1. Mobile Application: Mobile Banking – PDA Project

2. Subjects BANCO DO BRASIL Brazil The Banco do Brasil Mobile phone service Mobile Project Available Platforms Next steps CITIBANK BRAZIL Citibank - Brazil Why wireless technology? How it was born Main Benefits Investments / Payback

3. Brazil The Banco do Brasil Mobile phone Service Mobile Project Available Platforms Next Steps Gabriela Zinn Salvucci Subjects

4. Population – 184,1 million inhabitants Population – 184,1 million inhabitants Produto Interno Bruto – R$ 1,500 billiion Produto Interno Bruto – R$ 1,500 billiion PIB per capta – R$ 9,1 thousand PIB per capta – R$ 9,1 thousand Telephones quantity – 41,4 million Telephones quantity – 41,4 million Cellphones quantity – 76,6 million Cellphones quantity – 76,6 million Internet home users – 18,5 million Internet home users – 18,5 million Broadband connections – 3,1 million Broadband connections – 3,1 million Summary of Brazil

5. Brazil The Banco do Brasil Mobile phone Service Mobile Project Available Platforms Next Steps Subjects

6. Leadership in assets – R$ 233,7 billion. Leadership in assets – R$ 233,7 billion. 1st in total deposits – R$ 154 billion. 1st in total deposits – R$ 154 billion. Greatest credit portfolio – R$ 96,1 billion. Greatest credit portfolio – R$ 96,1 billion. Greatest service-delivery network in Brazil – 14,6 thousand service outlets. Greatest service-delivery network in Brazil – 14,6 thousand service outlets. Greatest ATM network in Latin America – 39 thousand terminals. Greatest ATM network in Latin America – 39 thousand terminals. Greatest client base: 21,9 million. Greatest client base: 21,9 million. Network abroad – 37 branches. Network abroad – 37 branches. Leader in Internet services – 6,9 million clients. Leader in Internet services – 6,9 million clients. Leader in the management of third-party resources – R$ 144,8 billion. Leader in the management of third-party resources – R$ 144,8 billion. Leader in the foreign-exchange and export commercial segment – 27,9% market share. Leader in the foreign-exchange and export commercial segment – 27,9% market share. Leader in credit and debit card billing – R$ 11,1 billion. Leader in credit and debit card billing – R$ 11,1 billion. Main financial agent for agrobusiness. Main financial agent for agrobusiness. Source: Banco do Brasil Report Performance Analysis and Accounting Statements 2005 of Performance Banco do Brasil – 2st quarter of 2005 Banco do Brasil: Figures that foster development

7. Brazil The Banco do Brasil Mobile phone Service Mobile Project Available Platforms Next Steps Subjects

8. Argentina Chile México Source: Agências Regulatórias, Ministérios e Operadoras Internacionais – publicado no Site Teleco 4 5 6 7 8 9 200120022003 Population: 37 milhões Cellphones : 8,3 milhões Participation: 22% México 0 2 4 6 8 1999200020012002 Population : 15 milhões Cellphones : 7,3 milhões Participation : 50% China 0 50 100 150 200 250 300 199819992000200120022003 Population : 1,3 bilhão Cellphones : 257 milhões Participation : 20% PhonesCellphones 0 10 20 30 40 19951997199920012003 Population : 103 milhões Cellphones: 30 milhões Participation : 29% International Mobile phones market share

9. Brazil is the 5th mobile phones market share in the world and the 2nd in America (1st USA). Brazil is the 5th mobile phones market share in the world and the 2nd in America (1st USA). 38 cellphones for 100 inhabitants (Distrito Federal level = 101). 38 cellphones for 100 inhabitants (Distrito Federal level = 101). 80% prepaid cellphones. 80% prepaid cellphones. 11,2% of the families have cellphones as the only way to comunicate (IBGE). 11,2% of the families have cellphones as the only way to comunicate (IBGE). Source: Anatel 2005 – Estimate from Teleco 89 MILLION CELLPHONES ESTIMATE FOR DEC/05 Brazilian mobile phones market share

