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Institutional presentation 3_q15

Pine is a Brazilian bank focused on providing financial solutions to corporate clients. It has a long history dating back to 1939 and focuses on establishing long-term client relationships. The bank has three primary business lines: corporate credit, financial instruments and commodities trading (FICC), and investment banking services. In 3Q15, Pine emphasized deleveraging its loan portfolio due to Brazil's worsening economic conditions, pre-paid some funding obligations, and continued reducing expenses to maintain strong capital ratios and asset quality.

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Institutional PresentationInstitutional Presentation 3Q15
2/32Investor Relations | 3Q15 | Profile and History Pine History Business Strategy Competitive Landscape Focus Always on the Client Corporate Credit FICC Pine Investimentos Highlights and Results Corporate Governance Corporate Governance Committees Social Investment and Responsibility Summary
Profile and History
4/32Investor Relations | 3Q15 | Over R$2 billion 36% R$500 million to R$2 billion 34% Up to R$500 million 30% Pine Specialized in providing financial solutions for corporate clients… Credit Portfolio by Annual Client Revenues Profile Focused on establishing long-term relationships Profound knowledge and product penetration Business is structured along three primary business lines: • Corporate Credit: credit and financing products • FICC: instruments for hedging and risk management • Pine Investimentos: Capital Markets, Financial Advisory, Project & Structured Finance and Research September 30th, 2015
5/32Investor Relations | 3Q15 | 184 222 341 521 620 755 663 761 1,214 2,854 3,105 4,192 5,763 6,963 7,912 9,920 9,826 7,691 62 121 126 140 136 152 171 209 335 801 827 825 867 1,015 1,220 1,272 1,256 1,181 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 sept/15 Corporate Credit Portfolio (R$ Million) Shareholders' Equity (R$ Million) ...with extensive knowledge of Brazil’s corporate credit cycle. History 1997 Noberto and Nelson Pinheiro sell their stake in BMC and found Pine 1939 Pinheiro Family founds Banco Central do Nordeste 1975 Noberto Pinheiro becomes one of BMC’s controlling shareholders Devaluation of the real Nasdaq Sept. 11 Brazilian Elections (Lula) SubprimeAsian Crisis Russian Crisis European Community End of 2007 Focus on expanding the Corporate Banking franchise Discontinuation of the payroll-deductible loan business May, 2007 Creation of Pine Investimentos products line and opening of the Cayman branch 2005 Noberto Pinheiro becomes Pine’s sole shareholder October, 2007 Beginning of the FICC Business October, 2011 Subscription of Pine’s capital by DEG August, 2012 Subscription of Pine’s capital by DEG, Proparco, Controlling Shareholder and Management November, 2012 Opening of the broker dealer in New York, Pine Securities USA LLC March, 2007 IPO May, 2015 18 years
Business Strategy
7/32Investor Relations | 3Q15 | Competitive Landscape Pine serves a niche market of companies with few options for banks. 100% focused on providing complete service to companies, offering customized products Corporate & SME SME & Retail Retail 100% Corporate Large Multi-Services banks Market Consolidation of the banking sector has decreased the supply of credit lines and financial instruments for corporate Foreign banks are in a deleveraging process PINE Full service Bank – Credit, Hedging, and Investment Bank products – with room for growth ~15 clients per officer Competitive Advantages:  Focus  Fast response: Strong relationship with clients, with the credit committee meeting twice a week and response times to clients of no more than one week  Specialized services  Tailor-made solutions  Product diversity Foreign and Investment Banks
8/32Investor Relations | 3Q15 | Focus Always on the Client Products tailored to meet the needs of each individual client. Working Capit CDIs Bank Guarantees Exclusive Funds Portfolio Management Swap NDFs Structured Swaps BNDES Onlending Bank Guarantees Compror ACC/ACE Export Finance Finimp Lettersof Credit 3,884 Onlending Overdraft Accounts Syndicated and Structured Loans Fixed Income Currencies Commodities Equities CDBs CDs RDBs LCAs LCIs DebenturesCRIs Eurobonds Private Placements Financial Letters Clients Treasury Corporate Credit FICC Pine Investimentos Distribution Capital Markets Financial Advisory Local Currency Foreign Currency Fixed Income Currencies Commodities Pricing of Assets and Liabilities Liquidity Management Trading Local Currency Onlending Foreign Currency Trade Finance Participation Funds Options Working CapitalUnderwriting Corporate & Structured Finance M&A Project Finance Structured Finance Private Credit Funds Real Estate Funds Rural Credits Aircraft Financing Investment Management In addition to the headquarters located in the city of São Paulo, Pine has 7 branches throughout Brazil, in the States of Ceará, Mato Grosso, Paraná, Pernambuco, Rio de Janeiro, Rio Grande do Sul, and São Paulo. The origination network also counts with a Cayman Branch and a broker dealer in New York (USA).
9/32Investor Relations | 3Q15 | Corporate Credit Actions Credit Committee Strong track record and solid credit origination and approval process. Credit Approval: Electronic Process Origination Officers Credit origination Credit analysis, visit to clients, data updates, interaction with internal research team Credit Analysts Regional Heads of Origination and Credit Analysis Presentation to the Credit Committee CRO, Executive Directors and Analysts of Credit Centralized and unanimous decision making process CREDIT COMMITTEE Meets once a week – reviewing 20 proposals on average Minimum quorum: 4 members - attendance of CEO or Chairman is mandatory Members: Chairman of the Board CEO Chief Risk Officer Chief Financial Officer Participants: FICC Executive Director Credit Analysts Team Other members of the Corporate Banking origination team Personalized and agile service, working closely with clients and keeping a low client to account officer ratio: each officer handles ~15 economic groups Geographic coverage of clients, providing the bank with local and extremely up-to-date credit intelligence and information Established long term relationships with more than 600 economic groups Origination network is comprised of 10 branches divided into 14 origination platforms in Brazil’s major economic centers Pine has approximentely 25 professionals in the credit analysis area, assuring that analysis is fundamentally driven and based on industry-specific intelligence Efficient loan and collateral processes, documentation, and controls, which has resulted in a low NPL track record Discussion on sizing, collateral, structure etc.
