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3Q04 Earnings

3Q04 Earnings. highlights. R$ 235.6 bi. Total Assets - Largest Bank in Brazil. R$ 122.5 bi. Leadership in Assets Under Management. R$ 84.1 bi. Leadership in loan Portfolio. R$ 157.1 bi. Leadership in Total Funding. 20.7 million. Customer Base. 6.7 million. Customers in BB’s Internet.

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3Q04 Earnings

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  1. 3Q04 Earnings

  2. highlights R$ 235.6 bi Total Assets - Largest Bank in Brazil R$ 122.5 bi Leadership in Assets Under Management R$ 84.1 bi Leadership in loan Portfolio R$ 157.1 bi Leadership in Total Funding 20.7 million Customer Base 6.7 million Customers in BB’s Internet 38,242 Largest ATM network in Latin America 14,230 Largest network service in the country 15.2% 2nd in ANBID Rank

  3. result building Spread Reduction Increase in Service Fees Commercial Income Recovery Productivity Ratios maintenance Growth of the Retail Credit Portfolio Increase of Income Tax and Social Contribution Expenses

  4. solid results Income Statement - with reallocations Quarterly Flow Change % 3Q03 2Q04 3Q04 /3Q03 /2Q04 R$ million Gross Financial Margin 3,888 3,925 3,919 0.8 (0.2) Provision for NPL (747) (903) (856) 14.6 (5.3) Net Financial Margin 3,141 3,022 3,063 (2.5) 1.4 Service Fees 1,412 1,643 1,717 21.5 4.5 Turnover Tax Expenses (242) (323) (345) 42.6 6.7 Contribution Margin 4,312 4,341 4,435 2.9 2.2 Administrative Expenses (2,931) (3,093) (3,129) 6.7 1.1 Commercial Income 1,381 1,248 1,307 (5.4) 4.7 Operating Income 1,213 1,003 1,256 3.5 25.1 Income before Profit Sh. Taxes Ext. Items 1,231 1,043 1,336 8.5 28.1 Income Tax and Social Contribution (516) (200) (545) 5.7 173.1 Profit sharing (50) (140) (67) 34.4 (52.1) Recurrent Result 665 703 724 8.8 2.9 - Extraordinary items - 102 109 6.7 665 805 833 25.2 3.4 Net Income EPS - R$ 0.91 1.10 1.14 25.2 3.4 ROE - % (Annualized) 25.7 27.7 27.5 ROA - % (Annualized) 1.3 1.4 1.4

  5. Loss with Spread Loss with Volume and Spread Gain with Volume new environment, new challenge Quarterly Flow 3Q03 3Q04 Abs. Chg. R$ million Volume: Assets – Permanent ¹ 209,072 227,099 18,027 Gross Financial Margin 31 3,888 3,919 Spread - % ² 1.8597 1.7257 (0.1341) Change G.F.M. (Distribution) 31 4,223 335 Gain with Volume Loss with Spread 3,608 (280) Loss with Volume and Spread (24) ¹ Average Balance ² Gross Financial Margin / (Assets - Permanent) Spread - % Analysis of volume and spread 3Q03 - 1.8597 (24) (280) 3Q04 - 1.7257 3,888 335 Volume - R$ million 3Q04 - 227,099 3Q03 - 209,072

  6. new environment, new challenge Spread analysis - % Nominal Spread Weighted Spread 3Q03 2Q04 3Q04 3Q03 2Q04 3Q04 Rate 1.86 1.79 1.73 1.86 1.79 1.73 Credit Operations 3.12 3.06 3.02 0.94 1.04 1.00 Individual 9.30 9.27 8.70 0.51 0.58 0.55 Corporate 2.02 1.99 1.96 0.27 0.30 0.30 Agribusiness 1.62 1.24 1.37 0.17 0.14 0.14 Other Operations (0.53) 0.99 0.58 (0.01) 0.01 0.01 Funding 1.44 1.00 0.91 0.58 0.42 0.38 Other 1.15 1.38 1.38 0.34 0.34 0.34 Credit Operation Mix - % 3Q03 2Q04 3Q04 3.6 3.5 3.5 18.2 18.5 19.2 33.1 31.7 34.3 43.9 44.8 45.6 Individual Corporate Agribusiness Other Operations

