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ITAÚ DAY

ITAÚ DAY. Presentations by: Sérgio Werlang - Macroeconomic Perspectives - Executive Director Former Brazilian Central Bank Board Member Alfredo Setubal - 2006 Results & 2007 Strategy Executive Vice President IR Officer. Brazil economic outlook. March 1, 2007.

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ITAÚ DAY

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  1. ITAÚ DAY Presentations by: Sérgio Werlang - Macroeconomic Perspectives - Executive Director • Former Brazilian Central Bank Board Member Alfredo Setubal - 2006 Results & 2007 Strategy • Executive Vice President • IR Officer Ouvidora Corporativa Itaú

  2. Brazileconomic outlook March 1, 2007

  3. Higher global growth leading to higher commodity prices

  4. China’s leading role on current commodity cycle Log (CRB metals)

  5. Benefiting from this benign scenario

  6. How Brazil has used these larger funds? Source: Central Bank

  7. How Brazil has used these larger funds? Source: Central Bank

  8. How Brazil has used these larger funds? Source: Central Bank

  9. Result: low risk & strong currency Sources: Central Bank, Bloomberg & Banco Itaú

  10. Inflation convergence Headline and core CPI (% y-o-y) Source: IBGE

  11. Falling but still high real rates

  12. Growth has been disappointing Sources: IMF & IBGE

  13. Public accounts tell us good stories Source: Central Bank

  14. Fiscal accounts Primary surplus reduction due to public investment increase (0.5% of GDP) Payroll expenditure control: inflation plus 1,5% Minimum wage increase for the next 5 years : negative impact on social security accounts Small tax exemptions Social security reform – Unlikely in this administration PAC: Acceleration Growth Program

  15. Increase of regional government borrowing limits to housing, water & sewage investments Better regulatory environment Natural gas Regulatory agencies Environment PAC: Acceleration Growth Program

  16. Congressional autonomy Judiciary independence Rule of law Institutional Framework

  17. Investment grade: how far is it?

  18. Baseline scenario

  19. Baseline scenario

  20. For further information: Sérgio Ribeiro da Costa Werlang sergio.werlang@itau.com.br Tomás Málaga tomas.malaga@itau.com.br

  21. New York March 1, 2007 Alfredo Setubal Investor Relations Director

  22. International Presence Member of Dow Jones Sustainability Indexes 06/07 • 7th consecutive year • Only Brazilian Bank on the Index Best Brazilian Bank 2006, 2005, 2004, 2003, 2002, 2001, 2000, 1999, 1998 Best Brazilian Bank 2005, 2004, 2003, 2002, 1999 Best Brazilian Bank 2004, 2003, 2002, 2000, 1999 Itaú stock is negotiated on the São Paulo, Buenos Aires and New York Stock Exchanges R$ Million December 31th, 2006 Assets Stockholders’ Equity Foreign Branches 6,754 1,867 Itau Bank 4,478 1,202 Banco Itaú Europa 8,751 1,240 Banco Itaú Buen Ayre 1,442 218 Itaú BBA & subsidiaries 13,826 2,250 Consolidated 31,264 7,745

  23. Highlights • 4thQ. Results • Mortgage • Strategy by Segment • ADR’s Evolution • Creation of Shareholder Value

  24. Highlights Evolution of Stockholders’ Equity and Net Income R$ Million Jan/90 to Dec/06 Dividends: R$ 10.9 Billion Increase of Capital: R$ 0.1 Billion Argentina Crisis Real Devaluation Attack to WTC 6,195(*) Brazilian Election Period CAGR(90-06) = 15.9% Russian Crisis Asian Crisis CAGR(90-05) = 21.9% Mexican Crisis Real Plan Collor Plan Adaptability to Different Scenarios (*) Recurring Net Income

  25. Highlights Itaú: Credit Ratings A long and consistent performance record is reflected in the ratings awarded by international risk classification institutions • Consistent strong financial performance • Operational efficiency • Significant international presence, cutting back domestic volatility • Strong capitalization and provisioning • Equity quality SHORT TERM LONG TERM B BB+ International brA-1 brAA+ Domestic SHORT TERM LONG TERM Financial Strength = C International BR-1 Aaa.br Domestic Investment Grade in: • Portugal since 2000 • Cayman since 2006 SHORT TERM LONG TERM International B BB+ Domestic F1+(bra) AA+ (bra)

  26. Highlights Assets (R$ Billion) Stockholders’ Equity (R$ Billion) 38.7% 51.3% Credit Operations (R$ Billion) Growth of Deposits and Asset Management (in R$ billions) 38.2%

  27. Highlights Banking Services Fees + Insurance, Pension and Cap.Revenues (in R$ billions) Financial Margin (in R$ billions) CAGR = 22.2% 27.8% 20.0% CAGR = 17.4% 10.2 8.5 7.0 5.8 5.0 4.3 3.9 Net Income (in R$ billions) Non-interest Expenses (in R$ billions) 22.6% 6.5 CAGR = 12.7% CAGR = 23.9% 17.1% Itaú Itaú + BKB Insurance, Pension & Cap.

  28. Highlights Average ROE (%) BIS Ratio (%) +0.2 p.p. -12.6 p.p. Average ROA (%) Efficiency Ratio (%) -1.2 p.p. -2.7 p.p.

