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ABN AMRO reports pro-forma 2005 r esults under the new structure. Hugh Scott-Barrett Chief Financial Officer, Member of the Managing Board. London, 7 April 2006. Pro-forma 2005 results under the new structure. 7 February 2005: strategic focus on mid-market presented

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Abn amro reports pro forma 2005 r esults under the new structure

ABN AMRO reports pro-forma 2005 results under the new structure

Hugh Scott-BarrettChief Financial Officer, Member of the Managing Board

London, 7 April 2006


Pro forma 2005 results under the new structure
Pro-forma 2005 results under the new structure

  • 7 February 2005: strategic focus on mid-market presented

  • 14 October 2005: new organisational structure announced

  • 31 January 2006: full-year results 2005

  • Today: pro-forma 2005 results under new structure

  • 26 April 2005: Q1 2006 results released under new structure


Strategic focus on mid market segments
Strategic focus on mid-market segments

Product innovation

Top

Private

Clients

MNCs

‘SWEET

SPOT’

Mid-

Market/FIs

PC /

Mass Affluent

Small Business

Mass Retail

Feeder channel

Provider of scale

Consumer

Commercial


New group structure reflects strategic focus on mid market clients

Key Elements of the Strategy

Our new group structure

New Group structure reflects strategic focus on mid-market clients

  • Growth in Our Customer ‘Sweet Spot’

    • Where we are advantaged and most profitableConsumer: PC/Mass Affluent ClientsCommercial: SMEs, Mid-large corporates & FIs

  • Client-led strategy based on local engagement

    • Geographic distribution model

  • Value driven through working as ‘One Bank’

    • World-class products

    • International network capabilities

    • Spreading of successful formulas

    • High quality and more efficient services

NL

Europe

North America

Latin

America

Asia

Private Clients

Global Clients

  • Advantaged model:

  • Using local client engagement while delivering additional value by leveraging our global capabilities in products / services

Consumer Client Segment

Commercial Client Segment

through…

Local Products

Local Products

Local Products

Local Products

Local Products

Local Products

M&A

ECM

Global Markets

and…

Transaction Banking

Asset Management

Services

Group Functions


Unbundling wcs will deliver continued performance improvement

Opening up former WCS to the Group will result in greater leverage of wholesale banking products across a wider set of clients

The unbundling will contribute to a sustainable improvement in the efficiency ratio

Arm’s length interaction between Global Markets and the Client Units will increase the transparency of each product’s economics

Unbundling WCS will deliver continued performance improvement

NL

Europe

North America

Latin

America

Asia

Private Clients

Global Clients

Consumer Client Segment

Commercial Client Segment

Local Products

Local Products

Local Products

Local Products

Local Products

Local Products

M&A

ECM

Global Markets

Transaction Banking

Asset Management

Services

Group Functions


External reporting under the new group structure

External reporting under the new Group structure leverage of wholesale banking products across a wider set of clients


Quarterly financial reporting on all client bus asset management and group functions

ABN AMRO will publish financial accounting information on: leverage of wholesale banking products across a wider set of clients

BU NL (incl. Bouwfonds mortgages)

BU Europe (incl. BAPV)

BU North America

BU Latin America

BU Asia

BU Private Clients

BU Global Clients

BU Asset Management

BU Private Equity

Bouwfonds non-mortgages*

Group Functions, incl. Services

Quarterly financial reporting on all Client BUs, Asset Management and Group Functions

Global Clients

NL

Europe

North America

Latin America

Asia

PC

Consumer Client Segment

Commercial Client Segment

Global Markets

Transaction Banking

Asset Management

Services

Group Functions

* Bouwfonds non-mortgage will be divested, and until that time shown separately


Major changes in the new structure
Major changes in the new structure leverage of wholesale banking products across a wider set of clients

  • The major changes in the new structure are:

    • The mortgage related activities of Bouwfonds will be part of BU NL

    • Banca Antonveneta will be part of BU Europe. We will also report Banca Antonveneta separately which will make it possible to track progress against commitments

    • WCS has been unbundled in three parts:

      1. Global Clients

      2. Commercial Clients spread over the 5 regional client BUs

      3. Global Markets

      • BU Global Markets will be reported in the regional client BUs or BU Global Clients

      • Proprietary trading and futures income of Global Markets will be reported in Group Functions

      • Commercial Clients have been transferred to and will be reported in the regional client BUs


Abn amro will also report on global markets and the segments to track progress against commitments

ABN AMRO will provide financial information on BU Global Markets on a quarterly basis which will make it possible to track progress against commitments*

