Banco Bradesco Sa (BBD)

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Banco Bradesco S.A. (BBD)

Q4 2009 Earnings Call Transcript

January 29, 2010 9:00 am ET

Executives

Luiz Carlos Trabuco Cappi – CEO

Domingos Figueiredo de Abreu – EVP and IR Officer

Analysts

Jorge Kuri – Morgan Stanley

Peter Irblad – Deutsche Bank

Daniel Abut – Citi

David Vaamonde – Fidentiis

Victor Galliano – HSBC

Jason Mollin – Goldman Sachs

Flavimontodu [ph] – BlackRock

Presentation

Operator

Good morning, ladies and gentlemen. We would like to welcome everyone to Banco Bradesco’s fourth quarter 2009 earnings results conference call. This call would be conducted by Mr. Luiz Carlos Trabuco Cappi, Chief Executive Officer; Mr. Domingos Figueiredo de Abreu; Executive Vice President and Investor Relations Officer; Mr. Marco Antonio Rossi, Chief Executive Officer of Bradesco Seguros e Previdencia (Insurance); Mr. Samuel Monteiro dos Santos Junior, Executive Vice President and Chief Financial Officer of Bradesco Seguros e Previdencia (Insurance); Mr. Luiz Carlos Angelotti, Department Officer of Accounting Department.

This call is being broadcasted simultaneously through the internet in the Web site, www.bradesco.com.br/ir. In the address you can also find a banner through which the presentation will be available for download. We inform that all participants will only be able to listen to the conference call during the Company’s presentation. After the presentation, there will a question-and-answer session. At that time further instructions will be given. (Operator instructions).

Before proceeding, let me mention that forward-looking statements are being made under the Safe Harbor of the Securities Litigation Reform Act of 1996. Forward-looking statements are based on the beliefs and assumptions of Banco Bradesco’s management and on information currently available to the Company.

Forward-looking statements are not guarantees of performance, they involve risks, uncertainties and assumptions, because they relate to future events and therefore depend on circumstances that may or may not occur in the future.

Investors should understand that general economic conditions, industry conditions and other operating factors could also affect the future results of Banco Bradesco and could cause results to differ materially from those expressed in such forward-looking statements.

Now, I will turn the conference over to Mr. Luiz Carlos Trabuco Cappi, Chief Executive Officer. Mr. Trabuco, you may proceed.

Luiz Carlos Trabuco Cappi

Thank you. Good morning, everyone. Welcome to our conference call. First of all I would like to thank you all for accepting our invitation to take part in this conference at which we will present the 2009 results. The 2009 yearly conference, in the first semester, we had an adverse economic climate and a negative feeling, but we decided to maintain liquidity and credit lines to our client.

In the second semester, we saw a recession of the positive expectation for 2010 with the arrival of our new class of the consumers as a result of the social mobility, social inclusion and the popular asset to the banking system by the CDs and the elite classes.

Despite this, Bradesco is maintaining its investments. During these two semesters, we continued to expand our advanced network and investments. We opened 441 branches and the sub branches and ended at 2009 with 6015 attendance points. We set up 4,139 Bradesco Expresso units, bringing our network of 10,200 correspondent banking postal.

This was also a year marketed by national integration during which Bradesco consolidated its presence in a 100% of 5,564 Brazilian municipalities. We also opened the first floating banking branch in the world on about on the River Solimões or Amazonas.

In terms of the results, we are presenting net income of the R$8.012 billion, 66% of this income came from the financial sector and 34% from the insurance sector. Assets totaled 506.2 billion. Shareholders' equity ended the period at R$41.7 billion. The complete statement will be presented in statement by our colleague, Abreu.

In terms of the loan portfolio, we ended this year with volume of R$228 billion. We granted new loans amounted to R$243.2 billion and the average turnover period for the credit was 247 days.

In terms of our IT model, we continued to believe that technology brings commercial benefit. The pillars of the new architecture of the systems are flexibility, agility and simplifying profit.

In terms of our organization model, we are reinforcing the qualitative management, style directly at the convergence of the business segment bringing gains of the synergy. At the same time we have an advanced development program for our executives.

Our business model involves operating by segment. The retail segment ended last year at 20.9 million account holder client and 800,000 new accounts. We opened 1.9 million saving accounts.

For 2010, we foresee the inauguration of the 250 branches which will lead to an increase in sales and efficiency. The prime segment reserved special attention and now has national coverage with 277 branches in 25 Brazilian states. The middle segment will add an extra third branches to its current network of the 69 point and will continue to operate within the production chance concept.

The corporate segment attained the 1,200 largest Brazilian economics growth. It’s operated in complete synergy with the investment bank. Our investment banking took part in the main capital market operation carried out in Brazil. We are second in the ranking of the fixed income operation with 25 operations and a 19% of the market share.

The investment banking is in 5th position in the variable income ranking with a 10% market share. Looking at the order size decline, the insurance group presented this net income of R$2.723 billion with an impressive return on equity of 27.90%.

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