  7. margin growth guaranteed by business diversification Quarterly Flow Change % 3Q03 2Q04 3Q04 /3Q03 /2Q04 R$ million Gross Financial Margin 3,888 3,925 3,919 0.8 (0.2) Provision for NPL (747) (903) (856) 14.6 (5.3) Net Financial Margin 3,141 3,022 3,063 (2.5) 1.4 Service Fees 1,412 1,643 1,717 21.5 4.5 Turnover Tax Expenses (242) (323) (345) 42.6 6.7 Contribution Margin 4,312 4,341 4,435 2.9 2.2 Quarterly Flow Change % 3Q03 2Q04 3Q04 /3Q03 /2Q04 R$ million Service revenues 1,412 1,643 1,717 21.5 4.5 Customer Relationship Fees 407 510 514 26.3 0.8 Asset Management Fees 214 242 270 26.2 11.6 Credit Operations 142 161 161 13.1 (0.6) Collection 130 157 158 21.7 0.8 Services to Related Companies 34 39 46 34.0 19.0 Third Party Revenue and Payments 104 104 112 8.1 8.1 Credit Cards 109 141 137 26.4 (2.9) Others 273 289 318 16.8 10.3

  8. customers’ loyalty and asset management leadership Customer Base - in million 326 321 300 296 286 20.7 20.1 19.3 18.8 17.0 Asset Management - R$ billion 3Q03 4Q03 1Q04 2Q04 3Q04 Service Fees + GFM / Customer - R$ ¹ ¹ Customer base average of the last 4 quarters 20.2 19.9 20.0 18.9 19.0 122.5 116.9 116.0 102.7 91.8 3Q03 4Q03 1Q04 2Q04 3Q04 Market Share - %

  9. Coverage Ratio % - YTD Service Income / Personnel Expenses cost structure suitable with business generation Quarterly Flow Change % 3Q03 2Q04 3Q04 /3Q03 /2Q04 R$ million Personnel Expenses (1,681) (1,675) (1,744) 3.7 4.1 Salaries (688) (831) (712) 3.5 (14.3) Benefits (163) (191) (182) 11.7 (4.7) Social Charges (278) (312) (300) 8.1 (3.7) Training (10) (11) (10) (2.5) (9.5) Honorary of Directors and Councilmen (1) (2) (3) 128.6 26.5 Provisions for Employees Expenses (417) (206) (396) (5.1) 92.3 Labor Suits (125) (122) (141) 13.3 15.5 Human Resources - in thousands 2.9 2.8 2.8 2.6 2.4 98.6 98.3 98.4 93.1 92.6 92.3 90.5 90.8 85.1 82.8 82.6 81.8 81.9 80.6 79.7 10.8 10.6 10.7 10.2 10.5 3Q03 4Q03 1Q04 2Q04 3Q04 3Q03 4Q03 1Q04 2Q04 3Q04 Deposits + Assets under Manag. / Employee - R$ million Total Employees Interns

  10. 2,534 2,531 2,503 2,455 2,376 3Q03 4Q03 1Q04 2Q04 3Q04 222 217 209 17.5 206 17.4 17.4 17.3 17.3 188 3Q03 4Q03 1Q04 2Q04 3Q04 3Q03 4Q03 1Q04 2Q04 3Q04 cost structure suitable with business generation Productivity Ratios Assets per Work Force - R$ thousand Customers per Work Force Work Force per Branch ¹ ¹ Branch, Advanced Service Post and Banking Service Post

