Annual Report. Bombay, India. Photographer: Tom Parker.

2011 Annual Report Bombay, India. Photographer: Tom Parker.

Index 04 06 06 06 07 11 12 13 14 15 16 Management Report Joint Message from the Chairman of the Board of Directors and the Chief Executive Officer Governing Bodies and Executive Committee Senior Managing Directors Product Divisions, Departments and Units Branches, Subsidiaries and Representative Office Principles and Values Consolidated Financial Highlights Organisational Chart Rating Earnings Distribution Proposal Declaration of Conformity 20 21 22 23 24 25 25 26 27 28 01 Economic Environment International Economic Environment Economic Environment in the Eurozone Economic Environment in Portugal Economic Environment in Spain Economic Environment in the United Kingdom Economic Environment in Poland Economic Environment in the United States of America Economic Environment in Brazil Economic Environment in Angola Economic Environment in India 32 34 44 49 63 70 74 81 84 88 02 Activity Review Investment Banking Business Client Origination Private Banking Capital Markets Corporate Finance Mid-cap Financial Advisory Project Finance and Securitisation Acquisition Finance and Other Lending Private Equity Wealth Management This report is a free translation into English of the original Portuguese version. In case of doubt or misinterpretation on the Portuguese version will prevail. 2 Annual Report 2011

94 03 Human Resources 98 04 Integrated Risk Management Consolidated Financial Statements and Notes Consolidated Financial Statements Notes to Consolidated Financial Statements Individual Financial Statements and Notes Individual Financial Statements Notes to Individual Financial Statements Annexes I Shares and Bonds Held by Members of the Board of Directors and Supervisory Bodies II Shareholder III Adoption of the Financial Stability Forum (FSF) and Committee of European Banking Supervisors (CEBS) Recommendations on Transparency of Information and Assets Valuation IV Corporate Governance Structures and Practices V Remuneration of the Board of Directors and Supervisory Board Members and Relevant Staff (Senior Managing Directors and Control Functions Staff, as per the Definition of Notice 5/2008 of Bank of Portugal) VI Affidavit on the Remuneration Policy of the Board of Directors and Supervisory Board Members VII Remuneration Policy for the Senior Staff of Banco Espírito Santo de Investimento, S.A. (Senior Managing Directors (SMDS), Managing Directors, Executive Directors, Directors, Vice-presidents, Assistant Vice-presidents and Managers) VIII Excerpts from Minutes of the Annual General Shareholders Meeting Held on March 21 st 2012 Espírito Santo Investment Bank 3

IJoint Message from the Chairman of the Board of Directors and the Chief Executive Officer Banco Espírito Santo de Investimento (BESI) developed its activity in 2011 in a climate of strong instability, as the Eurozone sovereign debt crisis, the slowdown of the global economy and the successive sovereign rating downgrades spawned uncertainty within the financial markets. Concerns about the capacity of the peripheral countries (Greece, Ireland and Portugal) to meet their sovereign debt obligations spread to core Eurozone economies such as Spain, Italy and France, eroding confidence, which fell to its lowest level since the Lehman Brothers collapse. Fears about the contagion of the sovereign debt crisis made financial institutions more reluctant to expose themselves to each other, causing a liquidity dry-up and a drastic reduction in the financing of investment. On the other hand, the restrictive policies adopted in the economies subject to contagion as a response to the crisis fuelled the contraction of economic activity and consumption, with a direct impact on the main European economies but also indirectly penalising the whole global economy, including the emerging economies. In May 2011 the Portuguese Government, the European Union, the European Central Bank and the International Monetary Fund agreed