Good morning, ladies and gentlemen. And welcome to -- welcome, everyone to Banco Bradesco Fourth Quarter 2013 Earnings Results Conference Call. This call is being broadcast simultaneously through the Internet in the website www.bradesco.com.br/ir. In that address, you can also find a banner through which a presentation will be available for download. [Operator Instructions] Before proceeding, let me mention that forward-looking statements are being made under the safe harbor of the Securities Litigation Reform Act of 1996. Forward-looking statements are based on the beliefs and assumptions of Banco Bradesco's Management and on the information currently available to the company. Forward-looking statements are not guarantee of performance. They involve risks, uncertainties and assumptions because they're related to future events and, therefore, depend on circumstances that may or may not occur in the future. Investors should understand that general economic conditions, industry conditions and other operating factors could also affect the future results of Banco Bradesco and could cause results to differ materially from those expressed in such forward-looking statements. Now I would turn the conference over to Mr. Paulo Faustino da Costa, Market Relations Department director.

Good morning, everyone, and thank you, all, for participating on our first quarter conference call. We are here to provide you with all the information you made need about our numbers, and this is in line with our goals of always increasing the transparency of information disclosed to the market. We have here today, Mr. Julio de Siqueira Carvalho De Araújo, Executive Vice President; Mr. Marco Antonio Rossi, Chief Executive Officer of Bradesco Seguros Group and Bradesco's Executive Vice President; Mr. Luiz Carlos Angelotti, Executive Managing Director and Investor Relations Officer; and Mr. Moacir Nachbar Jr., Deputy Officer. I will now turn to our Executive Managing Director, Mr. Luiz Carlos Angelotti, who will lead our conference call. After his presentation, we will be open to answer your questions. Mr. Angelotti, please go ahead.

Good morning, everyone, and thank you for taking part into this fourth quarter 2013 conference call. Now please turn to Slide 2. Slide 2 shows the highlights for the period. Adjusted net income, which amounted to BRL 12,202,000,000. In 2013, 5.9% year-over-year, with ROE of 18%. Fourth quarter net income amounted to BRL 3,199,000,000, 3.8% growth quarter-over-quarter. Our insurance operation, which is one of the pillars of our business, has also performed well, with a net income of BRL 3,740,000,000 in 2013 and more than BRL 1 billion in the fourth quarter into premium growth, reinforcing the excellent prospects for this business. Our net credit margin went up by 12.9% in 2013, mainly impacted by the decline in delinquency costs, underlining the [indiscernible] quality of our loan portfolio. The delinquency ratio over 90 days continued to decline, falling by an additional 10 [ph] basis points quarter-over-quarter and 60 basis points year-over-year, reaching at 3.5%, at the lowest point in the last 5 years. We believe this ratio is becoming stable at this lower level. Our coverage ratio for overdue loans remained robust, reaching 192.3%, for the loans overdue by more than 90 days, demonstrating the soundness of our financial position. Fee income was up by 13% in 2013, while our OpEx went up by 5.6%. It will be [indiscernible] for this period. It is also worth noting that the performance of both lines is reaching our expectations. This mix of constant investment and fixed cost [indiscernible] led to an operating coverage ratio of 71.8%, resulting in the highest level of efficiency for the last 5 years. Total assets amount to over BRL 908 billion, and our expendable portfolio amounted to over BRL 427 billion. Slide 3 shows the reconciliation between our book net income and adjusted net income. In this…

[Operator Instructions] Our first question comes from Mario Pierry with Deutsche Bank.

Let me ask you 2 questions. The first one is related to your net interest income growth guidance of 6% to 10% in 2014. This is slower than the growth you're expecting for your loan book, so I wanted to understand from you exactly what do you expect, if you could break down the drivers of your net interest income between the loans, funding, insurance and securities, because I would imagine strong performance from your securities portfolios, especially with a higher interest rate environments. The second question is also kind of related to some guidance that you gave. You don't officially give guidance for asset quality, but you did mention that you see room for asset quality to improve. But I wanted to get from you a sense of what could be the impact of the higher interest rate environments in Brazil, as well as the weaker currency, let's say, if interest rates rise more than what you're expecting, would you be revising your view with respects to asset quality?

