notes or Definitive Bearer Notes denominated in the Specified Currency will become void on the date on which the Issuer gives the Euro Exchange Notice but all other obligations of the Issuer thereunder (including the obligation to exchange such Certificated Notes or Definitive Bearer Notes in accordance with this Condition 24) shall remain in full force and effect; and (2) new Certificated Notes denominated in euro will be issued in exchange for Certificated Notes denominated in the Specified Currency in such manner as the Fiscal Agent may specify and as shall be notified to the Noteholders in the Euro Exchange Notice; and (iii) all payments in respect of the Notes (other than, unless the Redenomination Date is on or after such date as the Specified Currency ceases to be a sub-division of the euro, payments of interest in respect of periods commencing before the Redenomination Date) will be made solely in euro by check drawn on, or by credit or transfer to a euro account (or any other account to which euro may be credited or transferred) maintained by the payee with, a bank in the principal financial center of any Member State of the European Communities. (d) Interest: Following redenomination of the Notes pursuant to this Condition 24, where Notes have been issued in definitive form, the amount of interest due in respect of the Notes will be calculated by reference to the aggregate principal amount of the Notes held by the relevant holder. (e) Interest Determination Date: If the Floating Rate Note Provisions are specified in the relevant Final Terms as being applicable and Screen Rate Determination is specified in the relevant Final Terms as the manner in which the Rate(s) of Interest is/are to be determined, with effect from the Redenomination Date the Interest Determination Date shall be deemed to be the second TARGET Settlement Day before the first day of the relevant Interest Period. 25. Foreign Currency Constraint If Foreign Currency Constraint provisions are specified in the relevant Final Terms as applicable, then notwithstanding the provisions of Condition 12 (Payments), the following provisions will apply to the Notes: (a) If a Foreign Currency Constraint Event (as defined below) shall have occurred, the Issuer shall give to the Fiscal Agent within two São Paulo Business Days (as defined below) after such event, a certificate signed by two authorized signatories certifying the existence of the Foreign Currency Constraint Event. The Issuer shall, as soon as practicable thereafter, give notice of such certification and its contents in accordance with Condition 21 and shall promptly appoint a Paying Agent with a Specified Office in the city of 184

São Paulo, Brazil (the São Paulo Paying Agent ). In this event, any Noteholder may, for a period of 30 days after the date of publication of such notice (the Election Period ), elect to exchange ( Exchange ) the Note (the Original Note ) and the related unmatured Coupons (if any) and unexchanged Talons (if any) for an equivalent nominal amount in the Specified Currency of Exchanged Notes (as defined below) ) and the related unmatured Coupons (if any) and unexchanged Talons (if any). To make such election, the Noteholder must deposit the Certificated Note or Definitive Bearer Note (if any) representing the Original Note (together with all related unmatured Coupons (if any) and unexchanged Talons (if any)) with any Transfer Agent or, in the case of Bearer Notes, any Paying Agent, together with a duly completed notice of election ( Election Notice ) in the form obtainable from any Transfer Agent or Paying Agent within the Election Period. No such election made may be withdrawn without the prior consent of the Issuer. All duly completed and valid Election Notices received by the Transfer Agents and Paying Agents within the Election Period shall, on receipt, be deemed to have been received on the first day of the Election Period. In these Conditions, unless the context otherwise requires, the following defined terms shall have the meanings set out below: Exchanged Note means a Note with terms and conditions identical to the terms and conditions of the Original Note for which it was exchanged, save that: (i) (ii) all payments due in respect of such Exchanged Note shall be made by the Issuer, to the extent permitted by Brazilian law, in the lawful currency of Brazil when due (a Due Date ) or, where a Due Date occurs before the date of Exchange (the Exchange Date ), as soon as practicable after the Exchange Date and without any additional amount in compensation for late payment against presentation (and, if applicable, surrender) of such Exchanged Note or related Coupon in the case of Bearer Notes at the Specified Office of the São Paulo Paying Agent and otherwise in accordance with Condition 12 (subject to paragraph (iii) below)and in the case of Registered Notes payment of principal and interest will be made to the person shown on the Register in respect of the Exchanged Notes at the close of business on the date of issue of such Exchanged Notes and in the case of payments of principal, against surrender of the relevant Certificated Note representing the Exchanged Notes at the Specified Office of the São Paulo Paying Agent and otherwise in accordance with Condition 12 (subject to paragraph (iii) below); the amount of any payment due in respect of such Exchanged Note shall be that amount in the lawful currency of Brazil, as determined by the São Paulo Paying Agent, having regard to the provision of this Condition 25, which would be required to purchase the amount of such payment in the Specified Currency at the rate of exchange on the São Paulo Business Day immediately prior to the Due Date (or, where the Due Date precedes the Exchange Date, on the São Paulo Business Day immediately prior to the date of payment) (A) if the Specified Currency is U.S. dollars, by the rate for buying U.S. dollars with the lawful currency of Brazil at the floating exchange rate reported by the Central Bank of Brazil on the SISBACEN Data System under PTAX 800 Option 5 Compra or (B) if the Specified Currency is a currency other than U.S. dollars, at the corresponding rate for the applicable Specified Currency (the Corresponding Rate ), the source of which Corresponding Rate will be specified in the applicable Final Terms. If no such rate of exchange is available, the applicable rate of exchange shall be an average of the Brazilian currency exchange rates on such São Paulo Business Day for the purchase of the Specified Currency notified to the São Paulo Paying Agent by Citibank N.A., São Paulo Branch, Banco Bradesco S.A. and Banco Itaú S.A., São Paulo. If one or more of these financial institutions does not provide such rate, the applicable exchange rate shall be the average of the rates supplied by the remaining financial institutions or, if 185

no such financial institution supplies such rate, such rate as is determined by the São Paulo Paying Agent in good faith; and (iii) all payments in respect of the Exchanged Note shall be made by transfer to a Brazilian currency account maintained by the payee with a branch in São Paulo, Brazil. Foreign Currency Constraint Event means any law, regulation, directive or communication imposed or issued by the Brazilian government or the Central Bank of Brazil or any other competent authority in Brazil imposing foreign exchange controls or other restrictions or any refusal to act or delay in acting by any such party, which has the effect of prohibiting, preventing or delaying the remittance of the Specified Currency (whether in respect of principal, interest, additional amounts payable pursuant to these Conditions or otherwise) to or by the Principal Paying Agent in respect of the Original Notes when due. São Paulo Business Day means a day, other than a Saturday or Sunday, on which commercial banks and foreign exchange markets are open for business in the city of São Paulo, Brazil. (b) On termination of the Foreign Currency Constraint Event, Exchanged Notes shall be exchanged for an equivalent amount of Original Notes provided that, prior to such exchange, all payments due in respect of the Original Notes and such Exchanged Notes shall have been made by the Issuer. Such exchange shall be effected by the holders of Exchanged Notes surrendering the Certificated Notes or Definitive Bearer Notes (if any) representing the Exchanged Notes (together with all related unmatured Coupons (if any) and unexchanged Talons (if any)) with any Transfer Agent or, in the case of Bearer Notes, any Paying Agent and, in the case of Registered Notes, the Registrar making the relevant entries in the Register relating to the Original Notes and the Exchanged Notes. (c) During the period in which a Foreign Currency Constraint Event is in effect, the Issuer shall take such steps as are legal under the laws and regulations of Brazil to make payments in respect of Original Notes not exchanged for Exchanged Notes (if any) in the Specified Currency from Brazil as promptly as such laws and regulations permit. (d) Notwithstanding anything in this Condition 25 to the contrary, during the period in which a Foreign Currency Constraint Event is in effect, any payments of principal of (but not interest on) the Original Notes which are not paid by reason of the imposition of such Foreign Currency Constraint Event shall bear interest in the Specified Currency at the Rate of Interest until the Foreign Currency Constraint Event is eliminated or, if earlier, such sums are duly paid in full, provided that the Issuer complies at all times with its obligations set forth in this Condition 25. (e) It shall not be an Event of Default under these Conditions to the extent that any Event of Default described in Condition 15(a) shall have occurred with respect to the Issuer solely as a result of a Foreign Currency Constraint Event, provided that the Issuer shall have fully complied with its obligations under this Condition 25. The Issuer shall not be in breach of any payment obligation in the Specified Currency relating to the Notes or Coupons to the extent payment in the Specified Currency is not made by reason solely of such Foreign Currency Constraint Event; and no Noteholder or holder of Coupons shall be entitled to take action against the Issuer to enforce any rights against the Issuer which such Noteholder or holder of Coupons would, but for the provisions of this Condition 25 have had in respect of such payment. 26. Governing Law and Jurisdiction (a) Governing Law: The Agency Agreement, the Notes, the Coupons and the Talons and all matters arising from or connected with the Notes are governed by, and shall be construed in accordance with, English law. 186

(b) English Courts: The courts of England have non-exclusive jurisdiction to settle any dispute (a Dispute ) arising from or in connection with the Agency Agreement, the Notes, the Coupons and the Talons and accordingly any legal action or proceedings arising out of or in connection therewith ( Proceedings ) may be brought in such courts. (c) Appropriate Forum: The Issuer agrees that the courts of England are the most appropriate and convenient courts to settle any Dispute and, accordingly, that it will not argue to the contrary. (d) Rights of Holders to Take Proceedings Outside England: Condition 25(b) (English courts) is for the benefit of the Noteholders and holders of Coupons and Talons only. As a result, nothing in this Condition 25 prevents any such holder from taking Proceedings in any other courts with jurisdiction. To the extent allowed by law, Noteholders and holders of Coupons and Talons may take concurrent Proceedings in any number of jurisdictions. (e) Process Agent: The Issuer agrees that the documents which start any Proceedings and any other documents required to be served in relation to those Proceedings may be served on it by being delivered to Hackwood Secretaries Limited at One Silk Street, London EC2Y 8HQ or, if different, its registered office for the time being. If such person is not or ceases to be effectively appointed to accept service of process on behalf of the Issuer, the Issuer shall, on the written demand of any Noteholder or holder of Coupons or Talons addressed and delivered to the Issuer or to the Specified Office of the Fiscal Agent appoint a further person in England to accept service of process on its behalf and, failing such appointment within 15 days, any Noteholder or holder of Coupons or Talons shall be entitled to appoint such a person by written notice addressed to the Issuer and delivered to the Issuer or to the Specified Office of the Fiscal Agent. Nothing in this paragraph shall affect the right of any Noteholder or holder of Coupons or Talons to serve process in any other manner permitted by law. This Condition applies to Proceedings in England and to Proceedings elsewhere. (f) Consent to Enforcement, etc.: The Issuer consents generally in respect of any Proceeding to the giving of any relief or the issue of any process in connection with such Proceeding including (without limitation) the making, enforcement or execution against any property whatsoever (irrespective of its use or intended use) of any order or judgment which is made or given in such Proceeding. (g) Contracts (Rights of Third Parties) Act 1999: No person shall have any right to enforce any term or condition of the Notes, the Coupons or the Talons under the Contracts (Rights of Third Parties) Act 1999. 187

CLEARING AND SETTLEMENT Book-Entry Ownership Bearer Notes The Issuer will make applications to Clearstream, Luxembourg and Euroclear for acceptance in their respective book-entry systems in respect of any series of bearer Notes to be represented by a temporary global Note and/or a permanent global Note in bearer form without coupons. Each temporary global Note or permanent global Note will have an ISIN and a Common Code. Transfers of interests in a temporary global Note or a permanent global Note and payments in respect of these Notes will be made in accordance with the normal Euromarket debt securities operating procedures of Clearstream, Luxembourg and Euroclear. Registered Notes The Issuer will make applications to Clearstream, Luxembourg and Euroclear for acceptance in their respective book-entry systems in respect of any series of registered Notes to be represented by a Regulation S Unrestricted Global Note. Each Regulation S Unrestricted Global Note will have an ISIN and a Common Code. The Issuer and the dealer or dealers with respect to a tranche of Notes will make application to DTC for acceptance in its book-entry settlement system of the restricted Notes represented by each Rule 144A Restricted Global Note. Each Rule 144A Restricted Global Note will have a CUSIP number. Each Rule 144A Restricted Global Note will be subject to restrictions on transfer contained in a legend appearing on the front of such Note, as set out under Notice to Investors. The custodian with whom the Rule 144A Restricted Global Notes are deposited (the Custodian ) and DTC will electronically record the nominal amount of the restricted Notes held within the DTC system. Investors in Notes of such series may hold their interests in a Regulation S Unrestricted Global Note only through Clearstream, Luxembourg or Euroclear. Investors may hold their interests in a Rule 144A Restricted Global Note directly through DTC if they are participants in the DTC system, or indirectly through organizations which are participants in such system. Payments of the principal of, and interest on, each Rule 144A Restricted Global Note registered in the name of DTC s nominee will be to or to the order of its nominee as the registered owner of such Rule 144A Restricted Global Note. The Issuer expects that the nominee, upon receipt of any such payment, will immediately credit DTC participants accounts with payments in amounts proportionate to their respective beneficial interests in the nominal amount of the relevant Rule 144A Restricted Global Note as shown on the records of DTC or the nominee. The Issuer also expects that payments by DTC participants to owners of beneficial interests in such Rule 144A Restricted Global Note held through such DTC participants will be governed by standing instructions and customary practices, as is now the case with securities held for the accounts of customers registered in the names of nominees for such customers. Such payments will be the responsibility of such DTC participants. None of the Issuer, the Fiscal Agent or any agent will have any responsibility or liability for any aspect of the records relating to or payments made on account of ownership interests in the Rule 144A Restricted Global Notes or for maintaining, supervising or reviewing any records relating to such ownership interests. All registered Notes will initially be in the form of a Regulation S Unrestricted Global Note and/or a Rule 144A Restricted Global Note, Certificated Notes will only be available, in the case of unrestricted Notes, in amounts specified in the applicable Final Terms, and, in the case of restricted Notes, in amounts of U.S.$250,000 (or its equivalent rounded upwards as agreed between the Issuer and the relevant dealer(s)), or higher integral multiples of U.S.$1,000, in certain limited circumstances described below. 188

Certificated Notes Registration of title to registered Notes in a name other than a depositary or its nominee for Clearstream, Luxembourg and Euroclear or for DTC will not be permitted unless (i) in the case of restricted Notes, DTC notifies the Issuer that it is no longer willing or able to discharge properly its responsibilities as depositary with respect to the Rule 144A Restricted Global Notes, or ceases to be a clearing agency registered under the U.S. Securities Exchange Act of 1934, as amended (the Exchange Act ) or is at any time no longer eligible to act as such and the Issuer is unable to locate a qualified successor within 90 days of receiving notice of such ineligibility on the part of DTC, (ii) in the case of unrestricted Notes, Clearstream, Luxembourg or Euroclear is closed for business for a continuous period of 14 days (other than by reason of holidays, statutory or otherwise) or announces an intention permanently to cease business or does, in fact do so, or (iii) in the case of restricted Notes or restricted Notes, principal in respect of any Notes is not paid when due or the Issuer has become obliged to put certain additional amounts in each case as described in the term and conditions of the Notes. In such circumstances, the Issuer will cause sufficient individual certificated Notes to be executed and delivered to the Registrar for completion, authentication and dispatch to the relevant holders of Notes. A person having an interest in a global note must provide the Registrar with: (i) (ii) a written order containing instructions and such other information as the Issuer and the Registrar may require to complete, execute and deliver such individual certificated Notes; and in the case of a Rule 144A Restricted Global Note only, a fully completed, signed certification substantially to the effect that the exchanging holder is not transferring its interest at the time of such exchange, or in the case of a simultaneous resale pursuant to Rule 144A, a certification that the transfer is being made in compliance with the provisions of Rule 144A. Individual certificated Notes issued pursuant to this paragraph (ii) shall bear the legends applicable to transfers pursuant to Rule 144A. Transfers of Registered Notes Transfers of interests in global Notes within DTC, Clearstream, Luxembourg and Euroclear will be in accordance with the usual rules and operating procedures of the relevant clearing system. The laws of some states in the United States require that certain persons take physical delivery in definitive form of securities. Consequently, the ability to transfer interests in a Rule 144A Restricted Global Note to such persons may be limited. Because DTC can only act on behalf of participants, who in turn act on behalf of indirect participants, the ability of a person having an interest in a Rule 144A Restricted Global Note to pledge such interest to persons or entities that do not participate in DTC, or otherwise take actions in respect of such interest, may be affected by the lack of a physical certificate in respect of such interest. Beneficial interests in a Regulation S Unrestricted Global Note may be held only through Clearstream, Luxembourg or Euroclear. Transfers may be made at any time by a holder of an interest in a Regulation S Unrestricted Global Note to a transferee who wishes to take delivery of such interest through the Rule 144A Restricted Global Note for the same series of Notes provided that any such transfer made on or prior to the expiration of the distribution compliance period (as defined in Notice to Investors ) relating to the Notes represented by such Regulation S Unrestricted Global Note will only be made upon receipt by the Registrar or any Transfer Agent of a written certificate from the transferor of such interest to the effect that such transfer is being made to a person whom the transferor reasonably believes is a qualified institutional buyer within the meaning of Rule 144A in a transaction meeting the requirements of Rule 144A and in accordance with any applicable securities law of any state of the United States or any other jurisdiction. Any such transfer made thereafter of the Notes represented by such Regulation S Unrestricted Global Note will only be made upon request through Clearstream, Luxembourg or Euroclear by the holder of an interest in the Regulation S Unrestricted Global Note to the Fiscal Agent and receipt by the Fiscal Agent of details of that account at DTC to be credited with the relevant interest in the Rule 144A Restricted Global Note. Transfers at any time by a holder of any interest in the Rule 144A Restricted Global Note to a transferee who takes delivery of such 189

interest through a Regulation S Unrestricted Global Note will only be made upon delivery to the Registrar or any Transfer Agent of a certificate setting forth compliance with the provisions of Regulation S and giving details of the account at Euroclear or Clearstream, Luxembourg, as the case may be, and DTC to be credited and debited, respectively, with an interest in the relevant global Notes. Subject to compliance with the transfer restrictions applicable to the Notes described above and under Notice to Investors, cross-market transfers between DTC, on the one hand, and directly or indirectly through Clearstream, Luxembourg or Euroclear accountholders, on the other, will be effected by the relevant clearing system in accordance with its rules and through action taken by the Custodian, the Registrar and the Fiscal Agent. On or after the issue date for any series, transfers of Notes of such series between accountholders in Clearstream, Luxembourg and Euroclear and transfers of Notes of such series between participants in DTC will generally have a settlement date three business days after the trade date (T+3). The customary arrangements for delivery versus payment will apply to such transfers. Cross-market transfers between accountholders in Clearstream, Luxembourg or Euroclear and DTC participants will need to have an agreed settlement date between the parties to such transfer. Because there is no direct link between DTC, on the one hand, and Clearstream, Luxembourg and Euroclear, on the other, transfers of interests in the relevant global Notes will be effected through the Fiscal Agent, the Custodian and the Registrar receiving instructions (and where appropriate certification) from the transferor and arranging for delivery of the interests being transferred to the credit of the designated account for the transferee. Transfers will be effected on the later of (i) three business days after the trade date for the disposal of the interest in the relevant global note resulting in such transfer and (ii) two business days after receipt by the Fiscal Agent or the Registrar, as the case may be, of the necessary certification or information to effect such transfer. In the case of cross-market transfers, settlement between Euroclear or Clearstream, Luxembourg accountholders and DTC participants cannot be made on a delivery versus payment basis. The securities will be delivered on a free delivery basis and arrangements for payment must be made separately. For a further description of restrictions on transfer of Registered Notes, see Notice to Investors. DTC has advised the Issuer that it will take any action permitted to be taken by a holder of Notes (including, without limitation, the presentation of Rule 144A Restricted Global Notes for exchange as described above) only at the direction of one or more participants in whose account with DTC interests in Rule 144A Restricted Global Notes are credited and only in respect of such portion of the aggregate nominal amount of the relevant Rule 144A Restricted Global Notes as to which such participant or participants has or have given such direction. However, in the circumstances described above, DTC will surrender the relevant Rule 144A Restricted Global Notes for exchange for individual certificated Notes (which will, in the case of restricted Notes, bear the legend applicable to transfers pursuant to Rule 144A). DTC has advised the Issuer as follows: DTC is a limited purpose trust company organized under the laws of the State of New York, a member of the U.S. Federal Reserve System, a clearing corporation within the meaning of the New York Uniform Commercial Code and a Clearing Agency registered pursuant to the provisions of Section 17A of the Exchange Act. DTC was created to hold securities for its participants and facilitate the clearance and settlement of securities transactions between participants through electronic bookentry changes in accounts of its participants, thereby eliminating the need for physical movement of certificates. Participants include securities brokers and dealers, banks, trust companies and clearing corporations and may include certain other organizations. Indirect access to DTC is available to others, such as banks, brokers, dealers and trust companies, that clear through or maintain a custodial relationship with a DTC participant, either directly or indirectly. Although DTC, Clearstream, Luxembourg and Euroclear have agreed to the foregoing procedures in order to facilitate transfers of beneficial interests in the global Notes among participants and accountholders of DTC, 190

Clearstream, Luxembourg and Euroclear, they are under no obligation to perform or continue to perform such procedures, and such procedures may be discontinued at any time. None of the Issuer, the Fiscal Agent or any agent will have any responsibility for the performance by DTC, Clearstream, Luxembourg or Euroclear or their respective direct or indirect participants or accountholders of their respective obligations under the rules and procedures governing their operations. While a Rule 144A Restricted Global Note is lodged with DTC or the Custodian, restricted Notes represented by individual certificated Notes will not be eligible for clearing or settlement through DTC, Clearstream, Luxembourg or Euroclear. If any series of Notes represented by one or more global Notes contains a foreign currency constraint provision, as more fully set out in the terms and conditions of the Notes and in the applicable Final Terms, upon the occurrence of a Foreign Currency Constraint Event (as defined in the terms and conditions of the Notes), notice of such event shall be given to the holders of Notes by the Registrar through DTC and/or Euroclear and/or Clearstream, Luxembourg. Exchanges of interests in the global note(s) representing the original Notes for interests in the global note(s) representing the Exchanged Notes (as defined in the terms and conditions of the Notes) will be made in accordance with the terms and conditions of the Notes. The Registrar will prepare one or more global Notes which will represent the Exchanged Notes and will obtain a new CINS and/or ISIN number for the Exchanged Notes. The global note(s) representing the original Notes and the global note(s) representing the Exchanged Notes will be marked down and up respectively upon exchange in accordance with the terms and conditions of the Notes. Interests in the Rule 144A Restricted Global Note representing the Exchanged Notes will be held in the account of the DTC Participant for the São Paulo Paying Agent on behalf of the holders of Notes. Interests in the Regulation S Unrestricted Global Note representing the Exchanged Notes will be held in the account of the Euroclear and/or Clearstream, Luxembourg accountholder for the São Paulo Paying Agent on behalf of the holders of Notes. Payments in respect of the Exchanged Notes will be made by the São Paulo Paying Agent outside DTC, Euroclear and Clearstream, Luxembourg in accordance with the terms and conditions of the Notes. Holders of Exchanged Notes may not transfer their interest in such Exchanged Notes except in connection with the termination of the Foreign Currency Constraint Event. On termination of the Foreign Currency Constraint Event, interests in the global note(s) representing the Exchanged Notes will be exchanged for interests in the global note(s) representing the original Notes and such interests in the global note(s) representing the original Notes will be transferred back to the original accounts in DTC, Euroclear and Clearstream, Luxembourg from which they were originally transferred, all in accordance with the terms and conditions of the Notes. The global note(s) representing the Exchanged Notes will be marked down to zero and the global note(s) representing the original Notes will be marked back up to the original aggregate nominal amount of the series. Pre-issue Trades Settlement It is expected that delivery of Notes will be made against payment therefore on the relevant issue date, which could be more than three business days following the date of pricing. Under Rule 15c6-1 of the U.S. Securities and Exchange Commission under the Exchange Act, trades in the United States secondary market generally are required to settle within three business days (T+3), unless the parties to any such trade expressly agree otherwise. Accordingly, purchasers who wish to trade Notes in the United States on the date of pricing or the next succeeding business days until the relevant issue date will be required, by virtue of the fact the Notes initially will settle beyond T+3, to specify an alternate settlement cycle at the time of any such trade to prevent a failed settlement. Settlement procedures in other countries will vary. Purchasers of Notes may be affected by such local settlement practices and purchasers of Notes who wish to trade Notes between the date of pricing and the relevant issue date should consult their own adviser. 191

TAXATION Brazilian Taxation The following summary is a general description of certain Brazilian tax aspects of the Notes and does not purport to be a comprehensive description of the tax aspects of the Notes. This summary is based upon tax laws of Brazil as in effect on the date of these Listing Particulars and is subject to any change in Brazilian law that may come into effect after such date. Prospective purchasers should consult their tax advisors as to the tax laws and specific tax consequences of acquiring, holding and disposing of the Notes. Individuals domiciled in Brazil and Brazilian companies are taxed in Brazil on the basis of their worldwide income, which includes earnings of Brazilian companies foreign subsidiaries, branches and affiliates. The earnings of branches of foreign companies domiciled in Brazil are generally taxed in Brazil in the same manner as Brazilian companies. Non-Brazilian residents in general are taxed in Brazil only when income is derived from Brazilian sources. Interest, fees, commissions (including any original issue discount and any redemption premium) and any other income payable by a Brazilian obligor to an individual, entity, trust or organization domiciled outside Brazil in respect of debt obligations derived from the issuance by a Brazilian issuer of international debt securities previously registered with the Central Bank, such as the Notes, are currently subject to income tax withheld at source. The rate of withholding tax with respect to such debt obligations is generally 15% as provided for in Section 10 of the Normative Act No. 252 of December 3, 2002 ( Normative Act No. 252/02 ). According to Normative Act 252/02, in the event that the beneficiary of such payments is domiciled in a tax haven jurisdiction (as defined by Brazilian tax laws from time to time), such payments of interest, fees, commissions (including any original issue discount and any redemption premium) and any other income are also subject to withholding in respect of Brazilian income tax at the general rate of 15%. However, pursuant to article 8 of Law No. 9779 of January 19, 1999, if the relevant average term of the Notes is of less than 96 months, the rate applicable to the beneficiary domiciled in a tax haven jurisdiction is 25% (article 691, IX of Decree No. 3,000 of March 26, 1999 and article 1, IX of Law No. 9,481 of August 13, 1997). Accordingly, there is a risk that the tax authorities may change the understanding above and apply the rate of 25% in the event that the beneficiary is domiciled in a tax haven jurisdiction. A lower income tax rate may be applicable by a tax treaty between Brazil and the other country where the recipient of the payment has its domicile. Notwithstanding this fact, it is possible that such income tax withheld at source may be tax creditable in the country where the recipient is domiciled, according to the applicable tax regulations of such country. Gains on the sale or disposal of the Notes made outside Brazil by a non-resident, other than a branch, subsidiary or an affiliated company of a Brazilian resident as defined under Brazilian tax law, to another non- Brazilian resident are not subject to Brazilian taxes. However, Article 26 of the Law No. 10,833/03, established that, as from February 1, 2004, capital gains realized on the disposal of Brazilian situs assets by non-residents, whether to other non-residents or Brazilian residents and whether made outside or within Brazil, are subject to Brazilian withholding income tax. Although the scope of Law No. 10,833/03 is yet unclear, we believe that the Notes shall not fall into such new provision. However, Brazilian tax authorities may understand otherwise; i.e., that the gains accrued abroad on the sale or disposal of such Notes should be taxable in Brazil. If the position mentioned above does not prevail, gains realized by a non-resident from the sale or other disposition of the Notes to a Brazilian resident could be subject to Brazilian withholding income tax at a rate of 15% or 25%, if the non-resident is domiciled in a tax haven jurisdiction (that is deemed to be a jurisdiction which does not impose any tax on income or which imposes such tax at a maximum effective rate lower than 20%, or where the laws impose restrictions on the disclosure of ownership composition or securities ownership or do not allow for the identification of the effective beneficiary of income attributed to non-residents pursuant 192

to Section 23 of Law No. 11,727 enacted on June 23, 2008 and 4º of Law No. 9,430 enacted on December 27, 1996). Additionally, Law No. 11,727 also changed the scope of new transactions that would be subject to Brazilian transfer pricing rules, with the creation of the concept of a privileged tax regime. Pursuant to Law No. 11,727, a jurisdiction will be considered a privileged tax regime if it (i) does not tax income or taxes it at a maximum rate lower than 20%; (ii) grants tax advantages to a non-resident entity or individual (a) without the need to carryout a substantial economic activity in the country or a said territory or (b) conditioned upon the nonexercise of a substantial economic activity in the country or a said territory; (iii) does not tax or taxes proceeds generated abroad at a maximum rate lower than 20% or (iv) restricts the ownership disclosure of assets and ownership rights or restricts disclosure about economic transactions carried out. Although the interpretation of the current Brazilian tax legislation could lead to the conclusion that the above mentioned concept of privileged tax regime should apply only for the purposes of Brazilian transfer pricing rules, it is unclear whether such concept would also apply to the acquisition of notes for purposes of this law. There is no judicial guidance as to the application of Law No. 11,727 and, accordingly, we are unable to predict whether the Brazilian Internal Revenue Service or the Brazilian courts may decide that the privileged tax regime concept shall be applicable to deem a non-resident as a tax haven resident when investing in the Notes. However, in the event that the privileged tax regime concept is interpreted to be applicable to transactions such as the investment on the Notes by a non-resident, this tax law would accordingly result in the imposition of taxation to a non-resident that meets the privileged tax regime requirements in the same way applicable to a tax haven resident. Generally, there are no stamp, transfer or other similar taxes in Brazil with respect to the transfer, assignment or sale of the Notes outside Brazil. Under Brazilian law, the receipt of a Note by a resident of Brazil may result in the imposition of an inheritance tax (Imposto Sobre Transmissão Causa Mortis e Doação de Quaisquer Bens ou Direitos) on the recipient by the State in which the recipient resides at a rate of up to 8% of the value of the Notes (generally, as determined by judicial or administrative valuation in the jurisdiction in which the decedent s estate is administered). A transfer of a Note by gift made by a Noteholder (whether or not a nonresident) and involving a resident of Brazil may be subject to gift tax (Imposto Sobre Doação de Quaisquer Bens ou Direitos) imposed on the donee by the State in which such Brazilian recipient resides. The conversion of foreign currency into Brazilian reais and the conversion of, Brazilian reais into foreign currency is subject to IOF/Câmbio. Currently, the rate of IOF/Câmbio is 0.38% for almost all foreign currency conversions into reais, 0% on the conversion into Brazilian currency of foreign loans with a term of more than 360 days and 6% on the conversion into Brazilian currency of foreign loans with a term of up to 360 days. However, the Federal Government may increase the current IOF/Câmbio rate at any time up to a maximum rate of 25.0%. Any such new rate would only apply to future exchange transactions. United States Federal Income Taxation TO ENSURE COMPLIANCE WITH TREASURY DEPARTMENT CIRCULAR 230, PROSPECTIVE PURCHASERS ARE HEREBY NOTIFIED THAT: (A) ANY DISCUSSION OF FEDERAL TAX ISSUES IN THESE LISTING PARTICULARS IS NOT INTENDED OR WRITTEN TO BE RELIED UPON, AND CANNOT BE RELIED UPON, BY PROSPECTIVE PURCHASERS FOR THE PURPOSE OF AVOIDING PENALTIES THAT MAY BE IMPOSED ON PROSPECTIVE PURCHASERS UNDER THE INTERNAL REVENUE CODE; (B) SUCH DISCUSSION IS INCLUDED HEREIN BY THE ISSUER IN CONNECTION WITH THE PROMOTION OR MARKETING (WITHIN THE MEANING OF CIRCULAR 230) BY THE ISSUER OF THE TRANSACTIONS OR MATTERS ADDRESSED HEREIN; AND (C) PROSPECTIVE PURCHASERS SHOULD SEEK ADVICE BASED ON THEIR PARTICULAR CIRCUMSTANCES FROM AN INDEPENDENT TAX ADVISOR. 193

The following is a summary of certain material U.S. federal income tax consequences of the purchase, ownership and disposition of the Notes by a U.S. holder (as defined below), except as provided in Fungible Issue below, which is applicable to all holders. This summary does not address the material U.S. federal income tax consequences of every type of Note which may be issued under the Program, and the relevant Final Terms may contain additional or modified disclosure concerning the material U.S. federal income tax consequences relevant to such type of Note as appropriate. The summary deals only with Notes that will be purchased by U.S. holders and held as capital assets. This summary is based upon United States laws, including the Internal Revenue Code of 1986, as amended (the Code ), U.S. Treasury Regulations ( Treasury Regulations ) (final, proposed and temporary) promulgated thereunder, rulings, judicial decisions and administrative pronouncements, all as currently in effect, and all of which are subject to change or changes in interpretation, possibly on a retroactive basis. The summary is included herein for general information only, and there can be no assurance that the U.S. Internal Revenue Service (the IRS ) will take a similar view of the U.S. federal income tax treatment of an investment in the Notes as described herein. In particular, this summary does not purport to deal with persons in special tax situations, such as U.S. expatriates, persons subject to the alternative minimum tax, financial institutions, insurance companies, regulated investment companies, dealers in securities or currencies, traders in securities electing to mark their investments to market, tax-exempt entities, banks, persons holding Notes as a hedge against currency risks or as a position in a straddle for tax purposes, persons owning (directly, indirectly or by attribution) 10% or more of the outstanding share capital or voting power of the Issuer, persons whose functional currency is not the U.S. dollar or persons that purchase Notes for a price other than the respective issue prices of the Notes (except where otherwise specifically noted). Moreover, this summary deals only with Notes with a term less than 30 years, and does not address the tax treatment to U.S. holders of bearer Notes. This summary does not address any U.S. federal tax laws (such as the estate tax or gift tax) other than U.S. federal income tax laws. Bearer Notes are not being offered to U.S. Holders. A U.S. Holder who owns a bearer Note may be subject to limitations under U.S. federal income tax laws, including the limitations provided in sections 165(j) and 1287(a) of the Code. Prospective purchasers of Notes should consult the relevant Final Terms for any additional discussion of tax consequences that may be relevant to that particular issue and are urged to consult their own tax advisors in determining the particular U.S. federal, state, local and any other tax consequences to them of the purchase, ownership and disposition of Notes. As used herein, the term U.S. holder means a beneficial owner of a Note that is (i) a citizen or individual resident of the United States for U.S. federal income tax purposes, (ii) a corporation (or other entity taxable as a corporation for U.S. federal income tax purposes) created or organized in or under the laws of the United States, any state thereof or the District of Columbia, (iii) an estate the income of which is subject to U.S. federal income taxation regardless of its source, or (iv) a trust, if a court within the United States is able to exercise primary supervision over the administration of the trust and one or more U.S. persons have the authority to control all substantial decisions of the trust, or the income of which is otherwise subject to U.S. federal income taxation regardless of its source. If a partnership (or an entity treated as a partnership for U.S. federal income tax purposes) holds Notes, the tax treatment of a partner generally will depend upon the status of the partner and the activities of the partnership. A partner in a partnership that holds Notes is urged to consult its tax advisor regarding the specific tax consequences of the purchase, ownership and disposition of the Notes. For purposes of this summary, a Foreign Currency Note means a Note on which all payments which a U.S. holder is entitled to receive are denominated in, or determined by reference to, a single Foreign Currency. For this purpose, Foreign Currency means a currency or currency unit other than U.S. dollars. 194

Fungible Issue The Issuer may, without the consent of the holders of outstanding Notes, issue additional Notes with identical terms. These additional Notes, even if they are treated for non-tax purposes as part of the same series as the original Notes, in some cases may be treated as a separate issue for U.S. federal income tax purposes. In such a case, the additional Notes may be considered to have been issued with original issue discount ( OID ) even if the original Notes had no OID, or the additional Notes may have a greater amount of OID than the original Notes. These differences may affect the market value of the original Notes if the additional Notes are not otherwise distinguishable from the original Notes. U.S. Currency Notes Payments of Interest Except as described below under Original Issue Discount, payments of interest on a Note (including additional amounts paid with respect to withholding tax on such Note, if any, and withholding tax on payments of such additional amounts) generally will be taxable to a U.S. holder as ordinary interest income at the time such payments are received or are accrued in accordance with the U.S. holder s method of tax accounting. Thus, a U.S. holder may be required to report income in an amount greater than the actual amount of interest and/or OID (as described below) due to such holder on the Notes if they become subject to withholding tax and additional amounts are paid to such U.S. holder, because, for U.S. federal income tax purposes, U.S. holders would be treated as having received the amount of Brazilian taxes withheld by the Issuer with respect to a Note, and as then having paid over the withheld taxes to the Brazilian taxing authorities. Subject to certain limitations, a U.S. holder will generally be entitled to a credit against its U.S. federal income tax liability, or a deduction in computing its U.S. federal taxable income, for Brazilian income taxes withheld by the Issuer; provided that, if a U.S. holder elects to deduct Brazilian taxes for any taxable year, such U.S. holder must deduct rather than credit all foreign taxes for such taxable year. For purposes of the foreign tax credit limitation, foreign source income is classified in one of two baskets, and the credit for foreign taxes on income in any such basket is limited to U.S. federal income tax allocable to that income. Interest and OID on the Notes generally will be attributable to the passive income basket. In certain circumstances a U.S. holder may be unable to claim foreign tax credits (and may instead be allowed deductions) for Brazilian taxes imposed on a payment of interest if the U.S. Holder has not held the Notes for at least 16 days during the 31- day period beginning on the date that is 15 days before the date on which the right to receive the payment arises. Since a U.S. holder may be required to include OID on the Notes in its gross income in advance of any withholding of Brazilian income taxes from payments attributable to the OID (which would generally occur only when the Note is repaid or redeemed), a U.S. holder may not be entitled to a credit or deduction for these Brazilian income taxes in the year the OID is included in the U.S. holder s gross income, and may be limited in its ability to credit or deduct in full the Brazilian taxes in the year those taxes are actually withheld by the Issuer. The rules for foreign tax credits are complex and prospective purchasers should consult their tax advisers concerning the foreign tax credit implications to them of the payment of any Brazilian taxes. Original Issue Discount The following summary is a general discussion of the material U.S. federal income tax consequences to U.S. holders of the ownership and disposition of Notes issued with OID ( Discount Notes ) under applicable Treasury Regulations (the OID Regulations ). This summary does not discuss Notes that are characterized as contingent payment debt instruments for U.S. federal income tax purposes, which are subject to special provisions with respect to the U.S. federal income tax treatment of OID. A Note, other than a Note with a term of one year or less (a Short-Term Note ), will be treated as issued with OID if the amount by which the Note s stated redemption price at maturity exceeds its issue price is more than a de minimis amount. Generally, a Note s issue price will be the first price at which a substantial amount of 195

Notes included in the issue of which the Note is a part is sold to persons other than bond houses, brokers, or similar persons or organizations acting in the capacity of underwriters, placement agents, or wholesalers. The stated redemption price at maturity of a Note is the sum of all payments provided by the Note other than qualified stated interest payments. In general, under a de minimis exception a Note is not treated as issued with OID if the amount by which its stated redemption price at maturity exceeds its issue price is less than the de minimis amount of ¼ of 1% of its stated redemption price at maturity multiplied by the number of complete years to its maturity date from its original issue date (or its weighted average maturity if the Note is an installment obligation). The term qualified stated interest generally means stated interest that is unconditionally payable in cash or property (other than debt instruments of the Issuer) at least annually at a single fixed rate of interest or a variable rate (in the circumstances described below under Variable Rate Notes ). In addition, under the OID Regulations, if a Note bears interest for one or more initial accrual periods at a rate below the rate applicable for the remaining term of such Note (e.g., Notes with teaser rates or interest holidays), and if the greater of either the resulting foregone interest on such Note or any true discount on such Note (i.e., the excess of the Note s stated principal amount over its issue price) equals or exceeds a specified de minimis amount as determined under the OID Regulations, then the stated interest on the Note would be treated as OID rather than qualified stated interest. A U.S. holder of a Discount Note must include OID in income as ordinary interest income for U.S. federal income tax purposes as it accrues generally under a constant yield method in advance of receipt of the cash payments attributable to such income, regardless of such U.S. holder s regular method of tax accounting. In general, the amount of OID included in income by the initial U.S. holder of a Discount Note is the sum of the daily portions of OID with respect to such Discount Note for each day during the taxable year (or portion of the taxable year) on which the U.S. holder held the Discount Note. The daily portion of OID on any Discount Note is determined by allocating to each day in any accrual period a ratable portion of the OID allocable to that accrual period. Accrual periods may be of any length and may vary in length over the term of the Discount Note, provided that each accrual period is no longer than one year and each scheduled payment of principal or interest occurs either on the final day or first day of an accrual period. The amount of OID allocable to each accrual period generally is equal to the difference between (i) the product of the Discount Note s adjusted issue price at the beginning of the accrual period and the Discount Note s yield to maturity (determined on the basis of compounding at the close of each accrual period and appropriately adjusted to take into account the length of the particular accrual period) and (ii) the amount of any qualified stated interest payments allocable to such accrual period. The adjusted issue price of a Discount Note at the beginning of any accrual period is the sum of the issue price of the Discount Note plus the amount of OID allocable to all prior accrual periods minus the amount of any prior payments on the Discount Note that were not qualified stated interest payments. Under these rules, U.S. holders generally will have to include in taxable income increasingly greater amounts of OID in successive accrual periods. Acquisition Premium A U.S. holder that purchases a Discount Note for an amount less than or equal to the sum of all amounts payable on the Note after the purchase date, other than payments of qualified stated interest, but in excess of its adjusted issue price (any such excess being acquisition premium ) and that does not make the election described below under Election to Treat All Interest as Original Issue Discount, is permitted to reduce the daily portions of OID by a fraction, the numerator of which is the excess of the U.S. holder s adjusted basis in the Note immediately after its purchase over the Note s adjusted issue price, and the denominator of which is the excess of the sum of all amounts payable on the Note after the purchase date, other than payments of qualified stated interest, over the Note s adjusted issue price. 196

