Banco do Brasil - Financial Statements - 3rd …

1 Consolidated Financial Statements 3rd quarter 2017 0 3rd quarter 2017 Financial Statements Consolidated Financial Statements 3rd quarter 2017 1 INDEX Index ..1 Financial Statements ..3 BALANCE STATEMENT OF INCOME ..7 STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY ..8 STATEMENT OF CASH FLOWS ..9 STATEMENT OF ADDED VALUE .. 10 Notes to the Consolidated Financial Statements .. 11 1 - THE BANK AND ITS OPERATIONS .. 11 2 - COMPANY 11 3 - PRESENTATION OF Financial Statements .. 12 4 - DESCRIPTION OF SIGNIFICANT ACCOUNTING POLICIES .. 15 5 - INFORMATION BY SEGMENT .. 21 6 - CASH AND DUE FROM BANKS .. 25 7 - INTERBANK INVESTMENTS .. 25 8 - SECURITIES AND DERIVATIVE Financial INSTRUMENTS .. 26 9 - INTERBANK ACCOUNTS .. 33 10 - LOANS .. 35 11 - FOREIGN EXCHANGE PORTFOLIO.

2 41 12 - OTHER RECEIVABLES .. 42 13 - OTHER ASSETS .. 43 14 - 44 15 - PROPERTY AND EQUIPMENT .. 50 16 - INTANGIBLE ASSETS .. 51 17 - DEPOSITS AND SECURITIES SOLD UNDER REPURCHASE AGREEMENTS .. 52 18 FUNDS FROM ISSUANCE OF SECURITIES .. 56 19 - BORROWINGS AND ONLENDINGS .. 57 Consolidated Financial Statements 3rd quarter 2017 2 20 - OTHER LIABILITIES .. 58 21 - OTHER OPERATING INCOME/EXPENSES .. 63 22 - NON-OPERATING INCOME .. 65 23 - SHAREHOLDERS' EQUITY .. 65 24 - TAXES .. 71 25 - RELATED PARTY TRANSACTIONS .. 73 26 - EMPLOYEE BENEFITS .. 77 27 - PROVISIONS, CONTINGENT ASSETS AND LIABILITIES, LEGAL LIABILITIES TAXES AND SOCIAL SECURITY .. 87 28 - RISK AND CAPITAL MANAGEMENT .. 90 29 - STATEMENT OF COMPREHENSIVE INCOME .. 100 30 - OTHER INFORMATION.

3 101 Independent Auditor s Report .. 119 Declaration of the Executive Board Members about the Financial 129 Declaration of the Executive Board Members about the Report of Independent Auditors .. 130 Members of 131 Consolidated Financial Statements 3rd quarter 2017 In thousands of Reais, unless otherwise stated 3 BALANCE SHEET ASSETS Note Sep 30, 2017 Dec 31, 2016 Sep 30, 2016 CURRENT ASSETS 812,860,626 804,240,873 833,279,533 Cash and due from banks 6 14,267,230 12,805,771 12,928,959 Interbank investments 409,728,859 404,769,645 426,798,907 Securities purchased under resale agreement 384,528,833 371,537,393 392,773,794 Interbank deposits 25,200,026 33,232,252 34,025,113 Securities and derivative Financial instruments 8 17,431,031 16,959,199 20,497,283 Own portfolio 13,394,070 13,937,394 16,789,817 Subject to repurchase agreements 2,475,932 1,499,048 1,174,435 Pledged in guarantee 285,457 309.

4 539 314,133 Derivative Financial instruments 1,275,572 1,213,218 2,218,898 Interbank accounts 77,454,999 68,026,103 71,796,733 Payments and receipts pending settlement 3,161,384 3,513 3,759,990 Reserve requirement 72,209,073 66,063,844 66,355,457 Deposits with Banco Central do Brasil 69,441,849 63,451,094 63,636,925 National Treasury - rural credits resources 52,597 54,959 51,624 National Housing Finance System 2,714,627 2,557,791 2,666,908 Interbank onlendings -- -- 1,951 Correspondent banks 2,084,542 1,958,746 1,679,335 Interdepartmental accounts 129,464 376,530 210,944 Internal transfers of funds 129,464 376,530 210,944 Loans 10 174,806,739 174,149,338 177,910,778 Public sector 719,107 649,803 1,209,068 Private sector 188,233,478 186,111,325 190,040,551 Loans sold under assignment 229 374 48 (Allowance for loan losses) (14,146,075) (12,612,164) (13,338,889) Leasing transactions 10 175,274 237,447 263,149 Private sector 196,566 269,250 309,938 (Allowance for leasing transactions losses) (21,292) (31,803) (46,789) Other receivables 118,362,059 126,462,278 122,397,357 Receivables from guarantees honored 604,775 494,543 500,904 Foreign exchange portfolio 16,567,668 17,188,751 18,683,617 Accrued income 2,890,341 2,644,778 2,822,309 Securities trading 461,870 218,932 336,238 Specific credits 536 541 -- Sundry 99,816,340 107,887,734 101,777,596 (Allowance for other losses) (1,979,471) (1,973,001) (1,723,307)

