If “Other” has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to follow.

Item 17        ¨        Item 18        x

If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes        ¨        No        x

TABLE OF CONTENTS

INTRODUCTION

All references in this annual report to (1) “Itaú Unibanco Holding,” “Itaú Holding,” ”we,“we,” “us,” or “our,” are to Itaú Unibanco Holding S.A. (formerly Banco Itaú Holding Financeira S.A.) and its consolidated subsidiaries, except where otherwise specified or the context otherwise requires; (2) “Itaú Unibanco,” is to Itaú Unibanco S.A. (formerly Banco Itaú S.A.) and “Itaú BBA” is to Banco Itaú BBA S.A., in each case, together with its consolidated subsidiaries, except where otherwise specified or the context otherwise requires; (3) the “Itaú Financial Group” are to Itaú Holding and all of its subsidiaries before the Association; (4) the “Unibanco Financial Group” are to Unibanco Holdings and all of its subsidiaries before the Association; (5) “Itaú Unibanco Group” is to Itaú Unibanco Holding together with its subsidiaries and affiliates; (6) the “Brazilian government” is to the federal government of the Federative Republic of Brazil; (7) “preferred shares” and “common shares” are to our authorized and outstanding shares of preferred stock and common stock, designated asações preferenciaisandações ordinárias, respectively, each without par value; (8) “ADSs” are to our American Depositary Shares (one ADS represents one preferred share); (9) the “real,” “reais” or “R$” are to Brazilianreais, the official currency of Brazil, and (10) “US$,” “dollars” or “U.S. dollars” are to United States dollars.

As of December 31, 20112012 and March 21, 2012,April 19, 2013, the selling rate for purchasing U.S. dollars was R$1.8758 2.0435 to US$1.00 and R$1.8267 2.0089 to US$1.00, respectively.

We have prepared our consolidated financial statements included in this annual report under Item 18, in accordance with International Financial Reporting Standards(“IFRS”Standards ("IFRS") as issued by the International Accounting Standards Board (“IASB”("IASB"), as of December 31, 20112012 and 2010 and January 1, 2010,2011 and for the years ended December 31, 2012, 2011 and 2010. Until December 31, 2010, weWe prepared our consolidated financial informationstatements in accordance with generally accepted accounting principles in the United States (“("U.S. GAAP”GAAP"). until December 31, 2010. Our consolidated financial statements included in our annual report on Form 20-F for fiscal 2010 was the last report with U.S. GAAP financial statements. We adopted IFRS in 2011, with first adoption date on January 1, 2010, and subsequent reports have included IFRS financial statements. All 2012, 2011 and 2010 financial data included in this report, unless stated otherwise, hashave been prepared in accordance with IFRS.IFRS as issued by the IASB.

We use accounting practices adopted in Brazil applicable to the institutions authorized to operate by the Central Bank for our reports to Brazilian shareholders, in filings with the Brazilian Securities Commission(Comissão de Valores Mobiliários),rios or the CVM,“CVM”), for the determination of dividend payments, and for the determination of tax liability.

Our fiscal year ends on December 31, and references in this annual report to any specific fiscal year are to the twelve-month period ended December 31 of such year.

Certain industry data presented in this annual report have been derived from the following sources: the Central Bank System (Sistema do Banco Central),Centralor SISBACEN,“SISBACEN”), a database of information provided by financial institutions to the Central Bank; the Brazilian association of leasing companies (Associação Brasileira de Empresas de Leasing),Leasingor ABEL;“ABEL”); the Brazilian government development bank (Banco Nacional de Desenvolvimento Econômico e Social)Social, or BNDES;“BNDES”); the Brazilian financial and capital markets association (Associação Brasileira das Entidades dos Mercados Financeiros e de Capitais)Capitais, or ANBIMA;“ANBIMA”); the National Monetary Council (Conselho Monetário Nacional or “CMN”), or CMN, and the insurance industry regulator (Superintendência de Seguros Privados)Privados, or SUSEP.“SUSEP”).

You should assume that the information appearing in this annual report is accurate only as of the date to which it refers or as of the date of this annual report, as the case may be. Our business, financial condition, results of operations and prospects may have changed since that date.

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

This annual report contains statements that are or may constitute forward-looking statements, including but not limited to statements in “Item 3D. Risk Factors,” “Item 4B. Business Overview” and “Item 5. Operating and Financial Review and Prospects.” We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends affecting our business. These forward-looking statements are subject to risks, uncertainties and assumptions including, among other risks:

The words “believe,” “may,” “will,” “estimate,” “continue,” “anticipate,” “intend,” “expect” and similar words are intended to identify forward-looking statements, but are not the exclusive means of identifying such statements. We undertake no obligation to update publicly or revise any forward-looking statements because of new information, future events or otherwise. In light of these risks and uncertainties, the forward-looking information, events and circumstances discussed in this annual report might not occur. Our actual results and performance could differ substantially from those anticipated in such forward-looking statements.

ITEM 1 IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISORS

Not applicable.

ITEM 2 OFFER STATISTICS AND EXPECTED TIMETABLE

Not applicable.

ITEM 3 KEY INFORMATION

3A. Selected Financial Data

You should read the following selected financial data in conjunction with the “Introduction” and “Item 5. Operating and Financial Review and Prospects” included in this annual report. The information below is qualified in its entirety by reference to our consolidated financial statements included in Item 18 in this annual report.

We maintain our books and records inreais,, the official currency of Brazil, and prepare our financial statements for statutory and regulatory purposes in accordance with accounting practices adopted in Brazil and applicable to institutions authorized to operate by the Central Bank or (“Brazilian GAAP.GAAP”). Accounting principles and standards generally applicable under Brazilian GAAP include those established by Brazilian Corporate Law (Law No. 6,404, as amended, including Law No. 11,638), by the accounting pronouncements committee (Comitê de Pronunciamentos Contábeis or ”CPC”), or CPC, which began issuing standards in 2007, and by the federal accounting council (Conselho Federal de Contabilidadeor “CFC”), or CFC, while interpretative guidance was issued before the CPC became active by the Brazilian professional body of independent accountants (Instituto dos Auditores Independentes do Brasil)Brasil, or IBRACON.“IBRACON”). In the case of companies subject to regulation by the Central Bank, such as Itaú Unibanco Holding, the effectiveness of accounting pronouncements issued by accounting standard setters, such as the CPC, depends on approval of the pronouncement by the National Monetary Council (Conselho Monetário Nacional or “CMN”), or CMN and the Central Bank which also establishes the effective date of the pronouncements. In addition, the CVM and other regulatory entities, such as SUSEP and the Central Bank, provide additional industry-specific guidelines. See “Item 9C. Markets” for additional information.

Notwithstanding the above, we have derived the data we present in the tables below from our audited consolidated financial statements as of and for the years presented.presented, which have been prepared in accordance with IFRS as issued by IASB. You should read all of the data in the tables below together with the consolidated financial statements and notes included in “Item 18. Financial Statements” and the information we provide in “Item 5. Operating and Financial Review and Prospects.” Except where we have indicated otherwise, we have prepared all of the consolidated financial information in this document in accordance with IFRS as issued by IASB. Until December 31, 2010, weWe prepared our consolidated financial informationstatements in accordance with U.S. GAAP.GAAP until December 31, 2010. Our consolidated financial statements included in our annual report on Form 20-F for fiscal 2010 was the last report with U.S. GAAP financial statements. We adopted IFRS in 2011, with first adoption date on January 1, 2010, and subsequent reports have included IFRS financial statements. All 2012, 2011 and 2010 consolidated financial data included in this report hashave been prepared in accordance with IFRS as issued by the IASB. Our group division and segment data comeare derived from our management reporting systems and are not based on, or prepared in accordance with, IFRS. For a discussion of the major differences between our management reporting systems and our consolidated financial statements under IFRS, see “Item 5A. Operating Results – Results of Our Business Operating Segments” and note 3334 to our consolidated financial statements.

The consolidated financial statements as of December 31, 2012 and 2011 2010 and January 1,for the years ended December 31, 2012, 2011 and 2010 included in this annual report have been audited by PricewaterhouseCoopers Auditores Independentes, an independent registered public accounting firm, as stated in their report included elsewhere in this annual report.

IFRS Selected Financial Data

This information is qualified in its entirety by reference to the consolidated financial statements included in Item 18."Item 18 - Financial Statements".

Earnings and Dividend per Share Information (4)

⁽¹⁾ Earnings per share have been computed following the “two class method” set forth by IAS 33 Earnings Per Share. See “Item 10B. Memorandum and Articles of Association” for a description of our two classes of stock. See note 2728 to our consolidated financial statements for a detailed calculation of earnings per share.

⁽²⁾Under Brazilian Corporate Law, we are allowed to pay interest on stockholders’ equity as an alternative to paying dividends to our shareholders. See "Item 8A. Consolidated Financial Statements and Other Financial Information - Dividend Policy and Dividends" and “Item 10E. Taxation – Interest on Stockholders’ Equity” and note 20b21b to our consolidated financial statements for a description of interest on stockholders’ equity.

⁽¹⁾Under Brazilian Corporate Law, we are allowed to pay interest on stockholders’ equity as an alternative to paying dividends to our stockholders. See "Item 8A. Consolidated Financial Statements and Other Financial Information - Dividend Policy and Dividends" and "Item 10E. Taxation - Brazilian Tax Considerations - Interest on Stockholders Equity" for a description of interest on stockholders’ equity.

⁽²⁾Translated into US$ fromreais at the selling rate established by the Central Bank at the end of the year in which dividends or interest on stockholders’ equity were paid or declared, as the case may be.