Amortizable Bond Premium A U.S. holder that purchases a Note for more than the sum of all amounts payable on the Note after the purchase date, other than payments of qualified stated interest, may elect to amortize the bond premium. If a U.S. holder makes such an election, the amount of interest on the Note otherwise required to be included in the U.S. holder s income will be reduced each year by the amount of amortizable bond premium allocable to such year on a constant yield to maturity basis (except to the extent Treasury Regulations may provide otherwise). If a Note is redeemable prior to maturity, the amount of amortizable bond premium will be determined with reference to the amount payable on the earlier redemption date if such determination results in a smaller premium attributable to the period ending on the earlier redemption date. The election to amortize bond premium cannot be revoked without the consent of the IRS. Amortized bond premium will reduce the U.S. holder s tax basis in the Note by the amount of the premium amortized in any year. An election to amortize bond premium will thereafter apply to bond premium on certain other debt instruments that the U.S. holder then owns or thereafter acquired at a premium, and the election may have different tax consequences depending on when the debt instruments were issued or acquired. Special rules apply to (a) certain Notes payable in or by reference to a foreign currency (discussed below under Foreign Currency Notes ) and (b) certain Notes with contingent interest payments. A U.S. holder that does not elect to take bond premium (other than acquisition premium) into account will recognize a loss when the Note matures as described below in Sale, Retirement or Other Taxable Disposition of U.S. Currency Notes. A U.S. holder should consult its tax advisor before making an election to amortize bond premium. Market Discount A Note, other than a Short-Term Note, generally will be treated as purchased at a market discount (a Market Discount Note ) if the Note s stated redemption price at maturity or, in the case of a Discount Note, the Note s revised issue price, exceeds the amount for which the U.S. holder purchased the Note by at least 0.25% of the Note s stated redemption price at maturity or revised issue price, respectively, multiplied by the number of complete years to the Note s maturity (or, in the case of a Note that is an installment obligation, the Note s weighted average maturity). If this excess is not sufficient to cause the Note to be a Market Discount Note, then the excess constitutes de minimis market discount. For this purpose, the revised issue price of a Note generally equals its issue price, increased by the amount of any OID that has accrued on the Note and decreased by the amount of any payments previously made on the Note that were not qualified stated interest payments. Any gain recognized on the maturity or disposition of a Market Discount Note (including any payment on a Note that is not qualified stated interest) will be treated as ordinary income to the extent that the gain does not exceed the accrued market discount on the Note. Alternatively, a U.S. holder of a Market Discount Note may elect to include market discount in income currently over the life of the Note. This election shall apply to all debt instruments with market discount acquired by the electing U.S. holder on or after the first day of the first taxable year to which the election applies. This election may not be revoked without the consent of the IRS. A U.S. holder of a Market Discount Note that does not elect to include market discount in income currently will generally be required to defer deductions for interest on borrowings incurred to purchase or carry a Market Discount Note that is in excess of the interest and OID on the Note includible in the U.S. holder s income, to the extent that this excess interest expense does not exceed the portion of the market discount allocable to the days on which the Market Discount Note was held by the U.S. holder. Market discount will accrue on a straight-line basis unless the U.S. holder elects to accrue the market discount on a constant-yield method. This election applies only to the Market Discount Note with respect to which it is made and is irrevocable. Prospective purchasers are urged to consult their tax advisors if such purchasers purchase a Note at a discount or premium from the Note s issue price. In this event, the Notes so purchased may be subject to special U.S. federal income tax rules relating to the treatment of market discount or acquisition or bond premium. 197

Election to Treat All Interest as Original Issue Discount A U.S. holder may elect to include in gross income all interest that accrues on a note using the constant yield method discussed above under Original Issue Discount, with certain modifications. For purposes of this election, interest includes stated interest, OID, de minimis OID, market discount, de minimis market discount and unstated interest, as adjusted by any amortizable bond premium or acquisition premium. Generally, this election will apply only to the Note with respect to which it is made and must be made for the taxable year in which the U.S. holder acquired the Note. However, if a Note subject to an election has amortizable bond premium, the U.S. holder will be deemed to have made an election to apply amortizable bond premium against interest for all debt instruments with amortizable bond premium, other than debt instruments the interest on which is excludible from gross income, that such U.S. holder holds as of the beginning of the taxable year to which the election applies or any taxable year thereafter. Additionally, if a U.S. holder makes the election for a Market Discount Note, such U.S. holder will be treated as having made the election discussed above under Market Discount to include market discount in income currently over the life of all debt instruments that such U.S. holder currently owns or later acquires. A U.S. holder may not revoke any election to apply the constant yield method to all interest on a Note or the deemed elections with respect to amortizable bond premium or Market Discount Notes without the consent of the IRS. U.S. holders are urged to consult their tax advisors regarding the advisability of making this election. Variable Rate Notes A Note that provides for a variable rate of interest (a Variable Rate Note ) may qualify as a variable rate debt instrument if the conditions described below are met. In the event a Variable Rate Note qualifies as a variable rate debt instrument then payments of interest on such Variable Rate Note are treated as described above under Payments of Interest. Under the OID Regulations, Variable Rate Notes are subject to special rules whereby a Variable Rate Note will qualify as a variable rate debt instrument if: (a) such Variable Rate Note s issue price does not exceed the total noncontingent principal payments by more than the lesser of: (i) (ii).015 multiplied by the product of the total noncontingent principal payments and the number of complete years to maturity from the issue date, or 15% of the total noncontingent principal payments; and (b) such Variable Rate Note provides for stated interest, compounded or paid at least annually, only at: (i) (ii) (iii) (iv) one or more qualified floating rates, a single fixed rate and one or more qualified floating rates, a single objective rate, or a single fixed rate and a single objective rate that is a qualified inverse floating rate. 198

A Variable Rate Note provides for stated interest at a qualified floating rate if: (a) (b) variations in the value of the rate can reasonably be expected to measure contemporaneous variations in the cost of newly borrowed funds in the currency in which such Variable Rate Note is denominated; or the rate is equal to such a rate multiplied by either: (i) (ii) (iii) a fixed multiple that is greater than 0.65 but not more than 1.35, or a fixed multiple greater than 0.65 but not more than 1.35, increased or decreased by a fixed rate; and the value of the rate on any date during the term of such Variable Rate Note is set no earlier than three months prior to the first day on which that value is in effect and no later than one year following that first day. If such Variable Rate Note provides for two or more qualified floating rates that are within 0.25 percentage points of each other on the issue date or can reasonably be expected to have approximately the same values throughout the term of such Variable Rate Note, the qualified floating rates together constitute a single qualified floating rate. A Variable Rate Note will not have a qualified floating rate, however, if the rate is subject to certain restrictions (including caps, floors, governors, or other similar restrictions) unless such restrictions are fixed throughout the term of such Variable Rate Note or are not reasonably expected to significantly affect the yield on such Variable Rate Note. A Variable Rate Note provides for stated interest at a single objective rate if: the rate is not a qualified floating rate, the rate is determined using a single, fixed formula that is based on objective financial or economic information that is not within the control of or unique to the circumstances of Banco Votorantim or a related party, and the value of the rate on any date during the term of such Variable Rate Note is set no earlier than three months prior to the first day on which that value is in effect and no later than one year following that first day. A Variable Rate Note will not be treated as providing for stated interest at an objective rate, however, if it is reasonably expected that the average value of the rate during the first half of such Variable Rate Note s term will be either significantly less than or significantly greater than the average value of the rate during the final half of such Variable Rate Note s term. An objective rate as described above is a qualified inverse floating rate if: the rate is equal to a fixed rate minus a qualified floating rate; and the variations in the rate can reasonably be expected to inversely reflect contemporaneous variations in the cost of newly borrowed funds. 199

A Variable Rate Note will also provide for stated interest at a single qualified floating rate or an objective rate if interest on such Variable Rate Note is stated at a fixed rate for an initial period of one year or less followed by either a qualified floating rate or an objective rate for a subsequent period, and either: the fixed rate and the qualified floating rate or objective rate have values on the issue date of such Variable Rate Note that do not differ by more than 0.25% or the value of the qualified floating rate or objective rate is intended to approximate the fixed rate. In general, if a Variable Rate Note provides for stated interest at a single qualified floating rate or objective rate, or one of those rates after a single fixed rate for an initial period, all stated interest on such Variable Rate Note will be accounted for as described above under Payments of Interest. In this case, the amount of OID, if any, is determined by using, in the case of a qualified floating rate or qualified inverse floating rate, the value as of the issue date of the qualified floating rate or qualified inverse floating rate, or, for any other objective rate (other than a qualified inverse floating rate), a fixed rate that reflects the yield reasonably expected for such Variable Rate Note. If a Variable Rate Note constitutes a variable rate debt instrument but does not provide for stated interest at a single qualified floating rate or a single objective rate, and also does not provide for interest payable at a fixed rate other than a single fixed rate for an initial period, a U.S. holder generally must determine the interest and OID accruals on such Variable Rate Note by: determining a fixed rate substitute for each variable rate provided under such Variable Rate Note, constructing the equivalent fixed rate debt instrument, using the fixed rate substitute described above, determining the amount of qualified stated interest and OID with respect to the equivalent fixed rate debt instrument, and adjusting for actual variable rates during the applicable accrual period. When a U.S. holder determines the fixed rate substitute for each variable rate provided under a Variable Rate Note, it generally will use the value of each variable rate as of the issue date of such Variable Rate Note or, for an objective rate that is not a qualified inverse floating rate, a rate that reflects the reasonably expected yield on such Variable Rate Note. If a Variable Rate Note provides for stated interest either at one or more qualified floating rates or at a qualified inverse floating rate, and also provides for stated interest at a single fixed rate other than at a single fixed rate for an initial period, a U.S. holder generally must determine interest and OID accruals by using the method described in the previous paragraph. However, a Variable Rate Note will be treated, for purposes of the first three steps of the determination, as if such Variable Rate Note had provided for a qualified floating rate, or a qualified inverse floating rate, rather than the fixed rate. The qualified floating rate, or qualified inverse floating rate, that replaces the fixed rate must be such that the fair market value of such Variable Rate Note as of the issue date approximates the fair market value of an otherwise identical debt instrument that provides for the qualified floating rate, or qualified inverse floating rate, rather than the fixed rate. If a Variable Rate Note (such as a Note the payments on which are determined by reference to an index) does not qualify as a variable rate debt instrument under the OID Regulations, then the Variable Rate Note would be treated as a contingent payment debt obligation under applicable Treasury Regulations (the CPDI Regulations ). The CPDI Regulations generally require a U.S. holder of such an instrument to include future contingent and noncontingent interest payments in income as such interest accrues based upon a projected payment schedule, whether or not the U.S. holder has actually received any such payment. Additionally, the 200

CPDI Regulations provide special rules that would affect the character of any gain or loss upon the sale or exchange of a contingent payment debt instrument. The U.S. federal income tax treatment of any Variable Rate Notes or other Notes that are treated as contingent payment debt obligations will be more fully described in the applicable Final Terms. Short-Term Notes In general, an individual or other cash basis U.S. holder of a Short-Term Note is not required to accrue OID (as specially defined below for the purposes of this paragraph) for U.S. federal income tax purposes unless it elects to do so (but may be required to include any stated interest in income as the interest is received). Accrual basis U.S. holders and certain other U.S. holders are required to accrue OID on Short-Term Notes on a straight-line basis or, if the U.S. holder so elects, under the constant-yield method (based on daily compounding). In the case of a U.S. holder not required and not electing to include OID in income currently, any gain realized on the sale or retirement of the Short-Term Note will be ordinary income to the extent of the OID accrued on a straight-line basis (unless an election is made to accrue the OID under the constant-yield method) through the date of sale or retirement. U.S. holders who are not required and do not elect to accrue OID on Short-Term Notes will be required to defer deductions for interest on borrowings allocable to Short-Term Notes in an amount not exceeding the deferred income until the deferred income is realized. For purposes of determining the amount of OID subject to these rules, all interest payments on a Short-Term Note are included in the Short-Term Note s stated redemption price at maturity (i.e., all payments of interest are treated as OID). A U.S. holder may elect to determine OID on a Short-Term Note as if the Short-Term Note had been originally issued to the U.S. holder at the U.S. holder s purchase price for the Short-Term Note. This election shall apply to all obligations with a maturity of one year or less acquired by the U.S. holder on or after the first day of the first taxable year to which the election applies, and may not be revoked without the consent of the IRS. Sale, Retirement or Other Taxable Disposition of U.S. Currency Notes Generally, upon the sale, retirement or other taxable disposition of a Note, a U.S. holder will recognize taxable gain or loss equal to the difference between the amount realized on the sale, retirement or other taxable disposition (other than amounts representing accrued and unpaid qualified stated interest, which is taxable as interest) and such U.S. holder s adjusted tax basis in the Note. A U.S. holder s adjusted tax basis in a Note generally equals the cost of the Note, increased by the amount of any OID and de minimis OID (and market discount, if an election has been made to include currently) included in the U.S. holder s income with respect to the Note and decreased by the amount of any payments that are not qualified stated interest. Except to the extent described above under Original Issue Discount Market Discount or Original Issue Discount Short Term Notes or Foreign Currency Notes, any gain or loss recognized on a sale, retirement or other taxable disposition of a Note, other than amounts attributable to accrued and unpaid qualified stated interest, will be U.S. source gain or loss and generally will be treated as long-term capital gain or loss if at the time of the sale, retirement or other taxable disposition, the Note was held for more than one year. In the case of a U.S. holder who is an individual (or non-corporate U.S. holder), long term capital gains, if any, generally will be subject to U.S. federal income taxation at preferential rates if specified minimum holding periods are met. The deductibility of capital losses is subject to significant limitations. Gain realized by a U.S. holder on the sale, retirement or taxable disposition of a Note generally will be treated as U.S. source income. Consequently, if Brazilian withholding tax is imposed on such gain, the U.S. holder will not be able to use the corresponding foreign tax credit, unless the holder has other foreign-source income of the appropriate type in respect of which the credit may be used. The U.S. foreign tax credit rules are very complex and your ability to credit foreign taxes may be subject to various limitations. Accordingly, prospective investors should consult their own advisors with respect to the application of these rules to their particular circumstances. 201

Optional Redemption In general, if a Note provides for an alternative payment schedule or schedules applicable upon the occurrence of a contingency or contingencies and the timing and amounts of the payments that comprise each payment schedule are known as of the issue date of such Note a U.S. holder must determine the yield and maturity of such Note by assuming that the payments will be made according to the payment schedule, if any, that is significantly more likely than not to occur. Notwithstanding the general rules for determining yield and maturity, if a Note is subject to contingencies, and either a U.S. holder or the Issuer has an unconditional option or options that, if exercised, would require payments to be made on such Note under an alternative payment schedule or schedules, then (i) in the case of an option or options that the Issuer may exercise, the Issuer will be deemed to exercise or not exercise an option or combination of options in the manner that minimizes the yield on such Note and (ii) in the case of an option or options that a U.S. holder may exercise, it will be deemed to exercise or not exercise an option or combination of options in the manner that maximizes the yield on such Note. If both a U.S. holder and the Issuer hold options described in the preceding sentence, those rules will apply to each option in the order in which they may be exercised. If a contingency, including the exercise of an option, actually occurs or does not occur contrary to an assumption made according to the above rules, then except to the extent that a portion of a Note is repaid as a result of this change in circumstances and solely to determine the amount and accrual of OID, a U.S. holder must redetermine the yield and maturity of such Note by treating such Note as having been retired and reissued on the date of the change in circumstances for an amount equal to such Note s adjusted issue price on that date. Foreign Currency Notes As used herein, Foreign Currency means a currency or currency unit other than U.S. dollars. The discussion below relates to the Notes the payment of which is denominated in, or determined by reference to, a single Foreign Currency. Interest Cash Method A U.S. holder who uses the cash method of accounting for U.S. federal income tax purposes and who receives a payment of interest on a Note (other than OID, the treatment of which is described below under Interest Accrual Method ) will be required to include in income the U.S. dollar value of the Foreign Currency payment, based on the spot exchange rate on the date of receipt, regardless of whether the payment is in fact converted to U.S. dollars at that time. A cash method U.S. holder generally will not realize exchange gain or loss on the receipt of the interest payment but may have exchange gain or loss attributable to a subsequent disposition of the Foreign Currency so received which will be U.S. source ordinary income or loss. Interest Accrual Method A U.S. holder who uses the accrual method of accounting for U.S. federal income tax purposes, or who otherwise is required to accrue interest prior to receipt, will be required to include in income the U.S. dollar value of the amount of interest income that has accrued and is otherwise required to be taken into account with respect to a Foreign Currency Note during an accrual period. The U.S. dollar value of such accrued income will be determined by translating such income at the average rate of exchange in effect for the interest accrual period or, with respect to an accrual period that spans two taxable years, at the average rate for the partial period within the U.S. holder s taxable year. The average rate of exchange for an interest accrual period (or partial period) is the simple average of the spot exchange rates for each business day of such period or other average rate for the period that is reasonably derived and consistently applied by the U.S. holder. A U.S. holder may elect, however, to translate such accrued interest income at the spot rate on the last day of the interest accrual period, or the last day of the accrual period in that taxable year in the case of a partial accrual 202

period. If the last day of the interest accrual period is within five business days of the date of receipt of the accrued interest, a U.S. holder may translate such interest at the spot rate on the date of receipt. The above election will apply to all debt obligations held by the U.S. holder at the beginning of the first taxable year to which the election applies and may not be revoked without the consent of the IRS. U.S. holders should consult their own tax advisors as to the advisability of making the above election. A U.S. holder will recognize exchange gain or loss (which will be treated as U.S. source ordinary income or loss) with respect to accrued interest on the date such interest is received, and which generally will not be treated as an adjustment to interest income or expense. The amount of ordinary income or loss so recognized will equal the difference, if any, between the U.S. dollar value of the Foreign Currency payment received (determined on the basis of the spot rate on the date such payment is received) in respect of the accrual period and the U.S. dollar value of interest income that has accrued during such accrual period (as determined above), regardless of whether such U.S. holder actually converts the payment into U.S. dollars. Original Issue Discount In the case of a Discount Note that is also a Foreign Currency Note, a U.S. holder must determine OID allocable to each accrual period in units of the Foreign Currency using the constant yield method described in U.S. Currency Notes Original Issue Discount above. Accrued OID is translated into U.S. dollars and the U.S. holder will recognize Foreign Currency gain or loss on the accrued OID in the same manner as described above in Interest Accrual Method. Such U.S. holder may recognize U.S. source exchange gain or loss (taxable as ordinary income or loss) when it receives an amount attributable to OID in connection with a payment of interest or the sale, retirement or other taxable disposition of such Note. U.S. holders are urged to consult their tax advisors regarding the interplay between the application of the OID and foreign currency exchange gain or loss rules. Amortizable Bond Premium (including Acquisition Premium) Bond premium (including acquisition premium) on a Note that is denominated in, or determined by reference to, a Foreign Currency will be computed in units of the Foreign Currency, and any such bond premium that is taken into account currently will reduce interest income in units of the Foreign Currency. On the date bond premium offsets interest income, a U.S. holder may recognize U.S. source exchange gain or loss (taxable as ordinary income or loss) measured by the difference between the spot rate in effect on that date and on the date the Notes were acquired by the U.S. holder. A U.S. holder that does not elect to take bond premium (other than acquisition premium) into account currently will recognize a loss when the Note matures, as described below under Sale, Retirement or Other Taxable Disposition of Foreign Currency Notes. Market Discount Market Discount on a Note that is denominated in, or determined by reference to, a Foreign Currency, will be accrued in the foreign currency. If the U.S. holder elects to include market discount in income currently, the accrued market discount will be translated into U.S. dollars at the average exchange rate for the accrual period (or portion thereof within the U.S. holder s taxable year). Upon the receipt of an amount attributable to accrued market discount, the U.S. holder may recognize U.S. source exchange gain or loss (which will be taxable as ordinary income or loss) determined in the same manner as for accrued interest or OID. A U.S. holder that does not elect to include market discount in income currently will recognize, upon the disposition or maturity of the Note, the U.S. dollar value of the amount accrued, calculated at the spot rate on that date, and no part of this accrued market discount will be treated as exchange gain or loss. Sale, Retirement or Other Taxable Disposition of Foreign Currency Notes As discussed above under Sale, Retirement or Other Taxable Disposition of U.S. Currency Notes, a U.S. holder will generally recognize gain or loss on the sale, retirement, or other taxable disposition of a Note equal 203

to the difference between the amount realized on the sale, retirement or other taxable disposition and its adjusted tax basis in the Note. A U.S. holder s initial tax basis in a Foreign Currency Note will be the U.S. dollar value of the Foreign Currency amount paid for such Foreign Currency Note, determined on the date of such purchase. In the case of a Foreign Currency Note that is traded on an established securities market, a cash basis U.S. holder (or, upon election, an accrual basis U.S. holder) will determine the U.S. dollar value of the amount paid by translating the Foreign Currency payment at the spot rate on the settlement date of the purchase. (If an accrual basis taxpayer makes such an election, the election must be applied consistently to all debt instruments from year to year and cannot be revoked without the consent of the IRS.) The amount of any subsequent adjustments to such holder s tax basis will be the U.S. dollar value of the Foreign Currency amount of the adjustment, determined as discussed herein. A U.S. holder s adjusted tax basis in a Foreign Currency Note generally will equal the cost of the Foreign Currency Note to such holder, increased by the amount of any OID and de minimis OID (and market discount, if an election has been made to include currently) previously included in income by the holder with respect to such Foreign Currency Note and reduced by any payments that are not qualified stated interest previously received by the holder. If a U.S. holder receives Foreign Currency on a sale, retirement or other taxable disposition of a Foreign Currency Note, the amount realized will be based on the U.S. dollar value of the Foreign Currency on: the date of disposition, if it is a cash basis taxpayer and the relevant Foreign Currency Notes are not traded on an established securities market, as defined in the applicable Treasury Regulations; the date of disposition, if it is an accrual basis taxpayer that does not elect to use the settlement date; or the settlement date for the sale, if it is a cash basis taxpayer, or an accrual basis taxpayer that so elects, and the relevant Foreign Currency Notes are traded on an established securities market, as defined in the applicable Treasury Regulations. (If an accrual basis taxpayer makes such an election, the election must be applied consistently to all debt instruments from year to year and cannot be revoked without the consent of the IRS.) Except as discussed in the following paragraph with respect to exchange gains or losses, any gain or loss recognized upon the sale, retirement or other taxable disposition of a Foreign Currency Note generally will be capital gain or loss, except to the extent attributable to accrued but unpaid qualified stated interest and market discount or attributable to changes in the exchange rates as described below and will be treated as long-term capital gain or loss if at the time of sale, retirement or other taxable disposition the Foreign Currency Note was held for more than one year. If the U.S. holder is an individual (or other non-corporate U.S. holder), any longterm capital gain generally will be subject to U.S. federal income taxation at preferential rates. The deductibility of capital losses is subject to significant limitations. Gain realized by a U.S. holder on the sale, retirement or taxable disposition of a Note generally will be treated as U.S. source income. Consequently, if Brazilian withholding tax is imposed on such gain, the U.S. holder will not be able to use the corresponding foreign tax credit, unless the holder has other foreign-source income of the appropriate type in respect of which the credit may be used. The U.S. foreign tax credit rules are very complex and your ability to credit foreign taxes may be subject to various limitations. Accordingly, prospective investors should consult their own advisors with respect to the application of these rules to their particular circumstances. Gain or loss realized upon the sale, retirement or other taxable disposition of a Foreign Currency Note that is attributable to fluctuations in currency exchange rates will constitute exchange gain or loss and will be taxable as U.S. source ordinary income or loss. Such foreign exchange gain or loss will be recognized only to the extent of the total gain or loss realized by the U.S. holder on the sale, retirement or other taxable disposition. 204

A U.S. holder generally will have a tax basis in any Foreign Currency received as interest or on the sale, retirement or other taxable disposition of a Foreign Currency Note equal to the U.S. dollar value of such Foreign Currency at the spot rate on the date when the interest is so received or at the time of the sale, retirement or other taxable disposition. Any exchange gain or loss realized by a U.S. holder on a subsequent conversion or other disposition of Foreign Currency, generally, will be treated as ordinary income or loss. If a Note is issued in circumstances where interest payments on the Note are denominated in or determined by reference to one currency and the principal portion of the Note may be denominated in or determined by reference to another currency ( Dual Currency Notes ), the applicable Final Terms will discuss the material U.S. federal income tax consequences in respect of these features to holders. Foreign Currency Constraint There are no Treasury Regulations, published rulings or judicial decisions specifically addressing the effect of a Foreign Currency Constraint Event on the Notes. The Issuer believes that an election or the failure to so elect to request payment in the lawful currency of Brazil (as provided in Terms and Conditions of the Notes Foreign Currency Constraint ) should not be considered to result in a deemed sale or exchange of the Notes for U.S. federal income tax purposes, potentially resulting in recognition of gains or losses. There can be no assurance that the IRS will agree with this determination. U.S. holders should consult their tax advisors in this regard. Foreign Source Income For U.S. foreign tax credit purposes, qualified stated interest, OID, and any additional amounts paid with respect to a Note will be treated as foreign source income, subject to various classifications and other limitations. The rules relating to computing foreign tax credits or deducting foreign taxes are extremely complex, and U.S. holders are urged to consult their own tax advisors regarding the availability of U.S. foreign tax credits with respect to any Brazilian taxes withheld from payment. Tax Return Disclosure Requirement A U.S. holder may be required to report a sale, retirement or other taxable disposition of its Notes (or, in the case of an accrual basis U.S. holder, a payment of accrued interest) on IRS Form 8886 (Reportable Transaction Disclosure Statement) if it recognizes a foreign exchange loss that exceeds U.S.$50,000 in a single taxable year from a single transaction, if such U.S. holder is an individual or trust, or higher amounts for other nonindividual U.S. holders. U.S. holders are urged to consult their own tax advisors in this regard. Medicare Contribution Tax on Unearned Income Recently enacted legislation requires certain U.S. holders who are individuals, estates or trusts to pay an additional 3.8% tax on, among other things, interest on and capital gains from the sale, retirement or other taxable disposition of Notes for taxable years beginning after December 31, 2012. U.S. holders should consult their tax advisors regarding the effect, if any, of this new legislation on their investment in the Notes. U.S. Information Reporting and Backup Withholding Payments of principal, premium, if any, and interest (including OID) on, and proceeds from the sale, retirement or other taxable disposition of the Notes may be subject to information reporting to the IRS and possible backup withholding. Backup withholding of U.S. federal income tax at a current rate of 28% (and a scheduled rate of 31% beginning January 1, 2013) may apply to payments made in respect of the Notes to holders who are not exempt recipients and who fail to provide certain identifying information (such as the holder s taxpayer identification number) and make any other required certification. Payments made in respect of the Notes to a U.S. holder must be reported to the IRS, unless the U.S. holder is an exempt recipient or 205

otherwise establishes an exemption. U.S. persons who are required to establish their exempt status, generally, must provide an IRS Form W-9. Any amounts withheld under the backup withholding rules from a payment to a U.S. holder would be allowed as a refund or a credit against such U.S. holder s U.S. federal income tax, provided that the required information is furnished to the IRS in a timely manner. Recently enacted legislation requires certain individual U.S. holders to report information with respect to their investment in Notes not held through a custodial account with a U.S. financial institution to the IRS. Investors who fail to report required information could become subject to substantial penalties. Prospective investors are encouraged to consult with their own tax advisors regarding the possible implications of this new legislation on their investment in the Notes. THE UNITED STATES FEDERAL INCOME TAX DISCUSSION SET FORTH ABOVE IS INCLUDED FOR GENERAL INFORMATION ONLY AND MAY NOT BE APPLICABLE DEPENDING UPON A HOLDER S PARTICULAR SITUATION. HOLDERS ARE URGED TO CONSULT THEIR TAX ADVISORS WITH RESPECT TO THE TAX CONSEQUENCES TO THEM OF THE OWNERSHIP AND DISPOSITION OF THE NOTES, INCLUDING THE TAX CONSEQUENCES UNDER STATE, LOCAL, AND OTHER TAX LAWS AND THE POSSIBLE EFFECTS OF CHANGES IN U.S. FEDERAL INCOME OR OTHER TAX LAWS. EU Savings Tax Directive Under EC Council Directive 2003/48/EC on the taxation of savings income, each Member State is required to provide to the tax authorities of another Member State details of payments of interest or other similar income paid by a person within its jurisdiction to, or collected by such a person for, an individual resident or certain limited types of entity established in that other Member State; however, for a transitional period, Austria and Luxembourg may instead apply a withholding system in relation to such payments, deducting tax at rates rising over time to 35%. The transitional period is to terminate at the end of the first full fiscal year following agreement by certain non-eu countries to the exchange of information relating to such payments. A number of non-eu countries, and certain dependent or associated territories of certain Member States, have adopted similar measures (either provision of information or transitional withholding) in relation to payments made by a person within its jurisdiction to, or collected by such a person for, an individual resident or certain limited types of entity established in a Member State. In addition, the Member States have entered into provision of information or transitional withholding arrangements with certain of those dependent or associated territories in relation to payments made by a person in a Member State to, or collected by such a person for, an individual resident or certain limited types of entity established in one of those territories. On November 13, 2008 the European Commission published a proposal for amendments to the Directive, which included a number of suggested changes which, if implemented, would broaden the scope of the requirements described above. Investors who are in any doubt as to their position should consult their professional advisers. THE ABOVE INFORMATION IS SET FORTH IN SUMMARY FORM ONLY AND IS NOT INTENDED TO CONSTITUTE A COMPLETE ANALYSIS OF ALL TAX CONSEQUENCES RELATING TO THE OWNERSHIP OF THE NOTES. 206

CERTAIN UNITED STATES ERISA CONSIDERATIONS To ensure compliance with U.S. Treasury Department rules, we inform you that this summary was not intended or written to be used, and it cannot be used by any taxpayer, for the purpose of avoiding penalties that may be imposed on any taxpayer. This summary was written to support the promotion or marketing of the transactions addressed by these Listing Particulars. Each taxpayer should seek advice based on such taxpayer s particular circumstances from an independent tax advisor. The U.S. Employee Retirement Income Security Act of 1974, as amended ( ERISA ) imposes certain requirements on employee benefit plans (as defined in Section 3(3) of ERISA) subject to ERISA, including entities such as collective investment funds and separate accounts whose underlying assets include the assets of such plans, pursuant to ERISA ( ERISA Plans ), and on those persons who are fiduciaries with respect to ERISA Plans. Investments by ERISA Plans are subject to ERISA s general fiduciary requirements, including the requirement of investment prudence and diversification and the requirement that an ERISA Plan s investments be made in accordance with the documents governing the ERISA Plan. In addition, Section 406 of ERISA and Section 4975 of the Code prohibit certain transactions involving the assets of an ERISA Plan (as well as those plans that are not subject to ERISA but which are subject to Section 4975 of the Code, such as individual retirement accounts (together with ERISA Plans, Plans )) and certain persons (referred to as parties in interest or disqualified persons ) having certain relationships to such Plans, unless a statutory or administrative exemption is applicable to the transaction. A party in interest or disqualified person who engages in a prohibited transaction may be subject to excise taxes and other penalties and liabilities under ERISA and the Code and the prohibited transaction itself may have to be rescinded. Prohibited transactions within the meaning of Section 406 of ERISA or Section 4975 of the Code may arise if any Notes are acquired by a Plan with respect to which we, the Arrangers or any dealer or any of their respective affiliates are a party in interest or a disqualified person. Certain exemptions from the prohibited transaction provisions of Section 406 of ERISA and Section 4975 of the Code may be applicable, however, depending in part on the type of Plan fiduciary making the decision to acquire Notes and the circumstances under which such decision is made. There can be no assurance that any exemption will be available with respect to any particular transaction involving the Notes, or that, if an exemption is available, it will cover all aspects of any particular transaction. By its purchase of any Notes, the purchaser thereof will be deemed to have represented and agreed either that (i) it is not and for so long as it holds Notes will not be (and is not acquiring the Notes directly or indirectly with the assets of a person who is or, while the Notes are held, will be) an ERISA Plan or other Plan, an entity whose underlying assets include the assets of any such ERISA Plan or other Plan, or a governmental or other employee benefit plan which is subject to any U.S. federal, state or local law or foreign law, that is substantially similar to the provisions of Section 406 of ERISA or Section 4975 of the Code, or (ii) its purchase and holding of the Notes will not result in a non-exempt prohibited transaction under Section 406 of ERISA or Section 4975 of the Code (or, in the case of such a governmental or other employee benefit plan, a violation of any substantially similar U.S. federal, state or local law or foreign law). Similarly, each transferee of any Notes, by virtue of the transfer of such Notes to such transferee, will be deemed to have represented and agreed either that (i) it is not and for so long as it holds Notes will not be (and is not acquiring the Notes directly or indirectly with the assets of a person who is or while the Notes are held will be) an ERISA Plan or other Plan, an entity whose underlying assets include the assets of any such ERISA Plan or other Plan, or a governmental or other employee benefit plan which is subject to any U.S. federal, state or local law or foreign law, that is substantially similar to the provisions of Section 406 of ERISA or Section 4975 of the Code, or (ii) its purchase and holding of the Notes will not result in a non-exempt prohibited transaction under Section 406 of ERISA or Section 4975 of the Code (or, in the case of such a governmental or other employee benefit plan, a violation of any substantially similar federal, state or local law, or foreign law). 207

Governmental plans and certain church and other plans, while not subject to the fiduciary responsibility provisions of ERISA or the prohibited transaction provisions of ERISA and Section 4975 of the Code, may nevertheless be subject to state, local or other federal or foreign laws that are substantially similar to ERISA and the Code. Fiduciaries of any such plans should consult with their counsel before purchasing any Notes. The foregoing discussion is general in nature and not intended to be all-inclusive. Any Plan fiduciary who proposes to cause a Plan to purchase any Notes should consult with its counsel regarding the applicability of the fiduciary responsibility and prohibited transaction provisions of ERISA and Section 4975 of the Code to such an investment, and to confirm that such investment will not constitute or result in a non-exempt prohibited transaction or any other violation of an applicable requirement of ERISA or the Code. In addition, any insurance company proposing to use assets of its general account to purchase Notes should consider the implications of the United States Supreme Court s decision in John Hancock Mutual Life Insurance Co. v. Harris Trust and Savings Bank, 510 U.S. 86, 114 S. Ct. 517 (1993), which in certain circumstances treats such general account assets as assets of a Plan that owns a policy or other contract with such insurance company, as well as the effect of Section 401(c) of ERISA as interpreted by regulations issued by the United States Department of Labor in January 2000. The sale of Notes to a Plan is in no respect a representation by us or any dealers that such an investment meets all relevant requirements with respect to investments by Plans generally or any particular Plan, or that such an investment is appropriate for Plans generally or any particular Plan. 208

PLAN OF DISTRIBUTION The Notes will be offered on a continuous basis for sale by the Issuer to or through Banco Votorantim S.A. and/or Votorantim Bank Limited, together with such other dealers as may be appointed by the Issuer with respect to a particular series of Notes, pursuant to an amended and restated dealer agreement dated as of August 15, 2008 (the Dealer Agreement ) as amended or supplemented from time to time. We refer, collectively, to these entities as the dealers. One or more dealers may purchase Notes as principal from the Issuer from time to time for resale to investors and other purchasers at a fixed offering price or, if so specified in the applicable Final Terms, at varying prices relating to prevailing market prices at the time of resale as determined by any dealer. Each sale of Notes to any dealer as principal, for resale to one or more investors or to another broker-dealer (acting as principal for purposes of resale), will be made in accordance with the terms of the Dealer Agreement. Each Final Terms shall specify the principal amount and terms of the Notes to be purchased by a dealer, the time and date (each such time and date being referred to herein as a Time of Delivery ) and place of delivery of and payment for such Notes and such other information (as applicable) as is set forth in the Dealer Agreement. If the Issuer and a dealer agree, that dealer may also utilize its reasonable efforts on an agency basis to solicit offers to purchase the Notes. Commissions with respect to Notes that are sold through a dealer as an agent of the Issuer will be negotiated between the Issuer and that dealer at the time of such sale. A dealer may sell Notes it has purchased from the Issuer as principal to certain further dealers less a concession equal to all or any portion of the discount received in connection with such purchase. The dealer may allow, and such further dealers may reallow, a discount to certain other dealers. After the initial offering of Notes, the offering price (in the case of Notes to be resold at a fixed offering price), the concession and the reallowance may be changed. The Issuer may withdraw, cancel or modify the offering contemplated hereby without notice and may reject offers to purchase Notes in whole or in part (whether placed directly with us or through a dealer). Each dealer will have the right to reject, in whole or in part, any offer to purchase Notes received by it on an agency basis. Prior to the initial offering of Notes under this Program, there has been no established trading market for the Notes. The Issuer has applied to list the Program on the Irish Stock Exchange (Global Exchange Market) and Notes may be listed on the Irish Stock Exchange (Global Exchange Market), if so specified in the Final Terms. From time to time, the dealer(s) may make a market in the Notes, but no dealer is obligated to do so and may discontinue any market-making activity at any time. In addition, any such market-making activity will be subject to the limits imposed by the Securities Act and the Exchange Act. Accordingly, we cannot assure you as to the liquidity of, or the development or continuation of trading markets for, the Notes. In connection with the issue of any tranche of Notes, each dealer, if any, named as Stabilizing Manager in the relevant Final Terms (each a Stabilizing Manager ) (or persons acting on behalf of any Stabilizing Manager(s)) may over-allot Notes or effect transactions with a view to supporting the market price of the Notes at a level higher than that which might otherwise prevail. However, there is no assurance that the Stabilizing Manager(s) (or persons acting on behalf of a Stabilizing Manager) will undertake stabilization action. Any stabilization action may begin on or after the date on which adequate public disclosure of the terms of the offer of the relevant tranche of Notes is made and, if begun, may be ended at any time, but it must end no later than the earlier of 30 days after the issue date of the relevant tranche of Notes and 60 days after the date of the allotment of the relevant tranche of Notes. Neither the Issuer nor any of the dealers makes any representation or prediction as to the direction or magnitude of any effect that the transactions described in the immediately preceding paragraph may have on the price of Notes. In addition, the dealers are not required to engage in these activities, and neither the Issuer nor the dealers make any representation that the dealers will engage in any such transactions or that such transactions, once commenced, will not be discontinued without notice. 209

The Issuer has agreed to indemnify the dealers against some liabilities (including, without limitation, liabilities under the Securities Act) or to contribute to payments the dealers may be required to make in respect thereof. The Issuer has also agreed to reimburse the dealers for some other expenses. Some of the dealers have, directly or indirectly, performed investment and/or commercial banking or financial advisory services for the Issuer, for which they have received customary fees and commissions, and they expect to provide these services to us and our subsidiaries or affiliates in the future, for which they also expect to receive customary fees and commissions. European Economic Area In relation to each Member State of the European Economic Area which has implemented the Prospectus Directive (each, a Relevant Member State ), each dealer has represented and agreed, and each further dealer that is appointed under the Program will be required to represent and agree, that with effect from and including the date on which the Prospectus Directive is implemented in that Relevant Member State (the Relevant Implementation Date ) it has not made and will not make an offer to the public of any Notes in the Relevant Member State except that it may, with effect from and including the Relevant Implementation Date, make an offer to the public of such Notes in the Relevant Member State: (a) (b) (c) (d) if the applicable Final Terms in relation to the Notes specify that an offer of those Notes may be made other than pursuant to Article 3(2) of the Prospectus Directive in that Relevant Member State (a Non-exempt Offer ), following the date of publication of a prospectus in relation to such Notes which has been approved by the competent authority in that Relevant Member State or, where appropriate, approved in another Relevant Member State and notified to the competent authority in that Relevant Member State, provided that any such prospectus has subsequently been completed by the applicable Final Terms contemplating such Nonexempt Offer in accordance with the Prospectus Directive, in the period beginning and ending on the dates specified in such prospectus or the relevant Final Terms, as applicable; at any time to any legal entity which is a qualified investor as defined in the Prospectus Directive; at any time to fewer than 100 or, if the Relevant Member State has implemented the relevant provision of the 2010 PD Amending Directive, 150 natural or legal persons (other than qualified investors as defined in the Prospectus Directive) subject to obtaining the prior consent of the relevant dealer or dealers nominated by the Issuer for any such offer; or at any time in any other circumstances falling within Article 3(2) of the Prospectus Directive, provided that no such offer of Notes referred to in (b) to (d) above shall require the Issuer or any dealer to publish a prospectus pursuant to Article 3 of the Prospectus Directive or supplement a prospectus pursuant to Article 16 of the Prospectus Directive. For the purposes of this provision, the expression an offer of Notes to the public in relation to any Notes in any Relevant Member State means the communication in any form and by any means of sufficient information on the terms of the offer and the Notes to be offered so as to enable an investor to decide to purchase or subscribe the Notes, as the same may be varied in that Member State by any measure implementing the Prospectus Directive in that Member State and the expression Prospectus Directive means European Council Directive 2003/71/EC (and any amendment thereto, including the 2010 PD Amending Directive, to the extent implemented in the Relevant Member State) and includes any relevant implementing measure in each Relevant Member State and the 2010 PD Amending Directive means Directive 2010/73/EU. 210

United Kingdom Each dealer has represented and agreed, and each further dealer appointed under the Program will be required to represent and agree, that: (a) in relation to any Notes which have a maturity of less than one year, (i) it is a person whose ordinary activities involve it in acquiring, holding, managing or disposing of investments (as principal or agent) for the purposes of its business and (ii) it has not offered or sold and will not offer or sell any Notes other than to persons whose ordinary activities involve them in acquiring, holding, managing or disposing of investments (as principal or as agent) for the purposes of their businesses or who it is reasonable to expect will acquire, hold, manage or dispose of investments (as principal or agent) for the purposes of their businesses where the issue of the Notes would otherwise constitute a contravention of Section 19 of the Financial Services and Markets Act 2000 (the FSMA ) by the Issuer; (b) it has only communicated or caused to be communicated and will only communicate or cause to be communicated an invitation or inducement to engage in investment activity (within the meaning of Section 21 of the FSMA) received by it in connection with the issue or sale of any Notes in circumstances in which Section 21(1) of the FSMA does not apply to the Issuer; and (c) it has complied and will comply with all applicable provisions of the FSMA with respect to anything done by it in relation to any Notes in, from or otherwise involving the United Kingdom. In respect of any Notes which have a maturity of less than one year, the Issuer will issue such Notes only if the following conditions apply (or the Notes can otherwise be issued without contravention of Section 19 of the FSMA): (a) each relevant dealer represents, warrants and agrees to the selling restrictions set out in the Dealer Agreement; and (b) the redemption value of each such Note is not less than 100,000 (or an amount of equivalent value denominated wholly or partly in a currency other than Sterling), and no part of any Note may be transferred unless the redemption value of that part is not less than 100,000 (or such an equivalent amount). United States Each dealer subscribing for or purchasing Notes represents and agrees, and each dealer appointed under the Program described in these Listing Particulars that subscribes for or purchases Notes will be required to represent and agree, that: It will resell the Notes (a) outside the United States to non-u.s. Persons in offshore transactions in reliance on Regulation S and in accordance with applicable law and (b) with respect to certain identified Notes, in the United States through their respective dealers, in reliance on Rule 144A only to persons it reasonably believes to be qualified institutional buyers (as such term is defined in Rule 144A) purchasing for their own account or for the accounts of qualified institutional buyers. Any offer or sale of restricted Notes in reliance on Rule 144A will be made by broker-dealers who are registered as such under the Exchange Act. It has not offered or sold and will not offer or sell, or in the case of bearer Notes, deliver any unrestricted Notes within the United States or to, or for the account or benefit of, any U.S. Person (i) as part of its distribution at any time or (ii) otherwise until 40 days after the completion of the distribution of an identifiable tranche of which such Notes are a part, as determined and certified to the Fiscal Agent by such dealer (or, in the case of an identifiable tranche of Notes sold to or through more than one dealer, by each of such dealers with respect to Notes of an identifiable tranche purchased by or though it, in which case the Fiscal Agent shall notify such dealer when all such dealers have so certified), other than in accordance with Regulation S or another exemption from the registration requirements of the Securities Act, and that it will send to each distributor, dealer or person receiving a selling concession, fee or other remuneration to which it sells Regulation S Notes a confirmation or other notice setting forth the prohibition on offers and sales of the unrestricted Notes within the United States or to, or for the account or benefit of, any U.S. Person. Terms used in this paragraph have the meanings given to them in Regulation S. In the case of any Note that is a bearer Note, (i) except to the extent permitted under U.S. Treas. Reg. 1.163-5(c)(2)(i)(D) (the D Rules ), it has not offered or sold, and agrees that during the restricted period 211

it will not offer or sell, the Notes to a person who is within the United States or its possessions or to a United States Person, and it has not delivered and will not deliver within the United States or its possessions definitive Bearer Notes during the restricted period; (ii) it has and throughout the restricted period it will have in effect procedures reasonably designed to ensure that its employees or agents who are directly engaged in selling the Notes are aware that the Notes may not be offered or sold during the restricted period to a person who is within the United States or its possessions or to a United States person, except as permitted by the D Rules; (iii) if it is a United States person, it is acquiring the Notes for purposes of resale in connection with their original issue and if it retains Notes for its own account, it will only do so in accordance with the requirements of U.S. Treas. Reg. 1.163-5(c)(2)(i)(D)(6); (iv) with respect to each affiliate that acquires Notes from it for the purpose of offering or selling the Notes during the restricted period, it confirms the representations and agreements above on its behalf or agrees that it will obtain from such affiliate for the benefit of the Issuer such representations and agreements; and (v) it has not and will not enter into any written contract (other than a confirmation or other notice of the transaction) pursuant to which any other party to the contract (other than one of its affiliates or another dealer) has offered or sold, or during the restricted period will offer or sell, any Notes, except where pursuant to the contract the dealer has obtained or will obtain from that party, for the benefit of the Issuer and the several dealers, the foregoing representations and agreements. Neither the Issuer nor the Arrangers are registered as a broker-dealer under section 15 of the United States Securities Exchange Act of 1934, as amended (the Exchange Act ), and have agreed that, in connection with the any offer of Notes under the Program and subject to certain exceptions, they will not offer or sell any Notes in, or to persons who are nationals or residents of, the United States other than through a United States registered broker-dealer. Ireland Each dealer has represented and agreed in relation to the Notes that it has not and will not do anything in Ireland in connection with the Notes which might constitute a breach of Sections 9, 23 (including any advertising restrictions made thereunder) and 50 and any code of conduct made under Section 37 of the Investment Intermediaries Act 1995. Brazil The Notes have not been and will not be issued nor placed, distributed, offered or negotiated in the Brazilian capital markets. Neither the Issuer of the Notes nor the issuance of the Notes have been or will be registered with the CVM. Therefore, each dealers has represented and agreed that it has not offered or sold, and will not offer or sell, the Notes in Brazil, except in circumstances which do not constitute a public offering, placement, distribution or negotiation of securities in the Brazilian capital markets regulated by Brazilian legislation. Subsequent trading of the Notes in private transactions is not subject to registration in Brazil to the extent such trading does not qualify as a public offering or distribution. Persons wishing to offer or acquire the Notes within Brazil should consult with their own counsel as to the applicability of registration requirements or any exemption there from. 212