5 Other assets 13 504,971 454,562 475,423 Assets not for own use and materials in stock 366,357 339,302 329,374 (Allowance for impairment) (159,858) (137,564) (127,318) Prepaid expenses 298,472 252,824 273,367 See the accompanying notes to the Financial Statements . Consolidated Financial Statements 3rd quarter 2017 In thousands of Reais, unless otherwise stated 4 ASSETS Note Sep 30, 2017 Dec 31, 2016 Sep 30, 2016 NON-CURRENT ASSETS 587,030,129 597,136,101 614,932,362 LONG-TERM RECEIVABLES 556,136,703 564,008,357 583,276,586 Interbank investments 1,615,397 942,027 1,004,308 Securities purchased under resale agreement 495,410 145,292 150,870 Interbank deposits 1,119,987 796,735 853,438 Securities and derivative Financial instruments 8 120,059,738 104,309,483 105,173,675 Own portfolio 88,134,141 65,273,440 79,721,478 Subject to repurchase agreements 29,649,699 35,791,728 21,972,564 Pledged in guarantee 2,100,590 2,844,970 2,713,261 Derivative Financial instruments 175.

6 308 399,345 766,372 Interbank accounts 646,242 497,227 462,808 Reserve requirement 225 1,909 9 National Treasury - rural credits resources 225 1,909 9 Interbank onlendings 646,014 495,306 462,799 Correspondent banks 3 12 -- Loans 10 366,651,020 390,774,002 404,539,479 Public sector 72,105,086 73,401,682 73,482,277 Private sector 316,477,014 338,986,894 353,650,089 Loans sold under assignment 521,295 611,713 639,693 (Allowance for loan losses) (22,452,375) (22,226,287) (23,232,580) Leasing transactions 10 248,780 325,376 334,667 Private sector 253,935 334,946 360,340 (Allowance for leasing transactions losses) (5,155) (9,570) (25,673) Other receivables 66,897,913 67,143,433 71,744,945 Foreign exchange portfolio -- 282,794 296,426 Accrued income 47,683 31,350 60,106 Securities trading 483,541 887,868 613,465 Specific credits 408,177 377,698 366,862 Sundry 66,757,629 66,337,503 71,024,944 (Allowance for other losses) (799,117) (773,780) (616,858) Other assets 13 17,613 16,809 16,704 Prepaid expenses 17,613 16,809 16,704 PERMANENT ASSETS 30,893,426 33,127,744 31,655,776 Investments 16,853,215 16,855,006 16,481,958 Associates and joint ventures 16,704,248 16,703,729 16,303,620 Domestic 16,651,975 16,631,072 16,189,792 Abroad 52,273 72,657 113,828 Other investments 168,099 170,398 232,591 (Provision for losses) (19,132) (19,121)

7 (54,253) Property and equipment 15 7,213,478 7,557,478 7,198,918 Land and buildings 7,531,520 7,722,456 6,774,064 Other property and equipment 10,076,499 9,953,340 9,402,872 (Accumulated depreciation) (10,394,541) (10,118,318) (8,978,018) Intangible 16 6,826,733 8,715,260 7,963,884 Intangible assets 20,037,113 19,602,197 17,589,115 (Accumulated amortization) (13,210,380) (10,886,937) (9,625,231) Deferred -- -- 11,016 Organization and expansion costs 2,098 2,098 1,579,972 (Accumulated amortization) (2,098) (2,098) (1,568,956) TOTAL ASSETS 1,399,890,755 1,401,376,974 1,448,211,895 See the accompanying notes to the Financial Statements . Consolidated Financial Statements 3rd quarter 2017 In thousands of Reais, unless otherwise stated 5 LIABILITIES/SHAREHOLDERS EQUITY Note Sep 30, 2017 Dec 31, 2016 Sep 30, 2016 CURRENT LIABILITIES 1,063,390,677 1,004,424,338 1,024,746,296 Deposits 389,195,573 394,668,312 382,117,728 Demand deposits 61,793,371 69,349,186 61,622,917 Savings deposits 154,516,749 151,763,344 148,681,412 Interbank deposits 16,774,296 17,827,013 20,184,165 Time deposits 155,987,466 155,675,658 151,597,326 Other deposits 123,691 53,111 31,908 Securities sold under repurchase agreements 404,980,454 358,409,319 379,184,277 Own portfolio 28,561,564 42,983,151 22,353,562 Third-party portfolio 376,418,890 315,426,168 356,830.