Balance Sheet Data

(*) The average balances are calculated based on a monthly basis. See “Item 4B. Business Overview – Selected Statistical Information – Average Balance Sheet and Interest Rate Data” for more detailed information on our average assets, liabilities and stockholders’ equity for the years ended December 31, 2012, 2011 and 2010.

(*) The average balances are calculated based on a monthly basis. See “Item 4B. Business Overview – Selected Statistical Information – Average Balance Sheet and Interest Rate Data” for more detailed information on our average assets, liabilities and stockholders’ equity for the years ended December 31, 2012, 2011 and 2010.

Selected Consolidated Ratios (%)

⁽¹⁾ Net interest income divided by average interest-earning assets. The average balances are calculated based on a monthly basis. See “Item 4B. Business Overview - Selected Statistical Information – Average Balance Sheets and Interest Rate Data” for more detailed information on our average assets, liabilities and stockholders' equity for the years ended December 31, 2012, 2011 and 2010.

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⁽²⁾Net income attributable to Itaú Unibanco Holdingowners of the parent company divided by average total assets. The average balances are calculated based on a monthly basis. See “Item 4B. Business Overview - Selected Statistical

Information – Average Balance Sheet and Interest Rate Data” for more detailed information on our average assets, liabilities and stockholders' equity for the years ended December 31, 2012, 2011 and 2010.

⁽³⁾ Net income attributable to owners of the parent company divided by average stockholders' equity. The average balances are calculated based on a monthly basis. See “Item 4B. Business Overview - Selected Statistical Information – Average Balance Sheet and Interest Rate Data” for more detailed information on our average assets, liabilities and stockholders' equity for the years ended December 31, 2011 and 2010.

⁽³⁾ Net income attributable to Itaú Unibanco Holding divided by average stockholders' equity. See “Item 4B. Business Overview - Selected Statistical Information – Average Balance Sheet and Interest Rate Data” for more detailed information on our average assets, liabilities and stockholders' equity for the years ended December 31,2012, 2011 and 2010.

⁽⁴⁾Loans and leases operations as of year-end divided by total deposits as of year-end.

⁽⁵⁾ Total stockholders' equity as of year-end divided by total assets as of year-end.

EXCHANGE RATES

Currently, the Brazilian foreign exchange system allows the purchase and sale of foreign currency and the performance of international transfers inreais by any individual or legal entity, subject to certain regulatory procedures.

The Brazilian government may impose temporary restrictions on the conversion of Brazilian currency into foreign currencies and on the remittance to foreign investors of proceeds from their investments in Brazil. Brazilian law allows the government to impose these restrictions whenever there is a serious imbalance in Brazil’s balance of payments or there are reasons to foresee a serious imbalance. We cannot predict whether the Brazilian government will impose remittance restrictions in the future. Thereal may depreciate or appreciate substantially against the U.S. dollar in the future. See “Item 3D. Risk Factors — Risks Relating to Brazil — Exchange rate instability may have a material adverse effect on the Brazilian economy and our business, financial condition and results of operations.”

As of April 19, 2013, the U.S. dollar-real exchange rate (PTAX) was R$2.0089 to U$1.00.

Exchange Rates

Before March 14, 2005, under Brazilian regulations, foreign exchange transactions were carried out on either the commercial rate exchange market or the floating rate exchange market. The commercial market was reserved primarily for foreign trade transactions and transactions that generally required prior approval from the Central Bank, such as registered investments by foreign persons and related remittances of funds abroad (including the payment of principal and interest on loans, notes, bonds and other debt instruments denominated in foreign currencies and registered with the Central Bank). The floating rate exchange market generally applied to specific transactions for which Central Bank approval was not required. Rates in the two markets were generally the same. On March 4, 2005, the CMN, through Resolution No. 3,265 effective March 14, 2005, as updated by CMN Resolution No. 3,568 of May 29, 2008, unified the two markets and allowed the exchange rate to float freely for all purposes. In addition, CMN issued Resolutions No. 3,844 and No. 3,845, both dated March 3, 2010, and the Central Bank issued Circulars No. 3,491, No. 3,492 and No. 3,493, all dated March 24, 2010, which consolidate and simplify certain exchange rules and related procedures. In 2011 the process of simplifying certain exchange rules and related procedures continued. By the issuance of Circular no. 3,545 on July 4, 2011, Central Bank adopted a new processing system of exchange transactions and revised the methodology of foreign exchange contracts. Currently, the Brazilian foreign exchange system allows the purchase and sale of foreign currency and the performance of international transfers inreais by any individual or legal entity, subject to certain regulatory procedures.

The Brazilian government may impose temporary restrictions on the conversion of Brazilian currency into foreign currencies and on the remittance to foreign investors of proceeds from their investments in Brazil. Brazilian law allows the government to impose these restrictions whenever there is a serious imbalance in Brazil’s balance of payments or there are reasons to foresee a serious imbalance. We cannot predict whether the Brazilian government will impose remittance restrictions in the future. The real may depreciate or appreciate substantially against the U.S. dollar in the future.

As of March 21, 2012, the U.S. dollar-real exchange rate was R$1.8267 to U$1.00.

The following table sets forth information on the selling rate for U.S. dollars as reported by the Central Bank for the periods and dates indicated.

Source: Central Bank

⁽¹⁾ Represents the average of the exchange rates on the last day of each month during the relevant period.

Source: Central Bank

⁽¹⁾ Represents the average of the closing exchange rates on the last day of each month duringday the relevant period.

Not applicable.

Not applicable.

The following section does not describe all the risks of an investment in our preferred shares and ADSs. These are the risks we consider material as of the date of this annual report. There may be additional risks that we currently consider immaterial or of which we are currently unaware, and any of these risks could have similar effects to those set forth below.

Therefore, you should carefully read this annual report in its entirety. You should consider, among other things, the risk factors with respect to Itaú Unibanco Holding, to Brazilian financial institutions and to Brazil not normally associated with investments in securities of United States, European and other similar issuers, including those risk factors set out below. Our business, results of operations, financial condition or prospects could be negatively affected if any of such risks occurs, and as a result, the trading price of our preferred shares and ADSs could decline and you could lose all or part of your investment.

Risks Relating to Brazil

The Brazilian government has exercised, and continues to exercise, influence over the Brazilian economy. This influence, as well as Brazilian political and economic conditions, could have a material adverse effect on our business, financial condition and results of operations and, as a consequence, on the market price of our preferred shares and ADSs.

The Brazilian government from time to time intervenes in the Brazilian economy and makes changes in policies and regulations. The Brazilian government’s actions have involved, in the past, among other measures, changes in interest rates, changes in tax policies, price controls, capital control limits and restrictions on selected imports and, prior to the current floating exchange regime, currency devaluations. Our business, financial condition, and results of operations may be materially and adversely affected by changes in policies or regulations involving or affecting certain factors, such as:

As a bank in Brazil, the vast majority of our income, expenses, assets and liabilities are directly tied to interest rates. Therefore, our business, results of operations and financial condition are significantly affected by inflation, interest rate fluctuations and related government monetary policies, all of which may have a material adverse effect on the growth of the Brazilian economy and on us, including our loan portfolio, our cost of funding and our income from credit operations.

In addition, changes in administrationsadministration may result in changes in government policy that may affect us. Uncertainty over whether the Brazilian government in the future will implement changes in policies or regulations affecting these and other factors in the future may contribute to heightened volatility in the Brazilian securities markets and in the securities of Brazilian issuers, which in turn may have a material adverse effect on us and, as a consequence, on the market price of our preferred shares and ADSs.

Inflation and fluctuation in interest rates could have a material adverse effect on our business, financial condition and results of operations.

Inflation and interest rate volatility have in the past caused material adverse effects in the Brazilian economy. While the Brazilian government has been able to keep inflation close to target levels since the introduction of inflation targets in 1999, we cannot assure you that it will continue to be able to do so. Inflation, especially sudden increases in inflation, usually causes the loss of purchasing power. Also prolonged periods of high inflation provoke distortions in the allocation of resources. From 20042006 to 2011,2012, the average annual inflation was 5.4%5.2%. Expected inflation for 2012,2013, as surveyed by the Central Bank, is 5.28%5.5%.

Measures to combat historically high rates of inflation have included tight monetary policies with high interest rates, resulting in restrictions on credit and short-term liquidity. Between 20052006 and 2011,2012, the base interest rate established by the Central Bank, which is the benchmark interest rate payable to holders of securities issued by the Brazilian government and traded through the Special Clearing and Settlement System (Sistema Especial de Liquidação e Custódia)dia or“SELIC”), or the SELIC, varied between 19.75%17.65% per year and 8.75%7.14% per year. Public expectations regarding possible future governmental actions in the economy, government intervention in the foreign exchange market and the effects of the downturn in the global financial markets have caused and may continue to cause interest rates to fluctuate. In addition, if Brazil experiences fluctuations in rates of inflation in the future, our costs and net margins may be materially and adversely affected, and government measures to combat inflation may include tightening monetary policy with high interest rates which may harm our business. Increases in the SELIC rate could materially and adversely affect us by reducing the demand for credit, increasing our cost of funds and increasing the risk of customer default. Conversely, decreases in the SELIC rate could also materially and adversely affect us by decreasing revenues on interest-earning assets and lowering our margins.

Exchange rate instability may have a material adverse effect on the Brazilian economy and our business, financial condition and results of operations.