NOTICE TO INVESTORS The following information relates to the form and transfer of the Notes. Because of the following restrictions, purchasers of Notes offered in the United States in reliance on Rule 144A are advised to consult legal counsel prior to making any offer, resale, pledge or transfer of the Notes. The Notes have not been registered under the Securities Act and may not be offered or sold in the United States or to, or for the account or benefit of, U.S. persons except in accordance with an applicable exemption from the registration requirements thereof. Accordingly, the Notes are being offered and sold only (1) to QIBs in compliance with Rule 144A, or (2) outside the United States to non-u.s. persons in reliance upon Regulation S under the Securities Act. Each purchaser of Notes offered hereby or by any Final Terms, by its acceptance thereof, will be deemed to have acknowledged, represented to and agreed with the Issuer and the dealers as follows: (a) (b) It understands and acknowledges that the Notes have not been registered under the Securities Act or any other applicable securities law, are being offered for resale in transactions not requiring registration under the Securities Act or to any other securities laws, including sales pursuant to Rule 144A under the Securities Act, and, unless so registered, may not be offered, sold or otherwise transferred except in compliance with the registration requirements of the Securities Act, or any other applicable securities law, pursuant to an exemption therefrom or in a transaction not subject thereto and in each case in compliance with the conditions for transfer set forth in paragraph (4) below. It is not the Issuer s affiliate (as defined in Rule 144 under the Securities Act) or acting on the Issuer s behalf and it is: (iv) (v) a QIB and is aware that any sale of the Notes to it will be made in reliance on Rule 144A. Such acquisition will be for its own account or for the account of another QIB; or a person who, at the time the buy order for the Notes was originated, was outside the United States and was not a U.S. person (and was not purchasing for the account or benefit of a U.S. person) within the meaning of Regulation S under the Securities Act. (c) (d) It acknowledges that neither the Issuer nor the Arrangers or any person representing us or the Arrangers has made any representation to it with respect to us or the offering or sale of any Notes, other than the information contained or incorporated by reference in these Listing Particulars or in any Final Terms, which has been delivered to it and upon which it is relying in making its investment decision with respect to the Notes. It acknowledges that no representation or warranty is made by the Arrangers as to the accuracy or completeness of such materials. It has had access to such financial and other information concerning us and the Notes as it has deemed necessary in connection with its decision to purchase the Notes, including an opportunity to ask questions of and request information from us or the Arrangers. It is purchasing the Notes for its own account, or for one or more investor accounts for which it is acting as a fiduciary or agent, in each case for investment, and not with a view to, or for offer or sale in connection with, any distribution thereof in violation of the Securities Act, subject to any requirements of law that the disposition of its property or the property of such investor account or accounts be at all times within its or their control and subject to its or their ability to resell such Notes pursuant to an effective registration statement under the Securities 213

Act, Rule 144A, Regulation S or any exemption from registration available under the Securities Act. It agrees on its own behalf and on behalf of any investor account for which it is purchasing the Notes and each subsequent holder of the Notes by its acceptance thereof will agree (I) to offer, resell, pledge or otherwise transfer such Notes only in accordance with the Securities Act and any applicable securities law of any state of the United States and, prior to the applicable legend being removed at the option of the Issuer (the resale restriction termination date ), only (a) to the Issuer, (b) pursuant to a registration statement which has been declared effective under the Securities Act, (c) for so long as the Notes are eligible for resale pursuant to Rule 144A to a person it reasonably believes is a QIB that purchases for its own account or for the account of a QIB to whom notice is given that the transfer is being made in reliance on Rule 144A, (d) pursuant to offers and sales to non-u.s. persons that occur outside the United States within the meaning of Regulation S or (e) pursuant to another available exemption from the registration requirements of the Securities Act; (II) in connection with any transfer of any note in certificated form, to check the box provided on the reverse thereof relating to the manner of such transfer and surrender such note to the Fiscal Agent; (III) if any proposed transfer is being made in accordance with (I)(d) or (e) above prior to the resale restriction termination date, to acknowledge that the Issuer reserves the right, prior to such transfer, to require the delivery of such certifications, legal opinions or other information satisfactory to the Issuer to confirm that the proposed transfer is being made pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act; (IV) to acknowledge that the Fiscal Agent will not be required to accept for registration of transfer any Notes, except upon presentation of evidence satisfactory to us and the Fiscal Agent that the foregoing restrictions on transfer have been complied with; and (V) to agree to provide to any person acquiring any of the Notes from it a notice advising such person that resales of the Notes are restricted as stated herein and that certificates representing the Notes may bear a legend to that effect. (e) Each purchaser of Rule 144A global Notes acknowledges that each such Rule 144A global Note will contain a legend substantially to the following effect: THIS RULE 144A RESTRICTED GLOBAL NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE SECURITIES ACT ) OR WITH ANY SECURITIES REGULATORY AUTHORITY OF ANY STATE OR OTHER JURISDICTION OF THE UNITED STATES AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (1) TO THE ISSUER, (2) PURSUANT TO A REGISTRATION STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (3) IN ACCORDANCE WITH RULE 144A UNDER THE SECURITIES ACT TO A PERSON THAT THE HOLDER AND ANY PERSON ACTING ON ITS BEHALF REASONABLY BELIEVE IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER, (4) IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 903 OR RULE 904 OF REGULATION S UNDER THE SECURITIES ACT OR (5) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED (IF AVAILABLE), IN EACH CASE IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES. NO REPRESENTATION CAN BE MADE AS TO THE AVAILABILITY OF THE EXEMPTION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT FOR RESALES OF THIS RULE 144A 214

RESTRICTED GLOBAL NOTE. THIS LEGEND MAY ONLY BE REMOVED WITH THE CONSENT OF THE ISSUER. (f) Each purchaser of Regulation S global Notes acknowledges that each such Regulation S global Note will contain a legend substantially to the following effect: THIS REGULATION S UNRESTRICTED GLOBAL NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933 (THE SECURITIES ACT ) OR WITH ANY SECURITIES REGULATORY AUTHORITY OF ANY STATE OR OTHER JURISDICTION OF THE UNITED STATES AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED WITHIN THE UNITED STATES EXCEPT PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT. THIS LEGEND MAY BE REMOVED AFTER 40 CONSECUTIVE DAYS BEGINNING ON AND INCLUDING THE LATER OF (A) THE DAY ON WHICH THE SECURITIES ARE OFFERED TO PERSONS OTHER THAN DISTRIBUTORS (AS DEFINED IN REGULATION S) AND (B) THE DATE OF THE CLOSING OF THE ORIGINAL OFFERING. (g) (h) (i) If it is a purchaser in a sale that occurs outside the United States within the meaning of Regulation S under the Securities Act, it agrees that until the expiration of a 40-day distribution compliance period within the meaning of Rule 903 of Regulation S under the Securities Act, no offer or sale of the Notes will be made by it to a U.S. person or for the account or benefit of a U.S. person within the meaning of Rule 902(k) of the Securities Act, except to a QIB and in compliance with the applicable restrictions set forth in paragraph (4) above. It acknowledges that the Issuer and the Arrangers will rely upon the truth and accuracy of the foregoing acknowledgments, representations and agreements and agrees that, if any of the acknowledgments, representations or warranties deemed to have been made by its purchase of Notes are no longer accurate, it shall promptly notify us and the Arrangers. If it is acquiring any Notes as a fiduciary or agent for one or more investor accounts, it represents that it has sole investment discretion with respect to each such account and that it has full power to make the foregoing acknowledgments, representations and agreements on behalf of each such account. With respect to the purchase and holding of any Notes, either (a) the purchaser and holder is not (i) an employee benefit plan (as defined in Section 3(3) of ERISA) that is subject to Title I of ERISA, (ii) a plan described in and subject to Section 4975 of the Code, (iii) an entity whose underlying assets include plan assets (within the meaning of ERISA) or (iv) a governmental or other plan which is subject to any U.S. federal, state or local law or foreign law that is substantially similar to the provisions of Section 406 of ERISA or Section 4975 of the Code; or (b) its purchase and holding of any Notes will not result in a non-exempt prohibited transaction under Section 406 of ERISA or Section 4975 of the Code (or, in the case of a governmental or other plan, a violation of any substantially similar U.S. federal, state or local law or foreign law). 215

LEGAL MATTERS Proskauer Rose LLP has advised the Arrangers on certain English law matters in connection with the Program. Campos Mello Advogados has advised us on certain Brazilian law matters in connection with the Program. 216

INDEPENDENT ACCOUNTANTS The consolidated financial statements of Banco Votorantim and its subsidiaries as of and for the years ended December 31, 2010, 2009 and 2008 included in these Listing Particulars, have been audited by KPMG Auditores Independentes, independent accountants, as stated in its reports appearing elsewhere in these Listing Particulars. KPMG Auditores Independentes is registered with the CFC and the CVM. 217

GENERAL INFORMATION Unless otherwise indicated, all information contained in this section is at the date of these Listing Particulars. 1. The establishment of the Program and the issuance of Notes thereunder is authorized by the Issuer s by-laws. 2. Application has been made to the Irish Stock Exchange for any Notes issued under the Program for the period of 12 months from the date of these listing particulars to be listed on the Official List of the Irish Stock Exchange and to be admitted for trading on the Irish Stock Exchange (Global Exchange Market). There can be no assurance that listing on the Irish Stock Exchange (Global Exchange Market) will be achieved prior to the issue date of any Notes or otherwise or that, if obtained, such listing will be maintained. 3. In March 2003 the European Commission published a proposal for a Directive of the European Parliament and of the Council on the harmonization of transparency requirements with regard to information about issuers whose securities are admitted to trading on a regulated market in the European Union (2004/109/EC) (the Transparency Directive ). While the Irish Stock Exchange (Global Exchange Market) is not a regulated market for the purposes of Directive 2004/39/EC, if the Transparency Directive is implemented in a manner which would require the Issuer to publish financial information either more regularly than it otherwise would be required to or according to accounting principles which are materially different from the accounting principles which the Issuer would otherwise use to prepare its financial information, the Issuer may seek an alternative admission to listing, trading and/or quotation for the Notes by such other listing authority, stock exchange and/or quotation system outside the European Union. Notice of any such termination and/or alternative listing shall promptly be given to Noteholders in accordance with Condition 21 (Notices). 4. The update of the Program and the execution of all documents in connection therewith was authorized by the Board of Executive Officers of the Issuer. All consents, approvals, authorizations and other orders of all regulatory authorities under the laws of Brazil have been given for the establishment of the Program, the issue of Notes under the Program and the execution of the Amended and Restated Fiscal Agency Agreement and Amended and Restated Deed of Covenant and are in full force and effect. Where the Issuer is acting through its principal office in Brazil in an issuance of the Notes under the Program, the Issuer shall be required to fulfill the following additional requirements: (i) the electronic registration of the financial terms and conditions of the Notes under the relevant ROF for the issue of any series of Notes, which shall be obtained prior to any such issuance; (ii) the registration in the ROF of the relevant schedule of payments, which shall be obtained after the entry into Brazil of the related proceeds; (iii) the obtaining of further authorizations from the Central Bank to make payments outside Brazil other than scheduled payments of principal, interest, commissions, fees and expenses as contemplated by the ROF and (iv) any necessary amendments or revalidations to the ROF and schedules of payments. 5. Except as disclosed in these Listing Particulars (see Business Legal Proceedings ), neither Banco Votorantim S.A. nor any of its subsidiaries is or has been involved in any governmental, legal or arbitration proceedings (including any such proceedings which are pending or threatened of which Banco Votorantim S.A. is aware) during the 12 months preceding the date of these Listing Particulars which may have or have had in the recent past significant effects, on the financial position or profitability of the Issuer. 6. Except as disclosed herein, there has been no significant change in the financial or trading position of Banco Votorantim S.A. or any of its subsidiaries and no material adverse change in the prospects of Banco Votorantim S.A. or any of its subsidiaries since December 31, 2010. 7. For so long as the Program remains in effect or any Notes shall be outstanding, physical copies of the following documents may be inspected during normal business hours (i) at the specified office of 218

the Listing Agent in Ireland, (ii) at the specified offices of any Paying Agent or Transfer Agent and (iii) at the registered office of Banco Votorantim S.A. in São Paulo, Brazil, namely: (a) (b) (c) (d) (e) (f) (g) the constitutive documents of Banco Votorantim S.A.; the Listing Particulars and any Final Terms relating to Notes which are admitted to listing, trading and/or quotation by any listing authority, stock exchange and/or quotation system (Final Terms relating to an unlisted Note will only be available for inspection by a holder of such Note and such holder must produce evidence satisfactory to the Listing Agent, Paying Agent, Transfer Agent or the Issuer, as the case may be, as to its holding of Notes and identity); the Amended and Restated Agency Agreement; the Amended and Restated Deed of Covenant; the Amended and Restated Dealer Agreement; the Amended and Restated Program Manual (which contains the forms of the Notes in global and definitive form); the most recent publicly available audited consolidated and non-consolidated annual financial statements of Banco Votorantim S.A. beginning with such financial statements for the years ended December 31, 2010, 2009 and 2008. In addition, copies of the items listed in (a) and (g) above will be provided free of charge at the Specified Offices of the Paying Agents, Transfer Agents and Listing Agent upon oral or written request. 8. The ISIN, CUSIP and Common Code numbers for any notes which have been accepted for clearance by DTC, Euroclear and/or Clearstream, Luxembourg, as the case may be, will be specified in the relevant Final Terms. 9. The issue price and the amount of the relevant Notes will be determined, before filing of the relevant Final Terms of each tranche of Notes, based on then prevailing market conditions. The Issuer does not intend to provide any post-issuance information in relation to any issues of Notes. 10. The total expenses related to the admission to trading are expected to be approximately EUR1,940. 219

ANNEX A FORM OF FINAL TERMS The Final Terms in respect of each Tranche of Notes will be substantially in the following form, duly supplemented (if necessary), amended (if necessary) and completed to reflect the particular terms of the relevant Notes and their issue. Text in this section appearing in italics does not form part of the form of the Final Terms but denotes directions for completing the Final Terms. Final Terms dated [date] BANCO VOTORANTIM S.A. (acting through its principal office in São Paulo) U.S.$5,000,000,000 Global Medium Term Note Program Series No: [ ] [TITLE OF NOTES] [FOREIGN CURRENCY CONSTRAINT] NOTES DUE [ ] Issue price: [ ] [THE NOTES CONTAIN A FOREIGN CURRENCY CONSTRAINT PROVISION, AS MORE FULLY DESCRIBED IN THE CONDITIONS (AS DEFINED BELOW). DURING A FOREIGN CURRENCY CONSTRAINT EVENT (AS DEFINED IN THE CONDITIONS) HOLDERS OF NOTES MAY ELECT TO EXCHANGE THE NOTES FOR AN EQUIVALENT NOMINAL AMOUNT OF EXCHANGED NOTES (AS DEFINED IN THE CONDITIONS) WITH TERMS AND CONDITIONS IDENTICAL TO THE CONDITIONS EXCEPT THAT PAYMENTS IN RESPECT OF THE EXCHANGED NOTES WILL BE MADE IN THE LAWFUL CURRENCY OF BRAZIL. AFTER THE TERMINATION OF THE FOREIGN CURRENCY CONSTRAINT EVENT EXCHANGED NOTES WILL BE EXCHANGED FOR AN EQUIVALENT NOMINAL AMOUNT OF THE NOTES AND SUCH HOLDER WILL RECEIVE FUTURE PAYMENTS IN RESPECT OF THE NOTES IN THE SPECIFIED CURRENCY (AS DEFINED BELOW). IF A HOLDER DOES NOT ELECT TO RECEIVE PAYMENTS IN THE LAWFUL CURRENCY OF BRAZIL BY MAKING SUCH EXCHANGE, AFTER THE TERMINATION OF THE FOREIGN CURRENCY CONSTRAINT, SUCH HOLDER WILL RECEIVE PAYMENTS IN RESPECT OF THE NOTES IN THE SPECIFIED CURRENCY. A FOREIGN CURRENCY CONSTRAINT EVENT WILL NOT BE DEEMED TO BE AN EVENT OF DEFAULT.] [DEALER NAME(S)] This document constitutes the Final Terms relating to the issue of Notes described herein. Terms used herein shall be deemed to be defined as such for the purposes of the Conditions set forth in the Listing Particulars dated [date] [and the supplemental Listing Particulars dated [date]]. All references to Final Terms should also be read as references to pricing supplement. These Final Terms must be read in conjunction with such Listing Particulars [as so supplemented]. The Listing Particulars are available for viewing at [address]. [The following alternative language applies if the first tranche of an issue which is being increased was issued under Listing Particulars with an earlier date. Terms used herein shall be deemed to be defined as such for the purposes of the Conditions (the Conditions ) set forth in the Listing Particulars dated [original date]. These Final Terms contain the final terms of the Notes and must be read in conjunction with the Listing Particulars dated [current date] [and the supplemental Listing Particulars dated [date]], save in respect of the Conditions which are extracted from the Listing Particulars dated [original date] and are attached hereto.] A-1

THE NOTES HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933 (THE SECURITIES ACT ). SUBJECT TO CERTAIN EXCEPTIONS, THE NOTES MAY NOT BE [OFFERED OR SOLD/OFFERED, SOLD OR DELIVERED] WITHIN THE UNITED STATES [OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS (AS DEFINED IN REGULATION S UNDER THE SECURITIES ACT ( REGULATION S ))]. THESE FINAL TERMS HAVE BEEN PREPARED BY THE ISSUER FOR USE IN CONNECTION WITH THE OFFER AND SALE OF THE NOTES OUTSIDE THE UNITED STATES TO NON-U.S. PERSONS IN RELIANCE ON REGULATION S [AND WITHIN THE UNITED STATES TO QUALIFIED INSTITUTIONAL BUYERS IN RELIANCE ON RULE 144A UNDER THE SECURITIES ACT ( RULE 144A)] [AND FOR LISTING OF THE NOTES ON THE GLOBAL EXCHANGE MARKET OF THE IRISH STOCK EXCHANGE]. [PROSPECTIVE PURCHASERS ARE HEREBY NOTIFIED THAT SELLERS OF THE NOTES MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A]. FOR A DESCRIPTION OF THESE AND CERTAIN FURTHER RESTRICTIONS ON OFFERS AND SALES OF THE NOTES AND DISTRIBUTION OF THESE FINAL TERMS AND THE REMAINDER OF THE LISTING PARTICULARS, SEE PLAN OF DISTRIBUTION AND NOTICE TO INVESTORS CONTAINED IN THE LISTING PARTICULARS. [THE NOTES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE U.S. SECURITIES AND EXCHANGE COMMISSION, ANY STATE SECURITIES COMMISSION IN THE UNITED STATES OR ANY OTHER U.S. REGULATORY AUTHORITY, NOR HAVE ANY OF THE FOREGOING AUTHORITIES PASSED UPON OR ENDORSED THE MERITS OF THE OFFERING OF NOTES OR THE ACCURACY OR THE ADEQUACY OF THESE FINAL TERMS OR THE LISTING PARTICULARS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENCE IN THE UNITED STATES.] [TO NEW HAMPSHIRE RESIDENTS: NEITHER THE FACT THAT A REGISTRATION STATEMENT OR AN APPLICATION FOR A LICENSE HAS BEEN FILED UNDER CHAPTER 421- B OF THE NEW HAMPSHIRE REVISED STATUTES WITH THE STATE OF NEW HAMPSHIRE NOR THE FACT THAT A SECURITY IS EFFECTIVELY REGISTERED OR A PERSON IS LICENSED IN THE STATE OF NEW HAMPSHIRE CONSTITUTES A FINDING BY THE SECRETARY OF STATE OF NEW HAMPSHIRE THAT ANY DOCUMENT FILED UNDER RSA 421-B IS TRUE, COMPLETE AND NOT MISLEADING. NEITHER ANY SUCH FACT NOR THE FACT THAT AN EXEMPTION OR EXCEPTION IS AVAILABLE FOR A SECURITY OR A TRANSACTION MEANS THAT THE SECRETARY OF STATE HAS PASSED IN ANY WAY UPON THE MERITS OR QUALIFICATIONS OF, OR RECOMMENDED OR GIVEN APPROVAL TO, ANY PERSONS, SECURITY OR TRANSACTION. IT IS UNLAWFUL TO MAKE, OR CAUSE TO BE MADE, TO ANY PROSPECTIVE PURCHASER, CUSTOMER OR CLIENT ANY REPRESENTATION INCONSISTENT WITH THE PROVISIONS OF THIS PARAGRAPH.] [ANY UNITED STATES PERSON WHO HOLDS THIS OBLIGATION WILL BE SUBJECT TO LIMITATIONS UNDER THE UNITED STATES INCOME TAX LAWS, INCLUDING THE LIMITATIONS PROVIDED IN SECTIONS 165(j) AND 1287(a) OF THE INTERNAL REVENUE CODE.] [THIS NOTE IS BEING ISSUED WITH ORIGINAL ISSUE DISCOUNT ( OID ). THE ISSUE PRICE, ORIGINAL ISSUE DATE, TOTAL AMOUNT OF OID, YIELD TO MATURITY, AND, IF APPLICABLE, THE COMPARABLE YIELD AND PROJECTED PAYMENT SCHEDULE OF THE NOTE MAY BE OBTAINED BY CONTACTING.] [Include whichever of the following apply or specify as Not Applicable (N/A). Note that the numbering should remain as set out below, even if Not Applicable is indicated for individual paragraphs or subparagraphs. Italics denote directions for completing the Final Terms.] A-2

1. Issuer: Banco Votorantim S.A., acting through its principal office in São Paulo. 2. [(i)] Series Number: [ ] [(ii) Tranche Number: (If fungible with an existing Series, details of that Series, including the date on which the Notes become fungible).] [ ] 3. Specified Currency or Currencies: [ ] 4. Aggregate Nominal Amount: [(i)] Series: [(ii) Tranche [ ] [ ]] 5. [(i)] Issue Price: [ ] per cent. of the Aggregate Nominal Amount [plus accrued interest from [insert date] (in the case of fungible issues only, if applicable)] [(ii) Net proceeds: [ ] (Required only for listed issues)] 6. Specified Denominations: [ ] 7. [(i)] Issue Date: [(ii)] Interest Commencement Date (if different from the Issue Date): 8. Maturity Date: [specify date or (for Floating Rate Notes) Interest Payment Date falling in the relevant month and year] 9. Interest Basis: [[ ]% Fixed Rate] [[specify reference rate] +/- [[ ]% Floating Rate] [Zero Coupon] [Index-Linked Interest] [Other (specify)] (further particulars specified below) 10. Redemption/Payment Basis (Condition 11): 11. Change of Interest or Redemption/ Payment Basis: [ ] [ ] [Redemption at par] [Index-Linked Redemption (specify)] [Dual Currency (specify)] [Partly Paid (specify)] [Partly Paid (specify)] [Installment (specify)] [Other (specify)] [Specify details of any provision for convertibility of Notes into another interest or redemption/ payment basis] 12. Put/Call Options: [Noteholder Put] [Issuer Call] [(further particulars specified below)] 13. (i) Status of the Notes: [Senior] [specify status if different from Condition 6] (ii) Date [Board] approval for issuance of Notes obtained: [ ] (Only relevant where Board or similar authorization is A-3

required for the particular tranche of Notes) 14. Listing: [Irish Stock Exchange (Global Exchange Market)/specify other/none] 15. Method of distribution: [Syndicated/Non-syndicated] PROVISIONS RELATING TO INTEREST (IF ANY) PAYABLE 16. Fixed Rate Note Provisions (Condition 8): [Applicable/Not Applicable] (If not applicable, delete the remaining sub-paragraphs of this paragraph) (i) Rate[(s)] of Interest: [ ] per cent. per annum [payable [annually/semiannually/quarterly/monthly] in arrear] (If payable other than annually, consider amending Condition 8) (ii) Interest Payment Date(s): [[ ] in each year up to and including the Maturity Date/specify other] (iii) Fixed Coupon Amount[(s)]: [ ] [per Note of [ ] Specified Denomination and per Note of [ ] Specified Denomination] (iv) Day Count Fraction: [30/360] [Actual/Actual (ISMA)] or [specify other] (Day count fraction should be Actual/Actual-ISMA for all fixed rate issues other than those denominated in U.S. dollars, unless otherwise requested) (v) Broken Amount(s): [Insert particulars of any initial or final broken interest amounts which do not correspond with the Fixed Coupon Amount[(s)] (vi) Interest Determination Date(s): (vii) Other terms relating to the method of calculating interest for Fixed Rate Notes: 17. Floating Rate Note Provisions (Condition 9): (i) Specified Period(s)/Specified Interest Payment Dates: [Insert day(s) and month(s) on which interest is normally paid (if more than one, then insert such dates in the alternative) in each year-only to be completed for any issue where day count fraction is Actual/Actual (ISMA)] [Not Applicable/give details] (Consider if day count fraction, particularly for U.S. dollar denominated issues, should be on an Actual/Actual basis) [Applicable/Not Applicable] (If not applicable, delete the remaining sub-paragraphs of this paragraph) [ ] (ii) Business Day Convention: [Floating Rate Convention/Following Business Day Convention/Modified Following Business Convention/Preceding Business Day Convention/specify others] (iii) Additional Business Centre(s): (iv) Manner in which the Rate(s) of Interest [Not Applicable/give details] [Screen Rate Determination/ISDA A-4

(v) is/are to be determined: Party responsible for calculating the Rate(s) of Interest and Interest Amount(s): (vi) Screen Rate Determination: Determination/specify others] [Name] shall be the Calculation Agent - Reference Rate: [For example, LIBOR or EURIBOR] - Relevant Screen Page: [For example, Telerate page 3750/248] - Interest Determination Date(s): [ ] - Relevant Time: [For example, 11.00 a.m. London time/brussels time] - Reference Banks: [specify] - Relevant Financial Centre: [specify] (vii) ISDA Determination: - Floating Rate Option: [ ] - Designated Maturity: [ ] - Reset Date: [ ] - ISDA Definitions (if different from those set out in the Conditions): (Second London business day prior to the start of each Interest Period if LIBOR (other than Sterling or euro LIBOR), first day of each Interest Period if Sterling LIBOR and the second day on which the TARGET System is operating prior to the start of each Interest Period if EURIBOR or euro LIBOR) [ ] (viii) Margin(s): [+/-][ ] per cent. per annum (ix) Minimum Rate of Interest: [ ] per cent. per annum (x) Maximum Rate of Interest: [ ] per cent. per annum (xi) Day Count Fraction: [ ] (xii) Rate Multiplier: [ ] (xiii) Fall back provisions, rounding provisions, denominator and any other terms relating to the method of calculating interest on Floating Rate Notes, if different from those set out in the Conditions: 18. Zero Coupon Note Provisions (Condition 10(b)): [ ] [Applicable/Not Applicable] (If not applicable, delete the remaining subparagraphs of this paragraph) (i) Accrual Yield: [ ] per cent per annum (ii) Reference Price: [ ] (iii) Basis: [ ] A-5

(iv) Day Count Fraction: [ ] (v) Any other formula/basis of determining amount payable: 19. Index-Linked Interest Note Provisions Condition 9): [ ] [Applicable/Not Applicable] (If not applicable, delete the remaining subparagraphs of this paragraph) (i) Index/Formula: [Give or annex details] (ii) Calculation Agent responsible for calculating the interest due: (iii) Provisions for determining Coupon where calculation by reference to Index and/or Formula is impossible or impracticable: [ ] [ ] (iv) Interest Periods: [ ] (v) Specified Period(s)/Specified Interest Payment Dates: (vi) Business Day Convention: [ ] (vii) Additional Business Centre(s): [ ] (viii) Minimum Rate of Interest: [ ] per cent. per annum (ix) Maximum Rate of Interest: [ ] per cent. per annum (x) Day Count Fraction: [ ] 20. Dual Currency Note Provisions (Condition 10(a)): (i) (ii) Rate of Exchange/method of calculating Rate of Exchange: Calculation Agent, if any, responsible for calculating the interest due: (iii) Provisions applicable where calculation by reference to Rate of Exchange impossible or impracticable: (iv) Person at whose option Specified Currency(ies) is/are payable: [Floating Rate Convention/ Following Business Day Convention/Modified Following Business Convention/Preceding Business Day Convention/specify other] [Applicable/Not Applicable] (If not applicable, delete the remaining sub-paragraphs of this paragraph) [Give details] [ ] [ ] [ ] (v) Day Count Fraction: [ ] PROVISIONS RELATING TO REDEMPTION 21. Call Option (Condition 11(c)): [Applicable/Not Applicable] (If not applicable, delete the remaining sub-paragraphs of this paragraph) (i) Optional Redemption Date(s) (Call): [ ] A-6

(ii) Optional Redemption Amount(s) (Call) and method, if any, of calculation of such amount(s): (iii) If redeemable in part: (a) Minimum Redemption Amount: [ ] (b) Maximum Redemption Amount: [ ] (iv) Notice period (if other than as set out in the Conditions): [ ] per Note of [ ] Specified Denomination [ ] (If setting notice periods which are different to those provided in the Conditions, the Issuer is advised to consider the practicalities of distribution of information through intermediaries, for example, clearing systems and custodians, as well as any other notice requirements which may apply, for example, as between the Issuer and the Agent) 22. Put Option (Condition 11(e)): [Applicable/Not Applicable] (If not applicable, delete the remaining subparagraphs of this paragraph) (i) Optional Redemption Date(s) (Put): [ ] (ii) Optional Redemption Amount(s) (Put) and method, if any, of calculation of such amount(s): (iii) Notice period (if other than as set out in the Conditions): [ ] per Note of [ ] Specified Denomination [ ] (If setting notice periods which are different to those provided in the Conditions, the Issuer is advised to consider the practicalities of distribution of information through intermediaries, for example, clearing systems and custodians, as well as any other notice requirements which may apply, for example, as between the Issuer and the Agent) 23. Final Redemption Amount: [[ ] per Note of [ ] Specified Denomination/specify other/see Appendix] 24. Early Redemption Amount (Tax): [ ] 25. (i) Early Termination Amount: [ ] (ii) Unmatured Coupons to become void: [ ] GENERAL PROVISIONS APPLICABLE TO THE NOTES 26. Form of Notes: [Bearer Notes/Registered Notes] [delete as appropriate] Bearer Notes (i) Temporary or Permanent Global Note: [Temporary Global Note exchangeable for a Permanent Global Note which is exchangeable for definitive Bearer Notes in the limited circumstances specified in the Permanent Global Note] [Permanent Global Note exchangeable for definitive Bearer Notes in the limited circumstances specified in the A-7

(ii) Exchange Date in respect of Temporary Global Note: (iii) Applicable TEFRA exemption: Rule 144A Restricted Global Note and/or Regulation S Unrestricted Global Note or Individual Certificated Notes: 27. Additional Financial Centre(s) or other special provisions relating to Payment Dates: 28. Talons for future Coupons to be attached to definitive Bearer Notes (and dates on which such Talons mature: 29. Details relating to Partly Paid Notes: amount of each payment comprising the Issue Price and date on which each payment is to be made and consequences (if any) of failure to pay, including any right of the Issuer to forfeit the Notes and interest due on late payment: Permanent Global Note] [Not Applicable/specify date] [C Rules/D Rules/Not Applicable] Registered Notes [Rule 144A Restricted Global Note and/or Regulation S Unrestricted Global Note available on Issue Date] [Individual Certificated Notes available on Issue Date] [Not Applicable/give details. Note that this item relates to the place of payment, and not interest period end dates, to which item 17(iii) relates] [Yes/No. If yes, give details] [Not Applicable/give details] 30. Details relating to Installment Notes: [Not Applicable/give details of amount of each installment, date on which each payment is to be made] 31. Redenomination, renominalization and reconventioning provisions: [Not Applicable/The provisions [in Condition 24 (Redenomination, Renominalization and Reconventioning)] [annexed to these Final Terms] apply] 32. Foreign Currency Constraint: [Applicable/Not Applicable] [If applicable, specify any amendments to Condition 25] 33. Consolidation provisions: [Not Applicable/The provisions [in Condition 20 (Further Issues)] [annexed to these Final Terms] apply] 34. Other terms or special conditions: [Not Applicable/Ratings/give details] DISTRIBUTION 35. (i) If syndicated, names of Managers: [Not Applicable/give names] (ii) Stabilizing Manager (if any): [Not Applicable/give names] 36. If non-syndicated, name of Dealer: [Not Applicable/give names] 37. Additional selling restrictions: [Not Applicable/give names] A-8

OPERATIONAL INFORMATION 38. (i) ISIN Code: [ ] (ii) CUSIP: [ ] (iii) CINS: [ ] (iv) Other: [ ] 39. Common Code: [ ] 40. Any clearing system(s) other than DTC, Euroclear and Clearstream, Luxembourg and the relevant identification number(s): [Not Applicable/give name(s) and number(s)] 41. Delivery: Delivery [against/free of] payment 42. Additional Agent(s) (if any): [ ] [LISTING APPLICATION Application has been made to the Irish Stock Exchange for any Notes issued under the Program for the period of 12 months from the date of these Listing Particulars to be listed on the Official List of the Irish Stock Exchange and to be admitted for trading on its Global Exchange Market. These Final Terms comprise the final terms required to list the issue of Notes described herein pursuant to the U.S.$5,000,000,000 Global Medium Term Note Program of Banco Votorantim S.A., acting through its principal office in São Paulo.] [STABILIZING In connection with the issue of the Notes, [enter name of stabilizing manager] (the Stabilizing Manager ) (or persons acting on behalf of any Stabilizing Manager) may over-allot Notes or effect transactions with a view to supporting the market price of the Notes at a level higher than that which might otherwise prevail. However, there is no assurance that the Stabilizing Manager (or persons acting on behalf of the Stabilizing Manager) will undertake stabilization action. Any stabilization action may begin on or after the date on which adequate public disclosure of the terms of the offer of the Notes is made and, if begun, may be ended at any time, but it must end no later than the earlier of 30 days after the issue date of the Notes and 60 days after the date of the allotment of the Notes.] RESPONSIBILITY The Issuer accepts responsibility for the information contained in these Final Terms. MATERIAL ADVERSE CHANGE STATEMENT There has been no material adverse change in the financial or trading position of the Issuer and its subsidiaries (taken as a whole) and no material adverse change in the financial position or prospects of the Issuer and its subsidiaries (taken as a whole) since December 31, 2010. GOVERNING LAW The Notes and all matters arising from or connected with the Notes are governed by, and shall be construed in accordance with, English law. A-9

Signed on behalf of the Issuer: By: Officer Duly authorized By: Officer Duly authorized A-10

INDEX TO FINANCIAL STATEMENTS Independent auditors report on the financial statements as of and for the years ended December 31, 2010 and 2009... F-4 Consolidated Balance Sheets as of December 31, 2010 and 2009...F-6 Consolidated Statements of Income for the years ended December 31, 2010 and 2009...F-7 Consolidated Statements of Changes in Shareholders Equity for the years ended December 31, 2010 and 2009...F-8 Consolidated Statements of Cash Flow for the years ended December 31, 2010 and 2009...F-9 Consolidated Statements of Added Value for the years ended December 31, 2010 and 2009...F-10 Notes to the Consolidated Financial Statements as of December 31, 2010 and 2009...F-11 Independent auditors report on the financial statements as of and for the years ended December 31, 2009 and 2008... F-86 Consolidated Balance Sheets as of December 31, 2009 and 2008...F-87 Consolidated Statements of Income for the years ended December 31, 2009 and 2008...F-88 Consolidated Statements of Changes in Shareholders Equity for the years ended December 31, 2009 and 2008...F-89 Consolidated Statements of Changes in Cash Flow for the years ended December 31, 2009 and 2008...F-90 Consolidated Statements of Added Value for the years ended December 31, 2009 and 2008...F-91 Notes to the Consolidated Financial Statements as of December 31, 2009 and 2008...F-92 Page F-1

Banco Votorantim S.A. Financial statements December 31, 2010 and 2009 F-2

Banco Votorantim S.A. Financial statements December 31, 2010 and 2009 Contents Independent auditors report on the financial statements 3-4 Balance sheets 5 Statements of income 6 Statements of changes in shareholders equity 7 Statements of cash flows 8 Statements of added value 9 Notes to the financial statements 10-82 F-3

KPMG Auditores Independentes R. Dr. Renato Paes de Barros, 33 04530-904 - São Paulo, SP - Brasil Caixa Postal 2467 01060-970 - São Paulo, SP - Brasil Central Tel 55 (11) 2183-3000 Fax Nacional 55 (11) 2183-3001 Internacional 55 (11) 2183-3034 Internet www.kpmg.com.br Independent auditors report on the financial statements To The Board of Directors and Shareholders of Banco Votorantim S.A. São Paulo - SP We have examined the individual and consolidated financial statements of Banco Votorantim S.A. referred as Bank and Consolidated, respectively, which comprise the balance sheet as of December 31, 2010 and the respective statements of income, changes in shareholders equity and cash flows for the year and semester then ended, and a summary of significant accounting practices and other notes to the financial statements. Management s responsibility for the financial statements Management is responsible for the preparation and fair presentation of these individual and consolidated financial statements in accordance with accounting practices adopted in Brazil, applicable to institutions authorized to operate by the Central Bank of Brazil, and for designing, implementing and maintaining the internal control relevant to the preparation of financial statements that are free from material misstatements, whether due to fraud or error. Auditor s responsibility Our responsibility is to express an opinion on these financial statements based on our audit carried out in accordance with the Brazilian auditing and international auditing standards. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including an assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal controls relevant of the Bank preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on effectiveness of the Bank s internal controls. An audit also includes evaluating the appropriateness of accounting practices used and reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. F-4 KPMG Auditores Independentes, uma sociedade simples brasileira e firma-membro da rede KPMG de firmas-membro independentes e afiliadas à KPMG International Cooperative ( KPMG International ), uma entidade suíça. KPMG Auditores Independentes, a Brazilian entity and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative ( KPMG International ), a Swiss entity.