on the terms of a EUR 78 billion financial assistance package to Portugal. This agreement established a number of targets to be reached by the national financial institutions in the medium term, including balance sheet deleveraging, reinforcement of capital ratios and improvement of liquidity position, naturally conditioning banking activity during the year. Supported by the reinforcement of its international expansion, the increased weight of its advisory and intermediation businesses, less capital and liquidity intensive, and a higher loan portfolio rotation, BESI s activity proved quite resilient. Banking income totalled EUR 238 million, down by 8.1% on 2010. The Bank posted a net profit for the year of EUR 9.1 million, a year-on-year reduction of 85% that was mainly caused by the deterioration of operating performance, losses on the sale of assets and loans and an increase in credit impairments. Bearing out the Bank s international development strategy, the contribution of the international area to total banking income increased from 65% in 2010 to 72% in 2011. During the year we reinforced our expansion into markets with high growth potential, entering a 75/25 joint venture with a local partner in India, the Burman family. The aim is to develop brokerage activities in a first phase, subsequently consolidating our presence through an investment bank. We are also looking into alternatives to reinforce our presence in Hong Kong, where we already develop a brokerage business through Execution Noble, and to expand our activity in some of the main markets in Sub-Saharan Africa, particularly in Angola, Mozambique and South Africa. In those geographies where the Bank already has a well-rooted presence, we pursued the consolidation of the existing business areas, focusing on intermediation and financial advisory activities: In Portugal, we maintained our leading position, actively participating in the ongoing privatisations programme, namely providing advisory services to China Three Gorges Corporation on its acquisition of 21.35% of EDP Electricidade de Portugal, S.A. and to State Grid Corporation of China on its acquisition of 25% of REN Redes Energéticas Nacionais, SGPS, S.A.; In Spain, our growing penetration in the corporate segment allowed us to participate in several transactions with high market visibility; In Brazil, our activity remained vigorous during the year, especially in the Mergers and Acquisitions (M&A) and capital market business areas, which achieved relevant positions in the local rankings; In the United Kingdom, our efforts focused on reinforcing the activities of Execution Noble with the objective of setting a difference vis-à-vis the competition, namely by promoting the distribution of Iberian, Polish and Brazilian products in the UK market; In Poland, where the Bank achieved remarkable progress, we concentrated on the M&A and capital market activities, leading and participating in various transactions; In the United States, we developed the advisory and intermediation activities with the objective of creating a platform for the distribution of products originated in other geographies; In Mexico we continued to analyse opportunities to develop the project finance and M&A business areas, through our joint representative office with BES. 4 Annual Report 2011

Once again the Bank s strategy translated into leading or very prominent positions in its main business areas: We were considered Best Investment Bank in Portugal in 2011, by the World Finance magazine, and Best Equities House in Portugal and Best M&A House in Portugal in 2011 by the Euromoney magazine; In Mergers & Acquisitions, we remained market leaders in Portugal and Iberia, by number of announced transactions (Bloomberg rankings), and maintained the 5 th position in the Brazilian M&A market, by value of completed transactions (according to ANBIMA); In Capital Markets - Origination, we participated in the most important transactions taking place in all the geographies where we operate. In