10/32Investor Relations | 3Q15 | Commodities 13% Fixed Income 15% Currencies 72% September 30th, 2015 Scenario on September 30th, 2015: Duration: 220 days Mark-to-Market: R$560 million Stress Scenario (Dollar: +31% and Commodities Prices: -30%): Stressed MtM : R$894 million R$ million FICC Solid trackrecord Client Notional Derivatives by Market Market Segments Notional Value and MtM Portfolio Profile Fixed Income: Fixed, Floating, Inflation, Libor Currencies: Dollar, Euro, Yen, Pound, Canadian Dollar, Australian Dollar Commodities: Sugar, Soybean (Grain, Meal and Oil), Corn, Cotton, Metals, Energy 8,376 7,703 7,482 7,948 3,270 6,045 288 221 349 366 560 514 -47 -365 -103 33 894 239 Sept-14 Dec-14 Mar-15 Jun-15 Sept-15 Oct-15 Notional Amount MtM Stressed MtM
11/32Investor Relations | 3Q15 | September, 2015 Infrastructure Debentures Lead Coordinator September, 2015 Debentures Coordinator R$10,300,000R$500,000,000 July, 2015 Project Finance R$104,000,000 Coordinator R$45,200,000 November, 2014 Debentures Lead Coordinator December, 2014 BNDES Onlending R$630,000,000 Coordinator July, 2015 February, 2015 March, 2015 Project Finance R$78,000,000 Coordnator Project Finance R$30,000,000 Lead Coordinator Structuring CRP R$24,000,000 Lead Coordinator R$20,000,000 June, 2015 CRI Lead Coordinator 2 5 2Q15 3Q15 11 10 9M14 9M15 R$ million Pine Investimentos Fee Generation Selected Transactions Capital Markets: Structuring and Distribution of Fixed Income Transactions. Financial Advisory: Project & Structured Finance, M&A, and hybrid capital transactions. Research: Macro and Commodities.
Highlights and Results
13/32Investor Relations | 3Q15 | 3Q15 Events and Highlights 1.Positive liquidity gap in the past years, with 401 days for credit versus 486 days for funding. 2.Liquid balance sheet with a cash position equivalent to 41% of time deposits. 3.Deeper deleveraging strategy in the loan portfolio, given the worsening of the economic scenario. 4.Voluntary pre-payment of the FIDC AGRO senior quotas amounting to R$340 million, in line with the Bank’s constant and active liability management. 5.Loan portfolio coverage ratio above 4% as a result of preventive provision increases in the last fifteen months. 6.Further reduction of expenses, as a result of the diligence and anticipation of an adverse market in 2015.
14/32Investor Relations | 3Q15 | 3Q15 Financial Highlights 1 Includes Stand by LCs, Bank Guarantees, Credit Securities to be Received and Securities (bonds, CRIs, eurobonds and fund shares) R$ million The main performance indicators were within expectations in the period. 3.3% 2.9% 2Q15 3Q15 NIM Evolution -40 bps 10 10 2Q15 3Q15 Net Income 3.3% 3.5% 2Q15 3Q15 ROAE +20 bps 1,208 1,181 Jun-15 Sept-15 Shareholders' Equity -2.2% 8,621 7,691 Jun-15 Sept-15 Total Loan Portfolio 1 -10.8% 7,564 7,409 Jun-15 Sept-15 Total Funding -2.0%
15/32Investor Relations | 3Q15 | R$ million 3Q15 2Q15 3Q14 9M15 9M14 Financial Margin Income from financial intermediation 1 80 92 135 297 Overhedge effect 55 (10) 4 79 (2) Income from financial intermediation ex overhedge 56 70 96 214 296 Net Interest Margin NIM Evolution Main Impacts NIM Breakdown Lower participation in revenues from FICC business and Treasury; Mark to market of securities and derivatives according to 4.277 Resolution of the Central Bank of Brazil; Voluntary pre-payment of the FIDC senior quotas; and Marginal increase in spreads. 3.3% 2.9% 2Q15 3Q15 -40 bps
16/32Investor Relations | 3Q15 | 24 22 2222 17 20 35.4% 44.9% 50.6% -100% -80% -60% -40% -20% 00% 20% 40% 60% 0 5 10 15 20 25 30 35 40 45 50 3Q14 2Q15 3Q15 70 6668 55 37.5% 44.3% -100% -80% -60% -40% -20% 00% 20% 40% 60% 0 20 40 60 80 100 120 140 9M14 9M15 Personnel Expenses Other administrative expenses Recurring Efficiency Ratio (%) Expenses and Efficiency Ratio Expenses Efficiency Ratio Rigorous cost control. R$ million 3Q15 2Q15 3Q14 9M15 9M14 Operating expenses1 44 48 49 137 146 (-) Non-recurring expenses (4) (4) (4) (9) (9) Recurring Operating Expenses (A) 41 44 45 128 137 Recurring Revenues2 (B) 81 98 127 289 365 Recurring Efficiency Ratio (A/B) 50.6% 44.9% 35.4% 44.3% 37.5% 1 Other administrative expenses +tax expenses +personnel expenses 2 Gross Income from financial intermediation - provision for loan losses +fee income +overhedge effect - hedge impact
17/32Investor Relations | 3Q15 | 1 Includes Stand by LC 2 Includes debentures, CRIs, Hedge Fund Shares, Eurobonds, Credit Portfolio acquired from financial institutions with recourse and Individuals R$ million Loan Portfolio The portfolio amounted to R$7.7 billion... -21.5% -10.8% 1 2 4,509 5,050 5,093 4,904 4,731 4,730 4,440 4,066 3,650 990 1,068 1,103 1,071 1,248 1,302 1,118 1,074 924 3,073 2,909 2,905 2,941 2,896 2,969 3,191 2,896 2,492 965 903 989 1,116 924 826 909 585 626 Sept-13 Dec-13 Mar-14 Jun-14 Sept-14 Dec-14 Mar-15 Jun-15 Sept-15 Trade finance: 8.1% Bank Guarantees: 32.4% BNDES Onlending : 12.0% Working Capital: 47.5% 9,657 8,621 7,691 9,537 9,930 10,090 10,032 9,800 9,826
