Quarterly Management Discussion & Analysis (MDA300905.pdf)

Analysis of the Consolidated PerformanceBanking Service FeesR$ MillionMutual Fund Management Fees 430 402 27Income from Administration of Consortium 15 13 2Credit Operations 300 273 27Income from Guarantees Provided 20 24 (4)Collection 103 97 6Interbank Fees (Bills, Checks and Documents) 51 50 0Tax Collection 63 46 17Foreign Exchange Services 7 7 (0)Brokerage Services 34 26 8Income from Inquiries of the Serasa Databases 47 43 5Custody Services and Managed Portfolios 19 17 2Other Services 61 40-21-In the third quarter of 2005, Banking Service Fees grewsignificantly by R$ 120 million, totaling R$ 1,971 million,against R$ 1,852 million in the prior quarter.Compared to Non-Interest Expenses, Banking ServiceFees showed a coverage index of 76%, as opposed to72% in the previous quarter. Taking only PersonnelExpenses into consideration, the coverage indexreached 186%, compared to 190% in the second quarter.This growth was driven by Mutual Fund ManagementFees, which increased by R$ 27 million as a result ofthe larger volume of funds under management.Fees from Credit Operations also stood out totaling R$300 million, which represents a 10% growth.Tax Collection Revenues contributed R$ 17 million tothe increase in Banking Service Fees and werepositively impacted by the normalization of taxpayments by state governments.The growth in revenues from Other Services is partlyattributable to Banco Itaú BBA. Itaú BBA is uniquelypositioned to reap the benefities of an antecipatedsignificant expansion in capital markets, fueled byexpected lower interest rates and potencial futureupgrade of Brazil to investment grade status and isplacing more emphasis on the provision of InvestmentBanking services.Banking Service Fees Coverage Index over Non-InterestExpensesNumber of Active Clients(*) and Current Accounts(Million)4.Q./03 1.Q./04 2.Q./04 3.Q./04 4.Q./04 1.Q./05 2.Q./05 3.Q./05Dec.03 Mar.04 Jun.04 Sep.04 Dec.04 Mar.05 Jun.05 Sep.05Non Interest ExpensesPersonnel ExpensesActive ClientsCurrent Accounts(*) Calculated by dividing Banking Service Fees by Personnel Expenses and by Non-InterestExpenses (Personnel Expenses, Others Administrative Expenses, Tax Expenses of CPMF andOthers and Other Operating Expenses)(*) Conceptually, a client (represented by a CPF/CPNJ number) is considered active if there hasbeen one or more transactions in the current account in the last six months or a not nullbalance in cash deposit.17 Management Discussion and AnalysisBanco Itaú Holding Financeira S.A.