The Brazilian currency fluctuates in relation to the U.S. dollar and other foreign currencies. The Brazilian government has in the past implemented various economic plans and utilized a number of exchange rate regimes, including sudden devaluations, periodic mini-devaluations in which the frequency of adjustments has ranged from daily to monthly, floating exchange rate systems, and dual exchange rates coupled with exchange controls. Since 1999, Brazil has adopted a floating exchange rate system with interventions by the Central Bank in buying or selling foreign currency. From time to time, the exchange rate between thereal and the U.S. dollar and other currencies has fluctuated significantly. For example, thereal depreciated 15.7%, 34.3%, 24.2% and 24.2%11.2% against the U.S. dollar in 2001, 2002, 2008 and 2008,2011, respectively, and appreciated 22.3%, 8.8%, 13.4%, 9.5%, 20.7%, 34.2% and 4.5% against the U.S. dollar in 2003, 2004, 2005, 2006, 2007, 2009 and 2010, respectively. In 2011,2012, thereal depreciated 11.2%8.2% against the U.S. dollar from an exchange rate of R$1.671.87 per US$1.00 as of December 31, 20102011 to an exchange rate of R$1.882.04 per US$1.00 as of December 31, 2011.2012. The average exchange rate in 20112012 was R$1.671.96 per US$1.00 compared withto an average exchange rate of R$1.761.67 per US$1.00 in 2010.2011. Recent Brazilian government interventions to maintain a stable foreign exchange rate might not have the desired effect and could lead to increased exchange rate volatility, potentially affecting our results.

Some of our assets and liabilities are denominated in, or indexed to, foreign currencies, especially the U.S. dollar. As of December 31, 2011, 27.0%2012, 25.1% of our total liabilities and 19.8%22.9% of our total assets were denominated in, or indexed to, a foreign currency. Although as of December 31, 2011,2012, our material foreign investments were economically hedged in order to mitigate effects arising out of foreign exchange volatility, including the potential tax impact of such investments, there can be no assurance that such hedging strategies will remain in place or will offset such effects. Therefore, a depreciation of thereal could have several adverse effects on us, including (i) losses on our liabilities denominated in or indexed to foreign currencies,currencies; (ii) impairments to our ability to pay dollar-denominated or dollar-indexed liabilities by making it more costly for us to obtain the foreign currency required to pay such obligations,obligations; (iii) impairments to the ability of our borrowers to repay dollar-denominated or dollar-indexed liabilities to us and (iv) negatively affect the market price of our securities portfolio. Conversely, an appreciation of the Brazilian currency could cause us to incur losses on our assets denominated in or indexed to foreign currencies. Therefore, depending on the circumstances, either a depreciation or appreciation of thereal could have a material adverse effect on our business, financial condition and results of operations and, as a consequence, on the market price of our preferred shares and ADSs.

Infrastructure and work force deficiencies in Brazil may impact economic growth and have a material adverse effect on our business.

Our performance is dependent on the overall health of the Brazilian economy. While Brazil has experienced economic growth in recent years, the rate of growth has decreased in 2011 and 2012. Continued growth could be limited by inadequate infrastructure, including potential energy shortages and a deficient transportation sector, and a lack of qualified work force, which could contribute to low levels of productivity and efficiency. Depending on intensity and duration, these factors could lead to employment volatility and generally lower income and consumption levels, which could limit our growth, result in increased default rates and ultimately have a material adverse effect on our business.

Developments and the perception of risk of other countries may adversely affect the Brazilian economy and the market price of Brazilian securities.

Economic and market conditions in other countries, including the United States, the European Union and emerging market countries, may affect to varying degrees the market value of securities of Brazilian issuers. Although economic conditions in these countries may differ significantly from economic conditions in Brazil, investors’ reactions to developments in these other countries may have a material adverse effect on the market value of securities of Brazilian issuers, the availability of credit in Brazil and the amount of foreign investment in Brazil. Crises in the European Union, the United States and emerging market countries, particularly Latin American countries, may diminish investor interest in securities of Brazilian issuers, including Itaú Unibanco Holding. This could materially and adversely affect the market price of our securities, and could also make it more difficult for us to access the capital markets and finance our operations in the future on acceptable terms or at all.

Banks located in countries considered to be emerging markets may be particularly susceptible to disruptions and reductions in the availability of credit or increases in financing costs, which could have a material adverse impact on our financial condition. In addition, the availability of credit to entities that operate within emerging markets is significantly influenced by levels of investor confidence in such markets as a whole and any factor that impacts market confidence (for example, a decrease in credit ratings or state or central bank intervention in one market) could materially and adversely affect the price or availability of funding for entities within any of these markets.

Risks Relating to Our Business and the Banking Industry

We are exposed to effects of the disruptions and volatility in the global financial markets and the economies in those countries where we do business, especially Brazil.

Beginning in late 2007, major financial institutions, including some of the largest global commercial and investment banks and insurance companies, experienced significant difficulties, especially lack of liquidity and depreciation of financial assets. More recently, fiscal problems in Europe, such as high debt levels, impaired growth and the risk of a sovereign default, particularly in Greece, Spain, Italy, Ireland and Portugal, increased volatility in already relatively fragile global financial markets. At the same time, the United States has been facing fiscal difficulties, which led to the downgrade of the U.S. long-term sovereign credit rating by Standard & Poor’s on August 6, 2011. See “Item 5A. Operating Results — Effects of the Global Financial Markets on our Financial Condition and Results of Operations.” These difficulties constricted the ability of a number of major global financial institutions to engage in further lending activity and caused losses. In addition, downgrades of sovereign credit ratings and defaults by, and doubts about the solvency of, certain financial institutions and the financial services industry generally led to market-wide liquidity problems and could lead to losses or defaults by, and bankruptcies of, other institutions.

We are exposed to the disruptions and volatility in the global financial markets because of their effects on the financial and economic environment in the countries in which we operate, especially Brazil, such as a slowdown in the economy, an increase in the unemployment rate, a decrease in the purchasing power of consumers and the lack of credit availability. We lend primarily to Brazilian borrowers and these effects could materially and adversely affect our customers and increase our non-performing loans and, as a result, increase the risk associated with our lending activity and require us to make corresponding revisions to our risk management and loan loss reserve models. For example, in 2009, we experienced an increase in our non-performing loans past due more than 90 days from 3.9%3.6% of total loans in December 31, 2008 to 5.6% December 31, 2009. As of December 31, 2011,2012, our non-performing loans past due more than 90 days represented 4.9%4.8% of our total loan portfolio.

The global financial downturn has had significant consequences for Brazil and the other countries in which we operate, including stock, interest and credit market volatility, a general economic slowdown, and volatile exchange rates that may, directly or indirectly, materially and adversely affect the market price of Brazilian securities and have a material adverse effect on our business, financial condition and results of operations. In addition, institutional failures and disruption of the financial market in Brazil and the other countries in which we operate could restrict our access to the public equity and debt markets.

Continued or worsening disruption or volatility in the global financial markets could lead to further increase in negative effects on the financial and economic environment in Brazil and the other countries in which we operate, which could have a material adverse effect on us.

A failure in, or breach of, our operational or security systems could temporarily interrupt our businesses, increasing our costs and causing losses.

Although we have high profile information security controls, continuing investments in infrastructure, and operations and crisis management in place, our business, financial, accounting, data processing systems or other operating systems and facilities may stop operating properly for a limited period of time or become temporarily disabled or damaged as a result of a number of factors including events that are wholly or partially beyond our control, such as: electrical or telecommunications outages; breakdowns, systems failures or other events affecting third parties with which we do business or that facilitate our business activities, including exchanges, clearing houses, financial intermediaries or vendors that provide services; events arising from local or larger-scale political or social matters and cyber attacks.

Temporary interruptions or failures in the physical infrastructure or operating systems that support our businesses and customers, or cyber attacks, or any unauthorized disclosures of personal information in our possession, could result in customer attrition, lawsuits, regulatory fines, penalties or intervention, reimbursement or other compensation costs.

Changes in applicable law and regulation may have a material adverse effect on our business.

Brazilian banks, including us, are subject to extensive and continuous regulatory review by the Brazilian government, principally by the Central Bank. We have no control over applicable law and government regulations, which govern all aspects of our operations, including regulations that impose:

·          minimum

The regulatory structure governing Brazilian financial institutions, including banks, broker-dealers and leasing companies and Brazilian insurance companies is continuously evolving. Disruptions and volatility in the global financial markets resulting in liquidity problems at major international financial institutions could lead the Brazilian government to change laws and regulations applicable to Brazilian financial institutions based on such international developments.

In response to the global financial crisis which began in late 2007, national and intergovernmental regulatory entities, such as the Basel Committee on Banking Supervision, proposed reforms to prevent the recurrence of a similar crisis, including the Basel III framework.framework, that creates new higher minimum regulatory capital requirements. In 2012,February 2011, the Central Bank issued preliminary guidance and an estimated timeline for implementation of the Basel III framework in Brazil. See “Item 4B. Business Overview — Regulation and Supervision — Regulation by the Central Bank — Capital Adequacy and Leverage/Regulatory Capital Requirements”.Requirements.” In addition, on March 1, 2013 and March 4, 2013, the Central Bank issued newinitial rules for implementation ofto implement the Basel III framework in Brazil, as detailed in notice of Public Hearing 40/2012 of February 17, 2012.Brazil. See “Item 4B. Business Overview — Regulation and Supervision -— Regulation by the Central Bank — Capital Adequacy and Leverage/Regulatory Capital Requirements — Implementation of Basel III in Brazil”. In the event that Public Hearing 40/2012 is fully implemented as currently proposed by the Central Bank and basedBrazil.” Based on our current regulatory capital ratios, as well as conservative assumptions on expected returns and asset growth, we do not anticipate that additional regulatory capital will be required to support our operations in the near future. However, depending on the outcomeeffects of Public Hearing 40/2012,the rules that complete the implementation of the Basel III framework on Brazilian banks and particularly on our operations, we may need to reassess our ongoing funding strategy for regulatory capital. See “Item 4B. Business Overview — Regulation and Supervision — Regulation by the Central Bank — Capital Adequacy and Leverage/Regulatory Capital Requirements — Implementation of Basel III in Brazil — Expected Future Rules.”