18/32Investor Relations | 3Q15 | 38%38%40%41%41% 7%7%6%5%6% 9%9%8%9%6% 10%10%11%8%9% 12%12%14%14%16% 12%12% 12%14%12% 12%12%9%9%10% Sept-15Jun-15Sept-14Sept-13Sept-12 Energy Real Estate Sugar and Ethanol Agriculture Engineering Transportation and Logistics Others Continuous Loan Portfolio Management Sectors Rebalance ...with improved sector diversification. The composition of the portfolio of the 20 largest clients changed by over 20% in the past twelve months; The share of wallet of the 20 largest clients remained below 30%, in line with market peers. Energy 12% Real Estate 12% Sugar and Ethanol 12% Agriculture 10% Engineering 9% Transportation and Logistics 7% Specialized Services 4% Telecom 4% Chemicals 4% Foreign Trade 3% Metallurgy 3% Retail 3% Vehiclesand Parts 3% Construction Material 2% Meatpacking 2% Food Industry 1% Other 9%
19/32Investor Relations | 3Q15 | SP 68% MG 22% PR 8% GO 2% Working Capital 48% Guarantees 31% BNDES Onlending 12% Trade Finance 9% Working Capital 77% Guarantees 23% Residential Lots 39% Residential 37% Warehouse 12% Mall 8% Commercial 4% Guarantees 59% Working Capital 31% BNDES Onlending 10% Wind Power 67% UTE 1% Distributors 13% Transmitting 9% Equipment Supplier 6% SHPs UHEs 4% Main Sectors Energy| Real Estate | Agriculture Energy (12%) Real Estate (12%) Sugar and Ethanol (12%) Exposure by Product Exposure by Segment Exposure by Product Exposure by Segment Exposure by Product Exposure by State
20/32Investor Relations | 3Q15 | MT 31% SP 29% BA 11% PR 10% MG 8% Others 11% Concession 33% Transporta- tion 33% Industrial 25% Oil and Gas 7% Energy 2% Working Capital 64% BNDES Onlending 19% Trade Finance 15% Guarantees 1% Working Capital 83% Guarantees 13% BNDES Onlending 4% Main Sectors Agriculture| Engineering Agriculture (10%) Engineering (9%) Exposure by Product Exposure by Product Exposure by SegmentExposure by State
21/32Investor Relations | 3Q15 | AA-A 37.7% B 29.5% C 25.1% D-E 4.3% F-H 3.4% 1.1% 0.7% 0.1% 0.7% 0.3% 0.3% 1.1% 2.1% 1.8% Jun-13 Sep-13 Dec-13 Mar-14 Jun-14 Sep-14 Dec-14 Mar-15 Jun-15 September 30th, 2015 Contracts Overdue: total amount of the contracts overdue for more than 90 days / Loan Portfolio excluding Bank Guarantees and Stand-by Letters of Credit. 1D-H Portfolio: D-H Portfolio / Loan Portfolio Res. 2,682 2Coverage of Total Portfolio: Provisions / Loan Portfolio Res. 2,682 3Coverage D-H Overdue Portfolio: Provisions / D-H Overdue Portfolio Loan Portfolio Quality 92.3% of the loan portfolio is classified between AA-C ratings. Loan Portfolio Quality – Res. 2,682 Credit Coverage Non Performing Loans > 90 days (Total Contract) Collaterals 1 2 3 0.7% 0.1% 0.7% 0.3% 0.3% 1.1% 2.1% 1.8% 1.2% set-13 dez-13 mar-14 jun-14 set-14 dez-14 mar-15 jun-15 set-15Sept-13 Dec-13 Mar-14 Jun-13 Sept-14 Dec-14 Mar-15 Jun-15 Sept-15 Products Pledge 41% Receivables 15% Properties Pledge 41% Investments 3% 1,628% 172% 127% 50% 1.050% 2.050% 4.2% 6.6% 7.7% 2.1% 4.1% 4.1% 00% 02% 04% 06% 08% 10% 12% 00% 01% 02% 03% 04% 05% 06% 07% 08% 09% 10% Sept-14 Jun-15 Sept-15 D-H Portfolio Coverage of Total Portfolio Coverage of D-H Overdue Portfolio
22/32Investor Relations | 3Q15 | R$ million Funding Diversified sources of funding... 58% 48% 48% 47%41%39% 41% 35% 41% Cash over Deposits -14.2% 1,944 2,175 2,314 2,271 1,905 1,720 1,209 951 853 1,048 1,112 1,022 761 731 545 361 291 343 372 475 659 908 920 1,122 1,273 1,322 1,321 93 90 76 80 98 69 157 197 359 20 23 27 41 30 27 24 18 33 1,099 1,141 1,174 1,086 1,292 1,333 1,161 1,091 952 649 632 582 594 709 635 509 476 207 762 792 833 508 892 747 796 787 764 437 459 434 427 323 347 338 272 318 69 113 364 346 388 687 837 819 1,022 429 500 478 473 531 430 773 735 545 973 871 834 1,064 819 839 929 605 692 8,367 7,564 7,409 7,894 8,383 8,797 8,559 8,638 8,500 Sept-13 Dec-13 Mar-14 Jun-14 Sept-14 Dec-14 Mar-15 Jun-15 Sept-15 Trade Finance: 9.3% Private Placements: 7.4% Multilateral Lines: 13.8% International Capital Markets: 4.3% Financial Letter : 10.3% Local Capital Markets: 2.8% Onlending: 12.8% Demand Deposits: 0.4% Interbank Time Deposits: 4.8% High Net Worth Individual Time Deposits: 17.8% Corporate Time Deposits: 4.6% Institutional Time Deposits: 11.5%
23/32Investor Relations | 3Q15 | 43% 41% 36% 37% 39% 57% 59% 64% 63% 61% Sept-14 Dec-14 Mar-15 Jun-15 Sept-15 Total Deposits Others Leverage: Expanded Loan Portfolio / Shareholders’ Equity Expanded Loan Portfolio excluding Bank Guarantees and Stand-by Letters of Credit / Shareholders’ Equity Credit over Funding ratio: Loan Portfolio excluding Bank Guarantees and Stand-by Letters of Credit / Total Funding Asset & Liability Management ... keeping a positive gap between credit and funding. Leverage ALM – Average Maturity Credit over Funding Ratio Total Deposits over Total Funding R$ milliondays 8,638 8,367 7,564 7,4098,500 GAP: +3 months 472 498 514 501 486 398 371 362 385 401 Sept-14 Dec-14 Mar-15 Jun-15 Sept-15 Funding Credit 7.7x 7.8x 7.8x 7.1x 6.5x 5.4x 5.4x 5.2x 4.7x 4.4x - 1.00 2.00 3.00 4.00 5.00 6.00 7.00 8.00 9.00 10.00 Sept-14 Dec-14 Mar-15 Jun-15 Sept-15 Expanded loan Porfolio Loan Portfolio excluding Bank Guarantees 80% 80% 77% 76% 70% Sept-14 Dec-14 Mar-15 Jun-15 Sept-15
24/32Investor Relations | 3Q15 | Capital Adequacy Ratio (BIS), Basel III BIS ratio maintained at 13.1% +80 bps13.7% 12.0% 12.2% 12.2% 12.4% 12.4% 12.2% 12.3% 12.2% 12.9% 2.2% 2.1% 1.5% 1.5% 1.4% 1.4% 0.8% 0.8% 0.9% 1.0% 15.9% 14.1% 13.7% 13.7% 13.8% 13.9% 13.0% 13.1% 13.1% 13.9% Sept-13 Dec-13 Mar-14 Jun-14 Sept-14 Dec-14 Mar-15 Jun-15 Sept-15 Sept-15* Tier II Tier I Minimum Regulatory Capital (11%) * Capital Simulation: It considers the new capital allocation weighting of 50% for transactions with guarantees for judicial or administrative proceedings involving tax matters, pursuant to Circular Letter 3.770 of the Brazilian Central Bank.