Brazil, we rubbed shoulders with the largest local and international banks in the structuring of financing and equity sale operations, reaching 11 th place in the respective ANBIMA rankings; In Brokerage, we remained market leader in Portugal, with a market share of 11.7%, and stood in 4 th place in the Madrid Stock Exchange s brokers ranking, with a market share of 7.3%. In Brazil, we advanced five positions in the Bovespa ranking, rising to 25 th place in a universe of roughly 100 brokers, underpinned by our recent creation of a derivatives desk. In Poland, we consolidated our 13 th position in the Polish brokers ranking, with a market share of 2%. In the United Kingdom, we focused our activity on the integration with Execution Noble. In Project Finance and Securitisation, we completed 23 transactions, playing a prominent role in the provision of advisory services. Leveraging on the bank s expertise in the infrastructures and renewable energy sectors, we took several initiatives to exploit alternative financing solutions, namely signing a Memorandum of Understanding with DEG - Deutsche Investitions - und Entwicklungsgesellschaft mbh, a leading development finance institution in Europe, with the aim of originating, structuring and executing financing solutions in Latin America and other developing markets. The outlook for 2012 is marred by persisting uncertainties concerning the resolution of the public finance crisis in the Eurozone, to which add concerns about global and regional economic growth. In this context, we will certainly be facing another year of great challenges, which we are set on tackling with our usual resolve and determination. We will continue to develop our activity with an increased focus on optimising the available resources, with the firm conviction that the strategy we have outlined, and which has steered our activity, will breed opportunities that we will fully exploit, and that will help us surpass the current difficulties. We would like in first place to thank our Clients, whose preference for the Bank in 2011 we wish to reciprocate by increasingly improving the quality and innovation of our services. Our recognition also goes to our Employees, whose effort and dedication are all the more important in periods of greater difficulties. We also express our appreciation to the Supervisory Board and our Auditors for their contribution to the increasingly high standards in accounting and management information reporting, and also to the Bank of Portugal, the Portuguese Securities Market Commission and the supervision authorities in the countries where we are present, for their constant cooperation and the trust placed in Banco Espírito Santo de Investimento. Finally, in our name and on behalf of all the members of the Board, we wish to express our sorrow for the death of Mr. António Espírito Santo Silva Salgado, who will be missed by all of us. Mr. António Espírito Santo Silva Salgado was a member of the Board of Directors since 1990, and his personal and professional qualities were greatly valued. In Acquisition Finance and Other Lending, we concluded several transactions in Portugal, despite the current funding restrictions. Activity in Brazil was quite strong, particularly in structured loans. Ricardo Espírito Santo Silva Salgado Chairman of the Board of Directors In Private Equity, the year was marked by: i) the continuation of works to launch the 2bCapital fund in the Brazilian market, which should be incorporated early in 2012, and ii) the investments totalling EUR 16 million, mainly concentrated in two companies, namely Globalwatt in Portugal and GLT in Spain. José Maria Espírito Santo Silva Ricciardi Vice-Chairman of the Board of Directors and Chief Executive Officer Espírito Santo Investment Bank 5