8 715 Funds from issuance of securities 18 87,988,766 68,052,214 71,941,873 Bonds backed by real estate, mortgage and other credits 79,279,585 62,623,394 67,334,503 Foreign securities 8,608,077 5,428,820 4,607,370 Certificates of structured operations 101,104 -- -- Interbank accounts 2,524,476 1,075 3,254,585 Receipts and payments pending settlement 2,524,476 1,075 3,238,815 Correspondent banks -- -- 15,770 Interdepartmental accounts 2,388,368 2,450,012 2,468,333 Third-party funds in transit 2,387,169 2,446,807 2,466,197 Internal transfers of funds 1,199 3,205 2,136 Borrowings 15,752,760 17,997,094 19,641,127 Foreign borrowing 15,752,760 17,997,094 19,641,127 Domestic onlending - official institutions 44,686,732 39,463,427 39,695,325 National Treasury -- -- 132 BNDES 6,911,213 8,227,439 9,128,563 Caixa Econ mica Federal 25,858,655 23,758,043 22,917,625 Finame 4,644,776 5,155,259 5,257,193 Other institutions 7,272,088 2,322,686 2,391,812 Foreign onlending 95 95 95 Derivative Financial instruments 1,483,927 1,089,344 1,744,897 Other liabilities 114,389,526 122,293,446 124,698,056 Billing and collection of taxes and contributions 4,902,252 427,463 4,088,460 Foreign exchange portfolio 7,740,131 17,879,212 17,423,634 Shareholders and statutory distributions 1,079,717 1,125,248 1,281,487 Taxes and social security 12,214,853 15,293,551 16,797.

9 035 Securities trading 732,700 379,982 668,297 Financial and development funds 8,907,025 9,055,620 8,750,670 Subordinated debts 10,228,204 4,158,742 2,647,425 Equity and debt hybrid securities 727,108 279,308 193,367 Other liabilities 67,857,536 73,694,320 72,847,681 See the accompanying notes to the Financial Statements . Consolidated Financial Statements 3rd quarter 2017 In thousands of Reais, unless otherwise stated 6 LIABILITIES/SHAREHOLDERS EQUITY Note Sep 30, 2017 Dec 31, 2016 Sep 30, 2016 NON-CURRENT LIABILITIES 242,935,881 309,758,884 337,741,460 LONG-TERM LIABILITIES 242,520,220 309,312,622 337,305,221 Deposits 47,927,416 51,312,376 55,584,795 Interbank deposits 2,874,617 2,837,788 3,734,439 Time deposits 45,052,799 48,474,588 51,850,356 Securities sold under repurchase agreements 12,889,830 16,224,713 31,285,762 Own portfolio 12,889,812 16,224,699 31,285,762 Third-party portfolio 18 14 -- Funds from issuance of securities 18 49,143,458 97,114,139 101,624,966 Bonds backed by real estate.

10 Mortgage and other credits 37,444,068 82,047,387 85,831,208 Foreign securities 11,671,852 14,964,440 15,666,524 Certificates of structured operations 27,538 102,312 127,234 Borrowings 2,615,598 2,412,254 3,170,978 Foreign borrowing 2,615,598 2,412,254 3,170,978 Domestic onlending - official institutions 37,986,931 43,619,266 45,382,677 National Treasury 158,557 149,248 167,864 BNDES 21,092,151 23,859,417 24,452,529 Finame 16,486,379 19,610,601 20,762,284 Other institutions 249,844 -- -- Foreign onlending 382 382 382 Derivative Financial instruments 235,699 781,047 555,098 Other liabilities 91,720,906 97,848,445 99,700,563 Foreign exchange portfolio 4,363,969 5,322,077 6,026,327 Shareholders and statutory distributions 454 986 -- Taxes and social security 496,494 732,496 766,295 Securities trading 350,146 24,613 141,099 Financial and development funds 5,934