25/32Investor Relations | 3Q15 | Rating Long term BB BB Ba3 - Short Term B B - - Long term brA+ A+(bra) A3.br Short Term - F1+(bra) Br-2 LocalCurrency AndForeignCurrency National 10,70
26/32Investor Relations | 3Q15 | R$ million Sept-15 Jun-15 Sept-14 Assets 9,920 10,031 10,885 Cash 123 272 71 Interbank investments 445 327 1,529 Securities 3,451 3,061 2,041 Interbank accounts 1 1 1 Lending operations 4,775 5,281 6,374 (-) Provisions for loan losses (198) (217) (132) Net lending operations 4,577 5,064 6,243 Other receivables 1,310 1,291 876 Property and equipments 13 14 125 Investments - - 105 Property and equipment in use 12 13 19 Intangible 1 1 1 Liabilities 8,739 8,823 9,612 Deposits 1,846 1,539 2,744 Money market funding 756 432 624 Funds from acceptance and securities issued 2,036 2,182 1,960 Interbank and Interbranch accounts 13 9 9 Borrowings and onlendings 3,040 3,118 2,913 Derivative financial instruments 264 182 165 Other liabilities 719 1,291 1,120 Deferred Results 65 70 78 Shareholders' equity 1,181 1,208 1,273 Liabilities and shareholders' equity 9,920 10,031 10,885 Balance Sheet
27/32Investor Relations | 3Q15 | Managerial Income Statement (overhedge effect and provisions reclassified) R$ million 3Q15 2Q15 1Q15 4Q14 3Q14 9M15 9M14 Income from financial intermediation 758 180 633 402 437 1,570 957 Lending transactions 178 176 201 198 222 555 584 Securities transactions 81 83 68 79 78 232 245 Derivative financial instruments 488 (64) 285 107 92 709 102 Foreign exchange transactions 11 (14) 79 19 45 75 26 Expenses with financial intermediation (758) (153) (600) (363) (378) (1,510) (725) Funding transactions (322) (134) (257) (201) (208) (713) (488) Borrowings and onlendings (380) 24 (288) (108) (133) (644) (174) Provision for loan losses (56) (42) (55) (54) (38) (154) (64) Gross income from financial intermediation (0) 27 33 39 59 60 232 Other operating (expenses) income (53) (34) (34) (43) (36) (121) (109) Fee income 26 25 21 23 26 72 70 Personnel expenses (22) (22) (23) (27) (24) (66) (70) Other administrative expenses (20) (17) (18) (22) (22) (55) (68) Tax expenses (2) (10) (4) (3) (3) (16) (8) Other operating income 2 1 11 4 5 14 21 Other operating expenses (36) (12) (22) (17) (17) (70) (54) Operating income (53) (7) (1) (3) 23 (61) 123 Non-operating income (1) 1 4 (1) 4 5 16 Income before taxes and profit sharing (53) (6) 3 (4) 28 (56) 139 Income tax and social contribution 73 17 20 15 3 111 (15) Profit sharing (10) (2) (13) (6) (12) (24) (35) Net income 10 10 10 5 19 31 89
28/32Investor Relations | 3Q15 | R$ million 3Q15 2Q15 3Q14 9M15 9M14 Income from financial intermediation 703 190 433 1,491 959 Lending transactions 178 176 222 555 584 Securities transactions 81 83 78 232 245 Derivative financial instruments 433 (54) 87 629 104 Foreign exchange transactions 11 (14) 45 75 26 Expenses with financial intermediation (758) (86) (319) (1,443) (666) Funding transactions (322) (134) (208) (713) (488) Borrowings and onlendings (380) 24 (133) (644) (174) Provision for loan losses (56) 24 22 (87) (4) Gross income from financial intermediation (55) 104 114 48 293 Other operating (expenses) income (53) (101) (95) (188) (168) Fee income 26 25 26 72 70 Personnel expenses (22) (22) (24) (66) (70) Other administrative expenses (20) (17) (22) (55) (68) Tax expenses (2) (10) (3) (16) (8) Other operating income 2 1 5 14 21 Other operating expenses (36) (79) (77) (137) (114) Operating income (108) 3 19 (140) 125 Non-operating income (1) 1 4 5 16 Income before taxes and profit sharing (108) 5 23 (135) 140 Income tax and social contribution 128 7 7 190 (16) Profit sharing (10) (2) (12) (24) (35) Net income 10 10 19 31 89 Income Statement
Corporate Governance
30/32Investor Relations | 3Q15 | Corporate Governance Pine is committed to best corporate governance practices Two Independent Members and one External Member on the Board of Directors Mailson Ferreira da Nóbrega: Brazil’s Finance Minister from 1988 to 1990 Gustavo Junqueira: Former Head of Pine Investimentos, Member of the Board of Directors at EZTEC, Financial Advisor at Arsenal Investimentos and CFO at Gradiente Eletrônica Harumi Susana Ueta Waldeck: Former CFO of Pine, with over 17 years of experience at the company. She brings the day-to-day experience to the Board. São Paulo Stock Exchange (BM&FBOVESPA) Level 2 Corporate Governance Audit and Compensation Committee reporting directly to the Board of Directors 100% tag along rights for all shareholders, including non-voting shares Arbitration procedures for fast settlement of litigation cases
31/32Investor Relations | 3Q15 | Social Investment and Responsibility Focus on the short, medium and long term. Social Investment Recognition Partnerships Most Green Bank Recognized by the International Finance Corporation (IFC), private agency programs of the World Bank as the most "green" bank as a result of its transactions under the Global Trade Finance Program (GTFP) and its onlending to companies focused on renewable energy and ethanol Efficiency Energy Recognition by World Bank for support in the Energy Efficiency sector. Responsible Credit “Lists of Exceptions”: the Bank does not finance projects or those organizations that damage the environment, are involved in illegal labor practices or produce, sell or use products, substances or activities considered prejudicial to society. System of environmental monitoring, financed by the IADB and coordinated by FGV, and internally-produced sustainability reports for corporate loans Protocolo Verde – “Green Protocol”, an agreement between FEBRABAN and the Ministry of the Environment to support development that does not compromise future generations. Exhibition and sponsorship of Brazilian artists, for instance Paulo von Poser and Miguel Rio Branco, in addition to sponsoring and supporting films and documentaries such as Quebrando o Tabu (Fernando Henrique Cardoso on the drug war), O Brasil deu certo, e agora? (idealized by Mailson da Nóbrega), Além da Estrada (Charly Braun) and others. Sustainability Annual Report Sixth consecutive year disclosing the Sustainability Report in the GRI standard. The 2014 report, with its high level of clarity, transparency and quality was recognized with the second place in the Abrasca Annual Report Award, considering its category of companies with net income to R$3 billion.
32/32Investor Relations | 3Q15 | This report may contain forward-looking statements concerning the business prospects, projections of operating and financial results and growth outlook of PINE. These are merely projections and as such are based solely on management’s expectations regarding the future of the business. These statements depend substantially on market conditions, the performance of the sector and the Brazilian economy (political and economic changes, volatility in interest and exchange rates, technological changes, inflation, financial disintermediation, competitive pressures on products and prices and changes in tax legislation) and therefore are subject to change without prior notice. Noberto N. Pinheiro Junior CEO/IRO João Brito CFO Raquel Varela Bastos Head of Investor Relations, Marketing & Press Luiz Maximo Investor Relations Specialist Gabriel Netto Investor Relations Analyst Phone: (55 11) 3372-5343 ri.pine.com ri@pine.com Investor Relations

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Institutional presentation 3_q15

  • 1.
  • 2.
    2/32Investor Relations |3Q15 | Profile and History Pine History Business Strategy Competitive Landscape Focus Always on the Client Corporate Credit FICC Pine Investimentos Highlights and Results Corporate Governance Corporate Governance Committees Social Investment and Responsibility Summary
  • 3.