  11. cost structure suitable with business generation Quarterly Flow Change % 3Q03 2Q04 3Q04 /3Q03 /2Q04 R$ million Other Administrative Expenses (1,221) (1,381) (1,344) 10.1 (2.7) Telecommunications and Data Processing (292) (316) (315) 8.0 (0.2) Amortization and Depreciation (122) (138) (131) 7.6 (4.9) Security, Guard and Transport Services (164) (171) (173) 5.2 1.5 Expenses with Premises and Equipment (137) (154) (145) 5.8 (5.8) Marketing and Public Relations (102) (104) (132) 29.1 26.4 Expenses with Outsource Services (96) (121) (127) 32.7 4.9 Other Administrative Expenses (308) (377) (320) 4.2 (15.0) Points of Service - in thousands Customers per Point of Service 5.0 5.0 5.0 4.9 4.7 1,453 1,442 1,423 1,418 1,319 14.2 13.9 13.5 13.2 12.9 3Q03 4Q03 1Q04 2Q04 3Q04 3Q03 4Q03 1Q04 2Q04 3Q04 Credit Operations / Points of Service - R$ million

  12. Efficiency Ratio % - YTD Administrative Expenses / Operational Income productivity equation completed by technology Automatization 3Q03 - % 3Q04 - % 7.2 6.4 89.6 10.4 14.8 86.9 86.4 86.3 85.2 50.6 16.8 51.2 16.0 Electronic Transactions / Total Transactions - % 15.0 11.6 POS and Others ATM Internet Financial Manager. Cashier 3Q03 4Q03 1Q04 2Q04 3Q04 56.8 56.5 56.2 56.4 55.6 3Q03 4Q03 1Q04 2Q04 3Q04

  13. productivity consistent improvement Business vs. Expenses - (%) 186.9 185.2 183.7 151.4 140.7 135.2 132.1 130.3 124.3 110.3 94.6 87.7 54.8 48.5 46.2 41.0 36.6 37.5 1999 2000 2001 2002 2003 Jan/Sep Service Revenues Gross Financial Margin Total

  14. Other Assets Tax Credit Credit Operations and Leasing Securities Portfolio Liquid Assets except Securities 13.3 13.6 15.0 19.2 18.9 30.7 30.2 34.4 29.4 30.2 30.5 29.7 28.1 28.8 28.5 3.9 3.6 4.6 3.9 4.1 21.5 21.6 19.2 19.1 18.0 the bank that invests the most in Brazil Change % 3Q03 2Q04 3Q04 /3Q03 /2Q04 R$ million Total Assets 215,134 227,374 235,599 9.5 3.6 Liquid Assets except Securities 29,340 30,316 35,228 20.1 16.2 Securities Portfolio 74,055 69,855 71,120 (4.0) 1.8 Credit Operations and Leasing 60,442 69,247 69,961 15.7 1.0 Tax Credit 9,897 8,971 8,505 (14.1) (5.2) Other Assets 41,400 48,986 50,785 22.7 3.7 Total Liabilities 215,134 227,374 235,599 9.5 3.6 Deposits 103,071 115,795 115,079 11.6 (0.6) Other Liabilities 100,376 98,715 106,749 6.3 8.1 Shareholders’ Equity 11,687 12,864 13,771 17.8 7.1 Market Funding - R$ billion Asset Composition - % 157.1 152.9 149.5 29.9 30.2 29.4 28.9 26.6 20.5 49.6 49.4 46.5 49.7 42.0 7.7 6.4 5.5 37.1 3Q03 4Q03 1Q04 2Q04 3Q04 Time Deposits Saving deposits Interbank Deposits Demand Deposits Money Market Borrowing Total 3Q03 2Q04 3Q04

  15. 0.7 0.6 0.6 2.1 1.8 8.7 10.6 10.7 9.3 10.7 67.3 65.9 70.5 69.3 72.0 21.4 22.8 19.5 18.9 16.7 3Q03 4Q03 1Q04 2Q04 3Q04 liquidity preserved Securities Portfolio Change % 3Q03 2Q04 3Q04 /3Q03 /2Q04 R$ million Securities Portfolio 74,055 69,855 71,120 (4.0) 1.8 Available for trading 5,393 11,998 12,690 135.3 5.8 Available for sale 43,158 31,008 31,997 (25.9) 3.2 Held to maturity 25,109 25,146 25,945 3.3 3.2 Derivatives 396 1,702 488 23.5 (71.3) Securities Portfolio Maturity - % 3Q04 3Q03 27.0% 39.6% 60.4% 73.0% 1 to 3 years 3 to 5 years Up to 1 year 1 to 5 years 5 to 10 years Over 10 years