Governing Bodies and Executive Committee GOVERNING BODIES General Meeting Board Chairman 1 Daniel Proença de Carvalho Secretary José Miguel Alecrim Duarte Board of Directors 2 Chairman Ricardo Espírito Santo Silva Salgado Vice-Chairmen José Maria Espírito Santo Silva Ricciardi Francisco Ravara Cary Rafael Caldeira de Castel-Branco Valverde Miguel António Igrejas Horta e Costa Ricardo Abecassis Espírito Santo Silva Other Members Amílcar Carlos Ferreira de Morais Pires Bernard Marcel Fernand Basecqz Bernardo Ernesto Simões Moniz da Maia Christian Georges Jacques Minzolini Diogo Luís Ramos de Abreu Duarte José Borges Coutinho Espírito Santo Silva Félix Aguirre Cabanyes Frederico dos Reis de Arrochela Alegria João Filipe Espírito Santo de Brito e Cunha José Manuel Pinheiro Espírito Santo Silva Luís Miguel Pina Alves Luna Vaz Moses Dodo Nicholas Mark Finegold Paulo José Lameiras Martins Phillipe Gilles Fernand Guiral Tiago Vaz Pinto Cyrne de Castro EXECUTIVE COMMITTEE Chief Executive Officer (CEO) José Maria Espírito Santo Silva Ricciardi Other Members Francisco Ravara Cary Rafael Caldeira de Castel-Branco Valverde Miguel António Igrejas Horta e Costa Ricardo Abecassis Espírito Santo Silva Christian Georges Jacques Minzolini Diogo Luís Ramos de Abreu Félix Aguirre Cabanyes Frederico dos Reis de Arrochela Alegria Luís Miguel Pina Alves Luna Vaz Moses Dodo Paulo José Lameiras Martins Tiago Vaz Pinto Cyrne de Castro Senior Managing Directors with a seat on the Executive Committee Alan do Amaral Fernandes José Luís de Saldanha Ferreira Pinto Basto Pedro Miguel Cordovil Toscano Rico Executive Committee Secretary Patrícia Salgado Goldschmidt Catanho Meneses Supervisory Board Permanent Members José Manuel Macedo Pereira (Chairman) Tito Manuel das Neves Magalhães Basto Mário Paulo Bettencourt de Oliveira Deputy Member Nuno Espírito Santo Leite de Faria STATUTORY AUDITORS Amável Calhau, Ribeiro da Cunha e Associados - Sociedade de Revisores Oficiais de Contas, represented by José Maria Rego Ribeiro da Cunha Senior Managing Directors Angus Macpherson Aníbal Paço Carl Adams Carlos Ferreira Pinto Carlos Nogueira Carolina Ibañez Charles Ashton Damien Devine Dipesh Patel Fernando Castro Solla Filipa Schubeius Garreth Hodgson João Arantes e Oliveira João Baptista Pereira José Gabriel José Miguel Rego Leonor Dantas Lucas Martínez Luís Sousa Santos Luís Vasconcelos Maria Luísa Baroni Mércia Bruno Miguel Guiomar Nuno Cardoso Patrícia Goldschmidt Paulo Araújo Pedro Ventaneira Ricardo Domenech Rodrigo Carvalho Rui Baptista Sílvia Costa Product Divisions, Departments and Units PRODUCT DIVISIONS Client Origination Pedro Toscano Rico (Portugal) Carolina Ibañez (Spain) Miguel Lins (BES Investimento do Brasil, S.A.) 3 Miguel Borges (United Kingdom) Bartlomiej Dmitruk (Poland) Nuno Cardoso (United States) Paulo Araújo (Execution Noble Limited) Jorge Ramos (Angola) Private Banking Lourenço Vieira de Campos Corporate Finance Leonor Dantas/ Luís Vasconcelos (Portugal) José Miguel Rego (Spain) Maria Luísa Baroni (BES Investimento do Brasil, S.A.) Lukasz Pawłowski (Poland) Daniel Pyne (United States) Angus Macpherson/ Richard Crawley/ John Llewellyn-Loyd (Execution Noble Limited) Tiago Félix (Cross-Border) Mid-cap Financial Advisory Leonor Dantas Acquisition Finance and Other Lending Rui Baptista/ Pedro Ruas (Portugal) Rui Baptista/ Gonzalo de Liñan Amusátegui (Spain) Rui Baptista/ Alan Fernandes (BES Investimento do Brasil, S.A.) Rui Baptista (Poland) Project Finance and Securitisation Luís Sousa Santos (Portugal and Poland) Carlos Álvarez Fernández (Spain) Alan Fernandes (BES Investimento do Brasil, S.A.) Robin Earle (United Kingdom) Carl Adams (United States) Capital Markets - Origination Sílvia Costa (Portugal and Spain) Miguel Guiomar (BES Investimento do Brasil, S.A.) Maciej Ptak/ Krzysztof Rosa (Poland) Angus Macpherson/ Peter Tracey (Execution Noble Limited) Tara Cemlyn-Jones (International) 1 Appointed by the General Meeting of March 31 st, 2011 2 Pedro Manuel Castro Simões Ferreira Neto renounced his position as Member of the Board of Directors and Member of the Executive Committee on June 15 th, 2011. Nicholas Mark Finegold was appointed Member of the Board of Directors on July 14 th, 2011. Board Member António Espírito Santo Silva Salgado passed away on November 21 st, 2011. Nigel Keith Purse left his position as Member of the Board of Directors and Member of the Executive Committee on November 30 th, 2011. 3 Since February 1 st, 2012. 6 Annual Report 2011