  • 4.
    4/32Investor Relations |3Q15 | Over R$2 billion 36% R$500 million to R$2 billion 34% Up to R$500 million 30% Pine Specialized in providing financial solutions for corporate clients… Credit Portfolio by Annual Client Revenues Profile Focused on establishing long-term relationships Profound knowledge and product penetration Business is structured along three primary business lines: • Corporate Credit: credit and financing products • FICC: instruments for hedging and risk management • Pine Investimentos: Capital Markets, Financial Advisory, Project & Structured Finance and Research September 30th, 2015
  • 5.
    5/32Investor Relations |3Q15 | 184 222 341 521 620 755 663 761 1,214 2,854 3,105 4,192 5,763 6,963 7,912 9,920 9,826 7,691 62 121 126 140 136 152 171 209 335 801 827 825 867 1,015 1,220 1,272 1,256 1,181 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 sept/15 Corporate Credit Portfolio (R$ Million) Shareholders' Equity (R$ Million) ...with extensive knowledge of Brazil’s corporate credit cycle. History 1997 Noberto and Nelson Pinheiro sell their stake in BMC and found Pine 1939 Pinheiro Family founds Banco Central do Nordeste 1975 Noberto Pinheiro becomes one of BMC’s controlling shareholders Devaluation of the real Nasdaq Sept. 11 Brazilian Elections (Lula) SubprimeAsian Crisis Russian Crisis European Community End of 2007 Focus on expanding the Corporate Banking franchise Discontinuation of the payroll-deductible loan business May, 2007 Creation of Pine Investimentos products line and opening of the Cayman branch 2005 Noberto Pinheiro becomes Pine’s sole shareholder October, 2007 Beginning of the FICC Business October, 2011 Subscription of Pine’s capital by DEG August, 2012 Subscription of Pine’s capital by DEG, Proparco, Controlling Shareholder and Management November, 2012 Opening of the broker dealer in New York, Pine Securities USA LLC March, 2007 IPO May, 2015 18 years
  • 6.
  • 7.
    7/32Investor Relations |3Q15 | Competitive Landscape Pine serves a niche market of companies with few options for banks. 100% focused on providing complete service to companies, offering customized products Corporate & SME SME & Retail Retail 100% Corporate Large Multi-Services banks Market Consolidation of the banking sector has decreased the supply of credit lines and financial instruments for corporate Foreign banks are in a deleveraging process PINE Full service Bank – Credit, Hedging, and Investment Bank products – with room for growth ~15 clients per officer Competitive Advantages:  Focus  Fast response: Strong relationship with clients, with the credit committee meeting twice a week and response times to clients of no more than one week  Specialized services  Tailor-made solutions  Product diversity Foreign and Investment Banks
  • 8.
    8/32Investor Relations |3Q15 | Focus Always on the Client Products tailored to meet the needs of each individual client. Working Capit CDIs Bank Guarantees Exclusive Funds Portfolio Management Swap NDFs Structured Swaps BNDES Onlending Bank Guarantees Compror ACC/ACE Export Finance Finimp Lettersof Credit 3,884 Onlending Overdraft Accounts Syndicated and Structured Loans Fixed Income Currencies Commodities Equities CDBs CDs RDBs LCAs LCIs DebenturesCRIs Eurobonds Private Placements Financial Letters Clients Treasury Corporate Credit FICC Pine Investimentos Distribution Capital Markets Financial Advisory Local Currency Foreign Currency Fixed Income Currencies Commodities Pricing of Assets and Liabilities Liquidity Management Trading Local Currency Onlending Foreign Currency Trade Finance Participation Funds Options Working CapitalUnderwriting Corporate & Structured Finance M&A Project Finance Structured Finance Private Credit Funds Real Estate Funds Rural Credits Aircraft Financing Investment Management In addition to the headquarters located in the city of São Paulo, Pine has 7 branches throughout Brazil, in the States of Ceará, Mato Grosso, Paraná, Pernambuco, Rio de Janeiro, Rio Grande do Sul, and São Paulo. The origination network also counts with a Cayman Branch and a broker dealer in New York (USA).
  • 9.
    9/32Investor Relations |3Q15 | Corporate Credit Actions Credit Committee Strong track record and solid credit origination and approval process. Credit Approval: Electronic Process Origination Officers Credit origination Credit analysis, visit to clients, data updates, interaction with internal research team Credit Analysts Regional Heads of Origination and Credit Analysis Presentation to the Credit Committee CRO, Executive Directors and Analysts of Credit Centralized and unanimous decision making process CREDIT COMMITTEE Meets once a week – reviewing 20 proposals on average Minimum quorum: 4 members - attendance of CEO or Chairman is mandatory Members: Chairman of the Board CEO Chief Risk Officer Chief Financial Officer Participants: FICC Executive Director Credit Analysts Team Other members of the Corporate Banking origination team Personalized and agile service, working closely with clients and keeping a low client to account officer ratio: each officer handles ~15 economic groups Geographic coverage of clients, providing the bank with local and extremely up-to-date credit intelligence and information Established long term relationships with more than 600 economic groups Origination network is comprised of 10 branches divided into 14 origination platforms in Brazil’s major economic centers Pine has approximentely 25 professionals in the credit analysis area, assuring that analysis is fundamentally driven and based on industry-specific intelligence Efficient loan and collateral processes, documentation, and controls, which has resulted in a low NPL track record Discussion on sizing, collateral, structure etc.
  • 10.
    10/32Investor Relations |3Q15 | Commodities 13% Fixed Income 15% Currencies 72% September 30th, 2015 Scenario on September 30th, 2015: Duration: 220 days Mark-to-Market: R$560 million Stress Scenario (Dollar: +31% and Commodities Prices: -30%): Stressed MtM : R$894 million R$ million FICC Solid trackrecord Client Notional Derivatives by Market Market Segments Notional Value and MtM Portfolio Profile Fixed Income: Fixed, Floating, Inflation, Libor Currencies: Dollar, Euro, Yen, Pound, Canadian Dollar, Australian Dollar Commodities: Sugar, Soybean (Grain, Meal and Oil), Corn, Cotton, Metals, Energy 8,376 7,703 7,482 7,948 3,270 6,045 288 221 349 366 560 514 -47 -365 -103 33 894 239 Sept-14 Dec-14 Mar-15 Jun-15 Sept-15 Oct-15 Notional Amount MtM Stressed MtM
  • 11.
    11/32Investor Relations |3Q15 | September, 2015 Infrastructure Debentures Lead Coordinator September, 2015 Debentures Coordinator R$10,300,000R$500,000,000 July, 2015 Project Finance R$104,000,000 Coordinator R$45,200,000 November, 2014 Debentures Lead Coordinator December, 2014 BNDES Onlending R$630,000,000 Coordinator July, 2015 February, 2015 March, 2015 Project Finance R$78,000,000 Coordnator Project Finance R$30,000,000 Lead Coordinator Structuring CRP R$24,000,000 Lead Coordinator R$20,000,000 June, 2015 CRI Lead Coordinator 2 5 2Q15 3Q15 11 10 9M14 9M15 R$ million Pine Investimentos Fee Generation Selected Transactions Capital Markets: Structuring and Distribution of Fixed Income Transactions. Financial Advisory: Project & Structured Finance, M&A, and hybrid capital transactions. Research: Macro and Commodities.