Thank you, Mario. Our net interest income guidance is 6% to 10%. We had some companies in this guidance, the credit contribution is around 70%, is 70% to 75%. And we have there other contributions for this goal that we have that came from the funding. And this line, we expect a better goal because of the high-level credit rate that we expect will amount to an [indiscernible] year. We have contributions for the -- our insurance group in the margins that probably, we expect something similar that we had in 2013. Probably we'll beat the expectations for the insurance business, as we have been in [indiscernible] securities and others. In this line, we have, during 2014, some impacts of the effects of our fixed portfolio. That is -- will be in a negative way. But on the other side, we have some additional contribution because the movement that we did with our end-to-end during the year, then this guidance that we gave you, 6% to 10%, we understand that it's very impossible to reach because the conditions that we had for this year. This [indiscernible] we understand could be a little conservative, but the 6% to 10%, we understand that is possible to retain this here in 2014.

Just let me interrupt you really quick here. Sorry, so if you could then describe a little bit of the drivers for the loan portfolio, my understanding then is that you expect further pressure on spreads, is this due to a change in mix? Or how are you seeing the competitive environment, especially from the public sector banks?

We have said at this year probably the competition will be in a more normal spreads to be a highly competition between the banks versus with more normal spreads. Then we expect this year we are working for to trying to maintain the stable of these spreads in the portfolio, considering the effects of the increase of favorable loans and the mortgage because they had lower spreads and they affect the mix, but we will continue to grow in SMEs, that gives us some compensation. Then that means in this case that we finish the year 7.1%, we expect though during the year some stability. So we will be -- we will finish on the 7.1% or 7%, but we expect more stability in our NIMs during the full year of 2014.

Okay. And then the second question...

And about the asset quality, we finished the year 2013 with 3.5% in our delinquency ratio for 90 days. Probably real asset during 2014, we expect some stability for this ratio, considering in our case the scenario that we gave you, we expect delinquencies that will be during the year stable and 10.75%, we'll finish the year with reduced level. We understand that it is possible to maintain stable this ratio. And they considering the growth that we expects for the [indiscernible] loans and mortgage that has a lower delinquency, and then we are investing in our improvements for our instruments for -- to do greater [ph] loans, and we understand that's possible to maintain the stability during 2014 in the delinquency ratio. And in this scenario, we expected -- we understand that the expense with the P&L, consider that we have some possibilities that to have a better delinquency ratio during the year with some decreasing the ratio. We expect to have some stability there in the expense that we probably -- the expense for 2014, we will be around the total level that we finished 2013.

Okay, Just and then a final follow-up. When you look at for the outlook for Brazil in 2014 and especially the asset quality, what concerns you the most? Is it the increase in interest rates? Is it the likely pick up in unemployment? Is it the FX volatility?

Well, the scenario that we have that we -- is a -- of our economic department, they visit, they expect to start visiting in the Selic rate, probably we're reaching 10.75% and it will be stable until the end of the year. The unemployment rate, we will have a small increase, which finishes 5.4% in 2013, we expect 5.7% for 2014. Then we understand that it is more increasing the unemployment rate, not really affected the delinquents. And for this system, our economic department for this system, they expect probably stabilities in the delinquency ratio. And then we understand that it is possible to maintain in our delinquency ratio, but the delinquency ratio is stable during 2014, which is some possibility to have some improvement, to have some decreasing the ratio because of the effect of the mix and the our investments in the [indiscernible] of our analysis.