Moreover, there are several proposed bills under consideration in the Brazilian congress that, if signed into law as currently drafted, could adversely affect us. For example, a proposed law to benefit insolvent individual borrowers would allow courts to change the terms and conditions of credit agreements in certain situations. In addition, another proposed bill to amend the rules of civil procedures could have the effect of making recovery more difficult and appealing unfavorable judicial decisions in higher courts more burdensome.

We also have operations in countries outside of Brazil, including Argentina, Chile, Colombia, Paraguay, Portugal, United Kingdom, Uruguay Portugal and the United States. Changes in the laws or regulations applicable to our business in the countries in which we operate or adoption of new laws, such as the Dodd-Frank Wall Street Reform and Consumer Protection Act in the United States, and the related rulemaking, may have a material adverse effect on our business, financial condition and results of operations.

The amendment of existing laws and regulations or the adoption of new laws and regulations could have a material adverse effect on our business, financial condition and results of operations, including our ability to provide loans, make investments or render certain financial services. See “ Item“Item 4B. Business Overview — Regulation and Supervision”.Supervision.”

Tax reforms may have a material adverse impact on our results of operations.

To maintain its fiscal policies, the Brazilian government regularly enacts reforms to tax and other assessment regimes. These reforms include the enactment of new taxes, changes in the bases of calculation or rates of assessments, including rates applicable solely to the banking industry, and occasionaloccasionally the enactment of temporary taxes for designated governmental purposes. For example, in July 2011, the Brazilian government introduced a tax on securities transactions or IOF/Securities-Derivatives at the rate of 1.0% on the notional adjusted value of financial derivatives. Also, the government changed twice the tax charged on consumer financial transactions in 2011: an increase of 1.5% per year in April and a reduction of 0.5% per year in December. See “ Item“Item 4B. Business Overview — Regulation and Supervision—Supervision — Taxation — TaxationTax on Financial Transactions”.Transactions.” The effects of these changes and any other changes that could result from the enactment of additional taxation cannot be quantified. These changes, however, may reduce our volume of operations, increase our costs or limit our profitability.

Future changes in tax policy that may affect financial operations include the creation of new taxes. Until 2007, certain financial transactions were subject to the provisional contribution on financial transactions (Contribuição Provisória sobre a Movimentação ou Transmissão de Valores e de Créditos e Direitos de Natureza Financeira or “CPMF”). However, much uncertainty exists as to whether the CPMF, or similar taxes, will be re-introduced in the future. Also, the Brazilian Congress may discuss broad tax reforms in Brazil to improve the efficiency of allocation of economic resources, as proposed by the executive branch of the Brazilian federal government. MajorFurthermore, extensive tax reforms in Brazil have been discussed over the last few years. We cannot predict if such tax reforms will be implemented in the future. The effects of these changes, if enacted, and any other changes that could result from the enactment of additional tax reforms, cannot be quantified.

Increases in reserve and compulsory deposit requirements may have a material adverse effect on our business, financial condition and results of operations.

The Central Bank has periodically changed the level of reserves and compulsory deposits that financial institutions in Brazil are required to maintain with the Central Bank. The Central Bank may increase the reserve and compulsory deposits requirements in the future or impose new requirements.

Increases in reserve and compulsory deposit requirements reduce our liquidity to make loans and other investments and, as a result, may have a material adverse effect on our business, financial condition and results of our operations.

The compulsory deposits generally do not yield the same return as other investments and deposits because a portion of compulsory deposits:

·          do

For more detailed information on compulsory deposits and capital requirements, see “Item 4B. Business Overview — Regulation and Supervision”.Supervision.”

As of December 31, 2011,2012, we had R$92,32357,253 million in interest-bearing compulsory deposits and R$5,7306,448 million in non-interest-bearing compulsory deposits. For more detailed information on compulsory deposits, see “Item 4B. Business Overview — Selected Statistical Information — Central Bank Compulsory Deposits”.

 Deposits.”

The increasingly competitive environment and consolidations in the Brazilian banking industry may have a material adverse effect on us.

The markets for financial and banking services in Brazil are highly competitive. We face significant competition from other large Brazilian and international banks, including Brazilian public banks. Competition has increased as a result of recent consolidations among financial institutions in Brazil and as a result of new regulations by CMN that facilitate the customer’s ability to switch business between banks. See Item“Item 4B. Business Overview –— Regulation and Supervision.Supervision — Antitrust Regulation.” The increased competition may materially and adversely affect us by, among other things, limiting our ability to retain our existing consumer base, increase our customer base and to expand our operations, reducing our profit margins on banking and other services and products we offer, and to the extent it limits investment opportunities.

Changes in the profile of our business and economic conditions may have a material adverse effect on our loan portfolio.

As of December 31, 2011,2012, our loan and financing portfolio was R$ 346,264366,984 million, compared to R$294,837346,264 million as of December 31, 2010.2011. Our allowance for loan losses was R$25,713 million, representing 7.0% of our total loan portfolio, as of December 31, 2012, compared to R$23,873 million, representing 6.9% of our total loan portfolio, as of December 31, 2011, compared to R$19,994 million, representing 6.8% of our total loan portfolio, as of December 31, 2010.2011. The quality of our loan portfolio is subject to changes in the profile of our business resulting from organic growth and our merger and acquisition activity and is dependent on domestic and, to a lesser extent, international economic conditions. For example, during 2012 Brazilian banks experienced an increase in non-performing loans in the consumer credit business, particularly in the automobile sector. Adverse changes affecting any of the sectors to which we have significant lending exposure, political events within and external to Brazil and the variability of economic activity may have a material adverse impact on our business, financial condition and our results of operations. Furthermore, our historic loan loss experience may not be indicative of our future loan losses.

In addition, our strategy includes efforts to significantly expand our loan portfolio as well as increase the number of clients, particularly individuals and small and middle-market companies, that we serve. Certain financial products we offer to individuals and other clients are generally characterized by higher margins, but also higher risks of default. A future increase in our loan portfolio, as well as a shift to higher margins and higher risk products, could result in increased default rates, which could have a material adverse effect on our business, financial condition and results of operations.

The value of our securities and derivatives positions are subject to market fluctuations due to changes in Brazilian or international economic conditions and may produce material losses.

As of December 31, 2011,2012, investment securities represented R$172,690239,807 million, or 21.1%25.1% of our assets, and derivative financial instruments, which are used to hedge against risks in each of our business units, represented R$8,75411,597 million, or 1.1%1.2% of our assets, and realized and unrealized gains and losses have had and will continue to have a significant impact on our results of operations. These gains and losses, which we record when investments in securities are sold or are marked to market (in the case of trading securities) or when our derivative financial instruments are marked to market, may fluctuate considerably from period to period and are impacted by domestic and international economic conditions. If, for example, we have entered into derivatives transactions to protect against decreases in the value of the real or in interest rates and the real increases in value or interest rates increase, we may incur financial losses. We cannot predict the amount of realized or unrealized gains or losses for any future period, and variations from period to period have no practical analytical value in helping us to make such a prediction. Such losses could materially and adversely affect our results of operations and financial condition. Gains or losses on our investment portfolio may not continue to contribute to net income at levels consistent with recent periods or at all, and we may not successfully realize the appreciation or depreciation now existing in our consolidated investment portfolio or any portion thereof.

Exposure to Brazilian federal government debt could have a material adverse effect on us.

Like many other Brazilian banks, we invest in debt securities of the Brazilian government. As of December 31, 2011,2012, approximately 14.2%16.6% of our total assets, and 64.0%63.4% of our securities portfolio, was comprised of debt securities issued by the Brazilian government. Any failure by the Brazilian government to make timely payments under the terms of these securities, or a significant decrease in their market value, will have a material adverse effect on us.

If our pricing expectations are incorrect or our reserves for future policyholder benefits and claims are inadequate, the profitability of our insurance and pension products or our results of operations and financial condition may be materially and adversely affected.

Our insurance and pension plan business sets prices and establishes reserves for many of our insurance and pension products based upon actuarial or statistical estimates. The pricing of our insurance and pension products and the insurance and pension plans reserves carried to pay future policyholder benefits and claims are each based on models that include many assumptions and projections which are inherently uncertain and involve the exercise of significant judgment, including as to the levels of and timing of receipt or payment of premiums, contributions, benefits, claims, expenses, interest credits, investment results, interest rates, retirement, mortality, morbidity and persistency. Although we frequently review the pricing of our insurance and pensions products and the adequacy of our insurance and pension plans reserves, we cannot determine with precision the ultimate amounts that we will pay for, or the timing of payment of, actual benefits, claims and expenses or whether the assets supporting our policy liabilities, together with future premiums and contributions will be sufficient for payment of benefits and claims. Significant deviations in actual experience from our pricing assumptions could have a material adverse effect on the profitability of our insurance and pension plans products. In addition, if we conclude that our reserves, together with future premiums, are insufficient to cover future policy benefits and claims, we would be required to increase our reserves and incur income statement charges for the period in which the determination is made, which may have a material adverse effect on our business, financial condition and results of operations.

Our market, credit and operational risk management policies, procedures and methods may not be fully effective in mitigating our exposure to unidentified or unanticipated risks.risks and our losses may exceed our allowance for loan losses.