Fixed Income Carlos Ferreira Pinto (Portugal and Spain) Roberto Simões (BES Investimento do Brasil, S.A.) Krzysztof Rosa (Poland) Marcus Ashworth (Execution Noble Limited) Treasury Carlos Nogueira (Portugal) Roberto Simões (BES Investimento do Brasil, S.A.) Krzysztof Rosa (Poland) Capital Structure Advisory Cristina Frazão (Portugal and Spain) Global Loan Syndication Lucas Martínez Vuillier (United Kingdom) Thomas Friebel (United States) Global Markets Rui Borges de Sousa (Portugal) Martim Amaral Neto (Spain) Roberto Simões (BES Investimento do Brasil, S.A.) Krzysztof Rosa (Poland) Secondary Market - Equities João Baptista Pereira (Portugal and Spain) Rui Marques (BES Securities do Brasil, S.A.) Rodrigo Carvalho (Poland) Garreth Hodgson (United States) Dipesh Patel (Execution Noble Limited) Nick Paulson-Ellis (Espírito Santo Securities - India) José Martins Soares (Global Equity Research) Martin Dolan (Global Equity Research) Scott Evans (Global Equity Research) Asset Management Fernando Castro Solla (Portugal and Spain) Paulo César Werneck (BESAF BES Activos Financeiros, Lda.) Private Equity João Arantes e Oliveira (Espírito Santo Capital - Sociedade de Capital de Risco, S.A.) Reinsurance Neil Strong (Execution Noble Limited) Wealth Management Francisco Brant de Carvalho / José Carlos Mendes (Espírito Santo Serviços Financeiros DTVM) DEPARTMENTS Compliance Patrícia Salgado Goldschmidt Corporate Communication and Image Pedro Pereira Santos Accounting Pedro Ventaneira Delfina Mendes Information & Documentation Paula Ramalhete Information and Management Reporting Systems Pedro Ventaneira António Pacheco Information Technology Rui Trindade de Sousa Legal Patrícia Salgado Goldschmidt Operations Pedro Ventaneira João Pereira da Silva Organisational Resources José Gabriel Corporate Development José Pinto Basto Human Resources José Gabriel Aníbal Paçó Risk Credit Risk Analysis Filipa Schubeius Rui Brigantim Pereira Risk Risk Control Pedro Ventaneira Luís Pereira UNITS Project Management Office & Change Management Rui Trindade de Sousa Branches, Subsidiaries and Representative Office BRANCHES Spain Félix Aguirre Cabanyes Ricardo Domenech Zamora London Rafael Caldeira de Castel-Branco Valverde Aníbal Jorge Campos Paçó New York Moses Dodo Nuno David Fernandes Cardoso Poland Christian Georges Jacques Minzolini Rodrigo Ferreira Cunha Metelo Carvalho SUBSIDIARIES BES Investimento do Brasil, S.A. - Banco de Investimento (Brazil) Ricardo Abecassis Espírito Santo Silva BES Securities do Brasil, S.A. - Corretora de Câmbios e Valores Mobiliários (Brazil) Ricardo Abecassis Espírito Santo Silva BESAF - BES Activos Financeiros, Ltda. (Brazil) Ricardo Abecassis Espírito Santo Silva Espírito Santo Serviços Financeiros DTVM (Brazil) Ricardo Abecassis Espírito Santo Silva Espírito Santo Capital - Sociedade de Capital de Risco, S.A. (Portugal) Francisco Ravara Cary João Carlos Mendes Reis Arantes e Oliveira Espírito Santo Investment p.l.c. (Ireland) Tiago Vaz Pinto Cyrne de Castro John Patrick Andrew Madigan Execution Noble Limited (United Kingdom) Luís Miguel Pina Alves Luna Vaz Execution Noble (Hong Kong) Limited Luís Miguel Pina Alves Luna Vaz Espírito Santo Securities (India) Luís Miguel Pina Alves Luna Vaz Nick Paulson-Ellis REPRESENTATIVE OFFICE Mexico City Moses Dodo Hugo António Villalobos Velasco Espírito Santo Investment Bank 7