ABN AMRO will provide financial information on the segments on an bi-annual basis

ABN AMRO will provide financial information on Transaction Banking on an annual basis

ABN AMRO will also report on Global Markets and the segments to track progress against commitments

GlobalClients

NL

Europe

NorthAmerica

LatinAmerica

Asia

PC

Consumer Client Segment

Commercial Client Segment

Global Markets

Transaction Banking

Asset Management

Services

Group Functions

* Full P/L with half year and full year results and efficiency ratio with first quarter and third quarter results


Pro forma 2005 results

Pro-forma 2005 results Markets on a quarterly basis which will make it possible to track progress against commitments*


Breakdown of 2005 results under the new structure
Breakdown of 2005 results under the new structure Markets on a quarterly basis which will make it possible to track progress against commitments*

All figures are excluding consolidation effect of private equity holdings

*NL is incl. Bouwfonds mortgage

** BF is Bouwfonds non-mortgage



Breakdown of rwas under the former and new structure
Breakdown of RWAs under the former and new structure activities

Risk weighted assets under the former structure (2005, EUR 257.9 bln)*

Risk weighted Assets under the new structure (2005, EUR 257.9 bln)*

All figures are excl. consolidation effects of controlled Private Equity holdings

*Excl. significant disclosed one-off items used for normalisation as specified in FY 05 results press release on page 4 (see also appendix this presentation)

** BU NL is incl. Bouwfonds mortgage; Other incl. Group Functions, Services and Bouwfonds non-mortgage



Bu netherlands bu nl
BU Netherlands (BU NL) activities

  • BU NL includes the following businesses from the former structure: BU NL (C&CC), WCS NL (excl. Global Clients), mortgage related activities of Bouwfonds and other

*Excl. Global Clients


Bu europe
BU Europe activities

  • BU Europe includes the following businesses from the former structure: WCS Europe (excluding Global Clients) and other (former NGM Europe)

  • The reported results of the BU Europe reflect the fact that a significant part of the WCS business has been transferred to the BU Europe and that this part was a high efficiency ratio business. Management of the BU Europe, in cooperation with the management teams of Global Markets, Transaction Banking and Services will focus on improving the financial performance of the business in 2006. Further details on initiatives planned to improve infrastructural efficiency, including any investments associated with those initiatives, will be given with the first quarter results

*Excl. Global Clients

** Adjusted for gain on sale of Bishopsgate (EUR 43 mln gross and EUR 39 mln net)


Bu north america bu na
BU North America (BU NA) activities

  • BU NA includes the following businesses from the former structure: BU NA (C&CC), WCS NA (excl. Global Clients) and other

*Excl. Global Clients


Bu latin america bu la
BU Latin America (BU LA) activities

  • BU LA includes the following businesses from the former structure: BU Brazil (C&CC) and WCS LA (excl. Global Clients)

*Excl. Global Clients

** Adjusted for sale of Real Seguros (EUR 229 mln gross and EUR 196 mln net)


Bu asia
BU Asia activities

  • BU Asia includes the following businesses from the former structure: WCS Asia (excl. Global Clients) and other (former NGM Asia)

*Excl. Global Clients


Bu global clients bu gc
BU Global Clients (BU GC) activities

  • As of 1 January 2006 our shareholding in Korean Exchange Bank (KEB) has been transferred from the BU Private Equity to the BU Global Clients. In the pro-forma 2005 results we have already included KEB in the BU Global Clients

  • On 14 December 2005, we set capital constraint and minimum return targets for Global Clients: RWAs on average less than 10% of Group total by end 2006 and beyond, with a return above our 10.5% assumed cost of equity

*WCS Global Clients

**Under former structure reported under BU Private Equity


Bu private clients bu pc
BU Private Clients (BU PC) activities

* Adjusted for gain (EUR 38 mln gross and net) on the sale of Nachenius Tjeenk and a charge (EUR 45 mln operating expenses and EUR 30 mln net profit) related to the merger of Banque Neuflize and OBC in France


Bu private equity bu pe
BU Private Equity (BU PE) activities

  • As of 1 January 2006 our shareholding in Korean Exchange Bank (KEB) has been transferred from the BU Private Equity to the BU Global Clients. In the pro-forma results we have already included KEB in the BU Global Clients


Group functions incl group services gf
Group Functions, incl Group Services (GF) activities

  • Group Functions includes the following businesses from the former structure: Group Functions and non-client related WCS activities (proprietary trading and futures)

  • Group Functions includes the stakes in Banca Antonveneta*, Capitalia, and K&H Bank

*Non-client related WCS activities (proprietary trading and futures)