  16. 1.9% 13.3% 23.0% 10.6% 20.4% 30.8% well balanced credit portfolio 3Q04 - Balance R$ 84.1 billion Credit Portfolio 2.0% 11.9% 24.0% 10.1% 2Q04 - Balance R$ 83.1 billion 21.4% 30.5% 3Q03 - Balance R$ 72.6 billion 2.1% 12.3% 20.6% 10.4% 20.4% 34.1% Retail Commercial Agribusiness Foreign Trade Abroad Others

  17. 6.5 15.1 93.5 84.9 increase with responsibility Credit Portfolio by Risk Level Shares % - 3Q04 8.2 10.6 4.1 2.1 91.8 89.4 97.9 95.9 Retail Commercial Agribusiness Foreign Trade BB SFN ¹ AA-C D-H ¹ Source: Brazilian Central Bank

  18. 80.0 80.0 70.0 70.0 60.0 60.0 50.0 50.0 40.0 40.0 30.0 30.0 20.0 20.0 10.0 10.0 AA A B C D E F G H AA A B C D E F G H 80.0 80.0 70.0 70.0 60.0 60.0 50.0 50.0 40.0 40.0 30.0 30.0 20.0 20.0 10.0 10.0 AA A B C D E F G H AA A B C D E F G H increase with responsibility Credit Portfolio by Risk Level - % Credit Portfolio Commercial and Foreign Trade 3Q03 3Q04 3Q03 3Q04 Retail Agribusiness 3Q03 3Q04 3Q03 3Q04

  19. 5.6 5.2 5.1 5.0 4.7 5.4 5.1 5.0 4.8 4.6 3.2 3.2 3.2 3.2 3.0 delinquency under control 3Q03 4Q03 1Q04 2Q04 3Q04 R$ million (A) Allowance for Loan Losses - Quarterly (747) (827) (901) (903) (856) (B) Allowance for Loan Losses - 12 Months (3,101) (3,072) (3,337) (3,378) (3,487) (C) Allowance for Loan Losses - 12 Months ¹ (3,101) (3,072) (3,600) (3,786) (3,975) (D) Loan Portfolio 72,601 77,636 79,647 83,131 84,148 (E) Average Portfolio - 3 Months 70,484 76,550 78,823 82,283 82,942 (F) Average Portfolio - 12 Months 66,163 69,702 73,245 77,035 80,149 Expenses / Portfolio (A/E) - % 1.1 1.1 1.1 1.1 1.0 Expenses / Portfolio (B/F) - % 4.7 4.4 4.6 4.4 4.4 Expenses / Portfolio (C/F) - % 4.7 4.4 4.9 4.9 5.0 ¹ With Extraordinary Items 4.7 4.6 4.4 4.4 4.4 2.0 1.8 1.7 1.8 1.8 1.1 1.1 1.1 1.1 1.0 3Q04 3Q03 4Q03 1Q04 2Q04 Expenses / Portfolio - % annualized ¹ 3Q03 4Q03 1Q04 2Q04 3Q04 Expenses / Portfolio (A/E) - % ² Expenses / Portfolio (C/F) - % ³ Overdue Loans / Credit Portfolio - % ¹ Expenses and average portfolio of the last 12 months ² Expenses and average portfolio of the quarter ³ Effective losses and average portfolio of the last 12 months Overdue Loans + 15 days / Credit Portfolio Overdue Loans + 60 days / Credit Portfolio

  20. increase of provisions for credit risk Breakdown of Allowance Balance - R$ million 5,374 5,102 4,693 4,195 4,044 999 973 778 558 495 4,375 4,128 3,915 3,637 3,549 3Q03 4Q03 4Q04 2Q04 3Q04 Allowance Required Additional Allowance Total Allowance