  • 12.
  • 13.
    13/32Investor Relations |3Q15 | 3Q15 Events and Highlights 1.Positive liquidity gap in the past years, with 401 days for credit versus 486 days for funding. 2.Liquid balance sheet with a cash position equivalent to 41% of time deposits. 3.Deeper deleveraging strategy in the loan portfolio, given the worsening of the economic scenario. 4.Voluntary pre-payment of the FIDC AGRO senior quotas amounting to R$340 million, in line with the Bank’s constant and active liability management. 5.Loan portfolio coverage ratio above 4% as a result of preventive provision increases in the last fifteen months. 6.Further reduction of expenses, as a result of the diligence and anticipation of an adverse market in 2015.
  • 14.
    14/32Investor Relations |3Q15 | 3Q15 Financial Highlights 1 Includes Stand by LCs, Bank Guarantees, Credit Securities to be Received and Securities (bonds, CRIs, eurobonds and fund shares) R$ million The main performance indicators were within expectations in the period. 3.3% 2.9% 2Q15 3Q15 NIM Evolution -40 bps 10 10 2Q15 3Q15 Net Income 3.3% 3.5% 2Q15 3Q15 ROAE +20 bps 1,208 1,181 Jun-15 Sept-15 Shareholders' Equity -2.2% 8,621 7,691 Jun-15 Sept-15 Total Loan Portfolio 1 -10.8% 7,564 7,409 Jun-15 Sept-15 Total Funding -2.0%
  • 15.
    15/32Investor Relations |3Q15 | R$ million 3Q15 2Q15 3Q14 9M15 9M14 Financial Margin Income from financial intermediation 1 80 92 135 297 Overhedge effect 55 (10) 4 79 (2) Income from financial intermediation ex overhedge 56 70 96 214 296 Net Interest Margin NIM Evolution Main Impacts NIM Breakdown Lower participation in revenues from FICC business and Treasury; Mark to market of securities and derivatives according to 4.277 Resolution of the Central Bank of Brazil; Voluntary pre-payment of the FIDC senior quotas; and Marginal increase in spreads. 3.3% 2.9% 2Q15 3Q15 -40 bps
  • 16.
    16/32Investor Relations |3Q15 | 24 22 2222 17 20 35.4% 44.9% 50.6% -100% -80% -60% -40% -20% 00% 20% 40% 60% 0 5 10 15 20 25 30 35 40 45 50 3Q14 2Q15 3Q15 70 6668 55 37.5% 44.3% -100% -80% -60% -40% -20% 00% 20% 40% 60% 0 20 40 60 80 100 120 140 9M14 9M15 Personnel Expenses Other administrative expenses Recurring Efficiency Ratio (%) Expenses and Efficiency Ratio Expenses Efficiency Ratio Rigorous cost control. R$ million 3Q15 2Q15 3Q14 9M15 9M14 Operating expenses1 44 48 49 137 146 (-) Non-recurring expenses (4) (4) (4) (9) (9) Recurring Operating Expenses (A) 41 44 45 128 137 Recurring Revenues2 (B) 81 98 127 289 365 Recurring Efficiency Ratio (A/B) 50.6% 44.9% 35.4% 44.3% 37.5% 1 Other administrative expenses +tax expenses +personnel expenses 2 Gross Income from financial intermediation - provision for loan losses +fee income +overhedge effect - hedge impact
  • 17.
    17/32Investor Relations |3Q15 | 1 Includes Stand by LC 2 Includes debentures, CRIs, Hedge Fund Shares, Eurobonds, Credit Portfolio acquired from financial institutions with recourse and Individuals R$ million Loan Portfolio The portfolio amounted to R$7.7 billion... -21.5% -10.8% 1 2 4,509 5,050 5,093 4,904 4,731 4,730 4,440 4,066 3,650 990 1,068 1,103 1,071 1,248 1,302 1,118 1,074 924 3,073 2,909 2,905 2,941 2,896 2,969 3,191 2,896 2,492 965 903 989 1,116 924 826 909 585 626 Sept-13 Dec-13 Mar-14 Jun-14 Sept-14 Dec-14 Mar-15 Jun-15 Sept-15 Trade finance: 8.1% Bank Guarantees: 32.4% BNDES Onlending : 12.0% Working Capital: 47.5% 9,657 8,621 7,691 9,537 9,930 10,090 10,032 9,800 9,826
  • 18.
    18/32Investor Relations |3Q15 | 38%38%40%41%41% 7%7%6%5%6% 9%9%8%9%6% 10%10%11%8%9% 12%12%14%14%16% 12%12% 12%14%12% 12%12%9%9%10% Sept-15Jun-15Sept-14Sept-13Sept-12 Energy Real Estate Sugar and Ethanol Agriculture Engineering Transportation and Logistics Others Continuous Loan Portfolio Management Sectors Rebalance ...with improved sector diversification. The composition of the portfolio of the 20 largest clients changed by over 20% in the past twelve months; The share of wallet of the 20 largest clients remained below 30%, in line with market peers. Energy 12% Real Estate 12% Sugar and Ethanol 12% Agriculture 10% Engineering 9% Transportation and Logistics 7% Specialized Services 4% Telecom 4% Chemicals 4% Foreign Trade 3% Metallurgy 3% Retail 3% Vehiclesand Parts 3% Construction Material 2% Meatpacking 2% Food Industry 1% Other 9%
  • 19.
    19/32Investor Relations |3Q15 | SP 68% MG 22% PR 8% GO 2% Working Capital 48% Guarantees 31% BNDES Onlending 12% Trade Finance 9% Working Capital 77% Guarantees 23% Residential Lots 39% Residential 37% Warehouse 12% Mall 8% Commercial 4% Guarantees 59% Working Capital 31% BNDES Onlending 10% Wind Power 67% UTE 1% Distributors 13% Transmitting 9% Equipment Supplier 6% SHPs UHEs 4% Main Sectors Energy| Real Estate | Agriculture Energy (12%) Real Estate (12%) Sugar and Ethanol (12%) Exposure by Product Exposure by Segment Exposure by Product Exposure by Segment Exposure by Product Exposure by State
  • 20.
    20/32Investor Relations |3Q15 | MT 31% SP 29% BA 11% PR 10% MG 8% Others 11% Concession 33% Transporta- tion 33% Industrial 25% Oil and Gas 7% Energy 2% Working Capital 64% BNDES Onlending 19% Trade Finance 15% Guarantees 1% Working Capital 83% Guarantees 13% BNDES Onlending 4% Main Sectors Agriculture| Engineering Agriculture (10%) Engineering (9%) Exposure by Product Exposure by Product Exposure by SegmentExposure by State
  • 21.