10. Brazil The Banco do Brasil Mobile phone Service Mobile Project Available Platforms Next Steps Subjects

11. The increase of cellphones users. The increase of cellphones users. Mobile Banking has a greater potential in terms of market penetration. compared to Internet Banking, mainly for the low level population. New mobile technologies advance, which provides secutrity and performance requirements. New mobile technologies advance, which provides secutrity and performance requirements. Searching for safe, comfort and low cost self-service channels. The successful case in BB using alternative channels. 86% 89% 90% 2002 Agency transactions 83% 200320042005 Alternative Channels Why Mobile Project was created at Banco do Brasil

12. Aug/2000 SMS messages project release Mobile Banking service using WAP 1.0 platform release Sep/2003 Mobile Banking was released in partnership with Mobile GSM Operator (Telemar/Oi) (pioneer in using GSM platform – the begginning of a complete mobile banking) Sep/2004 Mobile Banking was released with the Brasil Telecom GSM Operator (pioneer in using dinamic menus template) Mar/2005 Mobile Banking was released with the VIVO operator (pioneer in using download banking template with the CDMA/Brew Platform) Mobile Banking at Banco do Brasil

13. More convenient and safe transactions. Cost reduction – migration or evolution to low-cost mobile channels. Mobile Banking is available anywhere in Brazil. Does not represent a cultural or economic barrier for new users of electronic banking. Its easier to learn to use and to buy the cellphone than the PC. Advantages in using Mobile Banking

14. Internet BankingMobile Banking R$ 1.500,00 R$ 52,90 R$ 38,00 + R 14,90 Telephone contract + internet provider R$ 0,33* *at least 12 minutes using Internet 4 minutes cost: R$ 0,11 R$ 149,00 Varejo R$ 1,00 Corporate R$ 37,90 Oi contract 40 R$ 49,90 Corporate Oi contract DEVICE COMUNICATION TRANSACTIONS R$ 0,15/Trans. Users costs ¿Why using Mobile Banking?

15. Account balances Account extracts Savings balance Payment of accounts and bills. Transfers between Banco do Brasil accounts. Transfers between accounts from other banks. Prepaid cellphones credit recharge. Donations for Fome Zero" program. Loans. Bank account holder can achieve the following transactions

16. Mobile Banking BB – transactions access

17. Mobile Banking BB - Performance

18. Brazil The Banco do Brasil Mobile phone Service Mobile Project Available Platforms Next Steps Subjects

19. Each Chip has a BB key to develop criptography. Each Chip has a BB key to develop criptography. Only BB can has access to information sent by customers. Only BB can has access to information sent by customers. All transactions use short message system (SMS) to carry information forward Banco do Brasil and the operator. All transactions use short message system (SMS) to carry information forward Banco do Brasil and the operator. No Internet connection required. No Internet connection required. Oi chip sample, which holds the mobile banking solution of Banco do Brasil GSM Platform (SIM Card)

20. Vivo/Brew 2nd mobile banking case in the world and 1st being used. The solution was one of the greatest finalists at the Brew Developers 2005 award, which chooses the best and most innovate projects developed using wireless technology. How to use: download the application at the Vivo Operator website, using the cellphone. Safe transactions that use peer to peer criptography. CDMA / Brew Platform

21. Used both in GSM and CDMA platform cellphones. The customer connects to the Internet WAP2 website of Banco do Brasil to have access to the bank account, or through the Operator website. WAP2 platform provides Internet security, through proper mobile devices criptography (based in SSL). WAP 2.0 Platform

22. Operator accepts cellphone number and sends an SMS containing the transaction information to the customer Customer receives SMS containing information about the transaction performed at the alternative channels Banco do Brasil performs the transaction asked by the customer and returns information to the operator Customer performs any transaction through any alternative channel SMS Banking Platform – sending information