Our market, credit and operational risk management policies, procedures and methods, including our statistical modeling tools, such as value at risk (VaR), stress test and sensitivity analyses, may not be fully effective in mitigating our risk exposure in all economic market environments or against all types of risk, including risks that we fail to identify or anticipate. Some of our qualitative tools and metrics for managing risk are based upon our use of observed historical market behavior. In addition, due to limitations in the availability of information in Brazil, in assessing customers’ creditworthiness we rely largely on the credit information available from our own databases, certain publicly available consumer credit information and other sources. We apply statistical and other tools to these observations to quantify our risk exposures. These qualitative tools and metrics may fail to predict future risk exposures. These risk exposures could, for example, arise from factors we did not anticipate or correctly evaluate in our statistical models. This would limit our ability to manage our risks. Our losses thus could be significantly greater than the historical measures indicate. In addition, our quantified modeling does not take all risks into account. Our more qualitative approach to managing those risks could prove insufficient, exposing us to material unanticipated losses. If existing or potential customers believe our risk management is inadequate, they could take their business elsewhere. This could harm our reputation as well as our revenues and profits.

Our results of operations and financial condition depend on our ability to evaluate losses associated with risks we are exposed to and our ability to build these risks into our pricing policies. We estimate our allowance for loan losses according to the principles within IFRS. The calculation also involves significant judgment on the part of our management. Those judgments may prove to be incorrect or change in the future depending on information as it becomes available. This could adversely affect our operating income and, consequently, our financial condition and results of operations.

In addition, our businesses depend on the ability to process a large number of transactions securely, efficiently and accurately. Losses can result from inadequate personnel, inadequate or failed internal control processes and systems, information systems failures or breaches or from external events that interrupt normal business operations. We also face the risk that the design of our controls and procedures for mitigating operational risk proves to be inadequate or is circumvented.

We may incur losses associated with counterparty exposures.

We face the possibility that a counterparty will be unable to honor its contractual obligations. These counterparties may default on their obligations due to bankruptcy, lack of liquidity, operational failure or other reasons. ThisCounterparty risk may arise, for example, from entering into reinsurance agreements or loan facilities or other credit agreements under which counterparties have obligations to make payments to us; executing currency or other trades that fail to settle at the required time due to non-delivery by the counterparty or systems failure by clearing agents, exchanges, clearing houses or other financial intermediaries. In addition, we routinely transact with counterparties in the financial services industry, including brokers and dealers, commercial banks, investment banks, mutual and hedge funds and other institutional clients. We may incur in losses if a counterparty does not honor its contractual obligations.

Our controlling shareholder has the ability to direct our business.

As of JanuaryMarch 31, 2012,2013, IUPAR, our controlling shareholder, directly owned 51.00%51.0% of our common stock and 25.54%25.5% of our total capital stock. See “Item 7A. Major Shareholders”.Shareholders.” As a result, IUPAR has the power to control us, including the power to elect and remove our directors and officers and determine the outcome of any action requiring shareholder approval, including transactions with related parties, corporate reorganizations and the timing and payment of dividends. In addition, IUPAR is jointly controlled by Itaúsa, which is controlled by the Egydio de Souza Aranha family, and the former controlling shareholders of Unibanco, the Moreira Salles family. The interests of IUPAR, Itaúsa and the Egydio de Souza Aranha and Moreira Salles families may be different from your interests as a holder of our preferred shares and ADSs.

Investors in our securities do not have the same protections as if the majority of the members of our board of directors were independent.

As described in “Item 7A. Major Shareholders”, IUPAR is our controlling shareholder and, as a result, has the power to control us, including the power to elect and remove our directors and officers. Our current board of directors is comprised of 1312 members; only threefour of those directors are independent in accordance with our corporate governance policy. As a foreign private issuer, we are subject to corporate governance standards, such as the New York Stock Exchange listed company rules, that differ from those applicable to U.S. domestic issuers, including with respect to director independence requirements. See “Item 16G. Corporate Governance.” A significant number of our directors participate in decision-making on matters in which they have greater interests than would an independent director. As a result, the interests of these directors may not be, at all times, the same as those of our securityholders. In addition, several of our directors are affiliated with IUPAR and circumstances may arise in which the interests of IUPAR and its affiliates conflict with the interests of our other stockholders. Where these and other conflicting interests exist, our securityholders will be dependent on our directors exercising, in a manner fair to all of our securityholders, their fiduciary duties as a member of our board of directors.

We are subject to regulation on a consolidated basis and may be subject to liquidation or intervention on a consolidated basis.

The Central Bank treats us and our subsidiaries and affiliates as a single financial institution for regulatory purposes. While our consolidated capital base provides financial strength and flexibility to our subsidiaries and affiliates, their activities could indirectly put our capital base at risk. In particular, any investigation of, or intervention by the Central Bank in, the affairs of any of our subsidiaries and affiliates could have a material adverse impact on our other subsidiaries and affiliates and ultimately on us.

Integration of acquired or merged businesses involves certain risks that may have a material adverse effect on us.

We have engaged in a number of mergers and acquisitions in the past and may make further acquisitions in the future as part of our growth strategy in the Brazilian financial services industry. We believe that these transactions will contribute to our continued growth and competitiveness in the Brazilian banking sector.

Any acquisition and merger of institutions and assets and the integration of such institutions and assets involves certain risks including the risk that:

If we fail to achieve the business growth opportunities, cost savings and other benefits we anticipate from mergers and acquisition transactions, or incur greater integration costs than we have estimated, our business, financial condition and results of operations and financial condition may be materially and adversely affected.

Risks Relating to the Preferred Shares and the ADSs

The relative volatility and illiquidity of the Brazilian securities markets may substantially limit your ability to sell the preferred shares underlying the ADSs at the price and time you desire.

Investing in securities that trade in emerging markets often involves greater risk than investing in securities of issuers in the United States or in other countries, and these investments are generally considered to be more speculative in nature. The Brazilian securities market is substantially smaller, less liquid, more concentrated and can be more volatile than major securities markets in the United States or in other countries. There is also significantly greater concentration in the Brazilian securities market than in major securities markets such as the United States or in other countries. The ten largest companies in terms of market capitalization represented 54.4%52.4% of the aggregate market capitalization of BM&FBOVESPA S.A. – (Bolsa de Valores, Mercadorias e Futuros, or BM&FBOVESPA,“BM&FBOVESPA”), as of December 31, 2011.2012. Therefore, although you are entitled to withdraw our shares underlying the ability ofADSs from the holdersdepositary bank at any time, your ability to sell the preferred shares underlying the ADSs at the price and at time they desire may be limited.

The preferred shares and ADSs generally do not have voting rights.

According to our bylaws, , holders of preferred shares, and therefore of the ADSs, are not entitled to vote at meetings of our shareholders, except in limited circumstances. See “Item 10B. Memorandum and Articles of Association.” In the limited circumstances where the preferred shareholders are able to vote, holders may exercise voting rights with respect to the preferred shares represented by ADSs only in accordance with the provisions of the deposit agreement relating to the ADSs.

Despite there arebeing no provisions under Brazilian law or under our bylaws that limit ADS holders' ability to exercise their voting rights through the depositary bank with respect to the underlying preferred shares (in the limited circumstances in which the preferred shareholders are able to vote), there are practical limits to the ability of ADS holders to exercise their voting rights due to extra procedural steps involved in communicating with such holders. For example, our preferred shareholders will either receive notice of the meetings directly from us or through publication of notice in Brazilian newspapers and will be able to exercise their voting rights by either attending the meeting in person or voting by proxy. ADS holders, by comparison, will only receive notice of the meetings directly from us, if they are properly registered in our mailing list. If they are not registered in our mailing list, they will receive the notice only through the depositary bank.

According to the provisions of the deposit agreement, we will provide notice to the depositary bank, which will, in its turn, and to the extent practicable, mail such notice to holders and instructions on how the ADS holderholders can participate in the shareholders meeting. To exercise their voting rights, ADS holders must instruct the depositary bank on how to vote the shares represented by their ADSs. Because of this extra procedural step involving the depositary bank, the process for exercising voting rights is longer for ADS holders.

Holders of ADSs may be unable to exercise preemptive rights with respect to our preferred shares.

We may not be able to offer our preferred shares to U.S. holders of ADSs pursuant to preemptive rights granted to holders of our preferred shares in connection with any issuance of our preferred shares unless a registration statement under the Securities Act is effective with respect to the preferred shares and preemptive rights, or an exemption from the registration requirements of the Securities Act is available. However, as we are not obligated to file a registration statement relating to preemptive rights with respect to our preferred shares, we cannot assure you that we will file any such registration statement. If a registration statement is not filed and an exemptionfrom registration does not exist, The Bank of New York Mellon, as depositary, will attempt to sell the preemptive rights, and you will be entitled to receive the proceeds of the sale. However, these preemptive rights will expire if the depositary does not sell them in a timely manner, and U.S. holders of ADSs will not realize any value from the granting of the preemptive rights. For more information on the exercise of your preemptive rights, see “Item 10B. Memorandum and Articles of Association– — Preemptive Rights on Increase in Preferred Share Capital.”

If you surrender your ADSs and withdraw preferred shares, you risk losing the ability to remit foreign currency abroad and certain Braziliantax advantages.