    21/32Investor Relations |3Q15 | AA-A 37.7% B 29.5% C 25.1% D-E 4.3% F-H 3.4% 1.1% 0.7% 0.1% 0.7% 0.3% 0.3% 1.1% 2.1% 1.8% Jun-13 Sep-13 Dec-13 Mar-14 Jun-14 Sep-14 Dec-14 Mar-15 Jun-15 September 30th, 2015 Contracts Overdue: total amount of the contracts overdue for more than 90 days / Loan Portfolio excluding Bank Guarantees and Stand-by Letters of Credit. 1D-H Portfolio: D-H Portfolio / Loan Portfolio Res. 2,682 2Coverage of Total Portfolio: Provisions / Loan Portfolio Res. 2,682 3Coverage D-H Overdue Portfolio: Provisions / D-H Overdue Portfolio Loan Portfolio Quality 92.3% of the loan portfolio is classified between AA-C ratings. Loan Portfolio Quality – Res. 2,682 Credit Coverage Non Performing Loans > 90 days (Total Contract) Collaterals 1 2 3 0.7% 0.1% 0.7% 0.3% 0.3% 1.1% 2.1% 1.8% 1.2% set-13 dez-13 mar-14 jun-14 set-14 dez-14 mar-15 jun-15 set-15Sept-13 Dec-13 Mar-14 Jun-13 Sept-14 Dec-14 Mar-15 Jun-15 Sept-15 Products Pledge 41% Receivables 15% Properties Pledge 41% Investments 3% 1,628% 172% 127% 50% 1.050% 2.050% 4.2% 6.6% 7.7% 2.1% 4.1% 4.1% 00% 02% 04% 06% 08% 10% 12% 00% 01% 02% 03% 04% 05% 06% 07% 08% 09% 10% Sept-14 Jun-15 Sept-15 D-H Portfolio Coverage of Total Portfolio Coverage of D-H Overdue Portfolio
  • 22.
    22/32Investor Relations |3Q15 | R$ million Funding Diversified sources of funding... 58% 48% 48% 47%41%39% 41% 35% 41% Cash over Deposits -14.2% 1,944 2,175 2,314 2,271 1,905 1,720 1,209 951 853 1,048 1,112 1,022 761 731 545 361 291 343 372 475 659 908 920 1,122 1,273 1,322 1,321 93 90 76 80 98 69 157 197 359 20 23 27 41 30 27 24 18 33 1,099 1,141 1,174 1,086 1,292 1,333 1,161 1,091 952 649 632 582 594 709 635 509 476 207 762 792 833 508 892 747 796 787 764 437 459 434 427 323 347 338 272 318 69 113 364 346 388 687 837 819 1,022 429 500 478 473 531 430 773 735 545 973 871 834 1,064 819 839 929 605 692 8,367 7,564 7,409 7,894 8,383 8,797 8,559 8,638 8,500 Sept-13 Dec-13 Mar-14 Jun-14 Sept-14 Dec-14 Mar-15 Jun-15 Sept-15 Trade Finance: 9.3% Private Placements: 7.4% Multilateral Lines: 13.8% International Capital Markets: 4.3% Financial Letter : 10.3% Local Capital Markets: 2.8% Onlending: 12.8% Demand Deposits: 0.4% Interbank Time Deposits: 4.8% High Net Worth Individual Time Deposits: 17.8% Corporate Time Deposits: 4.6% Institutional Time Deposits: 11.5%
  • 23.
    23/32Investor Relations |3Q15 | 43% 41% 36% 37% 39% 57% 59% 64% 63% 61% Sept-14 Dec-14 Mar-15 Jun-15 Sept-15 Total Deposits Others Leverage: Expanded Loan Portfolio / Shareholders’ Equity Expanded Loan Portfolio excluding Bank Guarantees and Stand-by Letters of Credit / Shareholders’ Equity Credit over Funding ratio: Loan Portfolio excluding Bank Guarantees and Stand-by Letters of Credit / Total Funding Asset & Liability Management ... keeping a positive gap between credit and funding. Leverage ALM – Average Maturity Credit over Funding Ratio Total Deposits over Total Funding R$ milliondays 8,638 8,367 7,564 7,4098,500 GAP: +3 months 472 498 514 501 486 398 371 362 385 401 Sept-14 Dec-14 Mar-15 Jun-15 Sept-15 Funding Credit 7.7x 7.8x 7.8x 7.1x 6.5x 5.4x 5.4x 5.2x 4.7x 4.4x - 1.00 2.00 3.00 4.00 5.00 6.00 7.00 8.00 9.00 10.00 Sept-14 Dec-14 Mar-15 Jun-15 Sept-15 Expanded loan Porfolio Loan Portfolio excluding Bank Guarantees 80% 80% 77% 76% 70% Sept-14 Dec-14 Mar-15 Jun-15 Sept-15
  • 24.
    24/32Investor Relations |3Q15 | Capital Adequacy Ratio (BIS), Basel III BIS ratio maintained at 13.1% +80 bps13.7% 12.0% 12.2% 12.2% 12.4% 12.4% 12.2% 12.3% 12.2% 12.9% 2.2% 2.1% 1.5% 1.5% 1.4% 1.4% 0.8% 0.8% 0.9% 1.0% 15.9% 14.1% 13.7% 13.7% 13.8% 13.9% 13.0% 13.1% 13.1% 13.9% Sept-13 Dec-13 Mar-14 Jun-14 Sept-14 Dec-14 Mar-15 Jun-15 Sept-15 Sept-15* Tier II Tier I Minimum Regulatory Capital (11%) * Capital Simulation: It considers the new capital allocation weighting of 50% for transactions with guarantees for judicial or administrative proceedings involving tax matters, pursuant to Circular Letter 3.770 of the Brazilian Central Bank.
  • 25.
    25/32Investor Relations |3Q15 | Rating Long term BB BB Ba3 - Short Term B B - - Long term brA+ A+(bra) A3.br Short Term - F1+(bra) Br-2 LocalCurrency AndForeignCurrency National 10,70
  • 26.
    26/32Investor Relations |3Q15 | R$ million Sept-15 Jun-15 Sept-14 Assets 9,920 10,031 10,885 Cash 123 272 71 Interbank investments 445 327 1,529 Securities 3,451 3,061 2,041 Interbank accounts 1 1 1 Lending operations 4,775 5,281 6,374 (-) Provisions for loan losses (198) (217) (132) Net lending operations 4,577 5,064 6,243 Other receivables 1,310 1,291 876 Property and equipments 13 14 125 Investments - - 105 Property and equipment in use 12 13 19 Intangible 1 1 1 Liabilities 8,739 8,823 9,612 Deposits 1,846 1,539 2,744 Money market funding 756 432 624 Funds from acceptance and securities issued 2,036 2,182 1,960 Interbank and Interbranch accounts 13 9 9 Borrowings and onlendings 3,040 3,118 2,913 Derivative financial instruments 264 182 165 Other liabilities 719 1,291 1,120 Deferred Results 65 70 78 Shareholders' equity 1,181 1,208 1,273 Liabilities and shareholders' equity 9,920 10,031 10,885 Balance Sheet
  • 27.
