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Banorte Investor Day Closing Remarks November 16, 2007 1 Index 1. Treasury and Capital Markets. 2. Commitment to Shareholders. 3. Bancarization Opportunities. 4. Medium Term Strategies. 2 1. Treasury and Capital Markets 3 Hedging Strategy 4 Hedging Strategy continues evolving. Shield against Mexican elections is no longer needed. Actual coverage is adequate for this complex environment. Risk in fixed rate loan portfolio is contained. A growing proportion of the loan portfolio has fixed rates. Hedging necessary for long term maturities. Credit cards and payroll loans are not hedged. High returns on these loans. Possibility of resetting interest rates. 5 Funding Strategy 6 Funding Reduction in funding costs through growth in core deposits. Banorte’s growth rates are higher than the industry. Branch expansion supports future growth in core deposits. New banks entering the market. Possibility of an increase in funding costs. Banorte is very competitive – funding cost at 43% of Cetes. 60% of core deposits are demand deposits. 7 Funding Short term & long term market funding. Access according to market conditions. Mexican Inter-bank market. Conditions are normal. Recent increase in costs due to tightening by the Central Bank. Dollar denominated funding. INB’s funding comes mostly through clients. Wholesale funding is accessible. 8 Capitalization Strategy 9 Capitalization Capital strengthening. Subordinated debt issuance in ’06. Retained earnings. Capital consumption. Growth in risk assets. Investment in INB. Dividends. Prepayments of expensive obligations. 10 Capitalization Ratio PERCENTAGE 3Q06 4Q06 1Q07 2Q07 3Q07 Tier 1 12.6% 12.2% 11.0% 10.9% 10.9% Tier 2 2.3% 5.1% 4.9% 4.3% 3.9% TOTAL 14.9% 17.4% 15.9% 15.2% 14.8% % Tier 1 84% 70% 69% 72% 74% 11 Non Convertible Subordinated Debt Outstanding Type Issue Date (Ps millions) Tier 1 - 10 NC 5 Nov-02 Tier 2 - 10 NC 5 Balance Rate Maturity 1,208 8.0% Nov-12 Feb-04 3,238 5.87% Feb-14 Tier 1 - 15 NC 10 Oct-06 2,188 6.86% Oct-21 Tier 2 - 10 NC 5 Oct-06 4,376 6.14% Oct-16 12 2. Commitment to Shareholders 13 20 / 20 Vision ROE 26% 25% 2005 2006 23% 9M07 14 Dividend Policy Current dividend payment policy: 15% of recurring net income. Dividend % of Year per share Income Million Ps 2003 $0.18 18% 382 2004 $0.26 23% 528 2005 $0.32 24% 655 2006 $0.37 15% 757 2007 $0.45 15% 908 15 Credit Ratings Investment grade from the 3 most important agencies. The outlook is “positive”. Perspective Scale over IG Agency Rating Standard & Poors BBB- Positive = Sep ‘07 Fitch BBB Positive +1 Jul ‘07 Moody’s Baa1 Stable +2 May ‘07 BBB+ BBB+ Date Baa1 Baa1 BBB Banorte BBB- México Investment grade Standard & Poors Fitch Moody’s 16 3. Bancarization Opportunities 17 Financial Penetration Bank lending has become an engine of growth. % 2005 2006 Sep-07 Mortgage 80% 46% 22% Consumer 48% 36% 24% Corporate 7% 21% 34% Total 28% 28% 28% 18 Financial Penetration Financial penetration is low compared to the mid 90’s. Bank Loans and Deposits as a % of GDP % 40 35 30 25 20 Deposits 15 Loans 10 5 0 1994 1996 1998 2000 2002 2004 2006 2007 19 Financial Penetration The level of penetration is low compared to Latam peers. Credit to Private Sector as a % of GDP 69% 32% 31% 29% 22% Chile Brazil Average Colombia 9% Others 13% Banks Mexico 20% 12% Peru Argentina 20 Financial Penetration Low levels of branch penetration and household leverage. Branches per thousand habitants Families with debt payments in the formal economy (Units) (Millions) 25% of families 0.62 6.0 0.53 5.1 0.46 0.34 3.2 2.4 0.10 UK Canada USA Spain Chile 0.08 Mexico 2000 2002 2004 2006 21 Financial Penetration The outlook for mortgage lending is positive. 1,350 Thousands of new loans per year 1,200 1,050 900 850 790 708 Estimate 678 500 530 400 320 340 330 2000 2001 200 1998 1999 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 22 4. Medium Term Strategies 23 Medium Term Strategies Profitability Validate 20/20 vision. Organic growth Improve efficiency. Market share Difficult competitive environment. Asset quality Portfolio maturing / New originations. Growth drivers Loans / Recent initiatives / markets Focus: Consumer / Commercial / Mortgage / Microlending / USA / Investment projects. Bancarization Lower income segments. 24 Certain statements in this document are “forward-looking statements”. These statements are based on management’s current expectations and are subject to uncertainty and changes in circumstances. Actual results may differ materially from those included in these statements due to a variety of factors. 25 26