Opinion on the individual and consolidated financial statements In our opinion, the individual and consolidated aforementioned financial statements present fairly, in all material respects, the financial position of Banco Votorantim S.A. at December 31, 2010, the financial performance of its operations and its cash flows, for the year and semester then ended, in accordance with the accounting practices adopted in Brazil, applicable to institutions authorized to operate by the Central Bank of Brazil. Other issues - Statements of added value We have also reviewed the individual and consolidated statements of added value of Banco Votorantim S.A. for the year ended at December 31, 2010, whose presentation has been carried out in a spontaneous manner by the Bank. These statements were submitted to the same auditing procedures described above and, in our opinion are presented fairly in all material respects in relation to the financial statements taken as a whole. São Paulo, February 4, 2011 KPMG Auditores Independentes CRC 2SP014428/O-6 Zenko Nakassato Accountant CRC 1SP160769/O-0 Luciana Liberal Sâmia Accountant CRC 1SP198502/O-8 F-5

Banco Votorantim S.A. Balance sheets December 31, 2010 and 2009 (In thousands of Reais) Bank Consolidated Bank Consolidated Assets 2010 2009 2010 2009 Liabilities 2010 2009 2010 2009 Current assets 71,912,391 77,673,243 67,902,934 54,029,091 Current liabilities 66,407,835 66,934,790 68,833,350 51,235,475 Cash 68,530 197,760 150,621 239,912 Deposits 18,564,155 20,184,005 18,353,701 20,207,357 Interbank funds applied 22,841,765 41,756,719 14,117,068 20,128,609 Demand deposits 305,007 133,699 309,431 134,794 Interbank deposits 846,788 1,923,086 643,087 1,680,837 Money market 12,844,173 18,563,983 12,844,173 18,563,983 Time deposits 17,412,210 18,125,398 17,401,033 18,390,054 Interbank deposits 9,910,265 23,014,920 1,185,568 1,386,810 Other deposits 150 1,822 150 1,672 Foreign currency deposits 87,327 177,816 87,327 177,816 Money market repurchase commitments 31,548,633 22,690,734 30,252,996 21,854,298 Securities and derivative financial instruments 32,443,446 28,331,874 18,198,716 13,156,507 Own portfolio 21,247,154 11,899,800 20,861,476 11,784,851 Third party portfolio 7,770,634 10,470,496 6,860,675 9,749,009 Own portfolio 5,728,968 7,264,010 8,446,597 9,999,054 Free movement portfolio 2,530,845 320,438 2,530,845 320,438 Subject to repurchase commitments 21,318,546 16,752,975 4,633,065 472,290 Derivative financial instruments 1,266,020 2,593,498 948,121 936,976 Acceptances and endorsements 1,682,349 1,276,418 3,249,475 1,276,418 Deposited with the Central Bank - 46,682-46,682 Subject to guarantees provided 4,129,912 1,674,709 4,170,933 1,701,505 Funds from real state, mortgage, credit and similar 696,187 815,857 696,187 815,857 Funds from debentures - - 1,567,126 - Interbank accounts 6,310,423 92,995 6,310,423 92,995 Liabilities from overseas securities 986,162 460,561 986,162 460,561 Interbank funds 72,219 12,985 72,219 12,985 Interbranch accounts 32,040 33,704 32,043 39,586 Central Bank Deposits 6,212,534 69,496 6,212,534 69,496 Correspondents 25,670 10,514 25,670 10,514 Third party funds in transit 32,040 33,704 32,040 33,704 Own funds in transit - - 3 5,882 Interbranch relations - 82-2,403 Borrowings and repasses 6,336,105 3,674,370 6,337,430 3,675,444 Domestic branches - 82-2,403 Domestic borrowings - Official institutions - 141,952-141,952 Loans 8,372,061 6,357,606 21,302,491 16,432,445 Domestic borrowings - Other institutions 21,357 22,872 21,357 22,872 Foreign currency trade finance borrowings 3,649,406 1,663,244 3,649,406 1,663,244 Public sector 26,360 34,092 26,360 35,782 Domestic repasses - Official institutions 2,665,342 1,846,302 2,666,667 1,847,376 Private sector 8,404,466 6,471,095 21,822,895 17,211,861 National Treasury 50,838-50,838 - Allowance for loan losses (58,765) (147,581) (546,764) (815,198) BNDES 1,532,607 1,050,982 1,532,607 1,050,982 FINAME 1,081,897 795,320 1,083,222 796,394 Lease operations - - 3,823,590 1,782,285 Derivative Financial Instruments 6,025,418 18,306,416 4,758,587 1,518,293 Lease receivable - Public sector - - - 139 Lease receivable - Private sector - - 5,647,778 2,933,028 Derivative Financial Instruments 6,025,418 18,306,416 4,758,587 1,518,293 Unearned lease income - - (1,754,650) (1,123,912) Allowance for lease losses Other liabilities 2,219,135 769,143 5,849,118 2,664,079 - - (69,538) (26,970) Tax collection and payment, and similar payments 9,770 8,169 24,292 18,668 Other receivables 1,866,943 925,912 3,815,824 2,066,163 Foreing exchange portfolio 1,368,672 9,618 1,368,672 9,618 Social and statutory 202,883 231,600 379,649 356,546 Guarantees Honored - 5,301-5,301 Taxes payable 274,832 222,737 1,199,774 1,307,289 Foreign exchange portfolio 1,292,751 380,521 1,292,751 380,521 Securities clearing accounts 64,521 53,324 128,471 78,236 Income receivable 4,695 104,259 27,691 16,323 Subordinated debt - - 1,451,075 - Securities clearing accounts 78,748 105,009 97,275 119,786 Other 298,457 243,695 1,297,185 893,722 Sundry 528,596 386,373 2,435,954 1,599,783 Allowance for doubtful receivable Long-term liabilities 43,217,775 21,720,675 30,553,546 26,384,949 (37,847) (55,551) (37,847) (55,551) Deposits 5,294,904 4,581,642 5,244,755 4,270,064 Other assets 9,223 10,295 184,201 127,772 Interbank deposits 133,328 96,942 83,179 60,205 Other assets 4,264 1,217 87,719 65,021 Time deposits 5,161,576 4,484,700 5,161,576 4,209,859 Prepaid expenses 4,959 9,078 96,482 62,751 Money market repurchase commitment 4,126,924 2,913,170 4,126,924 2,913,170 Long Term Assets 42,969,525 15,530,664 39,707,526 30,611,010 Own portfolio 4,058,757 2,885,023 4,058,757 2,885,023 Interbank funds Applied 24,941,264 1,296,856 884,842 1,296,856 Free movement portfolio 68,167 28,147 68,167 28,147 Interbank deposits 24,941,264 1,296,856 884,842 1,296,856 Acceptances and endorsements 5,602,215 2,042,957 7,048,656 4,994,075 Securities and Funds from real state, mortgage, credit and similar 3,704,923 1,108,718 3,704,923 1,108,718 derivate financial instruments 7,076,935 4,464,545 6,964,284 5,038,214 Funds from debentures - - 1,446,441 2,951,118 Liabilities from overseas securities 1,897,292 934,239 1,897,292 934,239 Own portfolio 2,039,283 2,164,202 2,039,283 1,474,580 Subject to repurchase commitments 3,428,472-3,428,472 1,263,291 Borrowings and repasses 4,889,911 3,594,822 4,917,050 3,627,311 Derivative financial instruments 941,710 690,473 829,059 690,473 Deposits with the central bank - 287,067-287,067 Domestic borrowings - Other institutions - 21,765-21,765 Subject to guarantees provided 667,470 1,322,803 667,470 1,322,803 Foreign currency trade finance borrowings 588,024 500,093 588,024 500,093 Domestic repasses - Official institutions 4,301,887 3,072,964 4,329,026 3,105,453 Loans 10,444,174 9,105,890 29,635,739 20,356,914 National Treasury 22,500-22,500 - BNDES 2,548,720 2,452,292 2,548,720 2,452,292 Public sector 50,658 119,594 50,658 118,754 FINAME 1,730,667 620,672 1,757,806 653,161 Private sector 10,582,588 9,112,979 30,053,623 20,675,003 Allowance for loan losses Derivative financial instruments 17,179,956 5,081,274 1,662,401 5,081,274 (189,072) (126,683) (468,542) (436,843) Derivative financial instruments 17,179,956 5,081,274 1,662,401 5,081,274 Lease operations - - 56,191 1,811,992 Other liabilities 6,123,865 3,506,810 7,553,760 5,499,055 Leases receivable - Private sector - - 1,459,196 2,982,056 Unearned lease income - - (1,372,360) (1,142,644) Taxes payable 640,886 578,995 1,961,185 1,117,301 Allowance for lease losses - - (30,645) (27,420) Securities clearing accounts 24,966-24,966 - Subordinated debt 5,453,187 2,927,815 5,453,187 4,366,821 Other receivables 493,252 663,373 1,701,045 1,853,833 Other 4,826-114,422 14,933 Sundry 493,252 663,373 1,701,045 1,853,833 Deferred income 41,760 34,919 41,760 34,919 Other assets 13,900-465,425 253,201 Minority interest - - 59 24 Prepaid expenses 13,900-465,425 253,201 Shareholders' equity 8,388,877 7,145,443 8,388,877 7,145,443 Capital: Permanent assets 3,174,331 2,631,920 207,132 160,709 Domestic 4,026,841 3,544,896 4,026,841 3,544,896 Capital reserves 585,104 617,049 585,104 617,049 Investments 3,093,123 2,571,255 54,761 53,582 Revenue reserves 3,834,288 3,060,162 3,834,288 3,060,162 Valuation adjustments (57,356) (76,664) (57,356) (76,664) Domestic subsidiaries and affiliates 3,023,080 2,507,956 - - Investment in overseas subsidiary 46,774 35,274 - - Other investments 23,269 28,025 54,761 53,582 Fixed assets for use 41,979 33,124 87,786 58,131 Other fixed assets for use 77,882 62,052 153,811 109,646 Accumulated depreciation (35,903) (28,928) (66,025) (51,515) Intangibles 7,035-20,691 5,121 Other intangible assets 7,035-23,806 6,212 Accrued amortization - - (3,115) (1,091) Deferred charges 32,194 27,541 43,894 43,875 Organization and expansion expenses 35,130 45,271 83,860 91,162 Accumulated amortization (2,936) (17,730) (39,966) (47,287) Total assets 118,056,247 95,835,827 107,817,592 84,800,810 Total liabilities 118,056,247 95,835,827 107,817,592 84,800,810 See the accompanying notes to the financial statements. F-6

Banco Votorantim S.A. Statements of income Years ended December 31, 2010 and 2009 and semester ended December 31, 2010 ## (In thousand of Reais, except net profit per lot of one thousand shares) Bank Consolidated Semester Years Years 2010 2010 2009 2010 2009 Financial operations income 4,074,852 7,709,406 6,024,348 14,130,226 11,271,570 Loans 819,051 1,777,943 917,865 8,813,205 6,981,997 Lease operations - - - 2,644,084 1,803,373 Securities income 4,816,107 8,463,073 6,076,854 4,306,730 2,933,559 Derivative financial instruments (1,749,262) (2,901,864) (970,371) (2,004,047) (447,359) Foreign exchange operations (48,412) 41,664-41,664 - Compulsory deposits 237,368 328,590-328,590 - Financial operations expenses (3,208,484) (6,364,009) (4,900,915) (9,730,568) (7,346,035) Deposits, money market and interbank funds (3,265,104) (6,087,056) (5,067,308) (6,359,754) (4,858,414) Borrowings, assignments and repasses 46,401 (206,717) 621,335 (209,071) 617,367 Lease operations - - - (1,972,778) (1,330,202) Foreign exchange operations - - (239,724) - (239,682) Allowance for loan losses 10,219 (70,236) (215,218) (1,188,965) (1,535,104) Gross income from financial operations 866,368 1,345,397 1,123,433 4,399,658 3,925,535 Other operating income/(expenses) (134,644) (21,830) (242,713) (2,356,792) (2,551,531) Income from rendered service 117,281 254,891 205,217 440,220 358,195 Income from banking fee 715 1,246 899 804,464 459,016 Personnel expenses (156,043) (287,909) (208,193) (774,724) (564,198) Other administrative expenses (189,355) (345,351) (208,260) (1,535,746) (1,037,026) Tax expenses (45,734) (85,192) (73,554) (457,400) (363,879) Equity in earnings of subsidiaries 286,628 582,510 423,042 - - Other operational income 33,103 57,443 52,515 2,089,777 1,317,094 Other operational expenses (181,239) (199,468) (434,379) (2,923,383) (2,720,733) Operating results 731,724 1,323,567 880,720 2,042,866 1,374,004 Non operating results (5,002) (8,975) (669) (83,067) (85,881) Income before taxation and profit sharing 726,722 1,314,592 880,051 1,959,799 1,288,123 Income and social contribution taxes (117,895) (152,694) 1,689 (546,575) (283,988) Provision for income tax (37,403) (62,211) (106,105) (690,982) (787,082) Provision for social contribution (26,294) (43,703) (55,640) (206,874) (265,118) Deferred income and social contribution taxes (54,198) (46,780) 163,434 351,281 768,212 Profit sharing (71,098) (146,651) (79,967) (397,987) (201,323) Net profit before minority interest 537,729 1,015,247 801,773 1,015,237 802,812 Minority interest - - - 10 (1,039) Net profit for the semester/year 537,729 1,015,247 801,773 1,015,247 801,773 Net profit per lot of one thousand shares - R$ 6.59 12.45 10.00 See the accompanying notes to the financial statements. F-7

Banco Votorantim S.A. Statements of changes in shareholders' equity Years ended December 31, 2010 and 2009 and semester ended December 31, 2010 81,538,822,950 (In thousand of Reais) Capital Revenue Reserves Valuation adjustments - Capital Capital From fiscal Securities Retained Capital Increase Reserves Legal Expansion Incentives available for sale earnings Total Balances at December 31, 2008 3,380,000-31,946 303,732 2,741,523 - (95,006) - 6,362,195 Other - - - - - - - (1,736) (1,736) Capital Increase 614,896 - - - - - - - 614,896 (-) Paid-up capital (450,000) - - - - - - - (450,000) Premium on subscription of shares - - 585,103 - - - - - 585,103 Reversal of reserve from expansion - - - - (594,709) - - 594,709 - Distribution of dividends - - - - - - - (205,709) (205,709) Interest on own capital - - - - - - - (389,000) (389,000) Valuation adjustments - - - - - - 18,342-18,342 Net profit - - - - - - - 801,773 801,773 Distribution of net profit: Legal reserve - - - 40,089 - - - (40,089) - Dividends ( R$ 2.34 - per quota) - - - - - - - (190,421) (190,421) Expansion reserve - - - - 569,527 - - (569,527) - Balances at December 31, 2009 3,544,896-617,049 343,821 2,716,341 - (76,664) - 7,145,443 Paid-in capital 450,000 - - - - - - - 450,000 Capital Increase - 31,945 (31,945) - - - - - - Valuation adjustments - - - - - - 19,308-19,308 Net profit - - - - - - - 1,015,247 1,015,247 Distribution of net profit: Legal reserve - - - 50,762 - - - (50,762) - Dividends ( R$ 2.96 - per quota) - - - - - - - (241,121) (241,121) Expansion reserve - - - - 723,364 - - (723,364) - Balances at December 31, 2010 3,994,896 31,945 585,104 394,583 3,439,705 - (57,356) - 8,388,877 Balances at June 30, 2010 3,994,896-617,049 367,696 2,716,341 2,360 2,139 338,462 8,038,943 Capital increase - 31,945 (31,945) - - - - - - Valuation adjustments - - - - - - (59,495) - (59,495) Net profit - - - - - - - 537,729 537,729 Distribution of net profit: Legal reserve - - - 26,887 - - - (26,887) - Fiscal icentives reserve - (2,360) 2,360 - Dividends ( R$ 1.57 - per quota) - - - - - - - (128,300) (128,300) Expansion reserve - - - - 723,364 - - (723,364) - Balances at December 31, 2010 3,994,896 31,945 585,104 394,583 3,439,705 - (57,356) - 8,388,877 See the accompanying notes to the financial statements. F-8

Banco Votorantim S.A. Statements of cash flows Years ended December 31, 2010 and 2009 and semester ended December 31, 2010 (In thousand of Reais) Bank Consolidated Semester Years Years Cashflows from operations 2010 2010 2009 2010 2009 Net profit 537,729 1,015,247 801,773 1,015,247 801,773 Adjustments to net profit: (341,097) (388,678) (110,155) 1,651,351 1,976,248 Depreciation and amortization 5,064 9,432 9,343 28,448 19,696 Equity in earnings of subsidiary (286,628) (582,510) (423,042) - - Allowance for loan losses (10,219) 70,236 215,218 1,188,965 1,535,104 Allowance for losses on investments 4,345 4,345-16,634 - Provision for contingent liabilities /legal obligations (54,316) 105,189 87,657 350,871 335,567 Non operating results 657 4,630 669 66,433 85,881 Balance sheet variations Intrbank funds applied (11,799,111) (12,854,381) (33,193,275) (1,109,543) (12,546,099) Securities and Derivative financial instruments 4,224,941 (6,906,278) 2,273,758 (7,146,858) 5,214,400 Interbank and interbranch accounts (2,017,713) (6,219,010) (83,741) (6,222,568) (81,308) Loans/ Lease (3,046,535) (3,422,975) 2,047,623 (15,623,340) (5,647,828) Other receivables 677,698 (779,885) 3,942,920 (1,679,940) 2,876,220 Other assets (7,958) (12,828) (2,175) (268,653) 86,726 Deposits (676,259) (906,588) 5,531,901 (878,965) 5,544,987 Money market repurchase commitments 2,780,597 10,071,653 8,015,959 9,612,452 8,142,919 Acceptances and endorsements 2,836,170 3,965,189 406,207 4,027,638 (31,750) Borrowings and repasses 1,601,743 3,956,824 (3,377,685) 3,951,725 (3,382,185) Other liabilities (506,224) 1,308,200 (2,333,858) 2,220,451 (2,443,203) Deferred income 2,665 6,841 11,210 6,841 11,210 Valuation adjustments - Available for sale securities (59,495) 19,308 18,342 19,308 18,342 Cash generated (used) in the operations (5,792,849) (11,147,361) (16,051,196) (10,424,854) 540,452 Cashflows from financing activities Capital Increase - 450,000 750,000 450,000 750,000 Dividends paid (112,821) (112,821) (205,709) (112,821) (205,709) Interest on own capital - - (544,291) - (389,000) Minority interest - - - 35 (40,584) Subordinated debts 973,057 2,525,372 1,532,882 2,537,441 1,497,129 Cash generated (used) in financing activities 860,236 2,862,551 1,532,882 2,874,655 1,611,836 Cashflows from investment activities Disposal of fixed assets for use 435 480 1,392 1,102 8,132 Disposal of investments 4,338 11,342 453 13,072 522 Disposal of deferred 17,233-17,233-3,153 Purchase of fixed assets for use (5,862) (16,517) (21,997) (44,655) (26,893) Purchase of investments (12,284) (18,868) (52,390) (27,273) (849) Deferred charges (19,811) (24,136) (28,162) (28,679) (32,021) Intangible (4,131) (7,035) - (17,693) (5,398) Other 73,112 85,387 (20,761) 31,937 (43,563) Cash generated (used) in investment activities 53,030 30,653 (104,232) (72,189) (96,917) Net variation in cash and cash equivalents (4,879,583) (8,254,157) (14,622,546) (7,622,388) 2,055,371 Cash and cash equivalents at the begnning of the period 6,683,486 10,058,060 24,680,606 9,119,278 7,063,907 Cash and cash equivalents at the end of the period 1,803,903 1,803,903 10,058,060 1,496,890 9,119,278 Increase/(decrease) in cash and cash equivalents (4,879,583) (8,254,157) (14,622,546) (7,622,388) 2,055,371 See the accompanying notes to the financial statements. F-9

Banco Votorantim S.A. Statements of added value Years ended December 31, 2010 and 2009 (In thousands of Reais) Bank Consolidated 2010 2009 2010 2009 Income 7,744,307 5,632,713 13,269,272 9,064,157 Financial operations income 7,709,406 6,024,348 14,130,226 11,271,570 Income from rendered service and fees 256,137 206,116 1,244,684 817,211 Allowance for loan losses (70,236) (215,218) (1,188,965) (1,535,104) Other income/(expenses) (142,025) (381,864) (833,606) (1,403,639) Non operating results (8,975) (669) (83,067) (85,881) Financial operations expenses (6,293,773) (4,685,697) (8,541,603) (5,810,931) Inputs acquired from third parties (299,084) (172,426) (1,397,156) (959,388) Material, power and other operating expenses (1,153) (1,126) (5,041) (4,618) Outsourced services (3,401) (2,563) (20,840) (42,310) Other (294,530) (168,737) (1,371,275) (912,460) Communication (12,679) (9,739) (102,374) (81,591) Maintenance and conservation of fixed assets (6,163) (4,503) (13,967) (22,194) Data processing (65,112) (56,913) (118,137) (107,799) Promotions and public relations (10,621) (6,103) (22,779) (18,305) Publications (1,498) (2,254) (1,777) (3,110) Publicity and advertising (1,986) (2,169) (33,841) (19,943) Financial system services (60,159) (23,082) (181,612) (131,733) Specialized technical services (103,938) (37,931) (572,427) (242,815) Transportation (4,611) (3,213) (21,491) (28,083) Other (27,763) (22,830) (302,870) (256,887) Gross added value 1,151,450 774,590 3,330,513 2,293,838 Depreciation and amortization expenses (9,432) (9,343) (28,448) (19,696) Net added value produced by the Entity 1,142,018 765,247 3,302,065 2,274,142 Transferred added value 582,510 423,042 - - Equity in earnings of subsidiaries 582,510 423,042 - - Total added value to be distributed 1,724,528 1,188,289 3,302,065 2,274,142 Distribution of added value 1,724,528 1,188,289 3,302,065 2,274,142 Employees 385,675 253,943 1,051,722 677,746 Salaries and fees 189,973 138,046 489,243 358,140 Profit sharing 146,651 79,967 397,987 201,323 Benefits and training 33,967 24,576 124,364 89,180 FGTS (Government Severance Indemnity Fund for Employees) 15,084 11,354 40,128 29,103 Taxes 286,771 106,082 1,124,964 735,642 Domestic 286,771 106,082 1,124,964 735,642 INSS on salaries 48,885 34,217 120,989 87,775 Tax expenses (except Income and Social contribution taxes) 85,192 73,554 457,400 363,879 Income and social contribution taxes 152,694 (1,689) 546,575 283,988 Remuneration of third-party capital 36,835 26,491 110,142 57,942 Rental 36,835 26,491 110,142 57,942 Remuneration of equity 1,015,247 801,773 1,015,237 802,812 Dividends/Interest on own capital 241,121 190,421 241,121 190,421 Retained profit 774,126 611,352 774,106 613,430 Minoritary share in retained profits - - 10 (1,039) See the accompanying notes to the financial statements. F-10 9

Banco Votorantim S.A. Notes to the financial statements Years ended December 31, 2010 and 2009 (In thousand of reais) 1 Operations Banco Votorantim S.A. is a closed corporation that, operating in the form of a Multiple Bank, develops banking activities in authorized categories, by means of its commercial, financing and foreign exchange operation portfolios. Through its subsidiaries, it also operates in various other categories, with an emphasis on the activities of consumer credit, leasing, administration of investment funds and credit cards. Transactions are conducted in the context of a set of institutions that operate in an integrated manner in the financial market, including in relation to risk management, and certain transactions have the joint participation or the intermediation of member institutions, which form an integral part of the financial system. The benefits of the services provided between these institutions and the costs of the operational and administrative structure, are absorbed based on the practicality and reasonableness of the allocation of benefits and costs, jointly or individually. On September 28, 2009, Votorantim Finanças and Banco do Brasil concluded the strategic partnership establishment, and Banco do Brasil now holds a 50% interest in the voting stock and 50% in the total equity capital of Banco Votorantim S.A. (BV). The Board of Directors is divided, with three board members appointed by each institution, and the office of chairman will be rotated on a yearly basis. All strategic decisions will be made jointly. 2 Presentation of financial statements The financial statements were prepared on a basis of the accounting guidelines derived from Corporation Law rules and instructions of the National Monetary Council (CMN). F-11 10

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) Law 11638/07 was enacted on December 28, 2007, amended by Law 11941/09, which amended Corporate Law regarding accounting practices adopted in Brazil. Although said Law is already effective, some changes it introduced depend on normatization by the National Monetary Council. The amendments approved by CMN were as follows: 1) accounting treatment of intangible assets; 2) procedures to measure the recoverable value of assets; 3) elaboration of the statement of cash flows in place of the statement of changes in financial position; 4) the disclosure of related party information in notes to the financial statements; and 5) procedures for the recognition, measurement and disclosure of provisions, contingent assets and liabilities. The consolidated financial statements includes Banco Votorantim and the direct subsidiaries in the country and abroad, listed below: Participation percentage Direct subsidiaries in Brazil 2010 2009 Votorantim Corretora de Títulos e Valores Mob. Ltda. 99.98% 99.98% Votorantim Asset Management Distrib. de TVM Ltda. 99.99% 99.99% BV Financeira S.A. Crédito, Financiamento e Investimento 100% 100% BV Leasing Arrendamento Mercantil S.A. 99.99% 99.99% BVIP - BV Investimentos e Participações S.A. 100% - BVIA - BV Inv. Alternativos e Gestão de Recursos S.A. 100% - Direct subsidiaries overseas Votorantim Bank Limited 100% 100% Banco Votorantim Securities Inc. 100% 100% The consolidated financial statements were prepared in conformity with the consolidation rules and instructions of the CMN. F-12 11

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) The main procedures in the consolidation process of the financial statements are: a. Elimination of the balances of accounts of assets, liabilities, income and expenses among the branches and subsidiaries; b. Elimination of investments in the subsidiaries capital, reserves and retained earnings; c. Presentation of lease operations under the financial method, reclassifying Lease property to Lease operations, net of the residual value received in advance; d. The book balances of the overseas direct subsidiaries, which are prepared according to international accounting standards, were translated into reais, using the US dollar quotation on the closing date of the period, and were adjusted to accounting practices described in Note n o 4; e. The exchange variation of the operations of the branch and of the subsidiary companies overseas was distributed on the lines of the statement of income, according to the respective assets and liabilities that originated them; and f. The consolidation process does not include the consolidation of the exclusive investment funds and of the credit receivable investment funds in conformity with the consolidation rules established by the (CMN). The issuance of financial statements was given by Company s directors on February 4, 2011. 3 Risk management Risk management policies comply with market best practices and are in line with the guidelines defined by the CMN. They encompass bank institutions that comprise Votorantim Financial Conglomerate ( Conglomerate ). The Company established policies and procedures and implemented a risk management system capable of managing, evaluating and mitigating the risks inherent to its business, providing the management with a view of all incurred risks. F-13 12

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) Market risk Market risk is defined as the possibility of losses arising from the variation in the market value of positions held by the institution. Market risk management is executed in a centralized manner, by an area that maintains independence in relation to the front office. The basic procedures adopted for risk management are: (a) integrity of the pricing of assets and derivatives; (b) evaluation of the market risk using the Value at Risk methodology and from simulating scenarios; (c) accompanying the daily results using the back-test methodology. Conglomerate undertake operations that involve derivative financial instruments, operating in organized and over the counter markets, in order to ensure the management of market risk appropriate to the Group policy. These instruments are used for hedging positions to meet the demand of counterparties and as a means of reversing the positions at times of significant oscillations. Operational risk Operating risk is defined as the possibility of losses resulting from failure, weakness or inadequacy of internal processes, people and systems or external events. It also includes the legal risk associated to the inadequacy or deficiency in contracts signed by the institution, and to fines due to failure to abide by legal provisions and indemnities for damages to third parties arising from activities performed by the institution. The operating risk management process starts with the application of an appropriate methodology for mapping the risks and controls inherent to the processes. As required, action plans are prepared to mitigate the main threats identified in the processes. The combination of risk mapping and monitoring actions with the information obtained from the records of incurred losses allows a continuous improvement in the adopted policies and procedures, as well as the reduction of existing risks. F-14 13

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) Credit risk Credit risk consists of the possibility of occurring losses associated to a loan taker or a counterpart s failure to fulfill their respective financial obligations under the agreed-upon conditions, and losses associated to devaluation of a loan agreement due to deterioration of the loan taker s risk classification, reduction in gains or compensations, advantages granted in renegotiations and loan recovery costs. As part of the credit management process, controls and monitoring are conducted for credit policies and rules and their respective processes, restrictions and established limits, in addition to risk analysis and submission to appropriate levels and approving committees. The credit policy is formulated upon the analysis of internal indicators in the portfolio, company pricing and evaluation processes, and of external factors related to the financial situation of the companies and the economic situation of the country and foreign countries. Banco Votorantim carries out credit risk assessments of their operations, determined by means of judgment and statistical models. It is worth emphasizing that in the identification of the deterioration of the Bank s loan portfolio quality, risk mitigation measures are taken, such as reassessment of customer risk profile and industry analysis that influence threshold management and management and control of guarantees. Asset and liability management The Assets & Liabilities Operating Committee ( ALM ) is in charge of managing the structural risks of interest rate, liquidity and exchange rate, as well as the capital management, aiming to optimize the risk/return ratio and seeking greater efficiency when composing the factors that impact the Solvability Index (Basel). Basel 2010 2009 Total Reference Equity (RE I e II) 11,844,719 9,151,629 Reference Equity level I 8,405,405 7,108,438 Reference Equity level II 3,439,314 2,043,191 F-15 14

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) Basel 2010 2009 Reference equity required ( RER ) 9,945,507 7,771,228 Pepr (assets weighting risk factor) 8,759,342 6,617,578 Pcam (exchange rate risk factor) - - Pjurs (interest rate risk factor) 725,540 752,007 Pcom (commodities risk factor) 2,010 1,360 Pacs (stocks classified as trading risk factor) 41,682 22,761 Popr (operating risk factor) 416,933 377,522 Excess Reference Equity 1,899,212 1,380,401 Ratio (RE x 100) / (RER / 0.11) 13.1% 13.0% 4 Significant accounting practices a. Statement of income The revenues and expenses are recorded on the accrual basis using the daily pro rata basis criterion, and calculated based on the exponential method, except those related to operations with foreign countries, which are calculated using the straight-line method. b. Cash and cash equivalents Cash and cash equivalents are represented by available funds, interbank deposits and money market repurchase agreements - Own portfolio, maturity up to 90 days. c. Interbank funds applied Interbank investments are recorded at investment value, plus income accrued up to the balance sheet date, calculated pro rata with a basis on the variation of the index and on the agreed interest rate. F-16 15

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) d. Securities Securities are recorded by the amount effectively paid and classified based on Management s intention in three different categories: i. Securities for trading - Acquired for the purpose of being actively and frequently traded. Adjusted to market value with the corresponding entry to the results for the period; ii. Available for sale - Securities that are not for trading or held to maturity. Adjusted to market value with the corresponding entry to a separate account in shareholders equity, reduced for any tax effects; and iii. Securities held to maturity - Securities acquired with the intention and financial capacity to hold them in the portfolio to maturity. Recorded at cost of acquisition, plus income accrued in contra account to results for the period. In this category, the securities are not adjusted to market value. The market valuation methodology was established in compliance with consistent and verifiable criteria, which take into consideration the average price of trading on the date of calculation, or, in the absence thereof, the daily adjustment value of future market transactions disclosed by external sources or the probable net realizable value obtained using interest rate future value curves, exchange rates, price and currency indexes, besides any adjustments in the prices of securities of low liquidity. Income accrued with securities, regardless of the category in which it is classified, is calculated pro rata with a basis on the variation of the index and on the agreed interest rate, by the exponential or straight-line method, up to the date of maturity or of the final sale of the security, and is recognized directly in income for the period. e. Derivative financial instruments Derivative financial instruments are stated at market value, with consistent and verifiable criteria, considering the average price of trading on the date of calculation, or, in the absence thereof, conventional and proven methodologies. Increases or decreases in value are recorded in income or expense accounts of the respective financial instruments. F-17 16

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) The derivative financial instruments are classified according to the intention of Management, taking into account its purpose. Financial instruments used to offset, in whole or in part, the risks arising from exposure to variations in asset or liability market values are considered hedge instruments and are classified according to their nature as: i. Market risk hedge - Adjustments to market value of the financial instruments classified in this category, as well as of the item hedged, are recorded in counter entry to income (loss) for the period. and ii. Cash flow hedge - Derivative financial instruments classified in this category have their adjustments to market value recorded in shareholders equity, net of tax impacts. Derivative financial instruments that do not fulfill the hedge criteria have their adjustments to market value recorded directly in income for the period. For financial instruments traded in association with funding operations, both the financial instrument and the liabilities are accounted for by the intrinsic conditions contracted, and are not adjusted by the market value. f. Loan and lease operations, advances on foreign exchange contracts, other receivables with loan characteristics and allowance for loan losses Loan and lease operations, advances on foreign exchange contracts and other receivables with loan characteristics are classified according to Management s judgment of the risk levels involved, taking into consideration the economic situation, past experience and specific risks in relation to the operation, the debtors and guarantors, overdue payment period, and economic group, observing the parameters established by Central Bank of Brazil ( BACEN ), which requires the analysis of the portfolio and its rating at nine levels, ranging from AA (minimum risk) to H (maximum risk). In relation to the period of overdue payment verified in retail operations with a term of over thirty-six (36) months, a double count is permitted over intervals of overdue defined for the nine levels. Income from loans overdue for more than 60 days, regardless of their level of risk, are only recognized as income when effectively received. F-18 17

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) Operations rated at level H continue in this status for 180 days, when they are written off against the existing provision and controlled in memorandum accounts. Renegotiated operations are maintained, at a minimum, at the same level at which they were rated, in conformity with CMN Resolution nº 2,682. Renegotiations of loans that had already been written off against provision that were in memorandum accounts are rated as H and any gains from renegotiation are recognized as income when effectively received. Loan and lease operations that are subjects of hedges of derivative financial instruments are stated at market value using consistent and verifiable criterion. The adjustments of valuation at market value of these operations are recorded, when positive, in Other Receivables - Sundry, and, when negative, in Other Liabilities - Sundry, in counter entry to income from loans and income from leases. Loan assignment calculated recognizing income at the time of assignment, irrespectively of retention or not of risk. For the portfolio of loan operations granted with co-obligation, Management established a provision for losses, recorded under Other liabilities - Sundry. g. Prepaid expenses Funds applied in prepayments, where the benefits or rendering of services are to occur in future periods, are recorded. h. Accounting estimates Preparation of the financial statements in accordance with accounting practices adopted in Brazil requires that Management use its judgment in determining and recording accounting estimates, when applicable. The settlement of transactions involving these estimates may result in significantly different amounts due to the lack of precision inherent to the process of their determination. The Company management reviews the estimates and assumptions at least monthly. F-19 18

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) i. Permanent assets i. Investments in equity interest are valued using the equity method. Other permanent investments are valued at cost of acquisition less allowance for losses, when applicable; ii. Property, plant and equipment stated at acquisition cost, less accumulated depreciation. Depreciation of fixed assets is calculated using the straight line method, based on the following annual rates: Installations, furniture and equipment in use - 10%; Communication, security and transportation - 10%; Data processing systems - 20%. iii. Deferred charges are shown at acquisition or formation cost, less the respective amortization. Amortization is calculated by the straight-line method, based on the period over which the benefit is generated; and iv. Intangible Assets include rights relating to intangibles that are intended for the maintenance of the company or exercised for this purpose. Amortization is calculated by the straight-line method, based on the period over which the benefit is generated. Non-financial assets are subject to evaluation of the recoverable value yearly. j. Income and social contribution taxes Income tax was determined with a basis on the rate of 15%, plus a surcharge of 10%, and social contribution was determined with a basis on the rate of 15%, both applicable to the taxable income. The tax credit for income tax and social contribution tax credits are formed in accordance with a study of future realization prepared by Management. Deferred income tax is recognized at the subsidiary BV Leasing, calculated at the rate of 25%, on the adjustment of excess of depreciation of the lease portfolio. F-20 19

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) k. Contingent assets and liabilities and legal obligations The recognition, measuring and disclosure of contingent assets, contingent liabilities and legal obligations are carried out according to the following criteria: i. Contingent assets - These are only recognized in the financial statements when there is evidence providing certainty as to their realization and on which no appeal is admissible, situation which characterizes the likelihood of a favorable court decision as practically certain. ii. Contingent liabilities - These are recognized in the financial statements when, based on the opinion of the legal counsel and of Management, the risk of loss of a lawsuit or administrative proceeding is considered probable, with a probable outflow of financial resources for the settlement of obligations and when the sums involved are measurable with sufficient assurance. Contingent liabilities classified as possible losses are not accounted for, and should only be disclosed in the notes to the financial statements, whereas those classified as remote do not require provision and disclosure; and iii. Legal obligations - Tax and social security - Are lawsuits related to tax obligations, where the subject being contested is their legality or constitutionality which, regardless of the probability of success of the lawsuits in progress, have their amounts recognized in full in the financial statements. l. Other assets and liabilities Assets are stated at realizable values, including, when applicable, monetary and exchange variations earned (on a pro rata daily basis) and a provision for losses, when considered necessary. Liabilities are stated at known or calculated amounts, plus charges and monetary variations and exchange variations incurred (on a pro rata daily basis). F-21 20

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) 5 Composition of cash and cash equivalents Bank Consolidated 2010 2009 2010 2009 Cash 68,530 197,760 150,621 239,912 Interbank funds invested Commited operations - Banked positions 587,800 7,806,407 587,800 6,017,883 Interbank deposits 1,060,246 1,876,077 671,142 2,683,667 Foreign currency deposits 87,327 177,816 87,327 177,816 Total 1,803,903 10,058,060 1,496,890 9,119,278 6 Cash Bank Consolidated 2010 2009 2010 2009 Cash 231 352 301 423 Bank deposits 70 77 68,219 39,861 Free reserves - 6,306-6,306 Foreign currency cash 68,229 191,025 82,101 193,322 Total 68,530 197,760 150,621 239,912 F-22 21

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) 7 Interbank funds applied Bank Consolidated 2010 2009 2010 2009 Banked position 2,521,543 7,806,407 2,521,543 7,806,407 Financial Treasury Bill - 304,290-304,290 National Treasury Bill 224,835 2,769,246 224,835 2,769,246 National Treasury Notes 2,270,109 4,665,260 2,270,109 4,665,260 Other 26,599 67,611 26,599 67,611 Financed position 7,792,317 10,438,282 7,792,317 10,438,282 Financial Treasury Bill - 1,499,995-1,499,995 National Treasury Bill 5,817,573 3,096,890 5,817,573 3,096,890 National Treasury Notes 1,974,744 5,841,397 1,974,744 5,841,397 Sold position 2,530,313 319,294 2,530,313 319,294 Financial Treasury Bill - 319,294-319,294 National Treasury Notes 2,530,313-2,530,313 - Interbank deposits 34,851,529 24,311,776 2,070,410 2,683,666 Foreign currency investments 87,327 177,816 87,327 177,816 Total 47,783,029 43,053,575 15,001,910 21,425,465 F-23 22

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) 8 Securities a. Composition of the portfolio by category, domestic and overseas Bank 2010 2009 Trading securities Accrual value Market value (book) Unrealized gain/(loss) Accrual value Market value (book) Unrealized gain/(loss) Domestic 24,979,135 25,143,596 164,461 22,752,538 22,804,499 51,961 Financial Treasury Bill 493,112 493,109 (3) 108,890 108,892 2 National Treasury Bill 753,671 754,824 1,153 2,928,898 2,924,385 (4,513) National Treasury Notes 5,707,181 5,732,455 25,274 2,960,296 2,966,072 5,776 Real estate receivables certificates 7,148 7,148 - - - - Debentures 17,191,758 17,234,064 42,306 15,727,567 15,758,533 30,966 Agriculture debt titles 53,981 55,153 1,172 93,998 99,762 5,764 Rural Product Notes 457,896 466,384 8,488 384,111 386,187 2,076 Promissory notes 31,137 31,119 (18) 437,060 439,042 1,982 Shares Listed Companies 40,050 38,945 (1,105) 111,718 121,626 9,908 Shares of Non-Listed Companies 243,201 330,395 87,194 - - - Overseas 3,570,053 3,497,337 (72,716) 2,633,008 2,441,087 (191,921) Brazilian External Debt titles - - - 132,520 142,681 10,161 Foreign governments 1,778,693 1,779,691 998 1,209,516 1,206,740 (2,776) National Treasury 279,270 283,820 4,550 451,640 501,381 49,741 Other securities 1,512,090 1,433,826 (78,265) 839,332 590,285 (249,047) Total 28,549,188 28,640,933 91,745 25,385,546 25,245,586 (139,960) F-24 23

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) Bank 2010 2009 Securities available for sale Accrual value Market value (book) Unrealized gain/(loss) Accrual value Market value (book) Unrealized gain/(loss) Domestic 8,422,591 8,364,637 (57,954) 3,513,640 3,342,830 (170,810) National Treasury Bill 4,826,837 4,771,068 (55,769) 1,740,796 1,661,226 (79,570) Real estate receivables certificates 26,939 28,638 1,699 15,493 17,477 1,984 Debentures 1,299,780 1,325,597 25,817 1,315,233 1,294,968 (20,265) Promissory notes - - - 14,517 14,860 343 Financial Investment Fund - - - 59,700 59,700 - Credit Right Investment Fund Quotas 425,581 425,574 (7) 41,002 40,601 (401) Private Equity Investment Funds 61,615 61,615 - - - - Shares Listed Companies 203,452 217,053 13,601 - - - Shares of non-listed companies 1,578,387 1,535,092 (43,295) 326,899 253,998 (72,901) Overseas 330,127 307,081 (23,046) 1,002,766 924,032 (78,734) Other securities 330,127 307,081 (23,046) 1,002,766 924,032 (78,734) Total 8,752,718 8,671,718 (81,000) 4,516,406 4,266,862 (249,544) F-25 24

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) Consolidated 2010 2009 Securities for trading Accrual Value Market value (book) Unrealized gain/(loss) Accrual value Market value (book) Unrealized gain/(loss) Domestic 10,487,986 10,663,999 176,013 9,181,289 9,261,274 79,985 Financial Treasury Bill 570,874 570,872 (2) 111,496 111,498 2 National Treasury Bill 753,671 754,824 1,153 2,928,898 2,924,385 (4,513) National Treasury Notes 5,770,153 5,806,977 36,824 3,042,919 3,067,930 25,011 Real estate receivables certificates 7,148 7,148 - - - - Debentures 308,626 350,933 42,307 343,277 374,243 30,966 Agriculture debt titles 53,981 55,153 1,172 93,998 99,762 5,764 Rural product notes 457,896 466,384 8,488 384,111 386,187 2,076 Promissory notes 31,137 31,119 (18) 437,060 439,042 1,982 Financial Investment funds 1,508,317 1,508,317-1,371,852 1,371,852 - Credit Right Investment Fund Quotas 742,932 742,932-354,602 354,602 - Shares Listed Companies 40,050 38,945 (1,105) 113,076 131,773 18,697 Shares of non-listed companies 243,201 330,395 87,194 - - - Overseas 3,593,380 3,520,663 (72,717) 2,657,388 2,465,467 (191,921) Brazilian external debt titles - - - 132,520 142,681 10,161 Foreign governments 1,802,020 1,803,016 996 1,233,896 1,231,120 (2,776) National Treasury 279,270 283,821 4,551 451,640 501,381 49,741 Other securities 1,512,090 1,433,826 (78,264) 839,332 590,285 (249,047) Total 14,081,366 14,184,662 103,296 11,838,677 11,726,741 (111,936) F-26 25

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) Consolidated 2010 2009 Securities available for sale Accrual value Market value (book) Unrealized gain/(loss) Accrual value Market value (book) Unrealized gain/(loss) Domestic 8,952,024 8,894,077 (57,947) 4,087,308 3,916,497 (170,811) National Treasury Bill 4,826,837 4,771,068 (55,769) 1,740,796 1,661,226 (79,570) Real estate receivables certificates 26,939 28,638 1,699 15,493 17,477 1,984 Debentures 1,299,780 1,325,597 25,817 1,315,233 1,294,968 (20,265) Promissory Notes - - - 14,517 14,860 343 Financial Investment funds 1,730 1,730-59,700 59,700 - Credit Right Investment Fund Quotas 953,284 953,284-614,670 614,268 (402) Private Equity Investment Funds 61,615 61,615 - - - - Shares Listed Companies 203,452 217,053 13,601 - - - Shares of non-listed companies 1,578,387 1,535,092 (43,295) 326,899 253,998 (72,901) Overseas 330,127 307,081 (23,046) 1,002,766 924,034 (78,732) Other securities 330,127 307,081 (23,046) 1,002,766 924,034 (78,732) Total 9,282,151 9,201,158 (80,993) 5,090,074 4,840,531 (249,543) b. Composition by portfolio Bank Consolidated 2010 2009 2010 2009 Own Portfolio 7,768,251 9,428,212 10,485,880 11,473,633 Subject to repurchase commitment 24,747,018 16,752,975 8,061,537 1,735,581 Deposited with Central Bank of Brazil - 333,749-333,749 Subject to guarantees provided 4,797,382 2,997,512 4,838,403 3,024,308 Total 37,312,651 29,512,448 23,385,820 16,567,271 F-27 26