23. Operator accepts cellphone number and sends information to Banco do Brasil Customer sends SMS asking for a Ballance (B), an Extract (E) or a Recharge (R) Banco do Brasil performs transactions asked by the customers and returns information to the Operator Operator delivers the information and/or confirmation of the transaction Customer receives SMS containing the Balance or Extract information or Recharge confirmation SMS banking can be used through any cellphone, regardless of the technology and/or platform. SMS banking can be used through any cellphone, regardless of the technology and/or platform. Its a perfect platform to the most usual and low complexity level transactions. Its a perfect platform to the most usual and low complexity level transactions. SMS Banking Platform – ask for transactions

24. Brazil The Banco do Brasil Mobile phone Service Mobile Project Available Platforms Next Steps Subjects

25. Make solution enabled for other Mobile Operators in Brazil. SMS Banking: Prepaid recharges through SMS project (still going) SMS alerts (tests still going) Mobile payments (still being studied) Next Steps…

26. ¿Any Questions ?

27. Citibank - Brazil Why wireless technology? How it was born Main Benefits Investments / Payback Rogerio Vargas Subjects

28. Continents Countries Currencies Employees 190 years in the World 5 102 128 230,000 US$ 700 bi US$ 1,232 million Total Assets Net Equity Presence in the World

29. Presence in Brazil Customers Employees 1.1 million 2,300 10 51 US$ 5 bi Cities Branches Total Assets Citi has been present 90 years in Brazil. Business: Banking Area, Cards and Finance. The 2nd biggest business card in the world (outside of the USA). Citi has been present 90 years in Brazil. Business: Banking Area, Cards and Finance. The 2nd biggest business card in the world (outside of the USA).

30. Citibank - Brazil Why wireless technology? How it was born Main Benefits Investments / Payback Subjects

31. 2002 200320042005 CurrentMYF Why was the Direct Sales created ?

32. Started with 110 people and today more than 400 people. We are present in 10 cities in Brazil. The core of Direct Sales Area is to bring in new customers (created Jan/2003). This business is done totally out of offices (wireless solution). Main strategic objectives: 1. To develop an acquisition model. 2. To multiply the initial structure. A few words about this business area…

33. June 2005 Opened before 1998(22) Opened in 1998(04) Opened in 1999(03) Opened in 2000(05) Opened in 2002(02) Opened in 2003(00) Opened in 2004(08) Opened in 2005(03) TOTAL in 2005(50) What cities is the Direct Sales present?

34. Whats the importance of Direct Sales for the retail Citibank Brazil ?? The Direct Sales Area… In 2 years the Direct Sales brought more than 77,000 customers, 40% with monthly salary over US$ 3,000. And more …. In 2 years it has achieved 9% share in the total revenues of retail Citibank Brazil. This area has 30% of Sales Managers and brings... 70% of new customers 55% of new cards 22% of volume of personal loans 15% of volume of life insurance 15% of volume of on-shore investments

35. There are 5 steps in the People Pillar: To implement this strategy, we need TECHNOLOGY. To be able to multiply the initial structure several times, we need TECHNOLOGY. To have information and communication (foundation to develop people), again only with TECHNOLOGY. INFORMATION COMMUNICATION INNOVATION ENTREPRENEURISM KNOWLEDGE Why Wireless Solution… The Strategy of Direc Sales Area is based on 3 pillars: 1. People 2. Process 3. Control & Quality

36. There are 5 steps in the People Pillar: To implement this strategy, we need TECHNOLOGY. To be able to multiply the initial structure several times, we need TECHNOLOGY. To have information and communication (foundation to develop people), again only with TECHNOLOGY. INFORMATION COMMUNICATION INNOVATION ENTREPRENEURISM KNOWLEDGE The strategy of Direct Sales Area is based on 3 pillars: 1. PEOPLE 2. PROCESS 3. CONTROL & QUALITY Why wireless solution…