Our next question comes from Marcelo Telles with Crédit Suisse. Marcelo Telles - Crédit Suisse AG, Research Division: I have 2 questions. The first one, in terms of asset quality, I know you've explored quite a bit, but can you share with us what your policy has been lately? Have you tightened your credit standards versus maybe like 6 months ago or you are pretty much the same credit risk policy or if you could need given this lower economic growth to become a little more conservative at least at the margin? And my second question regarding still your NII growth, can you remind us what you think the impact of higher rates could do to your margin? I mean, if you go to 11% Selic rate, you think that you'd be able to follow previous guidance? I ask that because that the NII guidance last year, in 2013, was actually fell short of expectations like rest of the year initial guidance at the beginning of the year. So how comfortable are you with that 6% to 10% NII growth?

Okay. About the asset quality, we maintain our policy in the same way we maintain the same procedure that we practice during 2013 with 2012. But something that we continually, we do is improve our models there. Every time we do the analysis of the portfolio that we had before and we analyze the performance in our improvement that we can do in our instruments for to correct something that we understand that we need to correct, and then we use for to improve for the future our [indiscernible]. We maintained the same interest policy, but we continually investing in our instruments for to do the analysis and to approve the credit operations. About the NII growth of the guidance, we gave it 6% to 10%. We understand that the -- it's possible to reaching this guidance if we have some improvements in the Selic rates. We understand that we will have some benefits. Because last year, we were more affecting our [indiscernible] fixed portfolio because the faster increase that we have in the Selic rates. This year, the majority of the portfolio, we had some renew the fixed [ph] portfolio, and they have now better rates and they can support better the effects of, if we have some increasing in the Selic rates in the ordering, in the funding line, our increasing the -- in the Selic we'll be favorable to improve the margins. And then we understand that feeling. We can support you if we have some increase in the Selic rates. We'll be favorable this year for to improve our margin. Marcelo Telles - Crédit Suisse AG, Research Division: Just one follow-up on the margin. You sold and bought about BRL 41 billion of securities, right? I think mostly NTNs from [indiscernible]. And can you share with us what was the rate differential in that of those you bought? Because I believe this will lead to a positive impact on your NII growth given that I think most of that happened at the very end of the quarter, right? So it's probably [indiscernible] that with high yields they'll probably have an impact on NII, so I was wondering if you could share with us what the average difference in rates.

And when we decide to do spend to market value was in the end of the year. It was in the second part of this -- the second half of the December. Then we did it considering the market rates are in this periods, then we understand now that we have our NTNs in a better end market ratios. And do you have the -- do you give your contribution for our margins during 2014? And then in the next year, because they might [indiscernible] of this volumes the NTNs as a more long-term. Then we'll maintain for the next year and will continue contributing for the results after this. Marcelo Telles - Crédit Suisse AG, Research Division: But do you think this is -- do you think 100 basis points, 200 basis points is a reasonable number to work with?

I think it is something reasonable.

Our next question comes from Regina Sanchez with Itaú BBA. Regina Longo Sanchez - Itaú Corretora de Valores S.A., Research Division: I also have 2 questions. I mean, the first one, it's also related to just a change I mean, in the market rate of the NTNs. I would like to know, I mean what drove your decision, I mean, to recognize the losses in the available for sale securities portfolio in the fourth quarter? I mean, why you choose to sell and then bought back the securities instead of, I mean, just selling them in the market? I understand that this is a big position, approximately BRL 40 billion and that it could be difficult to sell all securities at once without impacting market prices in a short period of time. But I would like to know, do you consider to gradually reduce this exposure from now on given that you already absorbed most of the losses? And then my second question is regarding the guidance for administrative expenses and the 3% to 6%, I think this is very good, it's very positive, especially considering the wage agreement that was lump sum stake [ph] around 8%. So if you could comment on initiative I mean, how do you get achieved this very small growth on administrative expenses? I appreciate.