*** Adjusted for provisioning for balance sheet adjustment (EUR 86 mln operating income and EUR 60 mln net operating profit), release healthcare benefit provision (EUR 392 mln operating expenses and EUR 268 mln net operating profit), holiday provision (EUR 56 mln operating expenses and EUR 40 mln net operating profit), US regulatory fine (EUR 67 mln operating expenses and net operating profit) and release of tax provisions (EUR 100 mln)

As of the first quarter results, Banca Antonveneta will be reported under BU Europe


Bu global markets
BU Global Markets activities

  • On 14 December 2005, we set the following targets for Global Markets: improved efficiency ratio for Global Markets activities – improving at least 5 percentage points in 2006, and below 80% by end 2008

*Other includes Transaction Banking, Lending and M&A/ECM


Appendices

Appendices activities


Appendices table of contents
Appendices: table of contents activities

  • Breakdown of 2005 results under the former and new structure

  • Breakdown of pro-forma 2005 results per quarter

  • Significant disclosed one-off items



Breakdown of operating income under the former and new structure
Breakdown of operating income under the former and new structure

Operating income under the former structure (2005, EUR 19,603 mln)*

Operating income under the new structure (2005, EUR 19,603 mln)*

All figures are excl. consolidation effects of controlled Private Equity holdings

*Excl. significant disclosed one-off items used for normalisation as specified in FY 05 press release on page 4 (see also appendix of this presentation)

** BU NL is incl. Bouwfonds mortgage; Other is incl. Bouwfonds non-mortgage


Breakdown of operating expenses under the former and new structure
Breakdown of operating expenses under the former and new structure

Operating expenses under the former structure (2005, EUR 13,786 mln)*

Operating expenses under the new structure (2005, EUR 13,786 mln)*

All figures are excl. consolidation effects of controlled Private Equity holdings

*Excl. significant disclosed one-off items used for normalisation as specified in FY 05 press release on page 4 (see also appendix of this presentation)

** BU NL is incl. Bouwfonds mortgage; Other is incl. Bouwfonds non-mortgage


Breakdown of operating result under the former and new structure
Breakdown of operating result under the former and new structure

Operating result under the former structure (2005, EUR 5,817 mln)*

Operating result under the new structure (2005, EUR 5,817 mln)*

All figures are excl. consolidation effects of controlled Private Equity holdings

*Excl. significant disclosed one-off items used for normalisation as specified in FY 05 press release on page 4 (see also appendix of this presentation)

** BU NL is incl. Bouwfonds mortgage; Other is incl. Bouwfonds non-mortgage and the negative result of BU Europe


Breakdown of net operating result under the former and new structure
Breakdown of net operating result under the former and new structure

Net operating profit under the former structure (2005, EUR 3,969 mln)*

Net operating profit under the new structure (2005, EUR 3,969 mln)*

All figures are excl. consolidation effects of controlled Private Equity holdings

*Excl. significant disclosed one-off items used for normalisation as specified in FY 05 press release on page 4 (see also appendix of this presentation)

** BU NL is incl. Bouwfonds mortgage; Other is incl. Bouwfonds non-mortgage and the negative results of BU Europe



Breakdown of first quarter 2005 results under the new structure
Breakdown of first quarter 2005 results under the new structure

All figures are excluding consolidation effect of private equity holdings

*NL is incl. Bouwfonds mortgage

** BF is Bouwfonds non-mortgage


Breakdown of second quarter 2005 results under the new structure
Breakdown of second quarter 2005 results under the new structure

All figures are excluding consolidation effect of private equity holdings

*NL is incl. Bouwfonds mortgage

** BF is Bouwfonds non-mortgage


Breakdown of third quarter 2005 results under the new structure
Breakdown of third quarter 2005 results under the new structure

All figures are excluding consolidation effect of private equity holdings

*NL is incl. Bouwfonds mortgage

** BF is Bouwfonds non-mortgage


Breakdown of fourth quarter 2005 results under the new structure
Breakdown of fourth quarter 2005 results under the new structure

All figures are excluding consolidation effect of private equity holdings

*NL is incl. Bouwfonds mortgage

** BF is Bouwfonds non-mortgage



Overview of significant one off items as specified in fy 05 results press release

*As the reported 2005 numbers are impacted by various incidental items, and therefore not a fair reflection of the underlying trends, we have adjusted the 2005 figures for significant disclosed one-off items (any item greater than EUR 35 mln in net operating profit terms). These items were specified in Full Year 2005 results press release on page 4 (published on 31 January 2006)

Overview of significant one-off items as specified in FY 05 results press release*


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