37. Citibank - Brazil Why wireless technology? How it was born Main Benefits Investments / Payback Subjects

38. The business area saw this opportunity through a competitor... Dec/2002: We knew about a tool of a competitor with little development (only for data and no wireless) Jan/2003: We developed a wireless prototype with the following features: 1. 1.Fill prospects information and send wireless 2. 2.Follow-up sales performance. 3. 3.Products Catalogue. 4. 4.Messages: a communication channel real time. PLAY How it was born…

39. The second most important step... Find people in the Company with an open-mind and empowerment. Oct/2003: Meetings with People with empowerment in Technology, Compliance, Legal and Infosec to decide the development of this wireless solution and break paradigms. It would be the 1st PDA application and the 1st wireless solution in CitiGroup in the world (at that time, the PDA wasnt recognized as equipment in Citibank, only desktops and notebooks could be used). How it was born…

40. The third most important step... Look for companies with wireless know-how to improve the knowledge of the Company. Oct/nov 2003 Several meetings with companies to understand the technical feasibility of this wireless solution. Dec/2003 Jan/2004 Opened bidding to vendors. Feb/2004 Started the development of wireless solution. Feb/2005 Put in production. How it was born…

41. Citibank - Brazil Why wireless technology? How it was born Main Benefits Investments / Payback Subjects

42. Reduce costs: Eliminates part of operational process and reduction of the whole operation cycle-time. (There will be no investment in assets from Citibank, all equipment provided in comodatum). Improve business. e.g.: Tool for selling personal loan. More profitability: The sales managers have more time during each visit to offer other products (Cards / Life Insurance / Investments) and enhance sales productivity accelerating the activation process of the new customers. Shareholder Benefits Clean Process. Paperless in mid-term with digital certification. Less bureaucracy. Without copies of documents in mid-term. Reduce time of opening banking account. Customer Development of People: Implement a quick and effective communication channel. Development of People: Handling a high technology tool. Motivation: Provide in real time data and information to improve sales. e.g.: Opportunities focusing on bulk acquisition such as niches and payroll Companies. Employee

43. CALL CENTERPROSPECT SCHEDULING VISIT PV DATA RECEIVED AGENDA, STATUS MANAGER UPDATES THE AGENDA OF PDA EXCHANGE MESSAGES VISIT SENDS THE FORM CONSULT FORM CONSOLIDATION DOCUMENTS TO DO CHECKLIST OF DOCUMENTS BUREAU CONSULTING OPERATIONAL AREA WEB AUTHORIZING MANAGER EO PROCESS AND INPUT FORM DMSPM DOCUMENTS LIST UPDATE FINCON TYPING MANAGER EFFECTIVE MAINFRAME SUPERVISOR REGIONAL MANAGER WEB How it works

44. Internet Firewall Authentication Cryptography Fusion-Sync Fusion Server Fusion Database TELCOS Cryptography AES HTTPS SSL 3.0 GPRS CDMA 1xRTT Cryptography Algorithm HTTPS SSL 3.0 HTTPS SSL 3.0 Cryptography Algorithm Security application components Database Cryptography Digital Certificates - SSL End to end transmission Cryptography Two different authentication processes Ethical Hacking Test (Vulnerability Assessment) Self destruction in case of loss, theft or a password mistake. User vs personal device (only a specific user ID can use a specific device) Kiosk (This application does not allow anyone to install, remove, download, change or use any other application different than the one defined by Citigroup policies and standards of information security) How it works – Security Standards This solution has the same security standards as other applications of Citibank.

45. Citibank - Brazil Why wireless technology? How it was born Main Benefits Investments / Payback Subjects

46. Investment (Infrastructure / development): US$ 232,000 12 months Costs per PDA Cost per New Customer Break-even Payback 5 months Additional Cost per new customer: US$ 6 Cost per PDA per month: US$ 100 (including: rent, fee software license, mobile bill) Which are the investments…

47. ¿Any Questions ?