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) 9 Derivative financial instruments a. Composition Bank Consolidated Asset 2010 2009 2010 2009 Differential receivable from swap 1,225,434 2,676,473 794,884 1,019,951 Forward contracts 538 794 538 794 Purchase of call options - Shares 3,017 5,985 3,017 5,985 Purchase of put options - Shares - 1,400-1,400 Purchase of purchase call options - Financial asset/commodities 194,521 193,911 194,521 193,911 Purchase of putoptions - Financial asset/commodities 319,989 178,073 319,989 178,073 Credit derivatives 346,888 36,978 346,888 36,978 Non Deliverable Forward 114,964 125,069 114,964 125,069 Other 2,379 65,288 2,379 65,288 Total 2,207,730 3,283,971 1,777,180 1,627,449 Bank Consolidated Liabilities 2010 2009 2010 2009 Differential payable of swap 1,332,130 730,776 2,030,559 1,354,956 Forward contracts 171 438 171 438 Sale of call options - shares 3,817 4,170 3,817 4,170 Sale of put options - shares 2,970-2,970 - Sale of call options - financial asset/commodities 260,326 198,731 260,326 198,731 Sale of put options - financial asset/commodities 89,081 38,831 89,081 38,831 Option Box - Fixed income strategy 21,209,523 22,071,158 3,726,608 4,672,855 Credit derivatives 181,091 217,601 181,091 217,601 Non Deliverable Forward 116,951 117,735 116,951 117,735 Other 9,314 8,250 9,314 8,250 Total 23,205,374 23,387,690 6,420,988 6,599,567 F-28 27

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) b. Composition of the swap contracts by index 2010 2009 Bank Original value Accrual value Market value Original value Accrual value Market value Asset position 58,924,564 62,879,470 62,885,680 43,484,696 49,358,001 50,417,376 DI (Interbank deposits rates) 11,862,496 13,427,810 13,437,993 9,062,907 10,897,736 10,927,530 Dollar 5,212,038 4,957,009 5,000,538 4,461,946 4,406,356 4,526,975 Euro 152,730 150,550 151,096 51,041 48,142 48,142 IGPM - Inflation index 980,573 1,233,364 1,249,515 1,646,614 2,001,320 2,041,393 IPCA - Inflation index 1,998,340 1,671,213 1,499,340 2,063,694 2,342,412 2,377,881 Pre-Fixed rates 31,688,942 34,405,490 34,504,631 25,387,292 28,857,656 29,647,435 Libor - - - 740,229 740,773 766,933 Yen 33,844 33,778 33,863 - - - Commodities 6,554,554 6,554,614 6,554,592 6,425 6,222 6,221 Other 441,047 445,642 454,112 64,548 57,384 74,866 2010 2009 Bank Original value Accrual value Market value Original value Accrual value Market value Liability position 58,924,564 63,034,551 62,992,376 43,484,696 48,190,735 48,471,679 DI (Interbank deposits rates) 34,428,820 36,646,230 36,631,923 31,486,485 34,611,933 34,657,268 Dollar 3,641,200 3,551,150 3,562,879 3,785,386 3,848,287 3,943,880 Euro 140,129 137,640 138,167 45,594 44,764 44,705 IGPM - Inflation index 892,270 1,193,484 1,210,735 1,446,000 1,841,888 1,876,293 IPCA - Inflation index 5,589,428 6,013,227 5,922,478 2,531,063 3,459,869 3,523,648 Pre-Fixed rates 7,590,216 8,840,494 8,872,876 2,829,496 3,029,097 3,040,928 TRM - - - 11,903 14,397 16,007 Libor - - - 1,187,527 1,189,729 1,213,892 Yen 33,478 33,978 34,064 130,590 126,364 126,395 TJLP 39,248 44,025 44,025 7,582 9,775 9,775 Commodities 6,556,445 6,556,453 6,556,408 15,906 14,632 18,888 Other 13,330 17,870 18,821 7,164 - - Total net - (155,081) (106,696) - 1,167,266 1,945,697 F-29 28

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) 2010 2009 Consolidated Original value Accrual value Market value Original value Accrual value Market value Asset position 29,905,335 31,980,106 31,893,747 22,429,685 25,301,383 25,685,438 DI (Interbank deposits 9,003,016 10,221,170 10,231,353 7,233,833 8,889,063 8,918,926 rates) Dollar 6,169,147 6,235,878 6,278,987 5,542,047 5,746,016 5,858,789 Euro 152,730 150,550 151,096 51,041 48,142 48,142 IGPM - Inflation index 980,573 1,233,364 1,249,515 1,646,613 2,001,320 2,041,393 IPCA - Inflation index 1,998,340 1,671,213 1,499,340 2,063,694 2,342,412 2,377,881 Pre-Fixed rates 4,569,418 5,431,231 5,438,223 5,081,255 5,470,052 5,592,214 Libor 2,666 2,666 2,666 740,229 740,772 766,933 Yen 33,844 33,778 33,863 - - - Commodities 6,554,554 6,554,614 6,554,592 6,425 6,222 6,221 Outher 441,047 445,642 454,112 64,548 57,384 74,939 2010 2009 Consolidated Original value Accrual value Market value Original value Accrual value Market value Lability position 29,905,335 33,303,053 33,129,522 22,429,685 25,721,870 26,006,443 DI (Interbank deposits 8,266,406 10,087,094 10,072,748 12,260,548 14,025,292 14,070,662 rates) Dollar 3,345,816 3,255,515 3,267,736 3,475,934 3,546,516 3,634,817 Euro 140,129 137,640 138,167 45,594 44,764 44,705 IGPM - Inflation index 892,270 1,193,484 1,210,735 1,446,000 1,841,888 1,876,293 IPCA - Inflation index 5,589,428 6,013,227 5,922,478 2,531,063 3,459,869 3,523,648 Pre-Fixed rates 5,026,120 5,961,101 5,861,674 1,309,874 1,448,644 1,471,361 TRM - - - 11,903 - - Libor 2,666 2,666 2,666 1,187,527 1,189,729 1,213,892 Yen 33,478 33,978 34,064 130,590 126,364 126,395 TJLP 39,247 44,025 44,025 7,582 9,775 9,775 Commodities 6,556,445 6,556,453 6,556,408 15,906 14,632 18,888 Other 13,330 17,870 18,821 7,164 14,397 16,007 Total Net - (1,322,947) (1,235,775) - (420,487) (321,005) F-30 29

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) c. Composition of term contracts by index 2010 2009 Bank and Consolidated Original value Accrual value Market value Original value Accrual value Market value Asset position Term currency 16,778 538 538 49,823 794 794 Total 16,778 538 538 49,823 794 794 Liability position Term currency 17,955 171 171 2,443 438 438 Total 17,955 171 171 2,443 438 438 d. Composition of option by index Bank and Consolidated Purchase commitment Contracted value 2010 2009 Market (book) value Contracted value Market (book) value Dollar 6,166,038 156,175 9,553,212 224,695 Index 510,845,318 1,977 5,997,500 68,311 IDI 150 344,231 255 4,023 Shares 42,812 3,017 62,700 7,385 Commodities 359,138 856 477,178 47,483 Flex 4,775,598 11,271 842,192 27,472 Total 522,189,054 517,527 16,933,037 379,369 F-31 30

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) Bank and Consolidated Sales commitment Contracted value 2010 2009 Market (book) value Contracted value Market (book) value Dollar 12,021,032 69,964 12,174,306 96,632 Índex 473,687,131 162,696 5,959,000 73,668 IDI - - 110 890 Shares 391,400 6,787 88,900 4,170 Commodities 165,325 225 99,044 613 Flex 6,672,349 116,522 1,541,807 65,759 Total 492,937,237 356,194 19,863,167 241,732 e. Composition of the futures contracts by index Bank Consolidated 2010 2009 2010 2009 Purchase commitment 43,775,963 11,322,292 43,775,963 11,322,292 DDI (DI x Dollar spread future contract) 8,549,436 2,264,526 8,549,436 2,264,526 Euro - 20,215-20,215 Dollar 2,138,363 1,803,152 2,138,363 1,803,152 DI 31,853,930 3,827,339 31,853,930 3,827,339 T-Note 54,118 392,910 54,118 392,910 Índex - 37,706-37,706 BGI 288,956-288,956 - SCC (Foreign exchange swap with regular adjustments) 891,160 2,976,444 891,160 2,976,444 Sales commitment 61,402,479 25,503,776 96,154,057 48,826,317 DDI (DI x Dollar spread future contract) 7,300,113 6,330,025 7,344,453 6,375,377 Euro 212,282-212,282 - Dollar 807,292 1,414,522 807,292 1,414,522 DI 51,577,049 14,094,894 85,483,888 37,372,083 Commodities 28,640 687,384 829,039 687,384 T-Note 588,117-588,117 - BGI - 75-75 F-32 31

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) Bank Consolidated 2010 2009 2010 2009 SCC (Foreign exchange swap with regular adjustments) 887,060 2,976,876 887,060 2,976,876 Other 1,926-1,926 - Total Net (17,626,516) (14,181,484) (52,378,094) (37,504,025) f. Composition of the NDF contracts by index Bank and Consolidated Asset 2010 2009 Contracted Market Contracted value (book) value value Market (book) value Dollar 2,430,964 36,899 1,443,905 81,644 Euro 1,020 2,434 20,542 564 Pre-Fixed rates - - 757,422 42,861 Other 22,324 75,631 - - Liability Total 2,454,308 114,964 2,221,869 125,069 Dollar 1,502,367 89,665 2,420,668 117,583 Euro 29,399 2,325 53 1 Other 1,099 24,961-151 Total 1,532,865 116,951 2,420,721 117,735 Total Net 921,443 (1,987) (198,852) 7,334 F-33 32

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) g. Credit derivatives Bank and Consolidated Contracted value 2010 2009 Market value (book) Contracted value Market value (book) Received risk Credit swaps 5,393,489 (6,090) 4,030,878 36,978 Total 5,393,489 (6,090) 4,030,878 36,978 Transferred risk Credit swaps 5,393,489 1,111 4,030,878 7,190 Credit linked notes 141,027 147,544 197,574 210,412 Equity linked notes 9,164 9,315 8,010 8,251 Total 5,543,680 157,970 4,236,462 225,853 h. Credit derivatives by index 2010 2009 Bank and Consolidated Asset position Original value Accrual value Market value Original value Accrual value Market value Other 5,393,489 (6,090) (6,090) 4,030,878 36,978 36,978 Total 5,393,489 (6,090) (6,090) 4,030,878 36,978 36,978 Liability position Pre-Fixed rates 150,191 156,859 156,859 205,584 218,663 218,663 Other 5,393,489 1,111 1,111 4,030,878 7,190 7,190 Total 5,543,680 157,970 157,970 4,236,462 225,853 225,853 Total Net (150,191) (164,060) (164,060) (205,584) (188,875) (188,875) F-34 33

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) i. Composition of the options contracts - Fixed income strategy Contracted value 2010 2009 Market (book) value/ risk exposure Contracted value Market (book) value/ risk exposure Bank Pre-fixed risk Liability position Sale of Call at high limit 7,394,300 6,065,351 6,183,078 4,891,642 Sale of Put at low limit 12,646,935 15,144,172 17,751,136 17,179,513 Total 20,041,235 21,209,523 23,934,214 22,071,155 Dollar risk Asset position Sale of Put at low limit - 16,950,331-16,660,411 Total - 16,950,331-16,660,411 Liability position Sale of Call at high limit - 16,950,331-16,660,411 Total - 16,950,331-16,660,411 Contracted value 2010 2009 Market (book) value/ risk exposure Contracted value Market (book) value/ risk exposure Consolidated Pre-fixed Risk Liability position Sale of Call at high limit 1,273,391 1,017,132 1,286,111 1,128,118 Sale of Put at low limit 2,271,161 2,709,476 3,692,324 3,544,737 Total 3,544,552 3,726,608 4,978,435 4,672,855 Dollar risk Asset position Sale of Put at low limit - 3,033,099-3,376,449 Total - 3,033,099-3,376,449 Liability position Sale of Call at high limit - 3,033,099-3,376,449 Total - 3,033,099-3,376,449 F-35 34

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) j. Margin offered in guarantee Bank Consolidated Asset position 2010 2009 2010 2009 Exchange transactions 1,786,509 1,781,103 1,815,813 1,805,900 National Treasury Notes 1,781,741 1,464,825 1,811,045 1,489,622 Financial Treasury Bills 4,768 7,621 4,768 7,621 National Treasury Bills - 308,657-308,657 Clearing 71,383 118,398 71,383 118,398 National Treasury Notes 26,081 20,534 26,081 20,533 Financial Treasury Bills 24,288-24,288 - National Treasury Bills 21,014 97,864 21,014 97,865 Other 2,939,490 1,098,011 2,951,207 1,100,010 National Treasury Bills 84,286-84,286 - Financial Treasury Bills 1,268 1,156 12,985 3,155 Other (a) 2,853,936 1,096,855 2,853,936 1,096,855 Total 4,797,382 2,997,512 4,838,403 3,024,308 (a) 2010, it basically refers to securities of foreign governments, in the amount of R$1,546,455, and other securities abroad, in the amount of R$1,307,481. k. Derivative financial instruments segregated by local trading Bank Consolidated Asset position 2010 2009 2010 2009 Exchange Transaction 430,040 280,523 430,040 279,729 Counter 1,777,690 3,003,448 1,347,140 1,347,720 Financial institutions 1,736,818 2,233,257 1,306,268 572,756 Trade accounts receivable 40,872 770,191 40,872 774,964 Total 2,207,730 3,283,971 1,777,180 1,627,449 F-36 35

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) Bank Consolidated Liability position 2010 2009 2010 2009 Exchange Transaction 624,082 463,931 637,407 463,493 Counter 22,581,292 22,923,759 5,783,581 6,136,074 Financial institutions 22,450,784 22,887,296 5,653,073 6,094,612 Trade accounts receivable 130,508 36,463 130,508 41,462 Total 23,205,374 23,387,690 6,420,988 6,599,567 10 Interbank accounts Bank and Consoliadated Asset 2010 2009 Mandatory reserves - Central Bank of Brazil 6,212,534 69,496 Interbank repasses 72,219 12,985 Correspondent relations 25,670 10,514 Total 6,310,423 92,995 11 Interbranch relations Bank Consolidated Asset 2010 2009 2010 2009 Internal funds transfer. - 82-2,403 Liability Total - 82-2,403 Third-party funds in transit 32,040 33,704 32,040 33,704 Internal funds transfer - - 3 5,882 Total 32,040 33,704 32,043 39,586 F-37 36

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) 12 Loan and lease operations, advances on foreign exchange contracts, other receivables with loan characteristics and allowance for loan losses a. Composition of operation by category and installments overdue and to fall due Bank Consolidated 2010 2009 2010 2009 Advances to depositors 784 305 784 305 Loans 9,017,423 7,643,697 14,109,183 11,139,282 Discounted bills 27,080 23,060 27,080 23,060 Financing 5,755,232 4,359,372 33,552,936 23,167,427 Export financing 2,549,302 2,965,407 2,549,302 2,965,407 Financing for exports 270,727 187,308 270,727 187,308 Financing Rural 1,333,247 558,611 1,333,247 558,611 Real estate financing agreements 110,277-110,277 - Subtotal 19,064,072 15,737,760 51,953,536 38,041,400 Advances on foreign exchange/export contracts 537,799 449,699 537,799 449,699 Lease operations - - 4,324,737 3,947,885 Other - 5,301-5,301 Total loans 19,601,871 16,192,760 56,816,072 42,444,285 Bank Consolidated 2010 2009 2010 2009 Loans overdue (more than 15 days) 49,346 178,186 709,009 1,137,599 Loans to fall due 19,552,525 16,014,574 56,107,063 41,306,686 Total 19,601,871 16,192,760 56,816,072 42,444,285 F-38 37

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) b. Concentration of operations Bank Consolidated 2010 2009 2010 2009 Ten largest debtors 3,075,616 3,941,376 3,129,462 3,941,376 Fifty largest debtors 4,510,045 5,016,564 4,570,739 5,016,564 One hundred largest debtors 3,573,836 3,173,054 3,625,949 3,173,054 Other debtors 8,442,374 4,061,766 45,489,922 30,313,291 Total 19,601,871 16,192,760 56,816,072 42,444,285 c. Composition of operations by sector economic activity Bank Consolidated 2010 2009 2010 2009 Corporate entities 18,645,645 14,725,282 20,174,947 15,762,809 Public sector Services 77,018 156,833 77,018 156,833 Financial Institutions - - - 54 Private sector Industry 9,530,096 8,363,359 9,641,526 8,416,231 Commercial 2,486,995 1,447,851 3,283,583 2,151,246 Rural 1,313,368 558,595 1,313,368 558,595 Services 5,238,168 4,181,140 5,859,452 4,461,860 Financial Institutions - 17,504-17,990 Individuals 956,226 1,467,478 36,641,125 26,681,476 Total 19,601,871 16,192,760 56,816,072 42,444,285 F-39 38

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) d. Composition of the operation at the corresponding levels of risk Bank Risk level Loans to fall due 2010 2009 Loans overdue Total operations Loans to fall due Loans overdue Total operations AA 12,041,990-12,041,990 7,358,052-7,358,052 A 5,527,438-5,527,438 4,062,386-4,062,386 B 1,517,995 19,863 1,537,858 3,467,577 50,589 3,518,166 C 161,087 7,869 168,956 787,847 33,324 821,171 D 10,098 1,953 12,051 117,188 4,669 121,857 E 5,497 7,428 12,925 2,063 1,748 3,811 F 94,517 24,295 118,812 249 26,290 26,539 G 24,929 4,167 29,096 16,724 175,577 192,301 H 92,149 60,596 152,745 19,872 68,605 88,477 Total 19,475,700 126,171 19,601,871 15,831,958 360,802 16,192,760 Consolidated Risk level Loans to fall due 2010 2009 Loans overdue Total operations Loans to fall due Loans overdue Total operations AA 12,710,491-12,710,491 7,803,346-7,803,346 A 38,395,293-38,395,293 26,299,677-26,299,677 B 1,620,997 1,397,510 3,018,507 3,540,739 1,273,660 4,814,399 C 203,718 923,447 1,127,165 819,299 792,154 1,611,453 D 29,735 383,391 413,126 133,082 360,522 493,604 E 14,146 180,404 194,550 9,259 200,338 209,597 F 100,873 138,992 239,865 5,659 180,229 185,888 G 29,362 101,725 131,087 19,778 305,251 325,029 H 122,890 463,098 585,988 45,065 656,227 701,292 Total 53,227,505 3,588,567 56,816,072 38,675,904 3,768,381 42,444,285 F-40 39

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) e. Constitution of allowance for loan losses and receivables per level of risk Bank Consolidated Risk level Provision % 2010 2009 2010 2009 A 0.5 27,637 20,312 191,977 131,498 B 1 15,378 35,182 30,185 48,144 C 3 5,069 24,635 33,815 48,344 D 10 1,205 12,186 41,312 49,360 E 30 3,877 1,143 58,366 62,879 F 50 59,406 13,270 119,932 92,944 G 70 20,367 134,610 91,761 227,521 H 100 152,745 88,477 585,988 701,292 Total 285,684 329,815 1,153,336 1,361,982 Percentage of portfolio 1.46% 2.04% 1.96% 3.21% f. Movement of allowance for loan losses Bank Consolidated 2010 2009 2010 2009 Opening balance 329,815 140,528 1,361,982 774,126 Constitutions/(reversals) 70,236 215,218 1,188,965 1,535,104 Write off to losses (114,367) (24,830) (1,397,611) (946,147) Other - (1,101) - (1,101) Closing balance 285,684 329,815 1,153,336 1,361,982 F-41 40

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) g. Information about credit assignment 2010 2009 Transfer amount of assets assigned in the period 14,707,955 6,956,067 Book value of assets assigned in the period (13,326,899) (5,819,079) Gross income from assignments 1,381,056 1,136,988 Expenses with assigned contracts early settlement (603,906) (35,405) Provision for losses on assigned contracts (55,398) (36,918) Income from assignments before costs and taxes 721,752 1,064,665 Acceleration of the recognition in profit or loss of the costs associated with the asset assigned (381,798) (209,715) Income from assignments before taxes 339,954 854,950 Tax effects (174,512) (373,701) Net Income (loss) from assignments 165,442 481,249 h. Accounting hedge strategies 2010 2009 Consolidated Cost Market Value Unrealized gain/(loss) Cost Market Value Unrealized gain/(loss) Loans/Lease 38,645,311 38,971,119 325,808 26,902,679 27,434,629 531,950 Total 38,645,311 38,971,119 325,808 26,902,679 27,434,629 531,950 F-42 41

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) In order to hedge the risks of the fixed interest rate of loans, financing and lease operations, the Conglomerate entered into contracts on the Interbank Deposit (DI) futures market with BM&FBOVESPA, in accordance with the maturity schedule of the installments. In order to hedge the risks of the variable rate (Dollar) of export financing, the Conglomerate entered into contracts on the DDI and SCC futures market with BM&F BOVESPA, in accordance with the maturity schedule of the installments. i. Supplementary information Bank Consolidated 2010 2009 2010 2009 Credits renegotiated/amend during the year 8,710,731 5,970,525 8,906,615 6,199,852 Credits recovered previosly written off as losses 12,444 17,716 192,743 135,377 13 Foreing exchange portfolio Bank and consolidated Other receivables 2010 2009 Unsettled foreign exchange purchased 1,221,375 332,175 Rights from the sale of foreign exchange 643,639 51,870 Advances in foreign currency received (582,890) - Advances in domestic currency received (2,315) (25,473) Income receivable from advances granted 12,942 21,848 Income receivable from financed imports - 101 Total 1,292,751 380,521 F-43 42

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) Other liabilities 2010 2009 Sold foreign exchange to be settled 641,385 51,879 Financed imports - Foreign exchange contracted - (25,118) Liabilities for foreign exchange purchases 1,252,142 385,489 Advances against exchange (524,855) (402,632) Total 1,368,672 9,618 14 Securities clearing accounts Other receivables Bank Consolidated 2010 2009 2010 2009 Clearing department 9,055 1,100 17,118 1,100 Debtors account settlement pending - 292 10,022 14,485 Operations with financial assets and commodities to settle 46,627 66,416 46,627 66,416 Other credits 23,066 37,201 23,508 37,785 Total 78,748 105,009 97,275 119,786 Other liabilities Bank Consolidated 2010 2009 2010 2009 Clearing department 7 1 95 4,637 Commissions and brokerage fees payable 1,059-1,408 921 Creditors - unsettled accounts 165 325 52,778 18,878 Stock loan creditors 24,966 32,643 24,966 32,643 Operations with financial assets and commodities to settle 63,290 19,540 74,190 21,157 Other - 815 - - Total 89,487 53,324 153,437 78,236 F-44 43

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) 15 Other receivables - Sundry Bank Consolidated 2010 2009 2010 2009 Advances on salaries 1,303 5,133 2,784 20,851 Advances to suppliers 1,943-1,987 - Tax credits 509,039 575,317 2,120,104 1,788,321 Deposits in guarantee 77,529 9,054 125,180 36,967 Taxes and contributions to compensate 134,322 180,576 568,883 435,084 Taxes and contributions to recover - - 5 - Securities and credits receivable - 12,900-12,900 Receivable from associated companies 6,715 1,010 7,149 80 Credit card transactions - - 188,660 113,817 Adjustment to market value - loans and lease 96,930 210,860 325,808 531,950 operations Associated costs - loans and lease operations - - 519,752 418,404 Settlement of securities abroad 191,156-191,156 - Other 2,911 54,896 85,531 - Total 1,021,848 1,049,746 4,136,999 3,453,616 16 Other assets Bank Consolidated 2010 2009 2010 2009 Insurance costs 1,141-4,902 - Prepaid data processing expenses 2,852 6,905 3,075 - Comissions paid for acting as intermediary - - 509,472 281,351 Prepaid expenses with issue of securities 1,588-3,532 - Prepaid financial system service expenses 4,746 1,611 12,237 10,616 Prepaid specialized technical services expenses 8,532-26,370 - Assets not for own use 3,874 1,217 87,330 65,021 Other 390 562 2,708 23,985 Total 23,123 10,295 649,626 380,973 F-45 44

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) 17 Investments a. Domestic and overseas subsidiaries Companies Book value at 12/31/09 Dividends Equity in Earnings of Subsidiriaries Adjustments directly to shareholders equity Book value at 12/31/10 Domestic 2,507,956 (68,241) 583,378 (13) 3,023,080 Votorantim CTVM Ltda. 241,828 (1,328) 10,065 (46) 250,519 Votorantim Asset DTVM Ltda 38,753 (3,255) 24,534-60,032 BV Financeira S.A. 947,818 (55,967) 507,599-1,399,450 BV Leasing Arrend. Merc. S.A. 1,279,557 (7,691) 41,180 33 1,313,079 Overseas 35,274 - (868) 12,368 46,774 Votorantim Bank Limited 33,370-32 - 33,402 Banco Votorantim Securities 1,904 - (900) 12,368 13,372 Total 2,543,230 (68,241) 582,510 12,355 3,069,854 Companies Capital Shareholders equity 2010 Net Income Number of shares/quotas held Domestic Votorantim CTVM Ltda. 115,868 249,504 10,066 20,173 Votorantim Asset DTVM Ltda. 19,000 57,461 24,534 8,998,920 BV Financeira S.A. 472,000 1,334,863 507,599 126,361 BV Leasing Arrend. Merc. S.A. 996,200 1,310,996 41,188 510,353 BVIP - BV Inv. e Partic. S.A. - - - 1,000 BVIA - BV Inv. Alt. Gestão S.A. - - - 1,000 Overseas Votorantim Bank Limited 68,798 34,143 1,526 6,002,120 Banco Votorantim Securities 19,994 14,004 (18) 4,000,000 Total 1,691,860 3,000,971 584,895 F-46 45

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) b. Other investments Bank Consolidated 2010 2009 2010 2009 Investments in government incentives 33,287 33,698 94,506 76,693 Provision for losses (10,298) (5,953) (40,056) (23,422) Membership certificates 175 175 176 176 Shares and quotas 6 6 6 6 Other 99 99 129 129 Total 23,269 28,025 54,761 53,582 18 Fixed assets for use 2010 2009 Bank Cost Depreciation Net Net Fixed assets in progress 111-111 111 Furniture and equipment for use 31,794 (8,674) 23,120 21,628 Communication system 7,303 (4,033) 3,270 3,660 Data processing system 35,320 (21,606) 13,714 6,610 Security system 2,173 (511) 1,662 920 Transportation system 1,181 (1,079) 102 195 Total 77,882 (35,903) 41,979 33,124 F-47 46

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) Consolidated 2010 2009 Cost Depreciation Net Net Fixed assets in progress 111-111 111 Facilities 18,568 (1,522) 17,046 1,528 Furniture and equipment for use 49,258 (14,286) 34,972 30,296 Communication system 11,806 (6,097) 5,709 6,218 Data processing system 70,194 (42,360) 27,834 18,731 Security system 2,202 (524) 1,678 932 Transportation system 1,672 (1,236) 436 315 Total 153,811 (66,025) 87,786 58,131 Bank Consolidated 2010 2009 2010 2009 Opening balance 33,124 17,380 58,131 50,448 Purchase 16,517 21,997 45,655 26,893 Disposal (480) (1,392) (1,102) (8,132) Depreciation (7,182) (4,861) (14,898) (11,078) Closing balance 41,979 33,124 87,786 58,131 On December 31, 2010, there were no relevant assets indicating impairment loss. F-48 47

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) 19 Intangible 2010 2009 Bank Cost Depreciation Net Net Corporate projects 7,035-7,035 - Total 7,035-7,035-2010 2009 Consolidated Cost Depreciation Net Net SISBEX BMF&BOVESPA 200-200 200 Software with no physical substance 1,505 (469) 1,036 1,254 Licenses 10,066 (2,231) 7,835 3,667 Rights due to trade agreement 5,000 (415) 4,585 - Corporate projects 7,035-7,035 - Total 23,806 (3,115) 20,691 5,121 Bank Consolidated 2010 2009 2010 2009 Opening balance - - 5,121 - Purchase 7,035-17,693 5,398 Disposal - - (2,123) (277) Closing balance 7,035-20,691 5,121 F-49 48

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) Amortization estimates Bank Consolidated 2010 2009 2010 2009 In 2010 - - - 1,202 In 2011 - - 3,055 1,202 In 2012 - - 3,055 1,202 In 2013 - - 3,055 1,202 In 2014 - - 2,655 113 In 2015 - - 1,636 - More than 5 years 7,035-7,235 200 Total 7,035-20,691 5,121 On December 31, 2010, there were no relevant assets indicating impairment loss. 20 Deferred charges Bank 2010 2009 Cost Depreciation Net Net Leasehold expenditures 35,130 (2,936) 32,194 27,541 Total 35,130 (2,936) 32,194 27,541 F-50 49

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) 2010 2009 Consolidated Cost Depreciation Net Net Leasehold expenditures 82,113 (38,851) 43,262 43,025 Expenditures acquisition development 1,747 (1,115) 632 850 Total 83,860 (39,966) 43,894 43,875 Bank Consolidated 2010 2009 2010 2009 Opening balance 27,541 3,861 43,875 23,348 Purchase 24,136 28,162 28,679 32,021 Disposal (17,233) - (17,233) (3,153) Amortization (2,250) (4,482) (11,427) (8,341) Closing balance 32,194 27,541 43,894 43,875 On December 31, 2010, there were no relevant assets indicating impairment loss. 21 Deposits Bank Consolidated 2010 2009 2010 2009 Demand deposits 305,007 133,699 309,431 134,794 Interbank deposits 980,116 2,020,028 726,266 1,741,042 Time deposits 22,573,786 22,610,098 22,562,609 22,599,913 Other deposits 150 1,822 150 1,672 Total 23,859,059 24,765,647 23,598,456 24,477,421 F-51 50

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) 22 Money market repurchase commitments Bank Consolidated 2010 2009 2010 2009 Own Portfolio 25,305,911 14,784,824 24,920,233 14,784,824 Financial Treasury Bill 368,918-368,918 - National Treasury Bill 579,083 45,795 579,083 45,795 National Treasury Notes 5,742,823 295,488 5,355,984 295,488 Other 18,615,087 14,443,541 18,616,248 14,443,541 Third party portfolio 7,770,634 10,470,496 6,860,675 9,634,060 Financial Treasury Bill - 1,499,998-1,499,998 National Treasury Bill 5,815,100 3,095,350 5,761,542 2,328,127 National TreasuryNotes 1,955,534 5,875,148 1,099,133 5,805,935 Free portfolio 2,599,012 348,584 2,599,012 348,584 National Treasury Bill - 319,643-319,643 National Treasury Bills 2,525,824-2,525,824 - Other 73,188 28,941 28,941 73,188 Total 35,675,557 25,603,904 34,379,920 24,767,468 F-52 51

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) 23 Acceptances and endorsements Bank Consolidated 2010 2009 2010 2009 Debentures With exchange variation (a) - - 1,567,126 1,637,667 Post-fixed (b) - - 1,446,441 1,313,451 Funds from Real estate credit bills Post-fixed (c) 4,632 106,311 4,632 106,311 Funds from Agribusiness Credit Bills Post-fixed (d) 1,789,518 1,818,264 1,789,518 1,818,264 Financial Bill Pre-fixed (e) 13,644-13,644 - Post-fixed (f) 2,593,316-2,593,316 - Liabilities from overseas securities Pre-fixed (g) 369,806-369,806 - With exchange variation (h) 2,513,648 1,394,800 2,513,648 1,394,800 Total 7,284,564 3,319,375 10,298,131 6,270,493 (a) Discount rate in 2010: PTAX (exchange rate provided by BACEN) + 12.04% per year. (b) Discount rate in 2010: DI + 0.35% per year. (c) and (d) Discount rate in 2010: Discount rate equivalent now 90% of CDI (e) and (f) Discount rate in 2010: 100% to 108.10% of CDI (g) Discount rate in 2010: 9.25% a year to 10.63% per year (h) Rate of restatement in 2010: from 1.10% per year to 6.75% per year + foreign exchange variation Foreign securities. F-53 52

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) Accounting hedge strategies Consolidated Cost 2010 2009 Market value Unrealized gain/(loss) Cost Market value Unrealized gain/(loss) Liabilities from overseas securities 2,877,050 2,883,454 (6,404) 1,387,006 1,394,800 (7,794) Total 2,877,050 2,883,454 (6,404) 1,387,006 1,394,800 (7,794) In order to hedge the risks of the fixed interest rate of loans, financing and lease operations, the Conglomerate entered into contracts on the Interbank Deposit (DI) futures market with BM&FBOVESPA, in accordance with the maturity schedule of the installments. 24 Borrowings and repasses Bank Consolidated 2010 2009 2010 2009 Loans in the country With exchange variation (a) 21,357 186,589 21,357 186,589 Foreign borrowings With exchange variation (b) 4,237,430 2,163,337 4,237,430 2,163,337 Domestic repasses - National treasure Post-fixed (c) 73,338-73,338 - On-lending-BNDES Post-fixed (d) 4,081,327 3,503,274 4,081,327 3,503,274 On-lending-FINAME Post-fixed (e) 2,812,564 1,415,992 2,841,028 1,449,555 Total 11,226,016 7,269,192 11,254,480 7,302,755 (a) Discount rate in 2010: 7.10 % per year + exchange variation. (b) Discount rate in 2010: 0.50% per year a 17.5% a.a + exchange variation (c) Discount rate in 2010: 6.75% per year (d) Discount rate in 2010: 1.30% per year to 11% per year + TJLP (Long-term interest rate TJLP ) or exchange variation. (e) Discount rate in 2010: 0.30% per year to 17.5% per year or TJLP. F-54 53

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) 25 Other liabilities - Social and statutory Bank Consolidated 2010 2009 2010 2009 Dividends/interest on own capital/benefits payable 128,300 190,421 128,300 190,421 Provision for profit sharing 74,564 40,951 251,330 165,897 Bonuses and profit-sharing payable 19 228 19 228 Total 202,883 231,600 379,649 356,546 26 Other liabilities - Tax and social security Bank Consolidated 2010 2009 2010 2009 Income and social contributions taxes payable 121,405 127,119 517,666 559,074 Taxes and contributions on outsourced services 1,343 904 12,312 8,025 Taxes and contribution on the salary 3,793 2,194 6,672 4,125 Taxes and contributions on interest earning bank deposits 34,156 31,851 34,180 31,859 PIS 5,733 6,985 9,453 13,965 COFINS 1,340 529 7,234 2,385 ISS 2,201 1,330 8,377 5,027 Provision for tax risks 564,825 478,676 1,400,348 1,046,422 Provision for deferred taxes and contributions 180,922 152,140 1,164,706 753,695 Other taxes and contributions (Legal obligations) - 4 11 13 Total 915,718 801,732 3,160,959 2,424,590 F-55 54

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) 27 Other liabilities - Subordinated debts Bank Consolidated 2010 2009 2010 2009 Subordinated financial notes Post-fixed (c) 304,964-304,964 - Bank deposit certificates Post-fixed (a) 3,262,539 2,927,815 3,262,539 2,927,815 Debentures Post-fixed (b) - - 1,451,075 1,439,006 Subordinated note With exchange variation (d) 1,885,684-1,885,684 - Total 5,453,187 2,927,815 6,904,262 4,366,821 (a) Discount rate in 2010: 0.49% per year until 7.95% per year + CDI (b) Discount rate in 2010: 0.50% per year + CDI (c) Discount rate in 2010: 0.30% per year until 17.50% per year + TJPL (d) Discount rate in 2010: 7.38% per year + PTAX Accounting hedge strategies 2010 2009 Consolidated Accrual value Market value (book) Unrealized gain/(loss) Accrual value Market value (book) Unrealized gain/(loss) Subordinated note 1,986,505 1,885,684 100,821 - - - Total 1,986,505 1,885,684 100,821 - - - F-56 55

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) In order to hedge the risks of the fixed interest rate of loans, financing and lease operations, the Conglomerate entered into contracts on the DDI futures market with BM&FBOVESPA, in accordance with the maturity schedule of the installments. 28 Other liabilities - Sundry Bank Consolidated 2010 2009 2010 2009 Provision for personnel expenses 25,405 14,217 84,118 42,204 Provision administrative expenses 8,774 12,502 73,122 48,885 Provision for contingent liabilities 9,560 18,600 113,691 116,746 Comission of intermediation of operations - - 107,102 60,394 Amounts to on-lend credit assignment - - 204,868 139,630 Provision for assigned credit losses - - 80,090 24,692 Credit card transactions 25 12 194,023 120,477 Settlement of securities abroad 209,333 21,802 209,933 22,622 Credit and lease operation to liberate 4,337 126,669 30,549 155,267 Other (a) 45,849 49,893 314,111 177,738 Total 303,283 243,695 1,411,607 908,655 (a) In the Consolidated, it basically refers to unprocessed amounts arising from the operating cash flow from the loan operation portfolio. 29 Shareholders equity a. Capital Capital is represented by 81,538,822,950 nominative shares, 66,713,582,406 of which are common shares with no par value and 14,825,240,544 nominative preferred shares with no par value. F-57 56

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) In conformity with the strategic partnership between Banco do Brasil and Votorantim Finanças, in this year, the paid-up capital was made in the amount of R$ 450,000. b. Dividends Shareholders are assured a minimum compulsory dividend equivalent to 25% of net profit for each period, deducted from the statutory reserve. Management proposes the payment of dividends from the profit in the period. 2010 2009 Net Profit 1,015,247 801,773 Legal reserve 50,762 40,089 Calculation base 964,485 761,684 Interest on own capital - - Dividends 241,121 190,421 Proposed value 241,121 190,421 Percentage on calculation base 25% 25% c. Capital reserve Capital reserve is formed by Premium on the subscription of shares, in the amount of R$ 585,104. In accordance with the Extraordinary Shareholders Meeting held on December 22, 2010, the shareholders approved the allocation of the balances of capital reserves comprised of tax incentives and updating of stock exchange memberships to increase capital by R$ 31,945. F-58 57

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) d. Profit reserve Legal reserve Formed compulsorily on the basis of 5% of net income for the period, until it reaches 20% of the capital stock. Legal reserve may not be formed when the result of its addition to capital reserves is greater than 30% of capital stock. The legal reserve can only be used for capital increase or to offset loss. Expansion reserve To meet requirements arising from corporate law and Central Bank rules, at year end, Management proposes the allocation of undistributed profit to the Expansion reserve, to be set up after the allocations to the legal reserve and payment of dividends, if any. The reserve balance is at disposal of shareholders for future deliberations in the General Meeting. e. Adjustments directly to shareholder s equity Consolidated 2010 2009 Opening balance (76,664) (95,006) Available for sale securities 62,627 (10,495) Banco Votorantim 110,457 (51,259) Subsidiaries (47,830) 40,764 Tax effects (43,319) 28,837 Closing balance (57,356) (76,664) F-59 58

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) 30 Balance sheet by maturity brackets The balance sheet by maturity brackets statement was prepared considering the maturity term of the assets and liabilities, regardless of the category in which they are classified. Regarding assets and liabilities of indefinite term, operations with assets are classified in noncurrent assets and operations with liabilities in current liabilities. In the Balance Sheet statement, securities classified in the Trading securities category are presented as Current Assets, regardless of the maturity terms. Bank a. Asset Up to 90 From 91 From 1 From 3 Over 5 days to 360 days to 3 years to 5 years years Total Cash 68,530 - - - - 68,530 Interbank funds applied 8,848,148 13,993,617 24,696,619 232,551 12,094 47,783,029 Commited operations - Banked position 587,800 1,933,743 - - - 2,521,543 Commited operations- Financed position 6,148,649 1,643,668 - - - 7,792,317 Commited operations - Free portfolio 964,126 1,566,187 - - - 2,530,313 Interbank deposits 1,060,246 8,850,019 24,696,619 232,551 12,094 34,851,529 Foreign currency investments 87,327 - - - - 87,327 Securities 2,724,532 3,232,939 4,029,077 3,967,638 23,358,465 37,312,651 Securities for trading 800,027 2,620,951 3,743,031 2,185,556 19,291,368 28,640,933 Available for sale 1,924,505 611,988 286,046 1,782,082 4,067,097 8,671,718 Derivative financial instruments 606,337 659,683 560,812 71,580 309,318 2,207,730 Diferencial de swap 186,504 473,133 428,499 71,580 65,717 1,225,433 Term currency contracts 82 438 18 - - 538 Purchase of options - shares 268 2,749 - - - 3,017 Purchase of options - financial asset/commodities 328,583 145,762 40,165 - - 514,510 Credit derivatives 37,477 19,841 45,969-243,601 346,888 Non deliverable forward 51,043 17,760 46,161 - - 114,964 Other 2,380 - - - - 2,380 Interbranch relations 6,112,444 197,979 - - - 6,310,423 Loans 3,299,977 5,130,849 8,654,385 1,922,381 56,480 19,064,072 F-60 59

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) Up to 90 From 91 From 1 From 3 Over 5 days to 360 days to 3 years to 5 years years Total Allowance for loan losses (52,235) (6,530) (82,606) (93,531) (12,935) (247,837) Other receivables 1,392,891 474,052 227,851 111,493 153,908 2,360,195 Foreing exchange portfolio 949,247 343,504 - - - 1,292,751 Income receivable 4,684 11 - - - 4,695 Securities clearing accounts 78,748 - - - - 78,748 Sundry 387,140 141,456 227,851 111,493 153,908 1,021,848 Allowance for doubtful receivable (26,928) (10,919) - - - (37,847) Other assets 9,223-13,900 - - 23,123 Total 23,009,847 23,682,589 38,100,038 6,212,112 23,877,330 114,881,916 b. Liabilities Up to 90 days From 91 to 360 days From 1 to 3 years From 3 to 5 years Over 5 years Total Deposits 5,873,418 12,690,737 5,251,457 33,025 10,422 23,859,059 Demand deposits 305,007 - - - - 305,007 Interbank deposits 491,892 354,896 125,345 6,860 1,123 980,116 Time deposits 5,076,369 12,335,841 5,126,112 26,165 9,299 22,573,786 Other deposits 150 - - - - 150 Money market repurchase commitments 14,603,236 16,945,397 4,019,885 93,486 13,553 35,675,557 Own Portfolio 7,978,112 13,269,042 3,966,633 92,124-25,305,911 Third party portfolio 5,657,870 2,112,764 - - - 7,770,634 Free portfolio 967,254 1,563,591 53,252 1,362 13,553 2,599,012 Acceptances and endorsements 675,620 1,006,729 3,988,300 1,121,741 492,174 7,284,564 Interbranch accounts 23,139 8,901 - - - 32,040 Borrowings and repasses 1,727,367 4,608,738 4,212,040 636,956 40,915 11,226,016 Derivative financial instruments 558,979 5,466,439 16,980,843 123,365 75,748 23,205,374 Differential from swap 144,387 496,809 498,687 116,496 75,748 1,332,127 Term currency contracts 59 112 - - - 171 Compra de opções - ações 5,271 1,516 - - - 6,787 Compra de opções - ativo fin./merc. 94,598 93,627 161,182 - - 349,407 Option box 198,153 4,716,614 16,294,758 - - 21,209,525 Credit derivatives 62,857 118,234 - - - 181,091 Non deliverable forward 44,339 39,527 26,216 6,869-116,951 Other 9,315 - - - - 9,315 F-61 60

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) Up to 90 days From 91 to 360 days From 1 to 3 years From 3 to 5 years Over 5 years Total Other liabilities 2,196,283 22,852 1,682,346 1,552,135 2,889,384 8,343,000 Tax collection and payment, and similar payment 9,770 - - - - 9,770 Foreing exchange portfolio 1,368,551 121 - - - 1,368,672 Social and statutory 202,883 - - - - 202,883 Taxes payable 256,216 18,616 42,302 670 597,914 915,718 Securities clearing accounts 64,521-24,966 - - 89,487 Subordinated debt - - 1,610,252 1,551,465 2,291,470 5,453,187 Sundry 294,342 4,115 4,826 - - 303,283 Deferred income 39,895 1,865 - - - 41,760 Total 25,697,937 40,751,658 36,134,871 3,560,708 3,522,196 109,667,370 F-62 61

