Banco Bradesco Sa (BBD)

BBD 
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TRANSCRIPT SPONSOR
Wall Street Breakfast

Banco Bradesco S.A. (BBD)
Q2 2007 Earnings Call
August 7, 2007, 10:00 AM ET

Executives

Jean Philippe Leroy - Department Director
Milton Vargas - EVP and IR Officer
Samuel Monteiro de Santos Jr. - CFO

Analysts

Maria Laura Pessoa - Fator-Doria Atherino
Mario Pierry - Deutsche Bank
Daniel Abut - Citibank
Saul Martinez - Bear Stearns
Victor Galliano - HSBC

Presentation

Operator

Good morning ladies and gentlemen. We would like to welcome everyone to Banco Bradesco's 2007 Second Quarter Results Conference Call. This call will be conducted by Mr. Marcio Artur Laurelli Cypriano, Chief Executive Officer; Mr. Milton Vargas, Executive Vice President and Investor Relations Officer; Mr. Domingos Figueriredo de Abreu; Managing Director; Mr. Samuel Monteiro de Santos Jr., Chief Financial Officer of Bradesco Seguros Insurance and Mr. Jean Philippe Leroy, Department Director.

This call is being broadcasted simultaneously through the Internet in the website www.bradesco.com.br/ir. In that 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 be 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. Jean Leroy, Department Director. Mr. Leroy, you may proceed with your statements.

Jean Philippe Leroy - Department Director

Thank you again. Good morning everyone and welcome to our conference call. First of all, let me say that we are sorry for the delay in this call as we were receiving a lot of questions in the other conference call where the local community was attending. And let me now transfer the floor to Milton Vargas, our CFO and IRO for his comments and Bradesco's highlights, one can follow on slide no. 3 of the PowerPoint presentation. Thank you.

Milton Vargas - Executive Vice President and Investor Relations Officer

Good Morning and welcome to our conference call. In the first half of 2007, the Brazilian economy had recorded a substantial recovery in terms of business activity and investments. And we see no sign that this trend will be changing in the second half of the year. Despite our lack of infrastructure economic outlook is very strong given that the public accounts are well managed in and the investments are rising and becoming more and more diversified across sectors.

Our forecast for the year points to a 4.9% of GDP growth and 3.5% CPI and on the top of that unemployment is expected to be the lowest for the past six years falling to 9.6%. The reserves in foreign core currency are already close to the impact of some up to $150 billion due to a solid inflow of the CDI and our very strong [Indiscernible].

We expected a 1.8 real per dollar FX rate at the year-end. Card operations has been evolving in a significant manner due to interest rate decrease and the expansion of internal, belong to this deterioration is expanding now at 32.3% and should continue to speed up to year-end to 34.3% impacted by some non-recurring events that will recover in representation but [indiscernible] our focused effort has net income of more than 4 billion reais, 28% higher than in the same period of 2006.

Insurance, pension plans and savings bonds continue to be one of our major pillars of contribution to pass 1.2 billion reais net income in the first half keeping the leadership in premiums both in Brazil and Latin America.

The insurance group closed the first half with 62 billion reais in finance assets and 53 billion reais in the technical provision. But this causes continued improving efficiency. Our 12 month efficiency ratio stood at 40.2% in this semester showing a gradual improvement in efficiency ratios.

Taxes and contribution reached 3.6 billion reais equivalent to 93% of Bradesco's net income. The reported return on average assets reached 36.3%.

On the operational front, Bradesco performed very well. In the first six months of 2007, the loan book grew by 12.6%. 92.4% of our operations are related from [indiscernible], to speed. In other words, we are expanding our loan portfolio and achieving better credit quality.

As our sound growth of Bradesco is reflected to the Brazilian economy, we are leading the ranking of larger investment of BNDES Onlendings operations for the 5th consecutive year.

In markets, Bradesco originated 1.5 billion reais in operations, financing margin in 13,000 homes in the first half of 2007. On a year-over-year comparison, we grew 70% in volume and 120% growth in number of homes. Repeating the same performance as of the previous years, Bradesco impresses our middle market oriented platform. Platform grew by 60% its assets in the first half of the year.

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