As a holder of ADSs, you benefit from the electronic certificate of foreign capital registration obtained by the custodian for our preferred shares underlying the ADSs in Brazil, which permits the custodiandepositary to convert dividends and other distributions with respect to the preferred shares underlying the ADSs into non-Brazilian currency and remit the proceeds abroad. If you surrender your ADSs and withdraw preferred shares, you willmay be entitled to continue to rely on the custodian’scustodian´s electronic certificate of foreign capital registration for only five business days from the date of withdrawal. Thereafter, upon the disposition of or distributions relating to the preferred shares, you will not be able to remit abroad non-Brazilian currency unless you obtain your own electronic certificate of foreign capital registration, the Electronic Declaratory Registration of Foreign Direct Investment (RDE-IED), or you qualify under Brazilian foreign investment regulations that entitle some foreign investors to buy and sell shares on Brazilian stock exchanges without obtaining a separate electronic certificatescertificate of foreign capital registration.registration, the Electronic Declaratory Registration of Portfolio (RDE – Portfolio), in accordance with CMN Resolution No. 2,689, of January 26, 2000. If you do not qualify underfulfill the foreign investment regulationsrequirements to obtain a RDE – Portfolio, you will generally be subject to less favorable tax treatment of dividends and distributions on, and the proceeds from any sale of, our preferred shares. If you attempt to obtain your own electronic certificate of foreign capital registration, you may incur expenses or suffer delays in the application process, which could delay your ability to receive dividends or distributions relating to our preferred shares or the return of your capital in a timely manner. Moreover, should you surrender your ADSs and withdraw preferred shares, applicable regulations require you to enter into corresponding exchange transactions and pay taxes on these exchange transactions. The depositary’sFinally, the custodian´s electronic certificate of foreign capital registration may also be adversely affected by future legislative changes.

Holders of our preferred shares and ADSs may not receive any dividendsdividends.

According to our bylaws, we are obligated to pay our shareholders at least 25%25.0% of our annual adjusted net income, which may differ significantly from our net income calculated under IFRS. This adjusted net income may be capitalized, used to absorb losses or otherwise retained as allowed by Brazilian Corporate Law. In addition, Brazilian Corporate Law allows us to suspend the mandatory distribution of dividends to all shares in any particular year if our board of directors informs our shareholders that such distribution would be incompatible with our financial condition. In addition, due to the implementation of Basel III rules, Brazilian law currently establishes that if financial institutions are not in compliance with the CMN requirements, they must significantly reduce the amount of dividends to be distributed or even not distribute any dividends. See “Item 8A. Consolidated Financial Statements and Other Financial Information – Dividend Policy and Dividends” and “Item 10B. Memorandum and Article of Association – Calculation of Distributable Amount.”

As a holder of ADSs, you have shareholder rights that differ from those of shareholders of companies organized under the laws of the United States or other jurisdictionsjurisdictions.

Our corporate affairs are governed by the Brazilian Corporate Law and our bylaws, which may differ from the legal principles that would apply if we were incorporated in a jurisdiction in the United States or in other jurisdictions outside Brazil. Under Brazilian Corporate Law, youthe holders of ADSs and the holders of the preferred shares may have different rights with respect to protection of their interests, including measures related to actions taken by our board of directors or the holders of our common shares, which may differ from the laws of other jurisdictions outside Brazil.

ITEM 4 INFORMATION ON THE COMPANY

General

Our legal and commercial name is Itaú Unibanco Holding S.A. We were incorporated on September 9, 1943 and registered under NIRE 35300010230.1943. We are organized as a publicly held corporation for an unlimited period of time under the laws of Brazil. Our head offices are located at Praça Alfredo Egydio de Souza Aranha, 100, 04344-902, São Paulo, SP, Brazil and our telephone number is +55-11-5019-1267.

Investor information can be found on our website at www.itau-unibanco.com/ir. Information contained on our website is not incorporated by reference in, and shall not be considered a part of, this annual report. Our agent for service of process in the United States is the general manager of our New York branch, which is located at 767 Fifth Avenue, 50th Floorfloor, New York, NY 10153-0023.10153.

History

We trace our origins to 1944, when members of the Egydio de Souza Aranha family founded Banco Federal de Crédito S.A. in São Paulo. Since 1973 we have operated through Banco Itaú S.A., now Itaú Unibanco. Unibanco was founded by the Moreira Salles family in 1924, making it Brazil’s oldest non-state owned bank at the time of the Association.

On November 3, 2008, we announced the controlling shareholderscombination of Itaúsa and of Unibanco Holdings entered into an association agreement to combine the operations of Itaú Holding (now(currently Itaú Unibanco Holding) and its subsidiaries and E. Johnston, Unibanco Holdings S.A., including its subsidiary Unibanco and Unibanco’s subsidiaries. To effectThe result of this Association was the Association, we carried out a corporate restructuring pursuant to which E. Johnston, Unibanco Holdings and its subsidiary Unibanco became wholly owned subsidiariescreation of Itaú Unibanco Holding through a series of transactions, as described below:

A merger of shares means “incorporação de ações” as defined by article 252Holding. Since the final approval of the Brazilian Corporate Law, and is a corporate restructuring where one company (A) exchanges its shares for shares of another company (B), and as a consequence the shareholders of B become shareholders of A, and A becomes the sole shareholder of B. The shareholders of each of Itaú Unibanco Holding, Itaú Unibanco, E. Johnston, Unibanco Holdings and Unibanco approved the transactions at extraordinary shareholders’ meetings held on November 28, 2008. The transactions were approvedAssociation by the Central Bank on February 18, 2009 and the minutes of the shareholders’ meetings reflecting the approval of the merger of shares were registered by the Commercial Registry of the State of São Paulo in March 2009. The Association was approved with no restrictions by CADE on August 18, 2010.

The shares of Itaú Unibanco Holding, including those issued in exchange for shares of Unibanco and Unibanco Holdings, commenced trading under2010, we have fully integrated the same symbol on March 31, 2009. In May 2009, the trading symbols were standardised to “ITUB” on all the stock exchanges where Itaú Unibanco Holding’s securities are listed. At the extraordinary shareholders’ meeting held on November 28, 2008, our shareholders approved the change of our corporate name from Banco Itaú Holding Financeira S.A. to Itaú Unibanco Banco Múltiplo S.A. At the extraordinary shareholders’ meeting held on April 24, 2009, our shareholders approved a further change of our corporate name to Itaú Unibanco Holding S.A., which change was approved by the Central Bank on August 12, 2009. Finally, at the extraordinary shareholders’ meeting held on April 30, 2009, the shareholders of Itaú Unibanco approved the changeoperations of the corporate name of Banco Itaú S.A. to Itaú Unibanco S.A., which change was approved by the Central Bank on December 30, 2009.

 two banks.

As a result of December 31, 2012, we were the Association, many initiatives were takenlargest bank in orderBrazil based on market capitalization according to complete the integration of the two banks. The main initiatives were:Bloomberg.

Statistical Disclosure by Bank Holding Companies

See “Item 4B. Business Overview –— Selected Statistical Information” for additional information relating to our business.

Divestitures

Unibanco Saúde SeguradoraOrbitall

On December 16, 2009,22, 2011, Banco Itaucard S.A. (“Banco Itaucard”), Banco Itauleasing S.A., Itaú Seguros S.A. (“Itaú Seguros”)Unibanco and Intrag-Part. Administração e Participações Ltda. entered into a share purchase agreement with TI Brasil Participações Ltda., andby means of which they undertook to (i) spin-off Itaú Unibanco Serviços e Processamento de Informações Comerciais Ltda. (formerly known as Orbitall Serviços e Processamento de Informações Comerciais Ltda.) (“Old Orbitall”) so that all of its assets, liabilities, staff and necessary resources to carry out the third party credit card processing business of Old Orbitall would be merged into Orbitall Serviços e Processamento de Meios de Pagamento Ltda. (“Orbitall”) and (ii) sell 100.0% of the shares of Orbitall. The transaction closed on March 31, 2012.

Serasa

On October 22, 2012, Itaú Unibanco Holding, through BIU Participações S.A., entered into a stock purchase agreement with Experian Brasil Ltda., under which it undertook to sell its equity stake, corresponding to 601,403 common shares, in Serasa S.A., a credit bureau, for approximately R$1,700 million. This transaction closed on November 23, 2012.

BPI

On April 20, 2012 Itaú Unibanco Holding entered into an agreement withthrough its subsidiary IPI - Itaúsa Portugal Investimentos, SGPS, Lda. (“IPI”), to sell its stake of 18.87% in Banco BPI, S.A. By means of this transaction, Caixabank, S.A. (“La Caixa”), a subsidiary of Tempo Participações S.A.Spanish bank, acquired such stake for the sale of all the shares of Unibanco Saúde Seguradora held by Itaú Seguros and Itaú Unibanco, for R$55approximately €93 million. The performance of Unibanco Saúde Seguradora in the 12-month period after the closing date of the transaction entitled Itaú Seguros and Itaú Unibanco to an additional payment of approximately R$50 million. CADE approved the transaction in December 2009. The Brazilian National Agency of Supplemental Health (Agência Nacional de Saúde Suplementar) (“ANS”),Portuguese Central Bank approved the transaction on April 1, 2010. The30 and its closing of the transaction occurred on April 29, 2010.May 3, 2012.  This transaction had a positive impact of R$124 million on our consolidated stockholders’ equity due to the adjustment in other comprehensive income in connection with the sale and a negative non-recurring effect of R$186 million on our net income, due to the difference between the consideration received and the carrying amount of our equity investment and the adjustment in other comprehensive income.

Allianz Seguros

On December 29, 2009, Allianz South America Holding B.V. entered into an agreement with Itaú Unibanco Holding for the purchase for R$109 million of the 14.03% indirect interest that Itaú Unibanco Holding held in Allianz Seguros. The transaction closed on January 14, 2010 and was approved by CADE in March 2010. We notified SUSEP of the transaction.