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) Consolidated a. Asset Up to From 91 From 1 From 3 Over 5 90 days to 360 days to 3 years to 5 years years Total Cash 150,621 - - - - 150,621 Interbank funds applied 8,459,044 5,658,024 858,309 26,533-15,001,910 Commited operations - Banked position 587,800 1,933,743 - - - 2,521,543 Commited operations- Financed position 6,148,649 1,643,668 - - - 7,792,317 Commited operations - Free portfolio 964,126 1,566,187 - - - 2,530,313 Interbank deposits 671,142 514,426 858,309 26,533-2,070,410 Foreign currency investments 87,327 - - - - 87,327 Securities 5,517,541 3,244,117 4,067,597 4,081,233 6,475,332 23,385,820 Securities for trading 3,063,596 2,632,129 3,781,551 2,299,151 2,408,235 14,184,662 Available for sale 2,453,945 611,988 286,046 1,782,082 4,067,097 9,201,158 Derivative financial instruments 524,753 423,368 488,546 31,833 308,680 1,777,180 Differential from swap 104,922 236,817 356,234 31,833 65,078 794,884 Term currency contracts 82 438 18 - - 538 Purchase of options - shares 268 2,749 - - - 3,017 Purchase of options - Financial 328,583 145,762 40,165 - - 514,510 asset/commodities Credit derivatives 37,477 19,842 45,968-243,602 346,889 NDF 51,043 17,760 46,161 - - 114,964 Other 2,378 - - - - 2,378 Interbranch relations 6,112,444 197,979 - - - 6,310,423 Loans 7,621,407 14,227,848 23,485,606 6,487,660 131,015 51,953,536 Lease operations 3,738,216 85,374 56,191 - - 3,879,781 Allowance for loan losses (369,228) (177,536) (295,489) (159,050) (14,003) (1,015,306) Other receivables 2,385,771 1,430,053 818,633 549,049 333,363 5,516,869 Foreing exchange portfolio 949,247 343,504 - - - 1,292,751 Income receivable 27,680 11 - - - 27,691 Securities clearing accounts 97,275 - - - - 97,275 Sundry 1,338,497 1,097,457 818,633 549,049 333,363 4,136,999 Allowance for doubtful receivable (26,928) (10,919) - - - (37,847) Other assets 41,762 142,439 325,108 139,678 639 649,626 Total 34,182,331 25,231,666 29,804,501 11,156,936 7,235,026 107,610,460 F-63 62

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) b. Liabilities Até De 91 a De 1 De 3 Acima de 90 dias 360 dias a 3 anos a 5 anos 5 anos Total Deposits 5,690,044 12,663,657 5,201,308 33,025 10,422 23,598,456 Demand deposits 309,431 - - - - 309,431 Interbank deposits 304,094 338,993 75,196 6,860 1,123 726,266 Time deposits 5,076,369 12,324,664 5,126,112 26,165 9,299 22,562,609 Other deposits 150 - - - - 150 Money market repurchase commitments 13,306,438 16,946,558 4,019,885 93,486 13,553 34,379,920 Own Portfolio 7,591,273 13,270,203 3,966,633 92,124-24,920,233 Third party portfolio 4,747,911 2,112,764 - - - 6,860,675 Free portfolio 967,254 1,563,591 53,252 1,362 13,553 2,599,012 Acceptances and endorsements 675,620 2,573,855 5,434,742 1,121,741 492,173 10,298,131 Interbranch accounts 23,142 8,901 - - - 32,043 Borrowings and repasses 1,727,396 4,610,034 4,227,282 648,853 40,915 11,254,480 Derivatives financial instruments 493,141 4,265,446 1,477,618 109,237 75,546 6,420,988 Diffential from Swap 78,550 1,351,700 422,494 102,368 75,546 2,030,658 Term currency contracts 59 112 - - - 171 Purchase of options - shares 5,271 1,516 - - - 6,787 Purchase of options - financial asset/commodities 94,598 93,627 161,182 - - 349,407 Option Box 198,153 2,660,729 867,726 - - 3,726,608 Credit derivatives 62,857 118,234 - - - 181,091 Non deliverable forward 44,339 39,528 26,216 6,869-116,952 Other 9,314 - - - - 9,314 Other liabilities 3,829,062 2,020,056 2,168,684 1,659,170 3,725,906 13,402,878 Tax collection and payment, and similar payment 24,292 - - - - 24,292 Foreing exchange portfolio 1,368,551 121 - - - 1,368,672 Social and statutory 379,649 - - - - 379,649 Taxes payable 758,794 440,980 443,399 84,343 1,433,443 3,160,959 Securities clearing accounts 128,471-24,966 - - 153,437 Subordinated debt - 1,451,075 1,610,252 1,551,465 2,291,470 6,904,262 Sundry 1,169,305 127,880 90,067 23,362 993 1,411,607 Deferred Income 39,895 1,865 - - - 41,760 Minority interest 59 - - - - 59 Total 25,784,797 43,090,372 22,529,519 3,665,512 4,358,515 99,428,715 F-64 63

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) 31 Loans operations income Bank Consolidated 2010 2009 2010 2009 Advances to depositors 26 14 26 14 Loans 1,077,220 767,121 2,649,989 1,554,632 Discounted bills 4,904 6,333 4,904 6,333 Financing 425,456 312,102 5,218,383 4,214,630 Export financing 291,814 (215,805) 291,814 (215,805) Financing for exports 1,130 (9,884) 7,705 (9,884) Financing Rural 81,232 39,671 81,232 39,671 Rights for share loans 10,863 343 10,863 343 Results from credit assignment - - 721,752 1,064,665 Adjustment to market value (116,062) (120,513) (174,823) (120,513) Other 1,360 138,483 1,360 447,911 Total 1,777,943 917,865 8,813,205 6,981,997 32 Lease operations income Consolidated 2010 2009 Income from lease 730,196 239,735 Profit on disposal of leased assets 346,362 80,760 Income with excess depreciation 1,537,823 1,275,997 Adjustment to market value 28,072 34,569 Other 1,631 172,312 Total 2,644,084 1,803,373 F-65 64

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) 33 Net operations from securities income Bank Consolidated 2010 2009 2010 2009 Commited operations investments 1,388,405 1,626,286 1,388,405 1,624,007 Interbank deposits 3,059,297 2,204,166 112,835 178,378 Fixed income securities 3,566,225 2,848,235 2,079,525 1,415,156 Securities abroad 353,124 (397,817) 353,136 (352,885) Variable income securities 21,498 78,090 30,436 78,158 Investments in investment funds 4,918 13,219 289,261 261,794 Adjustment to market value 69,606 (295,325) 53,132 (271,048) Total 8,463,073 6,076,854 4,306,730 2,933,559 34 Results (income / (loss)) from derivative financial instruments Bank Consolidated 2010 2009 2010 2009 Swap Contracts (329,272) 1,720,976 (771,961) 324,222 Forward contracts (8,248) 8,198 (8,248) 8,198 Future contracts (409,746) (131,076) (767,434) (521,273) Option shares agreement (28,269) (26,715) (28,269) (26,715) Option agreement-financial 70,516 (74,328) 70,516 (74,315) assets/goods Credit derivatives 13,112 45,243 13,112 45,243 Option BOX - Fixed income strategy (2,128,376) (2,655,613) (430,181) (345,661) Non deliverable forward (18,674) 204,640 (18,674) 204,640 Other (62,907) (61,696) (62,908) (61,698) Total (2,901,864) (970,371) (2,004,047) (447,359) F-66 65

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) 35 Foreign exchange income Bank and consolidated 2010 2009 Income from exports 25,366 57,901 Income from imports 7,075 9,267 Financial income (loss) (976) (116) Variations and differences in rates (3,005) (354,627) Cash in foreign currencies 20,716 68,344 Other (7,512) (20,451) Total 41,664 (239,682) 36 Expenses on funding from the market Bank Consolidated 2010 2009 2010 2009 Securities transactions overseas 88,993 225,948 88,993 225,948 Interbank deposits (104,198) (384,338) (75,647) (355,595) Time deposits (2,483,529) (1,827,712) (2,483,529) (1,827,723) Commited operations (3,292,707) (2,720,691) (3,191,372) (2,631,547) Agribusiness credit bills (146,748) (154,730) (146,748) (154,730) Real estate credit note (3,462) (5,037) (3,462) (5,037) Financial Bill (113,574) - (113,574) - Debentures - - (402,584) 91,018 Other (31,831) (200,748) (31,831) (200,748) Total (6,087,056) (5,067,308) (6,359,754) (4,858,414) F-67 66

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) 37 Borrowings, assignments and repasses expenses Bank Consolidated 2010 2009 2010 2009 Loans in the country (5,623) (52,813) (5,623) (52,813) Foreign borrowings (77,179) 800,770 (77,179) 800,770 On-lending BNDES (256,953) (49,238) (256,953) (49,238) On-lending FINAME (113,641) (275,355) (115,995) (278,538) To foreign bankers (4,403) (45,663) (4,403) (45,663) Other 251,082 243,634 251,082 242,367 Total (206,717) 621,335 (209,071) 617,367 38 Lease operations expenses Consolidated 2010 2009 Depreciation of leased assets (1,901,071) (1,264,636) Amortization of leased assets (2,041) (2,139) Loss on sale of leased properties (187) - Adjustment to market value (25,260) (41,581) Other (44,219) (21,846) Total (1,972,778) (1,330,202) F-68 67

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) 39 Income from rendered service Bank Consolidated 2010 2009 2010 2009 Management of investment funds - - 109,819 81,948 Collection revenues 6,030 2,175 6,030 2,175 Comissions on placing of securities 69,345 39,134 70,207 40,073 Brokerage of stock exchange transactions - - 30,092 29,248 Income from guarantees provided 144,032 118,285 144,032 126,354 Credit card transactions - - 13,055 4,547 Comission of insurance brokerage - - 23,985 - Financial advisory 23,044 24,195 19,564 24,195 Other 12,440 21,428 23,436 49,655 Total 254,891 205,217 440,220 358,195 40 Income from banking fee Bank Consolidated 2010 2009 2010 2009 Individuals Preparations of registry - - 603,606 443,318 Transfers - - 1 3 Advance contract - - 12,741 430 Assets evalutions - - 158,675 3,469 Credit card - - 14,764 108 Other - - - 3,730 Corporate entities Preparations of registry - - 11,704 7,058 Transfers 870 505 880 506 Other 376 394 2,093 394 Total 1,246 899 804,464 459,016 F-69 68

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) 41 Pesonnel expenses Bank Consolidated 2010 2009 2010 2009 Fees (14,028) (12,600) (27,060) (25,511) Benefits (29,841) (22,014) (118,362) (84,780) Social security charges (63,969) (45,571) (161,117) (116,878) Salaries (175,945) (125,446) (462,183) (332,629) Training (4,126) (2,562) (6,002) (4,400) Total (287,909) (208,193) (774,724) (564,198) 42 Other administrative expenses Bank Consolidated 2010 2009 2010 2009 Water, energy and gas (1,153) (1,126) (5,041) (4,618) Rental (36,835) (26,491) (110,142) (57,942) Leased assets (941) (423) (4,821) (2,647) Communications (12,679) (9,739) (102,374) (81,591) Philanthropic contributions (3,229) (2,638) (7,461) (9,479) Maintenance and conservation of fixed assets (6,163) (4,503) (13,967) (22,194) Material (2,268) (874) (6,561) (3,734) Data processing (65,112) (56,913) (118,137) (107,799) Promotions and public relations (10,621) (6,103) (22,779) (18,305) Publicity and adversysing (1,986) (2,169) (33,841) (19,943) Publications (1,498) (2,254) (1,777) (3,110) Insurance (2,043) (223) (17,747) (9,201) Financial system services (60,159) (23,082) (181,612) (131,733) Outsourced services (3,401) (2,563) (20,840) (42,310) Surveillance and security (1,411) (1,280) (3,990) (2,950) Specialized technical services (103,938) (37,931) (572,427) (242,815) F-70 69

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) Bank Consolidated 2010 2009 2010 2009 Transportation (4,611) (3,186) (21,491) (20,329) Travel (7,403) (5,236) (35,969) (36,435) Legal fees (6,706) (5,318) (134,753) (96,786) Amortization (2,250) (4,522) (13,550) (8,618) Depreciation (7,182) (4,848) (14,898) (11,078) Other (3,762) (6,838) (91,568) (103,409) Total (345,351) (208,260) (1,535,746) (1,037,026) 43 Tax expenses Bank Consolidated 2010 2009 2010 2009 ISS (12,445) (10,326) (62,882) (45,774) PIS (9,699) (8,794) (53,759) (44,358) COFINS (58,724) (53,154) (331,650) (269,559) Other (4,324) (1,280) (9,109) (4,188) Total (85,192) (73,554) (457,400) (363,879) F-71 70

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) 44 Other operational income Bank Consolidated 2010 2009 2010 2009 Reimbursement of commission for intermediation of operations - CET - - 1,715,394 1,137,155 Reimbursement of other costs - CET 900 1,045 187,761 35,626 Reimbursement of commissions for intermediation of transactions - Non-CET - - 22,280 12,317 Reimbursement of other costs- non-cet 206 39,573 9,019 41,547 Foreign exchange variation of foreign investment 22,971-24,167 - Other income 33,366 11,897 131,156 90,449 Total 57,443 52,515 2,089,777 1,317,094 45 Other operational expenses Bank Consolidated 2010 2009 2010 2009 Commissions of intermediation of operations (CET) - - (1,609,854) (1,041,064) Commissions for intermediation of transactions - non-cet - (22,116) (776,713) (235,642) Other costs- non-cet (3,850) - (3,850) (2,535) Provision for contingent liabilities (1,613) (8,112) (38,850) (46,428) Monetary corrections of liabilities (34,787) (18,789) (94,561) (38,031) Foreign exchange variation of foreign investment (51,296) (309,486) (54,888) (309,486) Discounts granted in renegotiations of loans operations (79,069) - (271,627) (281,140) Other (28,853) (75,876) (73,040) (766,407) Total (199,468) (434,379) (2,923,383) (2,720,733) F-72 71

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) 46 Non operating results Bank Consolidated 2010 2009 2010 2009 Sales assets (591) 259 (119,486) (142,325) Provision for loss with investment (4,345) - (16,634) - Sales of investments - - 116 59,230 Other (4,039) (928) 52,937 (2,786) Total (8,975) (669) (83,067) (85,881) 47 Income and social contribution taxes a. Charges due on operations Bank Consolidated 2010 2009 2010 2009 Income before income and social contribution taxes and profit share 1,314,592 880,051 1,959,799 1,288,123 Charges at the nominal rates (525,836) (352,020) (783,920) (515,249) Exclusions/(additions) 424,882 192,534 273,255 (603,204) Tax loss carryforward for income tax 27,834 48,459 (329,867) (262,087) Tax loss carryforward for social contribution 17,933 28,001 16,311 28,001 Adjustment to market value - securities 126,155 (64,060) 119,538 (62,220) Adjustment to market value - derivatives 29,840 (76,780) (20,598) (210,500) Adjustment to market value - loan operations (45,572) 189,693 (6,437) (2,626) Profit sharing (58,660) (31,987) 39,539 (17,508) Allowance for loan losses (30,153) (86,045) (56,586) (333,315) Provision for contingent liabilities 111 (1,535) (3,219) 12,276 Derivatives - Cash basis (31,088) 42,293 (16,153) 149,371 Provision for assigned credit losses - - (22,043) - Provision for legal obligations - (81,877) - (220,371) Excess/Insufficiency of depreciation - - 384,456 324,549 F-73 72

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) Bank Consolidated 2010 2009 2010 2009 Earnings of subsidiary 233,004 114,655 - - Result of foreign branches (23,686) (94,488) (23,686) (94,488) Non-taxable interest on securities 103,627 96,380 103,627 96,380 Other 72,537 109,825 88,373 (10,666) Current income and social contribution taxes (100,954) (159,486) (510,665) (1,118,453) Deferred income and social contribution taxes (4,960) (2,259) (387,189) 66,253 Total income tax and social contribution (105,914) (161,745) (897,856) (1,052,200) b. Deferred Income and social contribution taxes with an impact on result Bank Consolidated Tax credit 2010 2009 2010 2009 Additions/(exclusions) Tax loss carryforward for income tax (27,834) (48,459) 329,867 262,087 Tax loss carryforward for social contribution (17,933) (28,001) (16,311) (28,001) Adjustment to market value - securities (31,055) (8,189) (31,070) 142,096 Adjustment to market value - derivatives - - 806 (96,830) Profit sharing - (15,862) (114) 17,508 Allowance for loan losses 30,153 86,045 54,606 (333,315) Provision for contingent liabilities (111) 1,535 3,219 (12,276) Derivatives - Cash basis - - (14,936) 502,084 Provision for assigned credit losses - - 22,043 - Provision for legal obligations - 81,877-220,371 Result of foreign branches - 94,488-94,488 Other - - 3,171 - Total (46,780) 163,434 351,281 768,212 F-74 73

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) Deferred tax obligation Bank Consolidated 2010 2009 2010 2009 Additions/(exclusions) Adjustment to market value - securities (51,780) 15,160 (45,164) (87,705) Adjustment to market value - derivatives (29,840) 24,874 (71,115) 449,703 Adjustment to market value - loan operations 45,572-82,457 (41,386) Derivatives - Cash basis 31,088 (42,293) 31,089 70,190 Insufficiency of depreciation - - (384,456) (324,549) Total (4,960) (2,259) (387,189) 66,253 c. Deferred Income and social contribution taxes with an impact on equity accounts Bank Consolidated 2010 2009 2010 2009 Asset (Other credits - Sundry) Opening balance 575,317 387,862 1,788,321 1,382,677 Tax loss carryforward for income tax (27,834) (48,459) 329,867 262,087 Tax loss carryforward for social contribution (17,933) (28,001) (16,311) (28,001) Adjustment to market value - securities (50,553) 15,832 (50,567) 15,763 Adjustment to market value - derivatives - - 806 (291,109) Profit sharing - (15,862) (114) 17,508 Allowance for loan losses 30,153 86,045 54,606 (333,315) Provision for contingent liabilities (111) 1,535 3,219 (12,276) Derivatives - Cash basis - - (14,936) 502,084 Provision for assigned credit losses - - 22,043 6,221 Provision for legal obligations - 81,877-220,371 Result of foreign branches - 94,488-94,488 Other - - 3,170 (48,177) Closing balance 509,039 575,317 2,120,104 1,788,321 F-75 74

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) Bank Consolidated 2010 2009 2010 2009 Liabilities (Other liabilities - Taxes payable) Opening balance 152,140 149,881 753,695 817,689 Adjustment to market value - Securities 75,603 (48,228) 68,986 (46,457) Adjustment to market value - Derivatives 29,840 (76,780) 71,115 (501,609) Adjustment to market value - loan operations (45,572) 84,344 (82,457) 128,534 Adjustment to market value - Lease operations - - - (2,804) Derivatives - Cash basis (31,089) 42,923 (31,089) (167,013) Excess of depreciation - - 384,456 324,549 Other - - - 200,806 Closing balance 180,922 152,140 1,164,706 753,695 d. Composition of tax credit Bank Consolidated 2010 2009 2010 2009 Tax loss carryforward for income tax 104,501 132,334 833,828 503,960 Tax loss carryforward for social contribution 55,165 73,099 56,788 73,099 Adjustment to market value - securities - 50,554-50,568 Adjustment to market value - derivatives - - 2,720 - Profit sharing - - - 116 Allowance for loan losses 170,679 140,527 826,658 772,052 Provision for contingent liabilities 2,326 2,438 43,475 40,257 Derivatives - Cash basis - - 1,600 16,536 Provision for assigned credit losses - - 32,035 9,992 Provision for legal obligations 81,877 81,877 223,003 223,001 Result of foreign branches 94,488 94,488 94,488 94,488 Other 3-5,509 4,252 Closing balance 509,039 575,317 2,120,104 1,788,321 F-76 75

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) e. Realization estimate of tax credit Bank Consolidated Nominal Value Present value Nominal Value Present value In 2011 203,013 181,188 1,001,944 894,229 In 2012 54,427 43,218 509,129 404,272 In 2013 98,203 69,645 228,068 161,744 In 2014 22,898 14,530 67,589 42,890 In 2015 48,608 27,667 89,789 51,106 More than 2016 81,890 26,697 223,585 72,892 Total 509,039 362,945 2,120,104 1,627,133 f. Composition of deferred tax liabilities Bank Consolidated 2010 2009 2010 2009 Adjustment to market value - Securities 75,602-80,222 11,236 Adjustment to market value - Derivatives 54,714 24,874 150,366 138,057 Adjustment to market value - Loan operations 38,773 84,344 130,323 153,973 Derivatives - Cash basis 11,833 42,922 11,833 42,922 Excess of depreciation - - 791,962 407,507 Closing balance 180,922 152,140 1,164,706 753,695 F-77 76

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) 48 Related party transactions Related party transactions are carried out at usual market values, terms and average rates in effect at the respective dates and in commutative conditions. Operations involving Banco Votorantim and its subsidiaries were eliminated and also consider absence of risk. a. Summary of related party transactions The balances of asset and liability transactions, income and expenses involving unconsolidated related parties are as follows: Banco do Brasil (a) Votorantim (b) 2010 2009 2010 2009 Assets Cash 22,539 - - - Securities - - 900 - Derivative financial instruments 707,429 46,504 20 3,033,109 Other receivables 1,167,390 21,798-12 - Liabilities Deposits 203,915-84,566 2,024 Money market repurchase commitments 269,865-876,325 2,210,858 Acceptances and endorsements 278,048 - - - Derivative financial instruments 2,808,640 80,849 61,125 138,696 Other liabilities 1,231,566 4,705 64,297 - Income Net profit for credit assignment 891,707 - - - Securities transactions 24,470 776 64 - Results from derivative financial instruments 15,200 4,408 565,971 863,507 Foreign exchange income 29,387 - - - Other operational income - 4,370 - - F-78 77

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) Banco do Brasil (a) Votorantim (b) 2010 2009 2010 2009 Expenses Money market repurchase commitment 43,390 166,174 191,919 231,230 Results from derivative financial instruments 52,529 13,019 169,014 - Foreign exchange income - - 45 - Other operational expenses 310 1,688 - - Related party transactions refer to the companies that form part of the Banco do Brasil Financial Conglomerate and of the Votorantim Industrial Conglomerate, the main companies of which are Votorantim Finanças S.A. and Votorantim Industrial S.A. The balance of derivatives involving companies of the Votorantim Industrial Conglomerate basically comprises fixed-income contracts - CETIP. b. Remuneration of management key personnel On December 31, 2010, the Bank spent the amount of R$ 132.737 as compensation for key Management personnel. Consolidated Fees 27,060 Bonuses 74,654 Social charges 31,023 Total 132,737 F-79 78

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) 49 Contingent assets and liabilities and legal obligations a. Composition of contingent liabilities classified in the probable risk category and presented in Other liabilites - Sundry Bank Consolidated 2010 2009 2010 2009 Tax contingencies (a) 3,741 12,505 6,413 17,846 Civil contingencies (b) 4-23,290 31,102 Labor contingencies (c) 5,815 6,095 83,988 67,798 Closing balance 9,560 18,600 113,691 116,746 (a) In the Consolidated, basically refers to matters involving ISS (Tax on Services), in the amount of R$ 1,255, and Corporate Income Tax (IRPJ)/ Verão Economic Plan, in the amount of R$ 3,959. (b) The Consolidated refers to, basically, to collection actions. (c) In the Consolidated, mostly refers to lawsuits filed by former employees involving indemnities, overtime, working time exemption, supplement per function and representation, among other matters. b. Changes in contingent liabilities classified in the probable risk category Bank Tax demands Civil demands Labor demands 2010 2009 2010 2009 2010 2009 Opening balance 12,505 8,567 - - 6,095 3,003 Constitutions - 3,606 4-1,546 3,092 Reversals (9,091) - - - (1,826) - Monetary corrections 327 332 - - - - Closing balance 3,741 12,505 4-5,815 6,095 F-80 79

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) Consolidated Tax demands Civil demands Labor demands 2010 2009 2010 2009 2010 2009 Opening balance 17,846 12,830 31,102 21,909 67,798 37,174 Constitutions 2,067 3,976-9,193 18,167 30,624 Reversals (14,105) - (7,812) - (1,977) - Monetary corrections 605 1,040 - - - - Closing balance 6,413 17,846 23,290 31,102 83,988 67,798 c. Composition of contingent liabilities classified in the possible risk category Bank Consolidated 2010 2009 2010 2009 Tax contingencies (a) 291,042 155,859 400,183 159,100 Civil contingencies (b) - - 37,934 17,773 Labor contingencies (c) 224 518 2,891 27,267 Closing balance 291,266 156,377 441,008 204,140 (a) In the Consolidated, basically refers to taxes on demutualization, in the amount of R$ 383,873 (R$141,953 in 2009). (b) The Consolidated refers to, basically, collection actions. (c) In the Consolidated, mostly refers to lawsuits filed by former employees involving indemnities, overtime, working time exemption, supplement per function and representation, among other matters. F-81 80

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) d. Composition of legal obligations presented in Other Liabilities - Taxes Payable Bank Consolidated 2010 2009 2010 2009 Tax contingencies (a) 564,825 478,676 1,400,348 1,046,422 Civil contingencies - - - - Labor contingencies - - - - Closing balance 564,825 478,676 1,400,348 1,046,422 (a) Refers, basically, to claims of non-payment of COFINS based on the revenues not derived from monthly invoicing (expansion of the calculation basis introduced by Law 9718/98). e. Judicial deposits presented in other credits - Sundry Bank Consolidated 2010 2009 2010 2009 Tax contingencies 72,366 6,977 77,384 8,821 Civil contingencies - - 27,799 17,858 Labor contingencies 5,107 2,047 19,790 10,184 Others 56 30 207 104 Total 77,529 9,054 125,180 36,967 f. Contingent assets There is no contingent asset recorded. F-82 81

Banco Votorantim S.A. Notes to the financial statements (In thousands of reais) g. Other commitments The Bank filed at the Internal Revenue Service its adhesion to the Special Installment Payment Program - PAES, created by Law 10684/03, of the Federal Government. Adhesion to the program allowed the scheduling of PIS, relating to the period from January 2000 to January 2003. The amount included in the program is R$ 7,203. 50 Employee benefits There are no post-employment benefits, such as pensions, other retirement benefits, postemployment life insurance and medical care, other long-term benefits to employees and managers, including long service leave and other leaves, jubilee or other benefits per years of service, share-based remuneration and rescission of contract benefits, except those provided for in collective bargaining of the category. F-83 82

Banco Votorantim S.A. Financial statements December 31, 2009 and 2008 F-84

Banco Votorantim S.A. Financial statements December 31, 2009 and 2008 Contents Independent auditors report 3 Balance sheets 4 Statements of income 5 Statements of changes in shareholders equity 6 Statements of cash flows 7 Statements of added value 8 Notes to the financial statements 9-64 F-85

KPMG Auditores Independentes R. Dr. Renato Paes de Barros, 33 04530-904 - São Paulo, SP - Brasil Caixa Postal 2467 01060-970 - São Paulo, SP - Brasil Central Tel 55 (11) 2183-3000 Fax Nacional 55 (11) 2183-3001 Internacional 55 (11) 2183-3034 Internet www.kpmg.com.br Independent auditors report To The Directors and Shareholders Banco Votorantim S.A. São Paulo - SP We have examined the balance sheets of Banco Votorantim S.A. ( Bank ) and the consolidated balance sheets of the Bank and its subsidiaries ( Consolidated ), as of December 31, 2009 and 2008 and the related statements of income, changes in shareholders equity, cash flows and added value for the years then ended, which are the responsibility of its Management. Our responsibility is to express an opinion on these financial statements. Our examinations were conducted in accordance with auditing standards generally accepted in Brazil and included: (a) planning of the audit work, considering the materiality of the balances, the volume of transactions and the accounting systems and internal accounting controls of the Bank and its subsidiaries; (b) verification, on a test basis, of the evidence and records which support the amounts and accounting information disclosed; and (c) evaluation of the most significant accobbunting policies and estimates adopted by management of the Bank and its subsidiaries, as well as the presentation of the financial statements taken as a whole. In our opinion, the aforementioned financial statements present fairly, in all material respects, the financial position of Banco Votorantim S.A. and the consolidated financial position of the Bank and its subsidiaries as of December 31, 2009 and 2008, and the results of its operations, changes in its shareholders equity, cash flows and added value for the years then ended, in conformity with accounting practices adopted in Brazil. São Paulo, February 11, 2010 KPMG Auditores Independentes CRC 2SP014428/O-6 Zenko Nakassato Accountant CRC 1SP160769/O-0 F-86 KPMG Auditores Independentes, uma sociedade simples brasileira e firma-membro da rede KPMG de firmas-membro independentes e afiliadas à KPMG International Cooperative ( KPMG International ), uma entidade suíça. KPMG Auditores Independentes, a Brazilian entity and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative ( KPMG International ), a Swiss entity.

Banco Votorantim S.A. Balance sheets December 31, 2009 and 2008 (In thousands of Reais) Bank Consolidated Bank Consolidated Assets 2009 2008 2009 2008 Liabilities 2009 2008 2009 2008 Current assets 77,673,243 67,458,340 54,029,091 46,640,299 Current liabilities 66,934,790 41,378,852 51,235,475 43,429,709 Cash 197,760 52,414 239,912 98,506 Deposits 20,184,005 14,299,429 20,207,357 14,122,633 Interbank funds applied 41,756,719 23,561,118 20,128,609 5,773,810 Demand deposits 133,699 101,495 134,794 109,067 Interbank deposits 1,923,086 4,361,178 1,680,837 4,173,402 Money market 18,563,983 4,012,535 18,563,983 4,012,535 Time deposits 18,125,398 9,831,249 18,390,054 9,834,799 Interbank deposits 23,014,920 19,511,154 1,386,810 1,723,846 Other deposits 1,822 5,507 1,672 5,365 Foreign currency deposits 177,816 37,429 177,816 37,429 Money market repurchase commitments 22,690,734 12,737,639 21,854,298 11,774,243 Securities and derivative financial instruments 28,331,874 30,427,160 13,156,507 18,197,766 Own portfolio 11,899,800 10,832,704 11,784,851 9,937,611 Third party portfolio 10,470,496 1,890,310 9,749,009 1,822,007 Own portfolio 7,264,010 9,047,586 9,999,054 5,879,883 Free movement portfolio 320,438 14,625 320,438 14,625 Subject to repurchase commitments 16,752,975 13,449,212 472,290 4,311,145 Derivative financial instruments 2,593,498 3,101,227 936,976 3,145,117 Acceptances and endorsements 1,276,418 1,564,142 1,276,418 1,564,142 Deposited with the Central Bank 46,682-46,682 - Subject to guarantees provided 1,674,709 4,829,135 1,701,505 4,861,621 Liabilities from overseas securities 460,561 1,034,471 460,561 1,034,471 Funds from real state and agricultural credits 815,857 529,671 815,857 529,671 Interbank accounts 92,995 37,899 92,995 37,899 Interbranch accounts 33,704 62,267 39,586 63,395 Collections in transit 12,985 32,016 12,985 32,016 Central Bank Deposits 69,496-69,496 - Third party funds in transit 33,704 62,267 33,704 62,267 Correspondents 10,514 5,883 10,514 5,883 Internal transfer of funds - - 5,882 1,128 Interbranch Relations 82-2,403 - Borrowings and repasses 3,674,370 7,036,208 3,675,444 7,074,270 Domestic Branches 82-2,403 - Domestic repasses - Official institutions 141,952 233,965 141,952 233,965 Domestic repasses - Other institutions 22,872 31,425 22,872 31,425 Loans 6,357,606 7,991,584 16,432,445 15,903,586 Overseas borrowings 1,663,244 4,869,100 1,663,244 4,869,100 Domestic repasses - Official institutions 1,846,302 1,901,718 1,847,376 1,939,780 Public sector 34,092 179,602 35,782 179,602 Private sector 6,471,095 7,880,762 17,211,861 16,209,586 Derivative financial instruments 18,306,416 2,639,284 1,518,293 3,736,270 Allowance for loan losses (147,581) (68,780) (815,198) (485,602) Derivative financial instruments 18,306,416 2,639,284 1,518,293 3,736,270 Lease operations - - 1,782,285 484,547 Other liabilities 769,143 3,039,883 2,664,079 5,094,756 Lease receivable - Public sector - - 139 6,064 Lease receivable - Private sector - - 2,933,028 719,693 Tax collection and payment, and similar payments 8,169-18,668 - Unearned lease income - - (1,123,912) (229,931) Foreing exchange portfolio 9,618 2,367,351 9,618 2,367,351 Allowance for lease losses - - (26,970) (11,279) Social and statutory 231,600 195,847 356,546 291,596 Tax and social security 222,737 96,428 1,307,289 1,418,607 Other receivables 925,912 5,380,071 2,066,163 6,022,663 Due in connection with securities dealings 53,324 234,578 78,236 526,410 Other 243,695 145,679 893,722 490,792 Credits due by letters of guarantee and bonds payable 5,301-5,301 - Foreign exchange portfolio 380,521 3,721,508 380,521 3,721,508 Income receivable 104,259 776,817 16,323 14,080 Long-term liabilities 21,720,675 36,704,206 26,384,949 22,453,735 Securities clearing accounts 105,009 428,801 119,786 683,606 Other 386,373 474,156 1,599,783 1,626,200 Deposits 4,581,642 4,934,317 4,270,064 4,809,801 Allowance for doubtful receivable (55,551) (21,211) (55,551) (22,731) Interbank deposits 96,942 133,198 60,205 8,682 Other assets 10,295 8,094 127,772 121,522 Time deposits 4,484,700 4,801,119 4,209,859 4,801,119 Other assets 1,217 225 65,021 51,367 Money market repurchase commitment 2,913,170 4,850,306 2,913,170 4,850,306 Prepayments 9,078 7,869 62,751 70,155 Own portfolio 2,885,023 2,973,908 2,885,023 2,973,908 Long-term assets 15,530,664 14,799,442 30,611,010 25,581,732 Free movement portfolio 28,147 1,876,398 28,147 1,876,398 Interbank funds applied 1,296,856 1,067,074 1,296,856 1,191,591 Acceptances and endorsements 2,042,957 1,349,026 4,994,075 4,738,101 Interbank deposits 1,296,856 1,067,074 1,296,856 1,191,591 Funds from debentures - - 2,951,118 3,389,075 Liabilities from overseas securities 934,239 369,019 934,239 369,019 Securities and Funds from real state and agricultural credits 1,108,718 980,007 1,108,718 980,007 derivate financial instruments 4,464,545 3,940,883 5,038,214 3,387,631 Borrowings and repasses 3,594,822 3,610,669 3,627,311 3,610,669 Own portfolio 2,164,202 1,788,447 1,474,580 2,353,824 Subject to repurchase commitments - 610,153 1,263,291 610,153 Domestic borrowings - Other instituions 21,765 58,425 21,765 58,425 Derivative financial instruments 690,473 1,542,283 690,473 423,654 Overseas borrowings 500,093 1,304,909 500,093 1,304,909 Related to Banco Central do Brasil 287,067-287,067 - Domestic repasses - Official institutions 3,072,964 2,247,335 3,105,453 2,247,335 Related to guarantees provided 1,322,803-1,322,803 - Derivative financial instruments 5,081,274 20,046,272 5,081,274 1,039,574 Loans 9,105,890 9,734,753 20,356,914 18,987,925 Derivative financial instruments 5,081,274 20,046,272 5,081,274 1,039,574 Public sector 119,594-118,754 - Private sector 9,112,979 9,785,290 20,675,003 19,235,539 Others liabilities 3,506,810 1,913,616 5,499,055 3,405,284 Allowance for loan losses (126,683) (50,537) (436,843) (247,614) Tax and social security 578,995 518,516 1,117,301 535,425 Lease operations - - 1,811,992 894,855 Due in connection with securities dealings - 167-167 Subordinated debt 2,927,815 1,394,933 4,366,821 2,869,692 Leases receivable - Public sector - - - - Other - - 14,933 - Leases receivable - Private sector - - 2,982,056 1,584,789 Unearned lease income - - (1,142,644) (683,034) Deferred income 34,919 23,709 34,919 23,709 Allowance for lease losses - - (27,420) (6,900) Minority interest - - 24 40,608 Other receivables 663,373 56,706 1,853,833 773,553 Shareholders' equity 7,145,443 6,362,195 7,145,443 6,362,195 Securities clearing accounts - 8,152-8,152 Capital: Other 663,373 48,554 1,853,833 765,401 Domestic 3,544,896 3,380,000 3,544,896 3,380,000 Capital reserves 617,049 31,946 617,049 31,946 Other assets - 26 253,201 346,177 Revenue reserves 3,060,162 3,045,255 3,060,162 3,045,255 Valuation adjustments to shareholders' equity - Available for sale securities (76,664) (95,006) (76,664) (95,006) Prepayments - 26 253,201 346,177 Permanent assets 2,631,920 2,211,180 160,709 87,925 Investments 2,571,255 2,189,939 53,582 10,369 Domestic subsidiaries and affiliates 2,507,956 2,179,220 - - Investment in overseas subsidiary 35,274 5,594 - - Other investments 28,025 5,125 53,582 10,369 Fixed assets 33,124 17,380 58,131 53,887 Other fixed assets for use 62,052 46,517 109,646 119,841 Accumulated depreciation (28,928) (29,137) (51,515) (65,954) Deferred charges 27,541 3,861 43,875 23,669 Organization and expansion expenses 45,271 17,089 91,162 73,937 Accumulated amortization (17,730) (13,228) (47,287) (50,268) Intangibles - - 5,121 - Other intangible assets - - 6,212 - Accrued amortization - - (1,091) - Total Assets 95,835,827 84,468,962 84,800,810 72,309,956 Total liabilities 95,835,827 84,468,962 84,800,810 72,309,956 See the accompanying notes to the financial statements. F-87

Banco Votorantim S.A. Statements of income Years ended December 31, 2009 and 2008 and semester ended December 31, 2009 (In thousand of Reais, except net profit per lot of one thousand shares) Bank Consolidated 2nd semester Years Years 2009 2009 2008 2009 2008 Financial operations income 3,129,763 6,024,348 9,335,422 11,271,570 12,612,720 Loans 610,483 917,865 3,079,008 6,981,997 8,541,545 Lease operations - - - 1,803,373 501,691 Securities income 3,062,903 6,076,854 7,051,192 2,933,559 3,743,590 Derivative financial instruments (543,623) (970,371) (1,479,398) (447,359) (859,087) Foreign exchange operations - - 576,755-577,116 Compulsory investments - - 107,865-107,865 Financial operations expenses (2,738,791) (4,900,915) (9,145,254) (7,346,035) (9,730,947) Deposits, money market and interbank funds (2,542,351) (5,067,308) (7,279,064) (4,858,414) (6,829,658) Borrowings, assignments and repasses (8,479) 621,335 (1,774,091) 617,367 (1,776,307) Lease operations - - - (1,330,202) (294,531) Foreign exchange operations (70,946) (239,724) - (239,682) - Allowance for loan losses (117,015) (215,218) (92,099) (1,535,104) (830,451) Gross income from financial operations 390,972 1,123,433 190,168 3,925,535 2,881,773 Other operating income/(expenses) (28,705) (242,713) 481,758 (2,551,531) (1,738,890) Income from rendered service 135,101 206,116 108,465 817,211 688,964 Personnel expenses (111,181) (208,193) (146,265) (564,198) (427,118) Other administrative expenses (125,313) (208,260) (148,163) (1,037,026) (845,506) Tax expenses (31,756) (73,554) (54,168) (363,879) (288,017) Equity in earnings of subsidiaries 281,272 423,042 539,765 - - Other operational income 22,904 52,515 349,498 1,317,094 904,923 Other operational expenses (199,732) (434,379) (167,374) (2,720,733) (1,772,136) Operating results 362,267 880,720 671,926 1,374,004 1,142,883 Non operating results (846) (669) 652 (85,881) (56,118) Income before taxation and profit sharing 361,421 880,051 672,578 1,288,123 1,086,765 Income and social contribution taxes 85,091 1,689 316,727 (283,988) 88,435 Provision for income tax (56,330) (106,105) 26,601 (787,082) (825,521) Provision for social contribution (26,979) (55,640) (12,906) (265,118) (479,019) Deferred income and social contribution taxes 168,400 163,434 303,032 768,212 1,392,975 Profit sharing (45,209) (79,967) (87,519) (201,323) (272,650) Net profit before minority interest 401,303 801,773 901,786 802,812 902,550 Minority interest - - - (1,039) (764) Net profit for the semester/year 401,303 801,773 901,786 801,773 901,786 Net profit per lot of one thousand shares - R$ 4.92 9.83 12.16 See the accompanying notes to the financial statements. F-88

Banco Votorantim S.A. Statements of changes in shareholders' equity Years ended December 31, 2009 and 2008 and semester ended December 31, 2009 (In thousand of Reais) Valuation adjustments to shareholders' Revenue reserves equity - Capital Available for sale Retained Capital reserves Legal Expansion securities earnings Total Balances at December 31, 2007 3,380,000 21,426 258,643 2,340,392-3,279 6,003,740 Other - - - - - (23,536) (23,536) Government incentives - 10,083 - - - - 10,083 Reserve for expansion - - - (20,257) - 20,257 - Monetary correction of membership titles - 437 - - - - 437 Adjustments to market value - Securities - - - - (95,006) - (95,006) Net profit - - - - - 901,786 901,786 Distribution of net profit: Legal reserve - - 45,089 - - (45,089) - Reserve for expansion - - - 421,388 - (421,388) - Distribution of dividends - - - - - (60,018) (60,018) Interest on own capital - - - - - (375,291) (375,291) Balances at December 31, 2008 3,380,000 31,946 303,732 2,741,523 (95,006) - 6,362,195 Other - - - - - (1,736) (1,736) Capital increase 614,896 - - - - - 614,896 (-) Capital to be paid In (450,000) - - - - - (450,000) Underwriting premium reserve - 585,103 - - - - 585,103 Reversal of expansion reserve - - - (594,709) - 594,709 - Distribution of dividends - - - - - (205,709) (205,709) Interest on own capital - - - - - (389,000) (389,000) Adjustments to market value - Securities - - - - 18,342-18,342 Net profit - - - - - 801,773 801,773 Distribution of net profit: Legal reserve - - 40,089 - - (40,089) - Distribution of dividends - - - - - (190,421) (190,421) Reserve for expansion - - - 569,527 - (569,527) - Balances at December 31, 2009 3,544,896 617,049 343,821 2,716,341 (76,664) - 7,145,443 Balances at June 30, 2009 3,380,000 31,946 323,756 2,741,523 (141,838) 128,710 6,464,097 Capital Increase 614,896 - - - - - 614,896 (-) Capital to be paid In (450,000) - - - - - (450,000) Underwriting premium reserve - 585,103 - - - - 585,103 Reserve for expansion - - - (25,182) - 25,182 - Dividend payout - - - - - (205,709) (205,709) Interest on own capital - - - - - (139,000) (139,000) Adjustments to market value - Securities - - - - 65,174-65,174 Net profit - - - - - 401,303 401,303 Distribution of net profit: Legal reserve - - 20,065 - - (20,065) - Distribution of dividends - - - - - (190,421) (190,421) Balances at December 31, 2009 3,544,896 617,049 343,821 2,716,341 (76,664) - 7,145,443 See the accompanying notes to the financial statements. F-89