Executive Committee José Maria Espírito Santo Silva Ricciardi Chief Executive Officer (CEO), Vice-Chairman of the Board of Directors, Chairman of the Global Management Committee (Compliance, Legal, Human Resources, Organisational Resources and Information and Management Reporting Systems). Francisco Ravara Cary Deputy Chief Executive Officer, Vice-Chairman of the Board of Directors, Chief Financial Officer, Assets and Liabilities Committee (ALCO), Risk Policies Committee, Global Credit and Risk Management Committee, Europe Credit and Risk Management Committee, Operational Committee, (Treasury, Espírito Santo Capital Sociedade de Capital de Risco, S.A.). Rafael Caldeira de Castel-Branco Valverde Executive Vice-Chairman of the Board of Directors, Senior Country Officer for Portugal, Senior Country Officer for the United Kingdom, Chairman of the Portugal Geography Committee, (Portugal Client Origination, Acquisition Finance and Other Lending, Family Offices, London Branch, London Client Origination and Information & Documentation). Miguel António Igrejas Horta e Costa Executive Vice-Chairman of the Board of Directors (Corporate Communication and Image, Institutional Relations and Premium Clients). Ricardo Abecassis Espírito Santo Silva Executive Vice-Chairman of the Board of Directors, Senior Country Officer for Brazil, Chairman of Brazil Geography Committee, Joint Chairman of the Americas Credit and Risk Management Committee, (Wealth Management, BES Investimento do Brasil, S.A. Banco de Investimento and its subsidiaries, Brazil Client Origination). Christian Georges Jacques Minzolini Executive Board Member, Senior Country Officer for Poland, Chairman of the Poland Geography Committee, (Poland Branch, Espírito Santo Investment Sp. Z.o.o., Secretary General, Corporate Development and Poland Clients Origination). Diogo Luís Ramos de Abreu Executive Board Member (Capital Structure Advisory). 8 Annual Report 2011

Executive Board Member, Senior Country Officer for Spain, Chairman of the Spain Geography Committee (Spain Branch and Spain Client Origination). Executive Board Member, (Global Markets). Félix Aguirre Cabanyes Frederico dos Reis de Arrochela Alegria Executive Board Member, (Capital Markets Origination, Secondary Markets Equity, Fixed Income and Asset Management, Execution Noble Limited and its subsidiaries). Executive Board Member, Senior Country Officer for the United States, Chairman of the United States Geography Committee, Joint Chairman of the Americas Credit and Risk Management Committee (New York Branch, Representative Office Mexico City and Global Loan Syndication). Luís Miguel Pina Alves Luna Vaz Moses Dodo Paulo José Lameiras Martins Executive Board Member, (Corporate Finance and Mid-cap Financial Advisory). Tiago Vaz Pinto Cyrne de Castro Executive Board Member, Senior Country Officer for Ireland, Chief Risk Officer, Chief Operations Officer, (Risk - Risk Control and Credit Risk Analysis, Accounting, Operations, Information Technology, Project Management Office & Change Management, Operational Risk (included in the Compliance Department), Information and Management Reporting Systems and Espírito Santo Investment, p.l.c.). Espírito Santo Investment Bank 9

Senior Managing Directors with a seat on the Executive Committee Alan do Amaral Fernandes Project Finance and Securitisation (Global), Project Finance and Securitisation (Brazil), Acquisition Finance and Other Lending (Brazil). José Luís de Saldanha Ferreira Pinto Basto Corporate Development, Global Loan Syndication. Pedro Miguel Cordovil Toscano Rico Portugal Client Origination. 10 Annual Report 2011

Principles and Values Banco Espírito Santo de Investimento business is built upon the following set of Principles and Values: Ownership A strong identification with the Bank s mission and corporate values and a strong sense of belonging to a team, involving a firm commitment to being an active and participant member. Feel the Bank as his/her own, living intensely its successes and failures. Behave with a strong sense of responsibility in terms of performance and risks in relation to both the Bank and its Clients. Client Orientation Conquer, maintain and develop the Client s trust by means of a professional attitude, focusing on its needs and trying to exceed its expectations, by defining strategies to maximise value and establish a true partnership. Excellence Provide quality services and the potential that results from