Fitch Ratings Changes View On Support For Leading Brazilian Banks.

Business Editors

SAO PAULO, Brazil & NEW YORK--(BUSINESS WIRE)--May 9, 2002

Fitch Ratings has altered the support ratings of Banco do Brasil, BNDES, Banco Bradesco, Banco Itau and Uniao de Bancos Brasileiros (Unibanco) from '2T' to '4T' and Banco BCN's support rating from '3T' to '4T'.

Fitch's support ratings represent its assessment of whether a bank would receive support should this be necessary. Fitch continues to view Banco do Brasil (BB), BNDES, Banco Bradesco (Bradesco), Banco Itau (Itau) and Uniao de Bancos Brasileiros (Unibanco) as the country's leading commercial banks, together controlling in excess of 40?% of the country's retail deposit base. As such, Fitch's expectations are that official support would be forthcoming should it be necessary. However, given that Brazil's local currency sovereign ratings remain considerably below investment grade, Fitch considers this support to be likely but not certain, thus prompting a change of support ratings for the banks in question. Transfer risk concerns remain, as indicated by the 'T' suffix attached to the support ratings.

Following consultations with Bradesco's senior management, Fitch considers that Banco BCN (BCN), wholly owned by Bradesco, would be supported by its parent if the need arose. However, given Fitch's view that official support for Bradesco should, itself, now be considered to be likely but not certain, BCN's support rating has been revised to reflect likely, but not certain, support.

These changes have not had an impact on the banks' remaining ratings, which are affirmed at: individual 'B/C' for Bradesco, Itau and BCN, 'C' for Unibanco, and 'D/E' for Banco do Brasil; Fitch does not assign individual or any short- or long-term ratings to BNDES. Short- and long-term foreign currency ratings for all banks remain at the sovereign ceiling, respectively 'B' and 'BB-' and the Rating Outlook for the long-term ratings is Negative. The banks' national ratings are also affirmed as follows: Banco do Brasil, Bradesco and Itau short-term 'F1+ (bra)' and long-term 'AA+ (bra)'; Unibanco and BCN short-term 'F1+ (bra)' and long-term 'AA (bra)' and Safra short-term 'F1+ (bra)' and long-term 'AA- (bra)'.

At the same time, Fitch has announced today the short- and long-term local currency ratings respectively of 'B' and 'B+' to Banco Bradesco, BCN and Banco Safra.

These ratings are at the sovereign ceiling, reflecting the banks' sizeable portfolios of Brazilian government debt. The Rating Outlook for the long-term ratings is Negative.

Note to Editors: Fitch Ratings's Support and Individual Ratings for Banks

Fitch's Individual ratings assess how a bank would be viewed if it were entirely independent and could not rely on external support. Its Support ratings deal with the question of whether a bank would receive support from its owners or from the state if it were to get into difficulty. These ratings are not debt ratings but rather, respectively, an assessment of the intrinsic strength of a bank and of any level of outside support that may, or may not, be available to it. A Support rating qualified by the suffix "T" indicates significant existing or potential transfer risk of economic and/or political origin that might prevent support for foreign currency creditors.

Fitch's national ratings provide a relative measure of creditworthiness for rated entities in countries where the sovereign's foreign and local currency ratings are below 'AAA'. National ratings are not internationally comparable since the best relative risk within a country is rated 'AAA' and other credits are rated only relative to this risk. They are signified by the addition of an identifier for the country concerned, such as 'AAA (bra)' for national ratings in Brazil.