Thank you, Regina, for the questions. About the NTNs, the decision, one part of the NTNs movement [indiscernible] that one part is related to insurance business. Then this movement is related to the new regulation of the SUSEP, that is our insurance company need to review their rates and their liabilities, changing for new March rate that now the regulator review gauge the rates, so that will give the rates to the companies. The new rates that they use is 5.6% for to do the movements in the liability. And they had a reversal of BRL 2.5 billion in the provisions for 2 months ending the spreads in the insurance business. They did something, the reversal position that we did in 2012. They need to -- in the NTN portfolio, they need to adjust to the market value, the market rates for 2 months saying the stability with the liabilities and the insurance business we have because there is a long-term liability, then we need to have the assets, the rates that will be compatible with this cost that we have. And one part of the movement is in the insurance company is because the new regulation that we have that came from SUSEP. In the bank portfolio, the independent portfolio that we have in the bank that we use for to do the asset liability management, we -- nothing in this column we changed. We did only to do these adjustments in our accounting costs. We did this -- we decide to do these adjustments in the costs and accounting books. During the movement, considering that the -- in the end of the year, at the level of the rate that we have, we understood that was better to do these adjustments, but nothing's changing in the economy because we continue with the same NTN portfolio in the bank. And we maintained this portfolio in the available-for-sale position growth, and we maintained this portfolio for to do our asset liability management in our management. Then the decision was because we understood that it was better for the company. We improved our average doing this movement. We have now a better position for to do the Basel III implementation and the profitability of these NTNs for the future increased, and do you give the contribution for our NII and for the results of the bank. Regina Longo Sanchez - Itaú Corretora de Valores S.A., Research Division: Okay. Just a follow-up. So you do not intend to sell this position because it's part of the asset liability management strategy of the bank? And just to confirm, I know it's a follow-up from previous questions. For in this guidance of NII of 6% to 10% growth, it does include this better contribution from the new yields on the NTN, so it's already considered, therefore, do you think it might be more towards the upper side of this 6% to 10%?

We consider it's possible to retain. During the year, we understand that we need to [indiscernible] we could do better. We understand that's very possible to reaching this guidance, considering the position that we have and in the scenario that we have for the economy this year. Regina Longo Sanchez - Itaú Corretora de Valores S.A., Research Division: Okay. And then about the expenses?

On the expense, our guidance is 3.6%. We expect to finish the year under the inflation ratio, the inflation level. Why we understand that, that's possible, if you look at our last 3 years, since 2011, that we finished with 18%. Because in during 2011, we did have some investments, they have 1,000 branches and we have a strong organic growth. Since then, we are now working in the -- we are improving our efficiencies. We are now, in 2012, we finished the year with OpEx growth was less than 8%. 2013, we finished with 4.6%. And for 2014, we expect to finish it under the inflation level. We have internally our Efficiency Committee, our Purchase Committee. We are involving all areas in the bank, all directors of areas are responsible for areas they're already booked in looking for opportunity inside the bank for, reduced costs are improving revenues because the efficiencies and not only [indiscernible]. And [indiscernible] both looking for opportunities, and then we have many projects they feel that probably will help us to maintaining costs under control during 2014. And then we have another contribution of our investments in NIT. Our IT restabilization program that some systems that we are finishing, they will give in some contribution for to improve the efficiency in the bank and they will help us to retaining this guidance that we gave that we are working hard to maintain the level of the growth in OpEx under the inflation goal. And we have another target that is our efficiency rates, that we expect to finish the year in around the 39% and the OpEx will contribute for to reaching this level.

Excuse me, ladies and gentlemen, since there are no further questions, I would like to invite Mr. Paulo Faustino da Costa to proceed.

Thank you, all, for participating in this conference call. I would like to take the opportunity to remind you that our Market Relation Department is our IR team are at your disposal and that all the content of our fourth quarter 2013 and the other information concerning Bradesco is in our website. Thank you.

That does conclude the Banco Bradesco audio conference for today. Thank you very much for participation, and have a good day.