MD&A and Financial Statements (PDF) - Banco Itaú

Activities Abroad
Europe
Banking activities under Banco Itaú Europa S.A.’s structure are
carried out in Portugal, Luxembourg, Miami, Cayman Islands
and Nassau, and primarily focus on international activities
including corporate banking, capital markets and private
banking in close cooperation with the conglomerate
institutions and areas which coordinate such activities in
Brazil. In September 2010, the group started its operations in
Switzerland, through Banco Itaú Suisse, headquartered in
Zurich. This subsidiary will operate in the private banking
segment, primarily to serve Brazilian and Latin-American
customers. As of September 30, 2010, Itaú Europa’s
consolidated assets totaled R$ 13,220 million, while assets
under management, arising from the private banking
segment, added up to R$ 20,285 million. Net income for the
quarter was R$ 18 million, representing a R$ 3 million decline
from the prior quarter, mainly a result of the reduction in the
financial margin, partly offset by increased service revenues
from the syndicated lons and private banking segments.
Argentina
Banco Itaú Argentina operates both in company (very small,
small, mid-sized and large companies) and individual
segments, with more emphasis on the latter, through an 81-
branch network. The unit employs 1,501 people. The main
products offered to individuals are savings accounts, personal
loans and credit cards; for companies, services provided are
financing, treasury products, including derivatives and
foreign exchange, and syndicated loans. Total assets
amounted to R$ 2,274 million at September 30, 2010, with
net income of R$ 2 million for the third quarter of the year.
The decrease in the requirement for the provisions for loan
and lease losses in the period shall be highlighted.
Chile
Banco Itaú Chile is active in company (very small, small, midsized
and large companies) and individual segments, with
focus on medium and high-income customers, with the offer
of a vast array of products. The unit has 2,031 employees.
Noteworthy events in the quarter include the opening of two
branches – the network now comprises 71 branches - and
the A3 rating for foreign currency assigned by Moody’s to
Banco Itaú Chile, thus improving its access to external
financing. Also important was the launch of the student loan
product that helped significantly grow the retail portfolio.
At September 30, 2010, total assets reached R$ 11,699
million, and credit assets stood at R$ 8,814 million, increasing
by 11% compared to June 30, 2010. With net income of R$ 48
million, highlights of the period include the growth in the
loan portfolio, mostly in the retail and corporate segments,
and the decline in delinquency levels.
Itaú Unibanco Holding S.A.
Uruguay
Banco Itaú Uruguay operates in individual and company
segments through 20 branches, of which two were opened
in the third quarter of 2010. Main products include credit
cards, cash management, trade financing, investment
services, and pension funds. During the period, Banco Itaú
became market leader in terms of Visa billings. Total assets
amounted to R$ 3,507 million, and net income remained
stable compared to the second quarter of the year, after
adjustment for the impact of exchange variations associated
with the capital hedge structure. Significant
accomplishments include improved results from credit card
and pension fund operations, and lower levels of the
provisions for loan and lease losses.
Additionally, Itaú Unibanco operates in the credit card market
through the largest card company in the country (OCA). OCA
carries out the three main operations: credit card acquirer,
issuer and operation processing. Credit cards and consumer
direct loans are the major products provided by OCA to
approximately 360,000 customers as of September 30, 2010.
Paraguay
The Itaú brand has been present in Paraguay since July 12,
2010, providing services to individuals and companies (small,
mid-sized and large companies, agribusinesses and
institutional clients), with 19 branches and 538 employees.
Credit cards stand out among the products offered by the
bank, as a significant revenue driver. At September 30, 2010,
total assets amounted to R$ 2,177 million, with a significant
growth in credit operations, in particular in the company
portfolio. The net income of R$ 8 million for the quarter was
helped by the portfolio growth but adversely impacted by
non-recurring expenses associated with the change in its
brand, and for this reason stood at a lower level than in the
previous quarter.
Products and Services to Foreign Institutional
Customers
The Itaú group provides foreign institutional customers with
a comprehensive range of products and services, such as
asset management, fund management, custody, alternative
products, brokerage, fixed income, foreign exchange,
endorsements and treasury products.
Foreign institutional customers are served both by
specialized teams and relationship managers based in units
located at New York, London, Hong Kong, Tokyo and Dubai.
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Management Discussion & Analysis 3 rd Quarter, 2010