    27/32Investor Relations |3Q15 | Managerial Income Statement (overhedge effect and provisions reclassified) R$ million 3Q15 2Q15 1Q15 4Q14 3Q14 9M15 9M14 Income from financial intermediation 758 180 633 402 437 1,570 957 Lending transactions 178 176 201 198 222 555 584 Securities transactions 81 83 68 79 78 232 245 Derivative financial instruments 488 (64) 285 107 92 709 102 Foreign exchange transactions 11 (14) 79 19 45 75 26 Expenses with financial intermediation (758) (153) (600) (363) (378) (1,510) (725) Funding transactions (322) (134) (257) (201) (208) (713) (488) Borrowings and onlendings (380) 24 (288) (108) (133) (644) (174) Provision for loan losses (56) (42) (55) (54) (38) (154) (64) Gross income from financial intermediation (0) 27 33 39 59 60 232 Other operating (expenses) income (53) (34) (34) (43) (36) (121) (109) Fee income 26 25 21 23 26 72 70 Personnel expenses (22) (22) (23) (27) (24) (66) (70) Other administrative expenses (20) (17) (18) (22) (22) (55) (68) Tax expenses (2) (10) (4) (3) (3) (16) (8) Other operating income 2 1 11 4 5 14 21 Other operating expenses (36) (12) (22) (17) (17) (70) (54) Operating income (53) (7) (1) (3) 23 (61) 123 Non-operating income (1) 1 4 (1) 4 5 16 Income before taxes and profit sharing (53) (6) 3 (4) 28 (56) 139 Income tax and social contribution 73 17 20 15 3 111 (15) Profit sharing (10) (2) (13) (6) (12) (24) (35) Net income 10 10 10 5 19 31 89
  • 28.
    28/32Investor Relations |3Q15 | R$ million 3Q15 2Q15 3Q14 9M15 9M14 Income from financial intermediation 703 190 433 1,491 959 Lending transactions 178 176 222 555 584 Securities transactions 81 83 78 232 245 Derivative financial instruments 433 (54) 87 629 104 Foreign exchange transactions 11 (14) 45 75 26 Expenses with financial intermediation (758) (86) (319) (1,443) (666) Funding transactions (322) (134) (208) (713) (488) Borrowings and onlendings (380) 24 (133) (644) (174) Provision for loan losses (56) 24 22 (87) (4) Gross income from financial intermediation (55) 104 114 48 293 Other operating (expenses) income (53) (101) (95) (188) (168) Fee income 26 25 26 72 70 Personnel expenses (22) (22) (24) (66) (70) Other administrative expenses (20) (17) (22) (55) (68) Tax expenses (2) (10) (3) (16) (8) Other operating income 2 1 5 14 21 Other operating expenses (36) (79) (77) (137) (114) Operating income (108) 3 19 (140) 125 Non-operating income (1) 1 4 5 16 Income before taxes and profit sharing (108) 5 23 (135) 140 Income tax and social contribution 128 7 7 190 (16) Profit sharing (10) (2) (12) (24) (35) Net income 10 10 19 31 89 Income Statement
  • 29.
  • 30.
    30/32Investor Relations |3Q15 | Corporate Governance Pine is committed to best corporate governance practices Two Independent Members and one External Member on the Board of Directors Mailson Ferreira da Nóbrega: Brazil’s Finance Minister from 1988 to 1990 Gustavo Junqueira: Former Head of Pine Investimentos, Member of the Board of Directors at EZTEC, Financial Advisor at Arsenal Investimentos and CFO at Gradiente Eletrônica Harumi Susana Ueta Waldeck: Former CFO of Pine, with over 17 years of experience at the company. She brings the day-to-day experience to the Board. São Paulo Stock Exchange (BM&FBOVESPA) Level 2 Corporate Governance Audit and Compensation Committee reporting directly to the Board of Directors 100% tag along rights for all shareholders, including non-voting shares Arbitration procedures for fast settlement of litigation cases
  • 31.
    31/32Investor Relations |3Q15 | Social Investment and Responsibility Focus on the short, medium and long term. Social Investment Recognition Partnerships Most Green Bank Recognized by the International Finance Corporation (IFC), private agency programs of the World Bank as the most "green" bank as a result of its transactions under the Global Trade Finance Program (GTFP) and its onlending to companies focused on renewable energy and ethanol Efficiency Energy Recognition by World Bank for support in the Energy Efficiency sector. Responsible Credit “Lists of Exceptions”: the Bank does not finance projects or those organizations that damage the environment, are involved in illegal labor practices or produce, sell or use products, substances or activities considered prejudicial to society. System of environmental monitoring, financed by the IADB and coordinated by FGV, and internally-produced sustainability reports for corporate loans Protocolo Verde – “Green Protocol”, an agreement between FEBRABAN and the Ministry of the Environment to support development that does not compromise future generations. Exhibition and sponsorship of Brazilian artists, for instance Paulo von Poser and Miguel Rio Branco, in addition to sponsoring and supporting films and documentaries such as Quebrando o Tabu (Fernando Henrique Cardoso on the drug war), O Brasil deu certo, e agora? (idealized by Mailson da Nóbrega), Além da Estrada (Charly Braun) and others. Sustainability Annual Report Sixth consecutive year disclosing the Sustainability Report in the GRI standard. The 2014 report, with its high level of clarity, transparency and quality was recognized with the second place in the Abrasca Annual Report Award, considering its category of companies with net income to R$3 billion.
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    32/32Investor Relations |3Q15 | This report may contain forward-looking statements concerning the business prospects, projections of operating and financial results and growth outlook of PINE. These are merely projections and as such are based solely on management’s expectations regarding the future of the business. These statements depend substantially on market conditions, the performance of the sector and the Brazilian economy (political and economic changes, volatility in interest and exchange rates, technological changes, inflation, financial disintermediation, competitive pressures on products and prices and changes in tax legislation) and therefore are subject to change without prior notice. Noberto N. Pinheiro Junior CEO/IRO João Brito CFO Raquel Varela Bastos Head of Investor Relations, Marketing & Press Luiz Maximo Investor Relations Specialist Gabriel Netto Investor Relations Analyst Phone: (55 11) 3372-5343 ri.pine.com ri@pine.com Investor Relations

Editor's Notes

  • #16 Recurring income from financial intermediation totaled R$389 million, with margin (NIM) at 4.3%, within the guidance range of 4.0% to 5.0%.   Year on year, the lower margin is mainly explained by a defensive mix of portfolio, by an average cash position 16.1% higher than the average of 2013 and also by an increase in FICC and Treasury risk aversion.   In 4Q14, recurring income from financial intermediation totaled R$94 million, with recurring net interest margin (NIM) at 4.2%. This reduction compared to the previous quarter is mainly explained by the lower flow of transactions in the FICC business, by an average cash position 7.5% higher than the 3Q14, and also by the mark to market of private securities that compose the expanded loan portfolio.