  29. Highlights Branches+CSBs ATMs 6.6% 4.9% Employees Internet Banking Clients (In million) 17.4% 13.0% 59,921 51,036 45,316 Itaú Itaucred

  30. Highlights • 4thQ. Results • Mortgage • Strategy by Segment • ADR’s Evolution • Creation of Shareholder Value

  31. 4thQ. Results 1.Results: • Q4/06: Recurring Net Income of R$ 1,628 million, 2.3% increasecompared to Q3/06; annualized ROE of 28.8%. (Full Year 2006: Net Income of R$ 6,195 million and ROE of 32.6%). • Q4/06: Net Income of R$ 1,280 million (Year 2006: Net Income of R$ 4,309) 2.Effects of BankBoston (BKB) acquisition in Brazil, Chile and Uruguay • Payment – Capital increase in Itaú (R$ 5,954 million), transferring common and preferred shares to Bank of America (7.44% of the total capital of Itaú). • Effects of BKB acquisition amounted R$ 2,171 million, net of tax effects. 3.38.2% growth in credit portfolio during 2006, including BKB, and of 24.7%, not considering BKB. • Vehicles: 64.7% in 2006 and of 14.3% in Q4/06. • Small and Medium Sized Companies: 59.9% (including BKB), 22.4% (excluding BKB) and 3.5% in Q4/06. • 5.3% delinquency ratio as of December 31, 2006, stable Q-Q. • .

  32. 4thQ. Results Non-recurring Effects – After Tax R$ Million 1 For more details, see page 4 of Management Discussion and Analysis Report. 2For more details, see Notes to Financial Statements 2a and 21i.

  33. 4thQ. Results R$ Million (Except where indicated) 1 Based on the average quotation of the last trading day in the period. It includes the number of shares related to BKB Chile and Uruguay acquisition. 2

  34. 4thQ. Results Itaú Holding Pro Forma R$ Million (Except where indicated)

  35. 4thQ. Results Credit Operation by Client Type R$ Million (Except where indicated) Not considering BKB contribution, total loans reached R$ 84,497 million, an increase of 24.7% in 2006. 1 Rural and Mortgage Loans – Loans linked with the balances of Demand and Savings Deposits.

  36. 100% 90% 28.6% 29.6% 29.8% 31.9% 32.9% 32.4% 34.8% 37.6% 39.0% 80% 70% 6.3% 6.2% 6.4% 6.3% 6.7% 6.9% 7.2% 60% 7.6% 8.5% 18.8% 21.8% 22.0% 19.1% 18.9% 18.7% 50% 19.0% 18.4% 18.2% 40% 30% 45.5% 42.8% 43.2% 41.5% 42.0% 41.8% 20% 38.9% 36.4% 34.3% 10% 0% Dec-04 Mar-05 Jun-05 Sep-05 Dec-05 Mar-06 Jun-06 Sep-06 Dec-06 Individuals Small and Medium-Sized Companies Mandatory Loans Corporate 4thQ. Results Credit Portfolio Break down

  37. 8.3% 8.1% 8.1% 5.3% 5.2% 5.1% 2.2% 2.1% 1.6% Jun/06 Sep/06 Dec/06 4thQ. Results Delinquency and Coverage Ratios Delinquency Ratios Delinquency Ratio - Global Delinquency Ratio - Individuals Delinquency Ratio - Companies (*) Provision for loan losses / Credits overdue for more than 60 days, which are not accrued.

  38. 4thQ. Results Delinquency Ratio (NPL) by Segment R$ Million

  39. 4thQ. Results Funding R$ Million (except where indicated) 1 Includes Repurchase Agreement – Own Issue Securities

  40. 4thQ. Results Banking Service Fees R$ Million (Except where indicated) Not considering BKB, Banking Service Fees reached R$ 8,718 million in 2006, increase of 12.7% compared to 2005. 1Investment Funds and Consortium.

  41. 4thQ. Results Non Interest Expenses R$ Million (Except where indicated) Not considering BKB, Non Interest Expenses reached R$ 11,470 million in 2006, increase of 9.7% compared to 2005. 1 It does not include PIS, COFINS and ISS

  42. 4thQ. Results Efficiency Ratio 1 50.3% 47.6% 1 For further details on the criteria used, see slide 4.

  43. Highlights • 4thQ. Results • Mortgage • Strategy by Segment • ADR’s Evolution • Creation of Shareholder Value

  44. Mortgage Housing Financing in Brazil – 3 Time Periods Number of Financed Houses (thousands) I – BRAZILIAN MIRACLE II – CRISIS III – REAL PLAN • Hyper inflation • High default rate on loans • Weak regulatory framework for mortgage loans • Interest rate mismatch • End of BNH in 1986 • Strong Economic Growth • Creation of BNH (National Habitation Bank) in 1966 • Macroeconomic stability (Real Plan - 1994) • High interest rate • Improved regulatory framework Years Source: BNDES

  45. Mortgage Mortgage Loan as a Percentage of GDP BRAZIL Source: Central Bank Data, Merrill Lynch estimates Note: Most data end-2005, some end 2004

  46. Highlights • 4thQ. Results • Mortgage • Strategy by Segment • ADR’s Evolution • Creation of Shareholder Value

  47. Itaú Itaubanco Itaú BBA Itaucred Corporation Banking Corporate Operations & Investment Banking Vehicles Cards – Current Account Holders Cards – Non Current Account Holders Insurance, Pension Plans and Capitalization Taií, FIC (CBD) and FAI (LASA) Investment Funds and Managed Portfolio Strategy by Segment Segmentation (Pro forma) NB: The organization chart of Itaucred segment reflects, chiefly, the transactions carried out through channels intended for non current account holders.

  48. Strategy by Segment Highlights of Pro Forma Segments R$ Million (Except where indicated) 1 It does not represent the sum of the parts, because there are transactions between the segments eliminated in the consolidated figures only.

  49. Strategy by Segment Highlights of Pro Forma Segments R$ Million (Except where indicated) 1 It does not represent the sum of the parts, because there are transactions between the segments eliminated in the consolidated figures only.

  50. Strategy by Segment Interest Rate Sensitivity R$ Million (Except where indicated)

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