Capital Expenditures

On January 27, 2012, we announced the construction of a new technology center, representing a total investment of approximately R$800 million.million for the first phase of the project (building). See “Business –“Item 4B. Business Overview Technology”. In September 2012, we announced an investment of R$10,413 million in technology, innovation and services to be made in the period from 2012 to 2015.

See “Item 5B. Liquidity and Capital Resources – Capital – Capital Expenditures” for a discussion of our capital expenditures for the last twothree fiscal years.

Acquisitions

Redecard

On February 7, 2012 Itaú Unibanco Holding announced its intention to acquire, directly or through its affiliates, all outstanding shares of Redecard S.A. (“Redecard”), through a public tender offer (the “Tender Offer”) aimed at (i) cancelling Redecard’s authorization as a publicly-held company registered with the CVM and (ii) delisting Redecard from the Novo Mercado Corporate Governance Listing Segment maintained by the São Paulo Stock Exchange (BM&FBOVESPABolsa de Valores, Mercadorias e Futuros, or “BM&F Bovespa”). The Tender Offer will target the acquisition of common shares of Redecard corresponding to approximately 50% of its share capital. The announced maximum price to be offered for each of such shares will be R$35.00, payable in reais, a total offer of up to R$11.8 billion. We intend to fund the Tender Offer with available cash. Itaú BBA will act as advisor and intermediary institution of the Tender Offer. The completion of the Tender Offer is subject to regulatory approval.

Banco Carrefour

On April 14, 2011 Itaú Unibanco entered into a share purchase and sale agreement governing the indirect acquisition by Itaú Unibanco of 49%49.0% of Banco CarrefourCSF S.A. (“Banco CSF”) for the amount of R$725 million. Banco CarrefourCSF is the entity responsible for the offering and distribution, on an exclusive basis, of financial, insurance and pension products and services through the distribution channels of Carrefour Comércio e Indústria Ltda., which operates under the “Carrefour” brand in Brazil. As of April 14, 2011, the “Carrefour” brand included 163 hypermarkets and supermarkets and related e-commerce channels, and had 7.7 million accounts and a credit portfolio (gross book value) of R$2,254 million as of December 31, 2010. This transaction is subject to the approval ofwas approved by the Central Bank.Bank in April 2012 and closed on May 31, 2012.

HSBC Portfolio in ChileBMG Association

On October 24, 2011, we completedJuly 9, 2012, Itaú Unibanco entered into an association agreement with Banco BMG S.A. (“Banco BMG”), a privately-held Brazilian bank, forming a joint venture for the acquisitiondistribution of HSBC’s retail portfoliopayroll loans in Chile,Brazil (the “BMG Association”). The BMG Association is structured as a new financial institution, Banco Itaú BMG Consignado S.A. (the “JV”), controlled by Itaú Unibanco, who holds, indirectly, 70.0% of the shares issued by the JV. BMG holds the remaining 30.0% stake in the JV. The initial stockholders’ equity of the JV was approximately R$1 billion. Itaú Unibanco has the right to nominate the majority of the board of directors of the JV and the majority of the officers of the JV, including the Chief Executive Officer. Banco BMG has the right to appoint the officers responsible for the commercial, back-office and collection divisions of the JV, subject to Itaú Unibanco’s approval.

Banco BMG shares its distribution channels operated through banking agents (correspondentes bancários) with the JV, which included, among others, 4has the right to grant 70.0% of the payroll loans generated by such distribution channels. The remaining 30.0% of such loans may be granted directly by Banco BMG.

The payroll loans granted to Itaú Unibanco’s clients through Itaú Unibanco’s branches and other exclusive Itaú Unibanco channels remain separate from the consumeroperations of the JV. Itaú Unibanco also provides funding for Banco BMG’s payroll loan transactions of up to R$300 million per month, for a five-year term, through the acquisitions of payroll credit portfolios. Itaú Unibanco and mortgage portfolios, rankingits affiliates also have the right to offer their products and services to the JV’s customers.

Following approval of this transaction by CADE, definitive agreements governing the BMG Association were executed on December 13, 2012, and included an investment agreement governing each party’s rights and obligations under the JV, and an agreement for the provision of funding through assignment of credit rights governing Itaú asUnibanco’s provision of funds to Banco BMG. The transaction closed on January 7, 2013 and it was approved and ratified by the leaderCentral Bank in the premium market, with a network of 88 branches in Chile.April, 2013.

MCC SecuritiesRedecard

On August 1, 2011,February 7, 2012, Itaú Unibanco Holding announced its intention to acquire, directly or through its subsidiaries, entered into certain agreementsaffiliates, all outstanding shares of Redecard S.A. (“Redecard”), through a public tender offer (the “Tender Offer”) aimed at cancelling Redecard’s authorization as a publicly-held company registered with the shareholdersCVM. The Tender Offer targeted the acquisition of MCC, acquiring 50% plus onecommon shares of Redecard corresponding to approximately 50.0% of its share issuedcapital. On April 12, 2012, Itaú Unibanco Holding confirmed that the price to be paid in cash would be R$35.00 per share (“Tender Offer Price”). The Tender Offer was successfully completed on September 24, 2012. As a result of the auction, Itaú Unibanco Holding acquired, through its affiliate Banestado Participações, Administração e Serviços Ltda., 298,989,137 common shares of Redecard, representing 44.4% of Redecard’s share capital, bringing the total amounts of common shares owned by MCC Securities Inc. (Cayman Islands) (“MCC Securities”),us to 94.4% of Redecard’s share capital. On October 18, 2012, Redecard’s registration as a wealth managementpublicly held company formingwas cancelled. As of December 31, 2012, Itaú Unibanco Holding held, through its affiliates, 100.0% of Redecard’s shares, as a joint venture with MCC’s shareholders targeting Chilean highresult of subsequent purchases. The shares were purchased at the Tender Offer Price for a total amount of R$11,752 million (including the Tender Offer) and the difference between the value paid and the value corresponding to the minority interest was recognized under appropriated reserves in the amount of R$11,151 million as of December 31, 2012, which net worth clients.of taxes totaled R$7,360 million. See note 3(c) to our annual consolidated financial statements.

Unibanco Participações Societárias

On July 29, 2011, we acquired, through a wholly-owned subsidiary, all remaining interests not previously owned in Unibanco Participações Societárias, an indirect investment subsidiary of Itaú Unibanco Holding, for approximately R$1.2 billion in cash.

HSBC Portfolio in Chile

On October 24, 2011, we completed the acquisition of HSBC’s high net worth portfolio in Chile, which included, among others, 4 branches and the consumer credit and mortgage portfolios, strengthening our position in the Chilean market, with a network of 88 branches in Chile.

MCC Securities

On August 1, 2011, Itaú Unibanco, through its subsidiaries, entered into certain agreements with Munita, Cruzat & Claro (“MCC”) and acquired 50.0% plus one share issued by MCC Securities Inc. (Cayman Islands), forming a joint venture with MCC targeting Chilean high net worth clients.

Itaú Unibanco Holding ranked among the tentwenty largest banks in the world in 20112012 and was the largest bank in Brazil, each ranking based on market capitalization according to Bloomberg.Bloomberg as of December 31, 2012. Our principal operations are: (i) commercial banking (including insurance, pension plan and capitalization products, credit cards, asset management and a variety of credit products and services for individuals, small and middle-market companies); (ii) Itaú BBA (corporate,corporate and investment banking and treasury)(Itaú BBA); (iii) consumer credit (financial products and services to our non-accountholders); and (iv) operations with the market and corporation (referred to as corporate and treasury in note 33 of34 to our consolidated financial statements).

On October 24, 2010, Itaú Unibanco completed the integrationWe have an extensive network with 4,121 branches, 906 customer site branches (“CSBs”) and 27,960 ATMs in Brazil and abroad, as of customer service locations throughout Brazil. In total,December 31, 2012, which includes 998 branches and 245 client service branches, or CSBs of Unibanco that were redesigned and integrated as Itaú Unibanco customer service locations thus creating a network of approximately 4,700 units in the country under the “Itaú” brand. 2010.

We have an extensive network with 4,072 branches, 912 CSBs and 28,769 ATMs in Brazil and abroad, as of December 31, 2011, we were elected or ranked:

In addition, we received the following awards and recognition in 2011:2012:

Our Ownership Structure

We are a financial holding company controlled by IUPAR, a holding company jointly controlled by (i) Itaúsa, which is a holding company controlled by members of the Egydio de Souza Aranha family,family; and (ii) E. Johnston, which is a holding company controlled by the former controlling shareholders of Unibanco, the Moreira Salles family. Itaúsa also directly owned 38.66%38.7% of the shares of our common stock as of December,March 31, 2011.2013. See “Item 7A. Major Shareholders”.

The following chart is a simplified overview of the direct and indirect ownership structure of the Itaú Unibanco Group as of February 29, 2012:March 31, 2013:

(*)

(1) Excluding controlling stockholdersshareholder and treasury shares

shares.

Ownership percentages above refer to the total of direct and indirect ownership. All of the above companies were organized and have their operations in Brazil, except Banco Itaú Argentina S.A., or (“Banco Itaú Argentina, Banco ItaúArgentina”), Itau BBA International S.A., or Banco ItaúLimited (“Itau BBA International,International”), Banco Itaú Chile S.A., or (“Banco Itaú ChileChile”), Banco Itaú Paraguay S.A (“Banco Itaú Paraguay”) and Banco Itaú Uruguay S.A., or (“Banco Itaú Uruguay.Uruguay”). For further information with respect to our significant subsidiaries, see note 2.4.a2.4(a) to our consolidated financial statements.