Banco Votorantim S.A. Statements of cash flows Years ended December 31, 2009 and 2008 and semester ended December 31, 2009 (In thousand of Reais) Bank Consolidated Years Years 2nd semester 2009 2009 2008 2009 2008 Cashflows from operations Net profit 401,303 801,773 901,786 801,773 901,786 Adjustments to net profit: (121,746) (110,128) (365,444) 1,984,001 1,177,496 Depreciation and amortization 6,142 9,370 7,426 27,449 27,200 Equity in earnings of subsidiary (281,272) (423,042) (539,765) - - Allowance for loan losses 117,015 215,218 92,099 1,535,104 830,451 Provision for contingent liabilities /legal obligations 35,523 87,657 74,359 335,567 251,429 Non operating results 846 669-85,881 56,666 Minority interest - - - - 11,313 Monetary correction of membership titles - - 437-437 Balance sheet variations Intrbank funds applied (27,123,732) (33,260,939) (19,821,939) (12,537,419) (1,191,591) Securities and Derivative financial instruments 3,711,030 2,273,758 15,945,149 5,214,400 (1,766,713) Interbank and interbranch accounts (30,553) (83,741) 1,007,711 (81,308) 1,007,816 Loans/ Lease (299,783) 2,047,623 (7,309,801) (5,647,828) (11,426,254) Other receivables 1,824,141 3,942,920 (3,330,370) 2,876,220 (4,831,036) Other assets (5,116) (2,175) (5,359) 86,726 298,536 Other liabilities (273,772) (801,003) 413,370 (948,775) 1,160,951 Deferred income (5,371) 11,210 12,508 11,210 12,508 Valuation adjustments market value securities 65,174 18,342 (95,006) 18,342 (95,006) Cash generated (used) in the operations (21,858,425) (25,162,360) (12,647,395) (8,222,658) (14,751,507) Cashflows from financing activities Deposits 705,574 5,531,901 (14,395,670) 5,544,987 3,754,843 Money market repurchase commitments (8,617,391) 8,015,959 (6,540,360) 8,142,919 (6,767,282) Acceptances and endorsements 416,890 406,207 812,546 (31,750) 1,479,447 Borrowings and repasses (943,630) (3,377,685) 5,195,809 (3,382,185) 5,200,701 Capital increase 750,000 750,000-750,000 - Dividends and bonuses (205,709) (205,709) - (205,709) - Interest on own capital (139,000) (544,291) (60,108) (389,000) (60,108) Non-controlling shareholder interests - - - (40,584) - Subordinated debt - - 276,718-290,850 Cash generated (used) in financing activities (8,033,266) 10,576,382 (14,711,065) 10,388,678 3,898,451 Cashflows from investment activities Disposal of fixed assets for use and lease 973 1,392 869 7,554 1,880 Disposal of investments 380 453 155,940 522 104,473 Purchase of fixed assets for use and lease (15,602) (22,024) (4,987) (24,750) (13,995) Purchase of investments (65,601) (52,390) (102,646) (849) (106,638) Deferred charges (20,109) (28,162) (1,515) (34,142) (8,944) Intangible investments - - - (6,741) - Transfer to investments - - 10,083-10,083 Other - (3,501) - (43,563) - Cash generated (used) in investment activities (99,959) (104,232) 57,744 (101,969) (13,141) Net variation in cash and cash equivalents (29,991,650) (14,690,210) (27,300,716) 2,064,051 (10,866,197) Cash and cash equivalents at the begnning of the year / semester 39,982,046 24,680,606 32,159,383 7,063,907 16,738,513 Cash and cash equivalents at the end of the year / semester 9,990,396 9,990,396 4,858,667 9,127,958 5,872,316 Increase/(decrease) in cash and cash equivalents (29,991,650) (14,690,210) (27,300,716) 2,064,051 (10,866,197) See the accompanying notes to the financial statements. F-90

Banco Votorantim S.A. Statements of added value Years ended December 31, 2009 and 2008 (In thousands of Reais) Bank Consolidated 2009 2008 2009 2008 Income 5,632,713 9,534,564 9,064,157 11,547,902 Financial operations income 6,024,348 9,335,422 11,271,570 12,612,720 Income from rendered service and fees 206,116 108,465 817,211 688,964 Allowance for loan losses (215,218) (92,099) (1,535,104) (830,451) Other income/(expenses) (381,864) 182,124 (1,403,639) (867,213) Non operating results (669) 652 (85,881) (56,118) Financial operations expenses (4,685,697) (9,053,155) (5,810,931) (8,900,496) Inputs acquired from third parties (172,399) (131,291) (951,634) (792,072) Material, power and other operating expenses - - - - Outsourced services (2,563) (2,832) (42,310) (61,484) Other (169,836) (128,459) (909,324) (730,588) Communication (9,739) (7,361) (81,591) (67,713) Maintenance and conservation of fixed assets (4,503) (2,209) (22,194) (31,568) Data processing (56,913) (43,658) (107,799) (88,388) Promoções e relações públicas (6,103) (6,603) (18,305) (27,939) Publications (2,254) (563) (3,110) (1,159) Publicity and advertising (2,169) (3,237) (19,943) (33,038) Financial system services (23,082) (9,226) (131,733) (106,394) Specialized technical services (37,931) (35,782) (242,815) (162,064) Transportation (3,186) (1,711) (20,329) (13,546) Other (23,956) (18,109) (261,505) (198,779) Gross added value 774,617 350,118 2,301,592 1,855,334 Depreciation and amortization expenses (9,370) (7,427) (27,450) (27,567) Net added value produced by the Entity 765,247 342,691 2,274,142 1,827,767 Transferred added value 423,042 539,765 - - Equity in earnings of subsidiaries 423,042 539,765 - - Total added value to be distributed 1,188,289 882,456 2,274,142 1,827,767 Distribution of added value 1,188,289 882,456 2,274,142 1,827,767 Employees 253,943 210,048 677,746 637,884 Salaries and fees 138,046 92,674 358,140 264,992 Profit sharing 79,967 87,519 201,323 272,650 Benefits and training 24,576 22,059 89,180 75,156 FGTS (Government Severance Indemnity Fund for Employees) 11,335 7,796 29,040 25,086 Other 19-63 - Taxes 106,082 (238,823) 735,642 261,466 Domestic 106,082 (238,823) 735,642 261,466 INSS on salaries 34,217 23,736 87,775 61,884 Tax expenses (except Income and Social contribution taxes) 73,554 54,168 363,879 288,017 Income and social contribution taxes (1,689) (316,727) 283,988 (88,435) Net variation in cash and cash equivalents 26,491 9,445 57,942 25,867 Rental 26,491 9,445 57,942 25,867 Shareholders' equity 801,773 901,786 802,812 902,550 Dividends/Interest on own capital 190,421 435,309 190,421 435,309 Retained profit 611,352 466,477 613,430 466,477 Minoritary share in retained profits - - (1,039) 764 See the accompanying notes to the financial statements. F-91

Banco Votorantim S.A. Notes to the financial statements Years ended December 31, 2009 and 2008 (In thousands of Reais) 1 Operations Banco Votorantim S.A. (Bank) is a closed company, which operating as a multiple bank, undertakes authorized commercial, financing and foreign exchange banking activities. Through its subsidiaries, it also undertakes a variety of other activities, with the more important being consumer credit, leasing operations, administration of investment funds and, recently, credit card activities. The operations are undertaken within the context of a group of institutions that operate in an integrated manner on the financial market, including with respect to risk management and these institutions co-participate or act as intermediaries of associated institutions, that are members of the financial system. The benefits of the services provided between these institutions and the costs of the administrative and operational structure are allocated on a practical and reasonable basis, as a whole or individually. Consistent with the relevant fact published on January 09, 2009, Banco do Brasil S.A. (BB) and Votorantim Finanças S.A. (VF) concluded on September 28, 2009 the establishment of a strategic partnership whereby BB will hold an investment interest equivalent to 50,00% of the total capital in Banco Votorantim S.A. (BV). Payment for the new preferred shares was made in cash, with R$ 750 million paid on September 28, 2009 and R$ 450 million paid six months later. In order to conclude this strategic partnership, the following took place: (i) a R$ 750 million dividend and/or interest on capital payout by BV, of which R$ 544.3 million was interest on equity capital and R$ 205.7 million were dividends; (ii) the conversion into preferred shares of 7,412,620,267 common shares issued by BV; (iii) the acquisition by BB of 33,356,791,198 common shares issued by BV and owned by VF, at R$ 3.0 billion; and (iv) the purchase by BB of 7,412,620,277 new preferred shares issued by BV, at R$ 1.2 billion. Payment to VF took place by means of cash deposits in escrow accounts at BV totaling R$ 2.1 billion, and at BB totaling R$ 840 million. The sum deposited in the BB escrow account is intended as a price adjustment arising from any likely contingencies detected in the Due Diligence in progress. F-92

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) Consolidation of the financial statements and of risk management and operating limits will be proportional to the equity interest. Governance of BV and of BV Participações S.A. will be shared by VF and BB. The Board of Directors is on equal terms, with three directors appointed by each institution, and the Board s Chair will alternate on a yearly basis. All strategic decisions will be made jointly. The transaction was approved by Central Bank of Brazil on December 4, 2009. 2 Presentation of the financial statements The financial statements were prepared based on accounting guidelines derived from Corporate Law, with the adopting of the alterations introduced by Law 11638/07 and Law 11941/09, for registering the operations, together, when applicable, with the norms and instructions from the National Monetary Council (CMN), the Central Bank of Brazil (Bacen). For purposes of preparing the financial statements, Banco Votorantim S.A. took into consideration the application of the alterations to Corporate Legislation introduced by Law 11638/07, with the respective alterations introduced by Law 11941/09, which have been regulated by BACEN to date, These include: (a) treatment of the balance for capital reserves and the allocation of retained earnings; (b) treatment of fixed assets and deferred charges; e (c) presentation of the statement of cash flows instead of the statement of changes in financial position. The financial statements of Banco Votorantim include the operations undertaken by the Bank and its branches in Brazil, and also the operations undertaken overseas, located in Nassau - Bahamas. The consolidated financial statements of the Votorantim Financial Conglomerate comprise Banco Votorantim and its direct subsidiaries in Brazil and overseas, as listed below: F-93

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) Share 2009 2008 Direct subsidiaries in Brazil Votorantim Corretora de Títulos e Valores Mobiliários Ltda. 99.98 99.98 Votorantim Asset Management Distribuidora de Títulos e Valores Mobiliários Ltda. 99.99 99.99 BV Financeira S.A. - Crédito, Financiamento e Investimento 100.00 99.99 BV Leasing - Arrendamento Mercantil S.A. 100.00 99.99 Direct subsidiaries overseas Votorantim Bank Limited 99.99 4.03 Banco Votorantim Securities Inc. 100.00 100.00 The consolidated financial statements were prepared in accordance with consolidation norms and instructions from Bacen for preparing the consolidation of the Financial Conglomerate. The main consolidation procedures adopted for consolidated financial statements were as follows: Description of main consolidation procedures for the consolidation of the financial statements a. Elimination of intercompany assets, liabilities, income and expenses balances between branches and its subsidiaries; b. Elimination of investment in the subsidiaries capital, reserves and retained earnings; c. Preparation of the financial statements of the leasing company using the financial method, reclassification of leased fixed assets to lease operations, less the residual value received in advance; d. The accounting balances of direct overseas subsidiaries, which are prepared in accordance with international accounting standards were translated into Reais, using the quotation for the North American Dollar at the period end, and were adjusted according to the accounting practices adopted in Brazil; e. The foreign exchange variation from transactions with branches and overseas related companies has been distributed between the headings in the statement of income, according to the respective assets and liabilities that gave rise to such; and F-94

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) f. The Financial Conglomerate, in accordance with the consolidation norms from Bacen, does not include the consolidation of the exclusive investment funds or the investment funds in credit rights. 3 Risk management Risk management has its policies tied to best market practices and is in line with the guidance specified by Central Bank of Brazil. It effectiveness covers the scope of the companies associated with Banco Votorantim. Policies and procedures were established, and a risk management system was implemented in order to manage, assess, and mitigate the risks inherent to the business, providing the Executive Directors a vision of all the risks involved. A Risk Management Committee was created, and there are three committees subordinated to it, one of which looks after market risk management, another at credit risk management, and a third one focused on operating risk management. The Assets and Liabilities Operating Committee ( ALM ) is in charge of putting in practice the capital and balance sheet strategic management. Monitoring the liquidity risk is undertaken by a specific Committee, subordinated to this Committee. Market risk Market Risk is defined as the likelihood of losses occurring as a result of fluctuations in the market values of positions held by the institution. Market risk management is performed in a centralized manner by an area independent from the operating desk. The basic procedures adopted to manage this risk are: (a) integrity in pricing assets and derivatives; (b) market risk assessment by means of the Value at Risk methodology and by simulating scenarios; (c) the daily monitoring of results with methodology compliance tests (back tests). F-95

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) Banco Votorantim and its subsidiaries take on transactions involving derivative financial instruments and act in organized over-the-counter markets, with a view to allowing a risk management in line with its policy. These instruments are employed to hedge positions, to meet requirement by counterparties, and as a means of reversing positions at times of large fluctuations. Operating risk Operating risk is defined as the likelihood of losses occurring as a result of faults, deficiencies, or the inadequacy of internal procedures, persons, and systems, or of external events. It also includes the legal risk associated with the inadequacy or deficiency of agreements entered into by the institution, as well as sanctions owing to non-compliance with legal provisions and indemnities due to damages to third parties caused by activities performed by the institution. The operating risk management process starts with the application of an in-house methodology intended to plot risks and controls existing in the procedures. When required, action plans are prepared to mitigate the main threats found in the procedure. The operating risk management stages are detecting, assessing, monitoring, controlling, and mitigating risks, information, and the action plan. In addition, it is mandatory to state in the database system any operating and operating risk management losses in the events occurred in the institutions. This procedure s primary purpose is to form a database for use in the capital allocation calculation as provided for in the Basel II accord, and it also provides sufficient information to detect these risks origins. The combined actions of plotting and monitoring risks with the information obtained by the records of losses incurred, will allow an ongoing improvement in the policies and procedures adopted, in addition to reducing any existing risks. Credit risk Credit risk consists in the likelihood of losses occurring associated with non-compliance, by a borrower or counterparty, with their respective financial obligations as agreed on, as well as a devaluation of the credit agreement as a result of a deterioration in a borrower s risk rating, a drop in gains and compensation, advantages granted on renegotiation or recovery costs. F-96

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) Banco Votorantim S.A. has a decision-making procedure which assures agility and focus on credit activities, in the light of business opportunities and changes in scenarios. Its focus has been to increase its assets by maximizing the risk/return ratio, with an ongoing concern on maintaining the quality of the bank s credit portfolio. To this end, Banco Votorantim has an independent area engaged in Credit Risk Management, which follows the best governance practices. As part of the credit risk procedure, controls are performed with the monitoring of credit policies and rules, as well as of the respective procedures, restrictions, and established limits, besides risk analysis and submission to the discretionary limits and approving committees. Credit policy is based on an analysis of internal portfolio indicators, pricing procedures, and company assessment, and on external factors in connection with a company s financial condition and the economic scenario in the country and overseas. The constant monitoring should also be mentioned of exposures and counterparties of credit assets, and the preparation or regular risk reports on the credit portfolio, for examination and decision making by the executive directors. Banco Votorantim performs credit risk assessments of its transactions, based on judging and statistical models. Please note that when detecting a deterioration in the bank s credit portfolio, risk mitigation actions are adopted such as a reassessment of the customer risk profile and sectoral analyses that influence the management of limits and even of security control. The credit cycle is composed of the following stages: 1. Credit proposal 2. Credit risk assessment 3. Credit granting 4. Preparing a transaction 5. Monitoring 6. Collecting a transaction 7. Recovery In line with the best market practices, Banco Votorantim continues to improve its controls and analysis models. In compliance with CMN Resolution nº 3721 and with the new Basel accord, there are specific committee and panel structures for an improved management, control, and monitoring of credit portfolio risk. F-97

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) Assets and liabilities management The ALM Operating Committee is in charge of managing the bank s assets and liabilities policy, which includes structural risks involving interest rates, liquidity, and exchange rates, as well as the organization s equity capital management, which seeks to optimize the risk vs. return ratio in order to minimize losses by means of well defined business strategies, in a quest for greater efficiency in the composition of factors which reflect on the Solvency Rate (Basel). Further details in the risk management structure will be found in www.bancovotorantim.com.br Reference Equity Level I 7,298,859 Reference Equity Level II 2,043,191 Total Reference Equity (Levels I and II) 9,342,050 Reference equity required 7,771,228 Weighted credit risk 6,617,578 Weighted market risk 776,128 Weighted operating risk 377,522 Excess RE 1,570,822 Ratio (minimum required by Central Bank is 11%) 13.2% 2009 Reference Equity Level I 6,388,586 Reference Equity Level II 1,452,455 Total Reference Equity (Levels I and II) 7,841,041 Reference equity required 6,384,163 Weighted credit risk 5,855,406 Weighted market risk 416,233 Weighted operating risk 112,524 Excess RE 1,456,878 Ratio (minimum required by Central Bank is 11%) 13.5% 2008 F-98

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) 4 Significant accounting practices a. Statement of income Incomes and expenses are recorded on an accruals basis. Operations involving pre-fixed rates are recorded at the redemption values and the income and expenses that refer to future periods are recorded as reductions against the respective assets and liabilities. Financial income and expenses are recorded on a daily pro rata basis, and calculated exponentially, except for those related to overseas transactions, which are calculated on a straight-line basis. Transactions involving post fixed rates or indexed to foreign currencies, are corrected to the balance sheet date. b. Cash and cash equivalents Cash and cash equivalents are represented by cash and short-term Interbank funds invested. c. Interbank funds applied Interbank funds applied are recorded at the investment values, plus accrued income to the balance sheet date, recorded on a daily pro rata basis, calculated based on the variation in the index or the interest rate agreed upon. d. Securities Securities are recorded at the amount paid and classified, based on management s intention, between three separate categories: i. Securities for trading - Securities acquired to be actively and frequently traded. They are adjusted by market value with a counter-entry to income for the period; i. Securities available for sale - Securities that are not intended for trading or to be held through to maturity. They are adjusted to market value with a counter-entry to a separate shareholders equity account, net of tax impacts; and ii. Securities held to maturity - Securities for which there is the intention and financial capacity to hold in portfolio up to their maturity. They are recorded at cost of purchase, plus accrued income with changes recorded to income for the period. F-99

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) The method for valuating securities at market values was based on criteria that can be independently verified, and takes into consideration the average trading price on the date of the calculation, or in its absence the value of the daily adjustment in future market transactions disclosed by Anbima, BM&FBovespa (Future and Commodities Exchange) and Bacen, or the likely net realization value obtained from the use of future interest rate, exchange rate, price index, and currency curves, and any adjustments to prices of securities with reduced liquidity in order to determine the most appropriate fair market value. Accrued income from securities, irrespective of the category to which they are classified, is calculated on a daily pro rata basis, based on the variation in the index or agreed upon interest rate, using the compounding method or straight line method, until the maturity date or the actual sale of the security, and is recognized directly to income for the period. Securities classified as securities for trading are reported in the balance sheet as current asset, independent of the maturity dates of the respective securities. e. Derivative financial instruments Derivative financial instruments are stated at market value, based on consistent criteria that can be independently verified, and are based on the average trading price on the date of calculating such, or in their absence, conventional and acceptable methodologies. Increases and decreases in value are recorded to income or expense accounts for the respective financial instruments. Derivative financial instruments are classified according to Management s intention, taking into consideration their purpose. Financial instruments used to compensate all or part of the risks arising from exposure to variations in the market value of assets or liabilities are considered to be hedge instruments and are classified according to their nature, between: i. Market risk hedge - The market value adjustments for financial instruments classified to this category, and for the hedge item are recorded to income for the period; and ii. Cash flow hedge - The market value adjustments for derivative financial instruments classified in this category, are registered to shareholders equity account, net of tax impacts. F-100

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) The market value adjustments for derivative financial instruments that do not fulfill hedge criteria are recorded directly to income for the period. For financial instruments traded in association with funding operations, both the financial instrument and the liability are recorded under the intrinsic terms of the contract, and are not adjusted at market value. f. Loans, lease operations and advances against foreign exchange contracts, other credits characterized as credit assignment and allowance for loan losses Transactions involving credit, lease operations and advances on foreign exchange contracts and other credits characterized as credit assignment are classified based on management s judgment of the risk levels involved, taking into consideration the economic situation, past experience and the specific risks in relation to the transaction, the debtors and guarantors, overdue payment period, observing the parameters established by BACEN, which require that the portfolio be analyzed and classified between nine levels, being AA (minimum risk) and H (maximum risk). With respect to the overdue payment period for retail operations that have more than 36 (thirty six) months to run, the overdue intervals are doubled for these operations for the nine levels. Income from loans overdue for more than 60 days, independent of the risk level, is only recognized as income when actually received. Transactions classified to level H remain with this classification for six months, when they are then written off against the existing provision and controlled in memorandum accounts. Any renegotiated transactions are recorded, at a minimum, to the same level in which they were classified. Renegotiations from credit transactions that had been written off against the provision, and recorded to memorandum accounts, are classified as H and any gains from the renegotiations are recognized as income when actually received. Credit and lease operations that are objects of hedge from derivative financial instruments, are valued at their market values based on consistent criteria that can be independently verified. The market value adjustments from these operations are registered, when positive, to Other Receivables - Other, and when negative, to Other Liabilities - Other, with a corresponding entry for financial income from loan operations and income from lease operations. F-101

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) g. Prepaid expenses These are recorded as investments in prepayments, for which the benefits or services will occur in future periods. h. Accounting estimates The preparation of financial statements in accordance with accounting practices adopted in Brazil requires that management uses its judgment in determining and recording accounting estimates, when applicable. Liquidation of the transactions involving these estimates could result in values that differ from the estimates, as a result of the inaccuracies inherent in the process for determining such, The Management reviews the estimates and premises at least monthly. i. Permanent assets i. O Investments in subsidiaries are valued using the equity method. Other permanent assets are stated at cost of purchase, less any provisions for loss, when applicable; ii. Property, plant and equipment stated at cost, less depreciation. Depreciation is calculated using the straight-line method, based on the following annual rates: facilities, furniture and equipment for use - 10%, communication system/security/transportation - 10%, data processing system - 20%; iii. Deferred charges are stated at cost of purchase or formation cost, less amortization. Amortization is calculated using the straight-line method, over the period that the benefit is generated; and iv. Intangible Assets include rights covering intangible assets intended to maintain the company or exercised with this purpose. Amortization is calculated according to the straight line method, based on the time during which the benefit is created. Non-financial assets are subject to revaluation of the recoverable value in annual periods. In 2009 the existence of relevant assets was not confirmed as likely to incur in a devaluation loss. F-102

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) j. Income and social contribution taxes Income tax has been calculated at the rate of 15% plus a surcharge of 10% applicable to taxable profit. Social contribution has been calculated at the rate of 9% until April 30, 2008 and as from May 01, 2008, at the rate of 15%, in accordance with Law 11707/08, on taxable income. The tax credit for income tax and social contribution is recorded based on technical viability study the realization of this asset, prepared by Management. In the subsidiary BV Leasing Arrendamento Mercantil S.A., deferred income tax has been recognized, calculated at the rate of 25%, on the adjustment for excess depreciation from the lease operations. k. Contingent assets and liabilities and legal obligations Recognition, measurement and disclosure of contingent assets, contingent liabilities and legal obligations are made based on the criteria defined in Resolution 3535/2008, which made it compulsory to adopt NPC Statement 22, issued by the Institute of Independent Auditors in Brazil - IBRACON. i. Contingent assets - These are recognized in the financial statements only when there is evidence that ensures they will be realized, and for which no more appeals can be made, with the gain considered almost certain. ii. Contingent liabilities - These are recognized in the financial statements when, based on the opinion of the legal advisors and management, the risk of loss from a legal or administrative claim is considered probable, and when it is probable that funds will be required to settle the obligations, and when the amounts involved can be measured with sufficient accuracy. Contingent liabilities classified as representing possible losses are not recognized in the accounts, but only have to be disclosed in the notes to the accounts, and those classified as remote do not require a provision nor do they have to be disclosed. iii. Legal obligations - Tax and social security - These are legal processes related to tax obligations, with these claims questioning the legality or constitutional nature of such, which, independent of the probability of a successful outcome from the legal processes in progress, are recognized in full in the financial statements. F-103

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) l. Other assets and liabilities Assets are shown at their realizable values, including, when applicable accrued income and inflation and foreign exchange adjustments (on a pro rata daily basis) and provisions for losses, when considered necessary. Liabilities are stated at known or calculated amounts, plus charges and monetary and foreign exchange variations incurred (on a pro rata daily basis). Assets and liabilities that do not have a defined period, for purposes of segregation in the balance sheet, are classified as long assets and current liabilities. 5 Composition of cash and cash equivalents Years Bank 2009 2008 Cash 197,760 52,414 Interbank funds invested 9,792,636 4,806,253 Cash and cash equivalents 9,990,396 4,858,667 Years Consolidated 2009 2008 Cash 239,912 98,506 Interbank funds invested 8,888,046 5,773,810 Cash and cash equivalents 9,127,958 5,872,316 F-104

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) 6 Cash Bank Consolidated 2009 2008 2009 2008 Bank deposits 77 11,745 39,861 57,389 Free reserves 6,306-6,306 - Foreign currency cash and cash equivalents 191,025 40,494 193,322 40,761 Other 352 175 423 356 Total 197,760 52,414 239,912 98,506 7 Interbank funds applied Bank Consolidated 2009 2008 2009 2008 Investments on the money market 18,563,983 4,012,535 18,563,983 4,012,535 Banked position 7,806,407 877,815 7,806,407 877,815 Financial Treasury Bill 304,290 289,999 304,290 289,999 National Treasury Bill 2,769,246 5,717 2,769,246 5,717 National Treasury Notes 4,665,260 14,407 4,665,260 14,407 Other 67,611 567,692 67,611 567,692 Financed position 10,438,282 1,855,503 10,438,282 1,855,503 Financial Treasury Bill 1,499,995 1,713,657 1,499,995 1,713,657 National Treasury Bill 3,096,890-3,096,890 - National Treasury Notes 5,841,397 141,846 5,841,397 141,846 Sold position 319,294 1,279,217 319,294 1,279,217 Financial Treasury Bill 319,294 1,279,217 319,294 1,279,217 Interbank deposits 24,311,776 20,578,228 2,683,666 2,915,437 Foreign currency investments 177,816 37,429 177,816 37,429 Total 43,053,575 24,628,192 21,425,465 6,965,401 F-105

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) 8 Securities a. Composition of the portfolio by category, domestic and overseas Bank 2009 2008 Trading securities Accrual value Market value (book) Unrealized gain/(loss) Accrual value Market value (book) Unrealized gain/(loss) Domestic 22,752,538 22,804,499 51,961 22,946,779 23,064,608 117,829 Financial Treasury Bill 108,890 108,892 2 101,545 101,507 ( 38) National Treasury Bill 2,928,898 2,924,385 ( 4,513) 368,294 372,738 4,444 National Treasury Notes 2,960,296 2,966,072 5,776 7,522,345 7,624,405 102,060 Debentures 15,727,567 15,758,533 30,966 14,278,552 14,273,507 ( 5,045) Agriculture debt titles 93,998 99,762 5,764 132,944 140,498 7,554 Shares listed companies 111,718 121,626 9,908 13,853 14,020 167 Rural Product Notes 384,111 386,187 2,076 529,246 537,933 8,687 Promissory notes 437,060 439,042 1,982 - - - Overseas 2,633,008 2,441,087 (191,921) 4,251,253 4,046,989 ( 204,264) Certificates of overseas deposits - - - 590,093 365,101 ( 224,992) Brazilian external debt titles 132,520 142,681 10,161 226,777 234,214 7,437 Foreign Treasury 1,209,516 1,206,740 ( 2,776) 2,506,400 2,545,327 38,927 National Treasury 451,640 501,381 49,741 32,645 33,852 1,207 Other securities 839,332 590,285 (249,047) 895,338 868,495 ( 26,843) Bank Total 25,385,546 25,245,586 (139,960) 27,198,032 27,111,597 ( 86,435) Securities available for sale Accrual value 2009 2008 Market value (book) Unrealized gain/(loss) Accrual value Market value (book) Unrealized gain/(loss) Domestic 3,513,640 3,342,830 (170,810) 1,494,673 1,364,858 ( 129,815) National Treasury Notes 1,740,796 1,661,226 ( 79,570) - - - Shares of non-listed companies 326,899 253,998 ( 72,901) 210,002 123,196 ( 86,806) Debentures 1,315,233 1,294,968 ( 20,265) 1,147,203 1,100,161 ( 47,042) Certificates of real estate receivables 15,493 17,477 1,984 17,137 18,972 1,835 Financial investment fund quotas 59,700 59,700-65,286 65,286 - Credit right investment fund quotas 41,002 40,601 ( 401) 55,045 57,243 2,198 Promissory Notes 14,517 14,860 343 - - - Overseas 1,002,766 924,032 ( 78,734) 1,289,865 1,248,078 ( 41,787) Other securities 1,002,766 924,032 ( 78,734) 1,289,865 1,248,078 ( 41,787) Total 4,516,406 4,266,862 (249,544) 2,784,538 2,612,936 (171,602) F-106

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) Consolidated 2009 2008 Trading securities Accrual value Market value (book) Unrealized gain/(loss) Accrual value Market value (book) Unrealized gain/(loss) Domestic 9,181,289 9,261,274 79,985 10,594,392 10,758,885 164,493 Financial Treasury Bill 111,496 111,498 2 103,371 103,332 ( 39) National Treasury Bill 2,928,898 2,924,385 ( 4,513) 368,294 372,738 4,444 National Treasury notes 3,042,919 3,067,930 25,011 7,654,901 7,785,320 130,419 Debentures 343,277 374,243 30,966 279,684 274,639 ( 5,045) Agriculture debt titles 93,998 99,762 5,764 132,944 140,498 7,554 Shares in listed companies 113,076 131,773 18,697 14,700 14,422 ( 278) Fund quotas in investment interests 1,371,852 1,371,852-1,230,364 1,244,731 14,367 Credit right investment fund quotas 354,602 354,602-280,888 285,272 4,384 Rural Product Notes 384,111 386,187 2,076 529,246 537,933 8,687 Promissory Notes 437,060 439,042 1,982 - - - Overseas 2,657,388 2,465,467 (191,921) 4,283,541 4,079,428 (204,113) Certifications of overseas deposits 132,520 142,681 10,161 226,777 234,215 7,438 National Ttreasury 451,640 501,381 49,741 65,363 66,571 1,208 Foreign Treasury 1,233,896 1,231,120 ( 2,776) 2,506,400 2,545,328 38,928 Other securities 839,332 590,285 (249,047) 1,485,431 1,233,315 (251,686) Total 11,838,677 11,726,741 (111,936) 14,877,933 14,838,313 ( 39,620) Consolidated 2009 2008 Securities available for sale Accrual value Market value (book) Unrealized gain/(loss) Accrual value Market value (book) Unrealized gain/(loss) Domestic 4,087,308 3,916,497 (170,811) 2,084,334 1,930,235 (154,099) National treasury notes 1,740,796 1,661,226 ( 79,570) - - - Shares of non-listed companies 326,899 253,998 ( 72,901) 210,002 123,196 ( 86,806) Debentures 1,315,233 1,294,968 ( 20,265) 1,147,203 1,100,161 ( 47,042) Certificates of real estate receivables 15,493 17,477 1,984 17,137 18,972 1,835 Fund quotas in investment interests 59,700 59,700-65,286 65,286 - Credit right investment fund quotas 614,670 614,268 ( 402) 644,706 622,620 ( 22,086) Promissory notes 14,517 14,860 343 - - - Overseas 1,002,766 924,034 ( 78,732) 1,289,865 1,248,078 ( 41,787) Other securities 1,002,766 924,034 ( 78,732) 1,289,865 1,248,078 ( 41,787) Total 5,090,074 4,840,531 (249,543) 3,374,199 3,178,313 (195,886) F-107

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) b. Composition of portfolio and maturity dates The distribution of maturity dates considered the due dates of securities, independent of the accounting classification. Trading securities Bank Consolidated 2009 2008 2009 2008 Without due dates 268,931 14,300 2,005,534 1,544,364 Within 90 days 1,188,286 411,444 1,214,296 444,162 From 91 to 360 days 1,368,968 5,213,485 1,368,968 5,213,556 From 1 to 3 years 5,038,917 3,385,855 5,039,216 3,387,554 From 3 to 5 years 1,174,232 3,109,980 1,276,766 3,271,011 Over 5 years 16,206,252 14,976,533 821,961 977,666 Total 25,245,586 27,111,597 11,726,741 14,838,313 Bank Consolidated Securities available for sale 2009 2008 2009 2008 Without due dates 313,699 123,196 313,699 123,196 Within 90 days 14,282 65,286 14,283 65,286 From 91 to 360 days 164,809 25,854 164,809 25,854 From 1 to 3 years 605,549 527,543 605,549 527,543 From 3 to 5 years 312,067 532,661 312,067 532,661 Over 5 years 2,856,456 1,338,396 3,430,124 1,903,773 Total 4,266,862 2,612,936 4,840,531 3,178,313 F-108

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) 9 Derivative financial instruments a. Composition of derivative financial instruments in asstes and liabilities accounts Bank Consolidated 2009 2008 2009 2008 Assets Differential receivable from swap 2,676,473 3,383,216 1,019,951 2,308,477 Term contracts 794-794 - Purchase of purchase options - Shares 5,985 721 5,985 721 Purchase of sale options - Shares 1,400 1,995 1,400 1,995 Purchase of purchase options - Financial asset/commodities 193,911 454,196 193,911 454,196 Purchase of sale options - Financial asset/commodities 178,073 70,746 178,073 70,746 Non-Deliverable Forward (NDF) 125,069 603,524 125,069 603,524 Other 102,266 129,112 102,266 129,112 Total 3,283,971 4,643,510 1,627,449 3,568,771 Liabilities Differential payable from swap 730,776 1,312,540 1,340,956 1,237,083 Term contracts 438-438 - Sale of purchase options - Shares 4,170 2,185 4,170 2,185 Sale of purchase options - Financial asset/commodities 198,731 520,023 198,731 520,023 Sale of sale options - financial asset/commodities 38,831 112,867 38,831 112,867 Option Box - Fixed income strategy - CETIP 22,071,158 20,251,070 4,672,855 2,416,815 Non-Deliverable Forward (NDF) 117,735 403,359 117,735 403,359 Other 225,851 83,512 225,851 83,512 Total 23,387,690 22,685,556 6,599,567 4,775,844 F-109

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) b. Composition of swap contracts by indexer Bank 2009 2008 Original value Accrual value Market value Original value Accrual value Market value Asset position 43,484,696 49,358,001 50,417,376 49,460,607 54,707,016 55,342,793 DI (Interbank deposits rates) 9,062,907 10,897,736 10,927,530 14,618,174 16,552,197 16,577,690 Dollar 4,461,946 4,406,356 4,526,975 4,855,479 5,903,474 5,930,693 Euro 51,041 48,142 48,142 117,483 123,209 122,006 IGPM - Inflation index 1,646,614 2,001,320 2,041,393 1,591,189 1,958,096 1,937,327 IPCA - Inflation index 2,063,694 2,342,412 2,377,881 1,515,037 1,703,543 1,727,610 Pre-Fixed rates 25,387,292 28,857,656 29,647,435 24,335,457 25,335,242 25,953,431 TRM - Referential index - - - 30,000 36,940 36,907 Libor 740,229 740,773 766,933 932,112 936,711 934,042 Yen - - - 912,969 1,470,706 1,471,507 Sterling - - - 394,534 516,602 525,130 Commodities 6,425 6,222 6,221 141,661 153,784 117,151 Other 64,548 57,384 74,866 16,512 16,512 9,299 Liability position 43,484,696 48,190,735 48,471,679 49,460,607 53,667,788 53,272,117 DI (Interbank deposits rates) 31,486,485 34,611,933 34,657,268 23,730,752 24,999,851 25,006,352 Dollar 3,785,386 3,848,287 3,943,880 10,172,361 10,840,096 10,918,325 Euro 45,594 44,764 44,705 - - - IGPM - Inflation index 1,446,000 1,841,888 1,876,293 1,487,749 1,927,004 1,889,864 IPCA - Inflation index 2,531,063 3,459,869 3,523,648 2,484,391 3,334,835 3,343,623 Pre-Fixed rates 2,829,496 3,029,097 3,040,928 6,761,914 6,959,445 6,558,269 TRM - Referential index 11,903 14,397 16,007 130,903 167,339 168,888 Libor 1,187,527 1,189,729 1,213,892 2,045,693 2,057,750 2,047,908 Yen 130,590 126,364 126,395 647,512 1,029,492 1,030,935 Sterling - - - 1,798,140 2,182,646 2,147,113 TJLP - Long-term interest rate 7,582 9,775 9,775 11,169 12,942 12,942 Commodities 15,906 14,632 18,888 182,859 149,224 147,898 Other 7,164 - - 7,164 7,164 - Total - 1,167,266 1,945,697-1,039,228 2,070,676 F-110

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) Consolidated 2009 2008 Original value Accrual value Market value Original value Accrual value Market value Asset position 22,429,685 25,301,383 25,685,438 34,199,187 39,386,155 39,034,294 DI (Interbank deposits rates) 7,233,833 8,889,063 8,918,926 14,323,283 16,278,932 16,304,345 Dollar 5,542,047 5,746,016 5,858,789 6,096,457 7,699,042 7,730,859 Euro 51,041 48,142 48,142 117,483 123,209 122,006 IGPM - Inflation index 1,646,613 2,001,320 2,041,393 1,591,189 1,958,096 1,937,327 IPCA - Inflation index 2,063,694 2,342,412 2,377,881 1,515,037 1,703,543 1,727,610 Pre-Fixed rates 5,081,255 5,470,052 5,592,214 8,127,950 8,492,078 8,118,110 TRM - Referential index - - - 30,000 36,940 36,907 Libor 740,229 740,772 766,933 932,112 936,711 934,043 Yen - - - 912,969 1,470,706 1,471,507 Sterling - - - 394,534 516,602 525,130 Commodities 6,425 6,222 6,221 141,661 153,784 117,151 Other 64,548 57,384 74,939 16,512 16,512 9,299 Liability position 22,429,685 25,721,870 26,006,443 34,199,187 38,356,749 37,962,900 DI (Interbank deposits rates) 12,260,548 14,025,292 14,070,662 8,764,224 10,075,608 10,082,110 Dollar 3,475,934 3,546,516 3,634,817 9,877,469 10,453,300 10,533,350 Euro 45,594 44,764 44,705 - - - IGPM - Inflation index 1,446,000 1,841,888 1,876,293 1,487,749 1,927,004 1,889,864 IPCA - Inflation index 2,531,063 3,459,869 3,523,648 2,484,391 3,334,835 3,343,623 Pre-Fixed rates 1,309,874 1,448,644 1,471,361 6,761,914 6,959,445 6,558,269 TRM - Referential index 11,903 14,397 16,007 130,903 167,339 168,888 Libor 1,187,527 1,189,729 1,213,892 2,045,693 2,057,750 2,047,908 Yen 130,590 126,364 126,395 647,512 1,029,492 1,030,935 Sterling - - - 1,798,140 2,182,646 2,147,113 Commodities 15,906 14,632 18,888 182,859 149,224 147,898 TJLP - Long-term interest rate 7,582 9,775 9,775 11,169 12,942 12,942 Other 7,164 - - 7,164 - - Total - ( 420,487) ( 321,005) - 1,029,406 1,071,394 F-111

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) c. Composition of non-deliverable forward contracts by indexer Bank and Consolidated 2009 2008 Asset Value contracted Market (book) value Value contracted Market (book) value Dollar 1,443,905 81,644 2,169,629 2,632,241 Euro 20,542 564 12,684 13,774 Fixed rates 757,422 242,454 4,205,101 4,024,732 Total 2,221,869 324,662 6,387,414 6,670,747 Liability Value contracted Market (book) value Value contracted Market (book) value Dollar 2,420,668 317,176 3,540,703 3,593,822 Euro 53 1 84,400 105,140 Fixed rates - - 2,182,313 2,194,282 Sterling - - 579,998 577,339 Other - 151 - - Total 2,420,721 317,328 6,387,414 6,470,582 d. Composition of futures contracts by indexer Bank Consolidated 2009 2008 2009 2008 Purchase commitment 11,322,292 16,689,461 11,322,292 16,689,461 DDI (DI x Dollar spread future contract) 2,264,526 7,539,487 2,264,526 7,539,487 Euro 20,215 83,674 20,215 83,674 Dollar 1,803,152 519,486 1,803,152 519,486 DI 3,827,339 6,577,129 3,827,339 6,577,129 Real - Brazilian currency - 583,082-583,082 T-Note 392,910 258,436 392,910 258,436 Index 37,706 1,100,949 37,706 1,100,949 Commodities - 27,218-27,218 SCC - (Foreign exchange swap with regular adjustments) 2,976,444-2,976,444 - F-112

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) Bank Consolidated 2009 2008 2009 2008 Sales commitment 25,503,776 22,299,893 48,826,317 41,343,515 DDI (DI x Dollar spread future contract) 6,330,025 8,812,853 6,375,377 8,892,467 Euro - 77,160-77,160 Dollar 1,414,522 4,097,286 1,414,522 4,097,286 DI 14,094,894 6,546,241 37,372,083 25,510,249 Real - Brazilian currency - 1,966,586-1,966,586 T-Note - 168,011-168,011 Yen - 631,756-631,756 Commodities 687,384-687,384 - SCC 2,976,876-2,976,876 - BGI 75-75 - e. Composition of option contracts by indexer Bank and Consolidated 2009 2008 Contracted value Market value (book) Contracted value Market value (book) Shares ( 26,200) 3,215 22,895 531 Dollar (2,621,094) 128,063 (2,677,669) ( 138,293) DI 145 3,133 ( 36,790) ( 14,906) Index 38,500 ( 5,357) - 46 Commodities 378,134 46,870 166,722 ( 30,193) Securities - ( 38,287) 670,203 46,525 Flexible ( 699,615) - 39,459 28,873 Total (2,930,130) 137,637 (1,815,180) (107,417) F-113