  21. ability to increase businesses with customers Change % 3Q03 2Q04 3Q04 /3Q03 /2Q04 R$ million Risk weighted Assets 109,121 119,966 121,391 11.2 1.2 Required Shareholders’ Equity 12,705 13,929 14,201 11.8 2.0 Required on weighted assets 12,003 13,196 13,353 11.2 1.2 Required on swap 173 152 223 29.0 47.3 Required on exchange exp. - - - - - Required on Interest on Equity 529 581 625 18.1 7.6 Referential Shareholders’ Equity 16,520 18,299 20,272 22.7 10.8 Tier I 11,663 12,702 13,609 16.7 7.1 Tier II 4,858 5,597 6,663 37.2 19.0 Surplus shareholders’ equity 3,815 4,371 6,070 59.1 38.9 Margin to leverage 34,680 39,733 55,185 59.1 38.9 BIS Ratio - % 14.3 14.5 15.7 Tier I 10.1 10.1 10.5 Tier II 4.2 4.4 5.2 Capital Adequacy - % 15.7 14.5 14.3 14.3 13.7 5.2 4.4 4.4 4.0 4.2 11.0 Tier I 10.5 10.1 9.9 10.1 9.7 Tier II 3Q03 4Q03 1Q04 2Q04 3Q04

  22. ability to increase businesses with customers Referential Shareholders’ Equity Required Shareholders' Equity Efect in Basel Ratio Efect in Leverage R$ million Net Income 833 - 0.7 7,569 Change of Adj. to market value - securities and derivatives 34 - 0.0 307 Increase of Subordinated Debt 1,066 - 0.8 9,689 Other Changes in Referential Shareholders' Equity 40 - 0.0 365 Increase of Shareholders' Equity Requirement on Risk Weight Assets - 157 (0.2) (1,425) Increase of Referential Shareholders' Equity Requirement on Swap - 72 (0.1) (653) Increase of Ref. Shareholders' Equity Req. on Interest Rate Exposure - 44 0.0 (400) Quarterly Changes 1,972 273 1.3 15,452 Balance - Jun/04 18,299 13,929 14.5 39,733 Balance - Sep/04 20,272 14,201 15.7 55,185 1,972 273 1.3 15,452 Net Quarterly Changes

  23. 89.1 87.1 85.8 83.4 77.9 12.0 12.7 12.2 12.3 11.5 19.0 17.7 18.0 17.4 18.4 58.1 55.7 56.6 53.8 48.1 3Q03 4Q03 1Q04 2Q04 3Q04 Solution in insurance and pension plan Quarterly Flow Change % 3Q03 2Q04 3Q04 /3Q03 /2Q04 R$ thousand Equity Income 57,436 61,604 64,144 11.7 4.1 Service Fees - Commission 80,898 83,696 83,504 3.2 (0.2) Service Fees – Asset Management 6,747 14,580 15,221 125.6 4.4 Insurance Added Value 145,082 159,880 162,868 12.3 1.9 Combined Ratio Evolution Administrative Expenses / Earned Premiums - % Expenses with Market / Earned Premiums - % Retained claims / Earned Premiums - %

  24. Market recognition Capitalization and Income 3Q03 4Q03 1Q04 2Q04 3Q04 Market Capitalization - R$ million 11,712 17,568 17,041 16,470 18,447 Free Float Capitalization - R$ million 848 1,272 1,234 1,192 1,339 Book Value per Share - R$ 15.97 16.63 17.33 17.57 18.81 Net Income per Share - R$ 0.91 0.87 0.84 1.10 1.14 7.38 6.77 6.38 6.05 5.00 1.44 1.34 1.34 1.28 1.00 3Q03 4Q03 1Q04 2Q04 3Q04 Price / Income 12 months Price / Book Value

  25. For further information access www.bb.com.br/ri Investor Relations Division SBS - Quadra 1 - Bloco C - Ed. Sede III - 17° floor 70073-901 - Brasília (DF) Phone: 55 (61) 310.5920 Fax: 55 (61) 310.3735 www.bb.com.br ri@bb.com.br Disclaimer- This presentation contains references and statements, planned synergies, increasing estimates, projections of results and future strategy for Banco do Brasil, it’s Associated and Affiliated Companies and Subsidiaries. Although these references and statements reflect the management’s belief, it also involves imprecision and high difficult risks to be foreseen, consequently, it may conduct to a different result than the one anticipated here. These expectations are highly depended on market conditions, on the Brazilian economic performance, on the sector and the international market. Banco do Brasil is not responsible for bringing up to date any estimate in this presentation.

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