Competitive Strengths

We believe the following strengths provide us with significant competitive advantages and distinguish us from our competitors.

Premier banking brand in Brazil.

Our brands are very strong and very well recognized in Brazil. They represent quality and reliability and, with our large portfolio of products, help us to maintain a low customer turnover rate, especially among customers in the high income segment. According to a 2011 Interbrand report, a brand consultancy, we have the most valuable brand in Brazil, with a value of R$24.3 billion in 2011, an increase of 18% compared to 2010.

Large branch network in geographic areas ofwith high economic activities.

We have an extensive network with 4,0724,121 branches, 912906 CSBs and 28,76927,960 ATMs in Brazil and abroad, as of December 31, 2011.2012. Our Brazilian branch network, while national in scope, is strategically concentrated in Southeast Brazil, the country’s wealthiest region. Our branch network in other countries of the Southern Cone (Argentina, Chile, Paraguay, and Uruguay) is also positioned in regions ofwith high levels of economic activity. A branch network in wealthier and key economic areas gives us a strong presence and a competitive advantage to offer our services to a broad range of customers and profit from selective market opportunities. Our exclusive ATM network allows us to offer a wide range of products and services to our customers.customers which we see as one of our competitive strengths.

Diverse line of products and services.

We are a multi-service bank offering a diverse line of products and services that are designed to address the needs of various types of clients, including corporate clients, small and medium-sized enterprises, retail customers, high-income individuals, private bank clients, non-accountholders and credit card users. We believe that this model creates opportunities to improve our client relationships with clients and thereby increase our market share. We expect to sustain our leading presence by capturing a solid and growing pipeline of transactions across a number of business segments.

Technology and electronic distribution channels as drivers for sales.

Our intensive use of technology and electronic distribution channels, which has contributed significantly to an increase in sales of products and services, is one of our most important competitive advantages. In 2011,2012, we spent approximately R$4,0005,215 million on information technology, of which approximately R$1,0001,853 million was for the purchase of hardware and software and approximately R$3,0003,362 million for the cost of information technology (“IT”) infrastructure, operation and maintenance. We have sophisticated technology that supports other remote banking access (call centers, Internet banking, etc.) and offers customers the ability to verify their statements and perform their transactions. Our sales teams can access client credit scores directly through mobile phones and credit proposals can be sent over the Internet by any broker registered in our systems.

Risk-based pricing model as a tool to manage risk while exploring opportunities.

Our risk-based pricing model is an important competitive advantage as it gives us a more precise dimension of the risk equation versus return in various scenarios. This is an essential tool to explore commercial opportunities and simultaneously manage risks. Depending on the product, each contract is individually priced using risk adjusted return on capital models that give us a better assessment of the market

 market.

Business Strategy

Our board of directors is responsible for defining the guidelines of our strategy and that of our subsidiaries. Strategic decisions by our board of directors are supported by the strategy committee of the board, which provides data and information about strategic business issues. See “Item 6C. Board Practices — Statutory Bodies”– Committees of the Board of Directors – Strategy Committee”. The strategy committee’s activities and responsibilities range from evaluating investment opportunities and budget guidelines to providing advice and support to the chief executive officer for the monitoring of our consolidated strategy. The strategy committee is supported by the economic scenarios sub-committee which provides macroeconomic data in order to support discussions on strategies, investments and budgets.

Expand our operations in Brazil and abroad.

We intend to expand our operations in Brazil and abroad. In 2012, we carried out a series of transactions aimed at expanding our operations in Brazil. We acquired the remaining shares of Redecard S.A. in a tender offer, resulting in our ownership of 100.0% of Redecard’s capital stock, formed Banco Itaú BMG Consignado S.A., a new financial institution in partnership with Banco BMG S.A. and controlled by us, and acquired shares representing 49.0% of the capital stock of Banco CSF S.A. Also in 2012, we were authorized by the Colombian regulatory authorities to structure our wholesale and investment bank operations abroad.

In 2011, we took significant steps to expand our wholesale and investment bank operations abroad. In Chile, we entered into an agreement with MCC, one of the leaders in third party wealth management services. Also in 2011, we acquired HSBC Bank’s high net worth portfolio in Chile, making Itaú Chile a leader for high net worth individuals with a network of 88 branches in that country. In addition, Itaú Unibanco started operations in Switzerland through Banco Itaú Suisse, located in Zurich, to provide services to private clients, both Brazilian and Latin American, who seek global investment opportunities. Finally, in November 2011, Itaú BBA was authorized by the Central Bank to structure its wholesale and investment bankbanking operations in Colombia pending approval by local regulatory bodies, which is expected to be granted in 2012.through Itaú BBA SA Colombia — Corporación Financiera (“Itaú BBA Colombia”). Itaú BBA’s target market in Colombia is composed of institutional investors and large Brazilian companies presentoperating in Colombia as well as Colombian companies operating in Brazil. The products portfolio in Colombia willis expected to include loan operations, foreign trade financing, foreign exchange and derivatives, and investment bank activities, such as advising on mergers and acquisitions and access to capital markets. In addition, in order to consolidate and expand operations in Europe, we recently transferred the central administration and registered offices of Banco Itaú BBA International from Lisbon to London by means of a cross-border merger by absorption. See “Item 4B. Business Overview — International Operations — Itau BBA International.” We expect these transactions, which added to the significant steps taken in 2011, to expand our wholesale and investment bank operations abroad, our offering of products and services and our distribution channels. In Chile, we entered into an agreement with Munita, Cruzat & Claro, one of the leaders in third party wealth management services in Chile. Also in 2011, we acquired HSBC Bank’s high net worth portfolio in Chile, strengthening our position in the Chilean market, with a network of 88 branches in that country. In addition, Itaú Unibanco Holding started operations in Switzerland through a subsidiary of Banco Itaú BBA International located in Zurich, to provide services to private clients, both Brazilian and Latin American, who seek global investment opportunities.

Continue to improve efficiency.

During 2009 and 2010, we focused our efforts on completing the integration of the Unibanco branches and customer site branches, while maintaining service quality and increasing our customer base. After the completion of the integration of Itaú and Unibanco branches in 2010, we implementedcreated the “Efficiency Project” during 2010 and 2011,, which implements, on an ongoing basis, close budget management and monitoring of costs and revenues, the establishment of targets for each business unit and the promotion of a strong culture of operational efficiency. In 2011, we fully integrated all systems that still had Unibanco’s legacy information on operations entered into prior to the integration of the branch network. This was the last remaining step to the integration of Banco Itaú Holding and Unibanco.

Grow our loan portfolio with the maintenance of asset quality.

The growth of our loan portfolio and the maintenance of asset quality are central issues to our strategy. We are constantly seeking to improve our models for risk management and our economic forecasts and scenario modeling. We intend to increase the average volume of creditloan operations to maintain and even grow our market share, depending on the product, market and customer type, including through the development of new products for specific client demographics.

Implement an advanced and fully integrated risk management approach should position us for sustainable growth and enhanced profitability.

Our main strategic goals in risk management include: (i) the incorporation of best practice recommendations and the implementation of the advanced approaches under Basel II and Basel III, which should enhance profitability from more precise risk-based pricing and risk-adjusted performance measurement frameworks, which are important sources of competitive advantage; and (ii) developing and implementing a fully integrated risk management approach, through the integration of processes and systems to provide a comprehensive picture of risk exposures across risk types and from multiple viewpoints, as well as through the development of stress testing and risk appetite standards.

Develop strong relationships with our clientscustomers based on customer segmentation.

We will continue to work on our customer segmentation strategy in order to identify our customers’ needs and enhance our relationship with our customer base, as well as to increase market penetration. A customer segment is a distinguishable part of our customer base that is subject to a specific set of needs that we focus on meeting. We believe that our customer segmentation tools and strategy provide us an important competitive advantage developed over the course of more than 25 years. We aim to fulfill clients’customers’ financial needs through a wide product portfolio, including cross-selling of banking and insurance products and sales through a variety of channels. It is also extremely important to deliver best-in-class customer service, in order to maintain and increase client satisfaction and increase portfolio profitability.

Operations

The table below presents revenues for our segments for each of the years ended December 31, 2012, 2011 and 2010. As disclosed in note 3334 to the consolidated financial statements we have four operational and reporting segments: Commercial Banking, Itaú BBA, Consumer Credit and Activities with the Market and Corporation.

(in millions of R$, except percentages)

⁽¹⁾ Includes net interest and similar income and expenses, dividend income, net gain (loss) from financial assetsinvestment securities and liabilitiesderivatives and foreign exchange results and exchange variation on transactions.

⁽²⁾ Activities with the Market and Corporation includes the results related to the trading activities in our proprietary portfolio, trading related to managing currency, interest rate and other market risk factors, asset and liability management and arbitrage opportunities in domestic and foreign markets. It also includes the results associated with financial income from the investment of our excess capital.

We mainly carry out our business activities in Brazil. We do not break down our revenues by geographic market within Brazil. Our revenues consisting of interest income, from financial operations, fee and comission incomebanking service fees and income from insurance, private pension and capitalization operations after claim and selling expenses are divided between revenues earned in Brazil and abroad. The information in the table below presents revenues for each of the years ended December 31, 2012, 2011 and 2010 and is presented after elimination upon consolidation.

(in millions of R$, except percentages)

⁽¹⁾Includes interest and similar income, dividend income, net gain (loss) from financial assetsinvestment securities and liabilities,derivatives, foreign exchange results and exchange variation on transactions.

The table below presents revenues abroad by operational segment for each of the years ended December 31, 2011and2012, 2011 and 2010:

(in millions of R$, except percentages)