innovative and creative solutions. Constantly seek perfection by paying attention to the details and obtaining results that exceed expectations. People Orientation Behave towards employees with respect and dignity, giving them room for personal and professional realisation. Respect the knowledge, skills and individuality of every employee. Learning Organization An attitude of continuous learning and innovation, promoting the diversity of ideas and the sharing of information. A permanent search for greater knowledge, making the Bank a source of distinctive knowhow in the market. Passion to Win Show involvement and determination to keep growing, using exceptional levels of energy and motivation. Communication Demonstrate the ability to express opinions and points of view objectively and clearly at the same time as providing others with the space to express and affirm themselves. Enhance the value of information through assertiveness and active listening. Value a consistent, non-hierarchical open-door policy towards people at every level of the organisation, creating the appropriate level of transparency. Think and Act Internationally Be aware of global trends affecting business and informed of relevant business developments in a global context. Be able to assess and estimate how global events may impact local business and vice-versa, developing tasks in a global environment. Respect the differences between the regions where the Bank operates, guaranteeing the integrity of businesses. Ethics and Transparency Align corporate thought and behaviour to respond appropriately to the need for human solidarity and respect for human dignity. Respect regulations and implement corporate rules when developing businesses, always behaving in the best interests of the Bank. A high level of transparency in terms of annual reports, financial accounts and other corporate documents, ensuring that employees, shareholders, regulators, Clients and the market in general are provided with adequate information. Espírito Santo Investment Bank 11

Consolidated Financial Highlights Consolidated Income Statement (EUR thousand) 2011 2010 % Restated Change Consolidated Banking Income 237,934 258,912 (8.1%) Fees and Commissions Income 131,467 139,743 (5.9%) Net Interest Income and Market Results 106,467 119,169 (10.7%) Total Operating Expenses (178,603) (137,836) 29.6% Staff Costs (109,218) (87,652) 24.6% General and Administrative Expenses (63,866) (46,741) 36.6% Depreciation and Amortisation (5,519) (3,443) 60.3% Operating Income 59,331 121,076 (51.0%) Impairment and Provisions (44,169) (38,602) 14.4% Non-controlling interests (212) (4,400) (95.2%) Profit before Income Tax 14,950 78,074 (80.9%) Income Tax (5,889) (17,699) (66.7%) Consolidated Net Profit 9,061 60,375 (85.0%) Consolidated Balance Sheet (EUR thousand) 2011 2010 Restated % Change Assets Financial assets held for trading 1,977,051 2,012,802 (1.8%) - Securities 1,133,978 1,276,023 (11.1%) Available-for-sale financial assets 303,220 695,005 (56.4%) Loans and advances to banks 246,691 372,610 (33.8%) Loans and advances to costumers 2,257,945 2,244,842 0.6% Held-to-maturity investments 727,998 717,736 1.4% Other assets 1,046,880 969,274 8.0% Total Assets 6,559,785 7,012,269 (6.5%) Equity and Liabilities Share Capital 226,269 180,000 25.7% Non-controlling interests 79,322 80,727 (1.7%) Total Equity 606,418 628,316 (3.5%) Financial liabilities held for trading 791,761 626 472 26.4% Deposits from banks 2,452,209 2,313,561 6.0% Due to costumers 859,247 1,338,765 (35.8%) Debt securities issued 1,299,619 1,172,281 10.9% Other liabilities 550,531 932,874 (41.0%) Total Equity and Liabilities 6,559,785 7,012,269 (6.5%) 12 Annual Report 2011