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) f. Credit derivatives Contracted value Bank and Consolidated 2009 2008 Market value (book) Contracted value Market value (book) Asset position - Risk transferred 635,659 650,838 46,470 47,963 Credit swaps 430,076 432,175 46,470 47,963 Others 205,583 218,663 - - Liability Position - Risk received 4,030,878 4,067,837 3,657,405 3,645,544 Credit swaps 4,030,878 4,067,837 3,657,405 3,645,544 g. Composition of contracts for fixed income strategy - CETIP Bank 2009 2008 Pre-fixed risk Liability position Value contracted Market value/ risk exposure Value contracted Market value/risk exposure Sale of Call at high limit 6,183,078 4,891,642 8,635,177 10,725,657 Sale of Put at low limit 17,751,136 17,179,513 9,794,765 9,525,413 Total 23,934,214 22,071,155 18,429,942 20,251,070 Dollar risk (*) Asset position Sale of Put at low limit 16,660,411 17,812,099 Total 16,660,411 17,812,099 Liability position Sale of Call at high limit 16,660,411 17,812,099 Total 16,660,411 17,812,099 Net difference - - (*) The risk exposure limits are weighted by the Options Delta F-114

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) Consolidated 2009 2008 Pre-fixed risk Liability position Value contracted Market value /risk exposure Value contracted Market value /risk exposure Sale of Call at high limit 1,286,111 1,128,118 917,611 1,263,894 Sale of Put at low limit 3,692,324 3,544,737 1,304,825 1,125,921 Total 4,978,435 4,672,855 2,222,436 2,389,815 Dollar risk (*) Asset position Sale of Put at low limit 3,376,449 2,330,451 Total 3,376,449 2,330,451 Liability position Sale of Call at high limit 3,376,449 2,330,451 Total 3,376,449 2,330,451 Net difference - - (*) The risk exposure limits are weighted by the Options Delta. h. Composition of derivative financial instruments by maturity date Asset/liabilities accounts Bank Consolidated 2009 2008 2009 2008 Market value Market value Market value Market value Up to 90 days 53,696 ( 34,842) 51,321 (2,642) From 91 to 360 days (15,851,631) ( 7,232) 180,782 82,609 From 1 to 5 years ( 4,091,002) (18,074,375) ( 4,989,157) (1,361,443) Over 5 years ( 214,782) 74,403 ( 215,064) 74,403 Total (20,103,719) (18,042,046) (4,972,118) (1,207,073) F-115

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) i. Margin offered in guarantee Bank Consolidated 2009 2008 2009 2008 Market value Market value Market value Market value Government securities National Treasury Notes 1,485,359 1,831,945 1,510,155 1,863,037 Financial Treasury Bills 8,777-10,777 1,394 National Treasury Bills 406,521-406,521 - Overseas bonds 1,088,036 2,997,190 1,088,036 2,997,190 Other 8,819-8,819 - Total 2,997,512 4,829,135 3,024,308 4,861,621 10 Loans, lease operations advances against foreign exchange contracts, and other credits characterized as credit granted and allowance for loan losses a. Composition of transactions by type Bank Consolidated 2009 2008 2009 2008 Advances to deposit holders 305 253 305 254 Loans 7,493,944 8,704,375 7,510,092 8,704,375 Discounted bills 23,060 21,844 23,060 21,844 Guaranteed account 79,526 70,685 79,526 70,685 Credit cards - loans - - 91,826 35,380 Personal credit 1,124 36,904 3,404,883 1,825,633 Direct consumer credit - - 18,808,055 15,954,964 Compror 69,103 228,248 69,103 228,248 Financing Rural and agricultural-industrial 558,611 312,307 558,611 312,307 Financing for infrastructure and development 4,359,372 3,829,309 4,359,372 3,829,309 Financing for exports 2,965,407 4,309,812 2,965,407 4,309,812 Other 187,308 331,917 171,160 331,916 Subtotal 15,737,760 17,845,654 38,041,400 35,624,727 F-116

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) Bank Consolidated 2009 2008 2009 2008 Lease operations - - 3,947,885 1,471,881 Advances on foreign exchange/export contracts (*) 449,699 1,078,047 449,699 1,078,047 Other receivables (**) 5,301 9,277 5,301 9,277 Total Loans 16,192,760 18,932,978 42,444,285 38,183,932 Sureties and guarantees (***) 11,142,904 8,022,167 11,142,904 8,022,167 Total 27,335,664 26,955,145 53,587,189 46,206,099 (*) The advances on foreign exchange contracts are classified as deductions against the heading other liabilities. (**) The heading other credits includes credits for sureties and guarantees honored. (***) Recorded to memorandum accounts. b. Composition of transactions by maturity dates Bank Consolidated 2009 2008 2009 2008 Loans overdue More than 15 days 178,186 68,534 1,137,599 457,371 Loans to fall due Within 90 days 2,969,405 2,847,793 5,978,700 5,521,624 From 91 to 360 days 3,707,280 5,750,386 11,569,160 11,997,543 From 1 to 3 years 5,152,983 7,664,187 16,757,090 16,082,007 From 3 to 5 years 2,270,015 2,519,236 5,040,357 4,022,668 Over 5 years 1,914,891 82,842 1,961,379 102,719 Total 16,192,760 18,932,978 42,444,285 38,183,932 F-117

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) c. Concentration of transactions Bank Consolidated 2009 2008 2009 2008 Ten largest debtors 3,941,376 4,817,736 3,941,376 4,852,170 Fifty largest debtors 5,016,564 5,828,741 5,016,564 5,875,408 One hundred largest debtors 3,173,054 3,648,125 3,173,054 3,693,923 Other debtors 4,061,766 4,638,376 30,313,291 23,762,431 Total 16,192,760 18,932,978 42,444,285 38,183,932 d. Composition of transactions by economic activity Bank Consolidated 2009 2008 2009 2008 Corporate entities 14,725,282 16,552,397 15,762,809 17,473,861 Public sector Financial institutions - - 54 1,776 State 156,833 179,602 156,833 181,378 Private sector Industry 8,363,359 10,543,450 8,416,231 10,600,355 Commercial 1,447,851 1,414,888 2,151,246 2,185,380 Rural 558,595 312,307 558,595 312,307 Services 4,181,140 4,096,080 4,461,860 4,188,371 Financial institutions 17,504 6,070 17,990 4,294 Individuals 1,467,478 2,380,581 26,681,476 20,710,071 Total 16,192,760 18,932,978 42,444,285 38,183,932 F-118

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) e. Composition of transactions at the corresponding risk levels Bank 2009 2008 Loans to Loans Total Loans to Loans Total Risk Level fall due overdue operations fall due overdue operations AA 7,358,052-7,358,052 10,712,158-10,712,158 A 4,062,386-4,062,386 4,123,596-4,123,596 B 3,467,577 50,589 3,518,166 3,240,239 13,579 3,253,818 C 787,847 33,324 821,171 608,942 35,731 644,673 D 117,188 4,669 121,857 118,454 8,233 126,687 E 2,063 1,748 3,811 2,906 1,168 4,074 F 249 26,290 26,539 359 22,924 23,283 G 16,724 175,577 192,301 762 6,535 7,297 H 19,872 68,605 88,477 10,748 26,644 37,392 Total 15,831,958 360,802 16,192,760 18,818,164 114,814 18,932,978 Consolidated 2009 2008 Loans to Loans Total Loans to Loans Total Risk Level fall due overdue operations fall due overdue operations AA 7,803,346-7,803,346 11,655,473-11,655,473 A 26,299,677-26,299,677 20,053,763-20,053,763 B 3,540,739 1,273,660 4,814,399 3,302,423 891,354 4,193,777 C 819,299 792,154 1,611,453 635,535 546,691 1,182,226 D 133,082 360,522 493,604 132,866 229,466 362,332 E 9,259 200,338 209,597 8,921 132,738 141,659 F 5,659 180,229 185,888 4,244 117,468 121,712 G 19,778 305,251 325,029 3,676 79,272 82,948 H 45,065 656,227 701,292 35,116 354,926 390,042 Total 38,675,904 3,768,381 42,444,285 35,832,017 2,351,915 38,183,932 F-119

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) f. Constitution of the allowance for loan losses per level of risk Bank Consolidated Risk Level Provision % 2009 2008 2009 2008 A 0,5 20,312 20,617 131,498 100,233 B 1,0 35,182 32,538 48,144 41,938 C 3,0 24,635 19,340 48,344 35,466 D 10,0 12,186 12,669 49,360 36,234 E 30,0 1,143 1,222 62,879 42,497 F 50,0 13,270 11,642 92,944 60,857 G 70,0 134,610 5,108 227,521 58,063 H 100,0 88,477 37,392 701,292 390,042 Subtotal 329,815 140,528 1,361,982 765,330 Provision without characteristic of credit assignment - - - 1,520 Complementary provision - - - 7,276 Total 329,815 140,528 1,361,982 774,126 Percentage of portfolio 2,04% 0,74% 3,21% 2,03% g. Movement of the allowance for loan losses Bank Consolidated 2009 2008 2009 2008 Opening balance 140,528 67,171 774,126 565,602 Constitutions/(Reversals) 215,218 92,099 1,535,104 830,451 Write off to losses ( 24,830) ( 18,648) ( 946,147) ( 621,833) Foreign exchange variation on overseas provisions ( 1,101) ( 94) ( 1,101) ( 94) Closing balance 329,815 140,528 1,361,982 774,126 F-120

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) h. Background of the allowance for loan losses Bank Consolidated Credit portfolio Loan loss expense % of expenses Credit portfolio Loan loss expense % of expenses 2009 16,192,760 215,218 1.33 42,444,285 1,535,104 3.62 2008 18,932,978 92,099 0.49 38,183,932 830,451 2.18 i. Default Bank Loans in arrears (levels D to H) Total portfolio % default 2009 276,889 16,192,760 1.7 2008 65,504 18,932,978 0.3 Consolidated Loans in arrears (levels D to H) Total portfolio % default 2009 1,702,567 42,444,285 4.0 2008 913,870 38,183,932 2.4 j. Credit portfolio coverage Bank Loans in arrears (levels D to H) Loan loss alowance % coverage rate 2009 276,889 329,815 119 2008 65,504 140,528 215 Consolidated Loans in arrears (levels D to H) Loan loss alowance % coverage rate 2009 1,702,567 1,361,982 80 2008 913,870 744,126 81 F-121

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) The coverage rate is obtained by dividing the loan loss allowance s balance by the balance of transactions in arrears over 60 days (Loans in arrears - levels D to H). k. Additional information Bank Consolidated 2009 2008 2009 2008 Credits renegotiated/amended during the year 5,970,525 3,752,054 6,199,852 4,006,192 Credits recovered during the year previously written off as losses (*) 17,716 1,661 135,377 126,107 Credits granted during the year (**) - - 5,813,060 3,639,107 (*) Recorded in the statement of income to income from loan transactions. (**) In 2009 a number of credit assignments were entered into, basically in favor of BV Financeira Fundo de Investimento em Direitos Creditórios I, BV Financeira Fundo de Investimento em Direitos Creditórios II, Banco do Brasil S.A., and Nossa Caixa S.A. the net outcome of these credit assignments was R$ 501,128. A provision was created for the balance of the credits assigned in order to cover any likely losses, in the sum of R$ 24,692 (2008 - R$ 9,427) and stated in Other Liabilities - Sundry items. 11 Other receivables - Foreign exchange portfolio Bank Consolidated 2009 2008 2009 2008 Unsettled foreign exchange purchased 332,175 2,471,832 332,175 2,471,832 Rights from the sale of foreign exchange 51,870 1,224,599 51,870 1,224,599 Advances in domestic currency received (25,473) ( 13,356) (25,473) ( 13,356) Income receivable from advances granted 21,848 38,344 21,848 38,344 Income receivable from financed imports 101 89 101 89 Total 380,521 3,721,508 380,521 3,721,508 F-122

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) 12 Other receivables - Securities clearing accounts Bank Consolidated 2009 2008 2009 2008 Exchanges - Deposits in guarantee - 235,580-236,407 Clearing department 1,100-1,100 - Debtors account settlement pending 292 2,045 14,485 238,202 BM&F settlement operations 66,416 153,919 66,416 153,919 Other 37,201 45,409 37,785 63,230 Total 105,009 436,953 119,786 691,758 13 Others receivables - Sundry Bank Consolidated 2009 2008 2009 2008 Advances on salaries and vacation 5,133 1,012 20,851 2,628 Tax credits 575,317 387,862 1,788,321 1,382,681 Deposits in guarantee 9,054 7,729 36,967 23,538 Taxes and contributions to compensate 180,576 89,445 435,084 319,071 Options for fiscal incentives - 23,353-45,618 Receivable from associated companies 1,010 1,064 80 - Securities and credits receivable 210,860-274,456 448,615 Costs financed (*) - - 306,612 74,300 Other debtors - Domestic 54,654 9,590 309,437 83,454 Securities and credits receivable 12,900 2,291 270,394 3,811 Other 242 364 11,414 7,885 Total 1,049,746 522,710 3,453,616 2,391,601 (*) Refers to costs associated with lease operations. F-123

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) 14 Other assets - Prepaid expenses Bank Consolidated 2009 2008 2009 2008 Systems development and maintenance 6,905 3,022 7,198 7,214 Commission paid to traders acting as intermediaries for operations - - 281,351 388,844 Financial System service expenses 1,611-10,616 - Others 562 4,873 16,787 20,274 Total 9,078 7,895 315,952 416,332 F-124

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) 15 Investments a. Interests in domestic and overseas subsidiaries Movements for the subsidiary Movements for controlling honored Number of shares/quotas at 12/31/09 Capital at 12/31/09 Shareholders equity at 12/31/08 Income/ (loss) for the period Dividends/ interest on own capital paid/ proposed Adjustments directly to shareholders equity 12/31/09 equity at Shareholders quotas held Number of shares/ Equity in earnings of subsidiaries Book value at 12/31/09 Book value at 12/31/08 Domestic 425,846 2,507,956 2,179,220 Votorantim CTVM Ltda. 20,181 59,250 223,284 18,545 - - 241,829 20,177 18,542 241,828 223,241 Votorantim Asset Manag. DTVM Ltda. 9,000,000 9,000 18,962 19,792 - - 38,754 8,999,820 19,792 38,753 18,963 BV Financeira S.A. 126,361 342,000 663,240 381,756 (95,439) (1,738) 947,819 126,361 381,755 947,818 663,198 BV Leasing Arred. Merc. S.A. 510,404 966,200 1,273,833 5,757 - - 1,279,590 510,404 5,757 1,279,557 1,273,818 Overseas (2,804) 35,274 5,594 Votorantim Bank Limited 10,000,000 17,412 42,164 1,955 - (10,749)* 33,370 9,999,999 (639) 33,370 1,701 Banco Votorantim Securities, Inc. 5,000,000 8,706 3,893 (917) - (1,072)* 1,904 5,000,000 (2,165) 1,904 3,893 * Includes foreign exchange variations of shareholders equity and net profits from overseas investments. F-125

Banco Votorantim S,A, Notes to the financial statements (In thousands of Reais) b. Other investments Bank Consolidated 2009 2008 2009 2008 Investments in government incentives 27,745 4,392 53,271 7,652 Membership certificates 175-176 2 Shares and quotas 6 459 6 1,491 Other 99 274 129 1,224 Total 28,025 5,125 53,582 10,369 16 Fixed assets 2009 2008 Bank Cost Depreciation Net Net Fixed assets in progress 111-111 - Facilities - - - 302 Furniture and equipment for use 27,954 ( 6,326) 21,628 6,659 Communication system 7,122 ( 3,462) 3,660 2,956 Data processing system 24,332 (17,722) 6,610 6,573 Security system 1,291 ( 371) 920 168 Transportation system 1,242 ( 1,047) 195 722 Total 62,052 (28,928) 33,124 17,380 F-126

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) Consolidated 2009 2008 Cost Depreciation Net Net Fixed assets in progress 111-111 - Facilities 2,691 ( 1,163) 1,528 2,310 Furniture and equipment for use 40,791 (10,495) 30,296 14,928 Communication system 11,543 ( 5,325) 6,218 8,385 Data processing system 51,560 (32,829) 18,731 27,151 Security system 1,312 ( 380) 932 215 Transportation system 1,638 ( 1,323) 315 898 Total 109,646 (51,515) 58,131 53,887 17 Deferred charges 2009 2008 Bank Cost Amortization Net Net Leasehold expenditures 45,271 (17,730) 27,541 3,861 2009 2008 Consolidated Custo Amortização Líquido Líquido Leasehold expenditures 89,553 (46,528) 43,025 20,880 Expenditures acquisition development of software 1,609 ( 759) 850 2,789 Total 91,162 (47,287) 43,875 23,669 F-127

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) 18 Intangible assets Consolidated 2009 Amortization rate Cost Accrued amortization Net SISBEX BM&F - 200-200 Software with no Physical Substance 20% 1,573 ( 319) 1,254 Licenses 20% 4,439 ( 772) 3,667 Total 6,212 (1,091) 5,121 19 Deposits a. Composition of the portfolio by type Bank Consolidated 2009 2008 2009 2008 Demand deposits 133,699 101,495 134,794 109,067 Interbank deposits 2,020,028 4,494,376 1,741,042 4,182,084 Time deposits 22,610,098 14,632,368 22,599,913 14,635,918 Deposits for investments 1,822 5,507 1,672 5,365 Total 24,765,647 19,233,746 24,477,421 18,932,434 F-128

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) b. Composition of the portfolio by maturity dates Bank Consolidated 2009 2008 2009 2008 Without due dates 135,521 101,495 136,465 109,067 Within 90 days 5,249,460 6,612,899 5,201,447 6,434,243 From 91 to 360 days 14,799,023 7,585,035 14,869,444 7,579,323 From 1 to 3 years 4,320,400 4,661,930 4,008,822 4,537,414 From 3 to 5 years 243,351 264,533 243,351 264,533 Over 5 years 17,892 7,854 17,892 7,854 Total 24,765,647 19,233,746 24,477,421 18,932,434 20 Money market repurchase commitments a. Composition of the portfolio by counterparty Bank Consolidated 2009 2008 2009 2008 From related parties 836,436 963,396 - - From non-related parties 24,767,468 16,624,549 24,767,468 16,624,549 Total 25,603,904 17,587,945 24,767,468 16,624,549 b. Composition of the portfolio by maturity dates Bank Consolidated 2009 2008 2009 2008 Within 90 days 10,963,887 6,452,893 10,127,451 5,489,497 From 91 to 360 days 11,726,847 6,284,746 11,726,847 6,284,746 From 1 to 3 years 2,861,190 3,712,441 2,861,190 3,712,441 From 3 to 5 years 35,675 134,956 35,675 134,956 Over 5 years 16,305 1,002,909 16,305 1,002,909 Total 25,603,904 17,587,945 24,767,468 16,624,549 F-129

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) 21 Acceptances and endorsements a. Composition of the portfolio by type Bank Consolidated 2009 2008 2009 2008 Debentures With exchange rate variation (a) - - 1,637,667 2,198,041 Post-fixed (b) - - 1,313,451 1,191,034 Funds from real estate credit notes Post-fixed (c) 106,311 19,696 106,311 19,696 Funds from agricultural credit bills Post-fixed (c) 1,818,264 1,489,982 1,818,264 1,489,982 Obligations from overseas securities With exchange rate variation 1,394,800 1,403,490 1,394,800 1,403,490 Total 3,319,375 2,913,168 6,270,493 6,302,243 (a) Interest rates: Exchange variation Dollar + 12.0436%a.a. (b) Interest rates: DI + 0.35% a.a. (c) Interest rates equal to 90% of CDI. b. Composition of the portfolio by maturity dates Bank Consolidated 2009 2008 2009 2008 From 0 to 360 days 1,276,418 1,564,142 1,276,418 1,564,142 Over 1 year 2,042,957 1,349,026 4,994,075 4,738,101 Total 3,319,375 2,913,168 6,270,493 6,302,243 F-130

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) 22 Borrowing and on-lending a. Composition of the portfolio by type Bank Consolidated 2009 2008 2009 2008 Domestic on-lending With exchange rate variation 186,589 323,815 186,589 323,815 Overseas on-lending With exchange rate variation 2,163,337 6,174,009 2,163,337 6,174,009 Domestic on-lending - BNDES (a) Post-fixed 3,503,274 2,992,912 3,503,274 2,992,912 Domestic on-lending -FINAME (b) Post-fixed 1,415,992 1,156,141 1,449,555 1,194,203 Total 7,269,192 10,646,877 7,302,755 10,684,939 (a) In 2009, interest rate: 2.75% p.a. to 16.55% p.a. or TJLP/Exchange rate variation + 1.30% p.a. to 9.69% a.a. (b) In 2009, interest rate: 4.55% p.a. to 11.00% p.a. or TJLP/Exchange rate variation + 0.50% p.a. to 5.50% a.a. b. Composition of the portfolio by maturity dates Bank Consolidated Maturity dates 2009 2008 2009 2008 Within 90 days 372,611 1,931,266 372,632 1,442,570 From 91 to 360 days 3,301,759 5,104,942 3,302,812 5,631,700 From 1 to 3 years 1,812,824 3,155,442 1,828,085 3,155,442 From 3 to 5 years 874,176 434,782 885,448 434,782 Over 5 years 907,822 20,445 913,778 20,445 Total 7,269,192 10,646,877 7,302,755 10,684,939 F-131

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) 23 Other liabilities - Foreign exchange portfolio Bank Consolidated 2009 2008 2009 2008 Unsettled foreign exchange sold 51,879 1,510,027 51,879 1,510,027 Financed import - Exchange contracted ( 25,118) ( 9,188) ( 25,118) ( 9,188) Obligations from the purchase of foreign currency 385,489 1,906,205 385,489 1,906,205 Advances against exchange contract (402,632) (1,039,703) (402,632) ( 1,039,703) Other - 10-10 Total 9,618 2,367,351 9,618 2,367,351 24 Other liabilities - Social and statutory Bank Consolidated 2009 2008 2009 2008 Dividends/Interest on own capital/benefits payable 190,421 155,291 190,421 155,291 Provision for profit sharing 40,950 39,656 165,897 134,564 Bonuses and profit-sharing payable 229 900 228 1,741 Total 231,600 195,847 356,546 291,596 25 Other liabilities - Tax and social security Bank Consolidated 2009 2008 2009 2008 Income and social contributions taxes payable 127,119-559,074 280,837 Taxes and contributions payable 43,797 58,446 65,399 87,577 Other taxes and contributions (Legal obligations) 478,676 398,050 1,046,422 755,099 Provision for deferred taxes and contributions 152,140 149,881 753,695 817,689 Provision for tax risks - 8,567-12,830 Total 801,732 614,944 2,424,590 1,954,032 F-132

4, Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) 26 Other liabilities - Due in connection with securities Bank Consolidated 2009 2008 2009 2008 Clearing department 1 510 4,637 1,188 Creditors account settlement pending 325 188,981 18,878 206,438 Creditors for share loans 32,643 12,234 32,643 12,234 Operations with financial assets and commodities to settle 19,540 15,281 21,157 288,958 Other 815 17,739 921 17,759 Total 53,324 234,745 78,236 526,577 27 Other liabilities - Subordinated debts Bank Consolidated 2009 2008 2009 2008 Bank deposit certificates Post-fixed 2,927,815 1,394,933 2,927,815 1,394,933 Debentures Post-fixed - - 1,439,006 1,474,759 Total 2,927,815 1,394,933 4,366,821 2,869,692 Consolidated Issue date Face value Maturity date Index Nominal rate 2009 Time deposits 11/27/07 625,000 11/27/12 CDI 0.491417 787,433 Time deposits 12/03/07 17,000 12/03/12 CDI 0.491417 21,381 Time deposits 12/03/07 386,300 12/03/12 CDI 0.540556 486,345 Time deposits 12/03/07 65,000 12/03/12 IGPM 7.219701 82,704 Time deposits 12/04/07 13,700 12/04/12 CDI 0.540556 17,241 Time deposits 03/18/08 115,000 03/18/13 IPCA 7.934241 144,103 F-133

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) Consolidated Issue date Face value Maturity date Index Nominal rate 2009 Time deposits 08/06/09 520,000 08/06/14 CDI 1.670229 541,172 Time deposits 08/17/09 15,000 08/17/14 IPCA 7.885736 15,627 Time deposits 08/17/09 10,500 08/17/14 IPCA 7.924428 10,942 Time deposits 08/17/09 39,000 08/17/14 IPCA 8.002932 40,652 Time deposits 08/18/09 5,000 08/18/14 IPCA 7.953867 5,209 Time deposits 07/12//09 500,000 12//12/14 CDI 1.635268 503,339 Time deposits 0712/09 100,000 12/08/14 CDI 1.674668 100,670 Time deposits 12/08/09 150,000 12/08/14 CDI 1.674668 150,949 Time deposits 12/22/09 20,000 12/23/14 CDI 1.674668 20,048 Debentures 04/20/09 1,387,149 04/20/16 CDI 0.50000 1,439,006 Total 4,366,821 28 Other liabilities - Other Bank Consolidated 2009 2008 2009 2008 Provision for personnel expenses 14,217 8,882 42,204 26,390 Provision other administrative expenses 12,287 4,328 48,525 30,780 Provision for contingent liabilities 18,600 3,003 116,746 59,083 Securities purchased - 3,648-3,648 Market value adjustment - Loans - 117,135-117,135 Amounts to on-lend credit assignment - - 164,322 55,756 Other - Credit card - - 120,477 74,924 Credit operations to liberate - - 24,285 17,758 Lease operations to liberate - - 4,311 4,074 Provision for losses - Credits assigned - - 24,692 9,427 Other 198,591 8,682 363,093 91,817 Total 243,695 145,679 908,655 490,792 F-134

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) 29 Shareholders equity a. Capital Equity capital in 2009 is composed of 81,538,822,950 shares, of which 66,713,582,406 common registered shares with no par value, and 14,825,240,544 preferred registered shares with no par value. In 2008 equity capital was composed of 74,126,202,673 common shares with no par value. According to the strategic partnership described in explanatory note no. 1, Banco do Brasil will pay in R$ 450,000 in part payment of the underwriting for 7,412,620,277 new preferred shares. b. Dividends The shareholders are guaranteed a minimum dividend equivalent to 25% of net income for the year, less legal reserve. Management proposes a minimum mandatory dividend payout totaling R$ 190,421. c. Interest on own capital In accordance with the option provided in Law 9249/95, in 2009, the Bank calculated interest on own capital based on the long term interest rate (TJLP) in force during the year, for the amount of R$ 389,000, which was recorded to financial expenses, as required by tax legislation, For purposes of these financial statements, this interest has been eliminated from financial expenses for the year and recorded to retained earnings. Income and social contribution taxes for the year decreased by approximately R$ 155,840, as a result of deducting the interest on own capital credited to the shareholders from these taxes. d. Capital reserves The capital reserve was created with the premium in the share underwriting totaling R$ 585,103 and with subsidies from fiscal incentives/updating of equity interests totaling R$ 31,946. The capital reserve can be used to increase capital or to offset losses. The balance for capital reserves will be allocated by December 31, 2010, as determined by BACEN Resolution 3605/08. F-135

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) e. Revenue reserve Legal reserve Compulsory requirement, based on 5% of net income for the year, up to the limit of 20% of realized capital. The legal reserve may cease to be funded when jointly with capital reserves it should exceed 30% of equity capital. The appropriation is not compulsory after this limit the legal reserve can only be used to increase capital or to compensate losses. Reserve of expansion In order to comply with the requirements under the corporate law and Central Bank of Brazil rules, Management proposes the allocation of retained earnings to an Expansion Reserve, created following the allocations to the legal reserve and dividend payout, if any. The reserve s balance is available to shareholders, for a future resolution taken at the Shareholders Meeting. 30 Service fee income Bank Consolidated 2009 2008 2009 2008 Income from banking charges 899 549 459,016 189,112 Credit facility rate - - - 120,053 Administration of investment funds - - 80,788 94,065 Brokerage exchange operations - - 29,248 31,420 Commissions on placing of securities 39,134 23,829 40,073 25,101 Services rendered related parties 13,144 9,829 - - Income from guarantees provided 118,284 55,856 118,284 55,856 Collection revenues 2,174-2,174 - Income from anticipated settlement - - 29,236 130,087 Others 32,481 18,402 58,392 43,270 Total 206,116 108,465 817,211 688,964 F-136

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) 31 Personnel expenses Bank Consolidated 2009 2008 2009 2008 Fees 12,600 12,086 25,511 25,293 Benefits 22,014 18,764 84,780 70,293 Social security charges 45,571 31,532 116,878 86,970 Salaries 125,446 80,588 332,629 239,699 Training 2,562 3,295 4,400 4,863 Total 208,193 146,265 564,198 427,118 32 Other administrative expenses Bank Consolidated 2009 2008 2009 2008 Rental 26,491 9,445 57,942 25,867 Communications 9,739 7,361 81,591 67,713 Maintenance and conservation of fixed assets 4,503 2,209 22,194 31,568 Data processing 56,913 43,658 107,799 88,388 Promotions and public relations 6,103 6,603 18,305 27,939 Publicity and advertising 2,169 3,237 19,943 33,038 Publications 2,254 563 3,110 1,159 Financial system services 23,082 9,226 131,733 106,394 Outsourced services 2,563 2,832 42,310 61,484 Specialized technical services 37,931 35,782 242,815 162,064 Amortization 4,522 3,355 16,162 15,242 Depreciation 4,848 4,072 11,288 12,325 Transportation 3,186 1,711 20,329 13,546 Travel 5,236 5,271 36,436 34,958 Other 18,720 12,838 225,069 163,821 Total 208,260 148,163 1,037,026 845,506 F-137

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) 33 Other operational income Bank Consolidated 2009 2008 2009 2008 Refund of costs (*) - - 1,173,925 470,267 Recovery of charges and expenses 1,939 676 11,132 21,197 Monetary corrections of assets 346 494 1,706 823 Reversal of operating provisions 51 3,553 51 3,553 Foreing exchange variations 6,190 311,271 6,190 301,377 Refund of collection expenses - - 19,578 11,436 Other 43,989 33,504 104,512 96,270 Total 52,515 349,498 1,317,094 904,923 (*) Refers to refunds of costs associated with loans and lease transactions. 34 Other operational expenses Bank Consolidated 2009 2008 2009 2008 Monetary corrections of liabilities 18,789 32,572 38,031 63,069 Exchange variance overseas investments 309,486 79,302 309,486 79,719 Commissions paid for acting as intermediary 22,116 3,862 1,754,355 1,192,905 Provision for contingent liabilities 8,112-46,428 15,228 Refis - Interest expenses - 15,532-60,681 - Income tax withheld overseas 46,078-46,078 - Discounts granted - - 281,140 232,481 Other 14,266 51,638 184,534 188,734 Total 434,379 167,374 2,720,733 1,772,136 F-138

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) 35 Income and social contribution taxes a. Charges due on operations Bank Consolidated 2009 2008 2009 2008 Income before income and social contribution taxes and profit share 880,051 672,578 1,288,123 1,086,765 Charges at the nominal rates (352,020) ( 269,031) ( 515,249) ( 434,706) Exclusions/(additions) 192,534 ( 269,031) ( 603,204) 153,869 Profit sharing 15,862 19,146 ( 17,508) 52,088 Equity in earnings of subsidiary 114,655 373,745 - - Results of subsidiary and branch overseas ( 94,488) ( 75,584) ( 94,488) ( 75,584) Non-taxable interest on securities 96,380 139,771 96,380 142,410 Interest on own capital 97,250 150,116 97,250 161,906 Allowance for loan losses ( 86,045) ( 32,731) ( 333,315) ( 109,169) Market adjustment Circulars 3068 and 3082 48,853 7,283 ( 275,346) 266,081 Derivatives - Law 11051 42,293 ( 20,978) 149,371 ( 172,504) Provision for contingent liabilities ( 1,535) ( 928) 12,276 ( 5,081) Excess depreciation from the lease portfolio - - 324,549 82,958 Other ( 35,274) ( 37,274) ( 107,916) 125,378 Provision for legal liabilities ( 81,877) - ( 220,371) - Tax loss carry forward for IR and CS 76,460 ( 253,535) ( 234,086) ( 314,614) Current income and social contribution taxes (159,486) - (1,118,453) ( 280,837) Deferred income and social contribution taxes ( 2,259) 13,695 66,253 (1,023,703) Total income tax and social contribution (161,745) 13,695 (1,052,200) (1,304,540) F-139

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) b. Deferred income and social contribution taxes affecting the results Bank Consolidated Deferred income and social contribution taxes 2009 2008 2009 2008 Additions/(exclusions) Market adjustment Circulars 3068 and 3082 40,034 ( 7,283) 320,612 ( 392,857) Derivatives - Law 11051 (42,293) 20,978 70,190 ( 547,888) Excess depreciation from the lease operations - - (324,549) ( 82,958) Total ( 2,259) 13,695 66,253 (1,023,703) Tax credit Additions/(exclusions) Allowance for loan losses 86,045 32,731 (333,315) 156,311 Tax loss and negative social contribution base ( 76,460) 253,535 234,086 314,614 Market adjustment Circulars 3068 and 3082 ( 8,189) - 45,266 136,715 Provision for contingent liabilities 1,535 903 ( 12,276) 7,498 Provision for profit share ( 15,862) 15,862 17,508 53,822 Derivatives - Law 11051 - - 502,084 723,403 Provision for legal liabilities 81,877-220,371 - Loss in overseas branch 94,488-94,488 - Other - - - 612 Total 163,434 303,031 768,212 1,392,975 c. Deferred income and social contribution taxes with an impact on assets and liabilities Bank Consolidated 2009 2008 2009 2008 Asset (Other receivables - Other) Opening balance 387,862 50,253 1,382,677 395,737 Provision for contingent liabilities 1,535 903 ( 12,276) 7,501 Market adjustment Circulars 3068 and 3082 15,832 34,722 ( 275,346) ( 30,718) Allowance for loan losses 86,045 32,731 ( 333,315) 156,919 Tax loss and negative social contribution base (76,460) 253,391 234,086 314,470 Derivatives - Law 11051 - - 502,084 484,946 F-140

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) Bank Consolidated 2009 2008 2009 2008 Provision for profit share (15,862) 15,862 17,508 53,822 Provision for legal liabilities 81,877-220,371 - Loss in overseas branch 94,488-94,488 - Other - - ( 41,956) - Closing balance 575,317 387,862 1,788,321 1,382,677 Liabilities (Other liabilities - Tax and social security) Bank Consolidated 2009 2008 2009 2008 Opening balance 149,881 163,576 817,689 234,596 Market adjustment Circulars 3068 and 3082 ( 40,664) 7,283 184,707 190,704 Derivatives - Law 11051 42,923 ( 20,978) (167,013) 309,431 Excess depreciation from the lease operations - - 324,549 82,958 Other - - ( 36,823) - Closing balance 152,140 149,881 753,695 817,689 d. Composition of tax credit expected of realization Tax credits were created pursuant to legislation in force, based on studies evidencing their realization. Bank Consolidated Composition 2009 2008 2009 2008 Allowance for loan losses 140,527 54,482 772,052 424,437 Market adjustment Circulars 3068 and 3082 50,554 34,722 52,481 34,889 Derivatives - Law 11051 - - 16,536 502,000 Provision for contingent liabilities 2,438 903 40,257 24,558 Provision for legal liabilities 81,877-223,001 - Loss in overseas branch 94,488-94,488 - Provision for profit share - 15,862 116 53,821 Other - - 12,331 - Tax loss carry forward for IR and CS 205,433 281,893 577,059 342,972 Total 575,317 387,862 1,788,321 1,382,677 F-141

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) The sums shown in the expectation of realizing the tax credit are founded on an updated technical study dated December 31, 2009. Expected realization Nominal value Bank Present value In 2010 128,118 106,884 In 2011 118,968 84,295 In 2012 103,598 61,748 In 2013 37,523 12,536 In 2014 53,851 18,651 In 2015 55,840 18,451 In 2016 227 96 In 2019 77,192 22,063 Total 575,317 324,724 Expected realization Nominal value Consolidated Present value In 2010 611,471 544,512 In 2011 400,814 309,754 In 2012 367,019 247,366 In 2013 42,962 15,917 In 2014 90,989 39,006 In 2015 55,840 18,451 In 2016 227 96 In 2019 218,999 62,906 Total 1,788,321 1,238,008 36 Related parties Transactions between related parties were undertaken at usual market values, terms, and average rates in force on the respective dates and under commutative conditions. The transactions involving Banco Votorantim and subsidiaries were eliminated and also do not consider any risk. F-142

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) a. Summary of transactions with related parties The balance of credit and debit transactions, of revenues and expenses involving non-consolidated related parties are as follows: Banco do Brasil (a) Votorantim (b) 2009 2009 2008 Assets Derivative financial instruments 46,504 3,033,109 2,411,636 Other receivables 21,798 12 - Liabilities Deposits - 2,024 3,381 Money market repurchase commitments - 2,210,858 2,553,379 Derivative financial instruments 80,849 97,191 138,696 Other liabilities 4,705 - - Income Securities income 776 - - Results from derivative financial instruments 4,408 863,507 157,919 Other operational income 4,370 - - Expenses Deposits, money market and interbank funds 166,174 231,230 317,321 Results from derivative financial instruments 13,019 - - Other operational expenses 1,688 - - (a) Banco do Brasil - includes companies in the Banco do Brasil Financial Conglomerate, the key ones being Banco do Brasil S.A. and Bank Nossa Caixa S.A. (b) Votorantim - includes companies in Votorantim Industrial Conglomerate, the key ones being Votorantim Finanças S.A. and Votorantim Industrial S.A. F-143

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) b. Compensation of Management s key personnel In 2009 Banco Votorantim and its subsidiaries spent the sum of R$ 98,911 in compensation for Management s key personnel. Consolidated Fees 25,511 Bonuses 73,400 37 Contingent assets and liabilities and legal obligations a. Contingent liabilities The Bank and its subsidiaries are parties in lawsuits resulting from the normal course of operations, involving tax, civil and labor issues. Management, based on information from its legal advisors and analyses of existing legal demands, has classified the contingencies between remote, possible and probable, taking into consideration the possibility of losses being incurred, Within this context, the contingent processes evaluated as representing a risk of possible loss are not recognized in the accounting records. The main contingent lawsuits assessed as likely losses are related to tax issues. Income tax/social contribution on the equity accounting method involving R$ 31,728 in overseas investments, and PIS - EC 17/97 of R$ 60,415. The key issues with subsidiaries are related to the incidence of ISS (service tax) totaling R$ 7,138, and demutualization in the sum of R$ 7,273. F-144

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) The position of contingent liabilities rated in the likely class, separated by the nature of the cause and provisions created, is as follows: Bank Tax demands Civil demands Labor demands 2009 2008 2009 2008 2009 2008 Opening balance 8,567 8,157 - - 3,003 747 Constitutions/(reversals) 3,606 - - - 3,092 2,256 Monetary corrections 332 410 - - - - Closing balance 12,505 8,567 - - 6,095 3,003 Consolidated Tax demands Civil demands Labor demands 2009 2008 2009 2008 2009 2008 Opening balance 12,830 12,696 21,909 27,790 37,174 19,150 Constitutions/(reversals) 3,976 ( 761) 9,193 ( 5,881) 30,624 18,024 Monetary corrections 1,040 895 - - - - Closing balance 17,846 12,830 31,102 21,909 67,798 37,174 In the consolidated position, court deposits classed as other credits - sundry items, rose to R$ 36,967 (2008 - R$ 23,453). b. Contingent assets No contingent assets were recorded. F-145

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) c. Legal obligations The Institution has filed for the non payment of COFINS based on income that is not derived from monthly revenue (enlargement of the calculation base introduced by Law 9718/98). Bank Consolidated 2009 2008 2009 2008 Opening balance 398,050 331,651 755,688 525,638 Constitutions/(reversals) 49,761 35,531 224,884 171,917 Monetary corrections 30,865 30,868 65,850 58,133 Closing balance 478,676 398,050 1,046,422 755,688 d. Other commitments On July 25, 2003, the Bank officially registered with the Federal Revenue Department its adhesion to the Special Program for Installment Payments - PAES, established by Law 10684/03, by the Federal Government. Adhesion to the program enables the payment in installments of PIS, referring to the period from January 2000 to January 2003, which was being legally questioned and recorded in a provision for tax risks. The PIS included in the program were divided into 120 months, calculated based on the limitation of 1,5% of gross income from financial intermediation, updated based on the variation of the long-term interest rate - TJLP and reclassified to taxes and contributions payable. On December 31, 2009, the balance of the program is R$ 6,985. The Bank has complied with the terms of the aforementioned program with respect making the installment payments, and payment of the other monthly taxes due. On November 30, 2009 the Institution opted for the benefits provided by the advent of Law 11941/2009, which provided for the sight payment of taxes in arrears until November 30, 2008 with reduced fines and interest. The sums paid were of R$ 49,883 and refer to the deficiency in income tax and social contribution payments during the 2004-2008 period. F-146

Banco Votorantim S.A. Notes to the financial statements (In thousands of Reais) 38 Other information a. Tax expenses refer mainly to the Provisional Contribution on Financial Activity - CPMF, contribution to the Social Integration Program - PIS, Contributions for Social Security Financing - COFINS and service tax - ISS. b. Non-operating profits refer basically to earnings obtained in the disposal of assets not used by the company. c. There are no post-employment benefits such as pensions, other retirement benefits, postemployment life insurance and medical assistance, other long-term benefits to employees and managers, including leave for years of service and other leaves, jubilees, and other benefits for years of service, compensation based on actions and benefits from contractual termination, with the exception of those provided for in the employees class collective agreement. 39 Subsequent event On January 20, 2010 Banco Votorantim issued subordinated notes totaling R$ 1,339,050 to mature on January 20, 2020. In accordance with CMN Resolution nº 3444/07, Banco Votorantim will request Central Bank of Brazil that the respective subordinated notes be considered eligible for capital level II in their nature of subordinated indebtedness, adding the sum found to the Reference Equity for the purpose of compliance with operating limits. F-147

THE ISSUER Banco Votorantim S.A. acting through its principal office in São Paulo, Banco Votorantim S.A. Av. das Nações Unidas, 14,171 Torre A 18 th floor 04794-000 São Paulo SP Brazil Banco Votorantim S.A. Av. das Nações Unidas, 14,171 Torre A 18 th floor 04794-000 São Paulo SP Brazil ARRANGERS Votorantim Bank Limited Centre of Commerce Building, Suite 401 No. 1, Bay Street VBL P.O.Box N-1863 Nassau NP The Bahamas THE PRINCIPAL PAYING AGENT The Bank of Tokyo-Mitsubishi UFJ, Ltd. 12-15 Finsbury Circus London EC2M 7BT United Kingdom AGENTS THE FISCAL AGENT, LONDON PAYING AGENT AND TRANSFER AGENT The Bank of New York Mellon, London Branch One Canada Square London E14 5AL United Kingdom THE REGISTRAR, EXCHANGE AGENT, NEW YORK PAYING AGENT AND TRANSFER AGENT The Bank of New York Mellon, New York 101 Barclay Street, 4E New York, NY 10286 United States of America THE IRISH PAYING AGENT AND LISTING AGENT The Bank of New York Mellon (Ireland) Limited Hanover Building Windmill Lane Dublin 2 Ireland To the Arrangers as to English law Proskauer Rose LLP Rua Funchal, 418 26 th floor 04551-060 Sao Paulo SP Brazil LEGAL ADVISORS To the Issuer as to Brazilian law Campos Mello Advogados Av. Pres. Juscelino Kubitschek, 360, 10 th floor 04543-000 São Paulo SP Brazil AUDITORS TO THE ISSUER KPMG Auditores Independentes Rua Dr. Renato Paes de Barros, 33, 4 th floor 04530-904 São Paulo, SP Brazil