Organisational Chart Board of Directors Executive Committee Project Management Office & Change Management Assets and Liabilities Committee Risk Policies Committee Credit and Risk Management Comittees Global Management Committee Operational Commitee Product Committees Geography Committees Client Origination Private Banking Product Divions Corporate Finance Mid-cap Financial Advisory Acquisition Finance and Other Lending Project Finance and Securitisation Capital Markets - Origination Fixed Income Treasury Capital Structure Advisory Global Loan Syndication Global Markets Equities Secondary Market Asset Management Departments Audit and Inspection (BES GROUP) Compliance Corporate Communication and Image Accounting Information and Documentation Information and Management Reporting Systems Information Technology Legal Operations Organisational Resources Corporate Development Human Resources Risk Espírito Santo Investment Bank 13

Rating In March 2011, Standard & Poor s (S&P) made two successive downgrades of the Republic of Portugal s long and short-term ratings, to BBB-/A3, with negative outlook (from A-/A-2). On December 5 th, 2011, S&P placed Republic of Portugal s ratings on CreditWatch negative, which were downgraded on January 13 th, 2012 to BB/B. In a press release issued in October 2011, Moody s announced the downgrade of BES Investimento do Brasil, S.A. s credit ratings to Ba2/Not Prime, from Ba1/Not Prime (long-term global local-currency deposit rating), and to Aa3.br/BR-1, from Aa2.br/BR-1 (long-term Brazilian national scale deposit rating). As a consequence, the ratings of the Portuguese banks were also revised downward, namely the long-term rating assigned to Banco Espírito Santo de Investimento, S.A., which on March 31 st, 2011 was lowered to BBB-, with negative outlook (from A-). On December 16 th, 2011, after revising its rating methodology for evaluating financial institutions, S&P downgraded the rating of Banco Espírito Santo de Investimento, S.A. to BB, placing it on CreditWatch negative in January 2012 to reflect the rating and outlook of the Republic of Portugal. On February 14 th, 2012, after the Banking Industry Country Risk Assessment revision, S&P downgraded the long-term rating of Banco Espírito Santo de Investimento S.A. to BB-, from BB, removing it from CreditWatch negative. The outlook remained negative. The agency reaffirmed the B short-term rating. With regard to the Bank s subsidiaries, in December 2011, S&P announced a downgrade of BES Investimento do Brasil, S.A. s credit ratings to BB/B, from BB+/B (global scale) and to braa/bra-1, from braa+/bra-1 (Brazilian local scale), both with negative outlook. The rating on the external debt issue in foreign currency was also lowered, to BB, from BB+, with negative outlook. Moody s also lowered the long-term foreign currency deposit rating to Ba2/Not Prime (from Ba1/Not Prime), the long-term foreign currency senior unsecured debt rating to Ba2/Not Prime (from Ba1/Not Prime), both with negative outlook, and the bank financial strength rating to D (from D+). These ratings downgrades reflected the downward revision of the parent company s risk profile following the downgrade of the Republic of Portugal s sovereign credit risk rating. Moody s report highlighted the recent expansion of the loan operations associated with investment banking activities, the good asset quality of the loan portfolio, and the satisfactory profitability ratios of BES Investimento do Brasil, S.A. as a result of the bank s fee-based operations, such as project finance and corporate finance. In a press release issued on February 16 th 2012, S&P announced the downgrade of BES Investimento do Brasil, S.A, s global scale credit ratings to BB-/B (from BB/B) and Brazilian national scale credit ratings to bra/bra-2 (from braa+/bra-1). This revision reflected the downgrades of BES Investimento do Brasil, S.A. s main shareholder ratings, which in turn resulted from the downgrade of the Republic of Portugal s sovereign credit risk rating. The stand-alone credit profile (SACP) of BES Investimento do Brasil, S.A. was left unchanged at BB, the same as that of its main shareholder. S&P based its rating on the company s adequate capitalisation, expertise, brand recognition in its key business segments, and adequate liquidity. 14 Annual Report 2011