BancoSabadell

Spanish Banks Conference Morgan Stanley

Madrid 10th may, 2002

Mr. Juan M. Nin General Manager (business) AGENDA

1. INTRODUCTION

2. COMMERCIAL STRATEGY

3. OUTLOOK

4. 1Q02 RESULTS

5. SUMMARY

2 THE GROUP

Banco Sabadell Group is a financial conglomerate, with a multi-brand specialisation approach for each market segment, providing high quality financial services to a wide domestic client base.

3 MILESTONES

18811881 Ÿ Founded by 127 Sabadell industrialists and professionals to provide financing to the local economy

Ÿ Expansion outside 1975-2000 1975-2000 Ÿ Expansion into non-traditional banking businesses

Ÿ 19961996 Acquisition of Natwest Spain and Banco de Asturias

Ÿ Creation of a core shareholder group: ŸCross shareholding with BCP 20002000 ŸCore-shareholding agreement with La Caixa and acquisition of Banco Herrero Ÿ Opening of BancSabadell d’Andorra

Ÿ Stock Exchange listing 20012001 Ÿ Wide shareholder base: more than 50.000 shareholders

4 BANCO SABADELL TODAY

DomesticDomestic retailretail bankbank Ÿ 94% of total revenues from domestic retail banking

ReferenceReference playerplayer inin Ÿ 4th largest among banks and 6th largest among financial institutions thethe SpanishSpanish marketmarket

Ÿ Top player in SMEs and professional associations Focused on the most Focused on the most Ÿ Leveraging on SMEs and professional association businesses to tap profitable business profitable business into the mass affluent sector segments segments Ÿ Leadership in foreign trade banking (above 9% market share)

AttractiveAttractive Ÿ Very significant presence in the largest and wealthiest regions: geographicalgeographical Catalonia, Madrid and Levante coveragecoverage (present(present Ÿ Strong market position in Asturias and Castilla-León as a result of andand potencial)potencial) the acquisitions of Natwest Spain and Banco Herrero Ÿ Cross-shareholding agreement with BCP Ÿ Joint acquisition of Ibersecurities Ÿ Launch of new e-bank (ActivoBank) OneOne ofof thethe mostmost Ÿ Establishment of BancSabadell d’Andorra dynamicdynamic financialfinancial Ÿ Core shareholder agreement with La Caixa and acquisition of institutionsinstitutions inin SpainSpain Banco Herrero Ÿ JV with Ÿ Venture capital activities (Aurica) Ÿ Real-estate development (Landscape) 5 JV WITH INTERNATIONAL PARTNERS

n Dexia Sabadell Banco Local : bank specialising in providing finance and financial services to the public sector in Spain (JV with Dexia)

n : multi-channel bank specialising in financial asset investment (JV with BCP)

n : an Internet portal for small and medium-sized companies: banking operations, financial information and management and shopping areas (JV with BCP)

n : electronic commerce solutions and services via internet to small and medium companies (JV with Siemens)

6 MARKET POSITION

As of 31/03/2002 Market capitalisation Total assets Loans to customers (net) € m € m € m

47.962 357.216 170.863 41.354 303.332 147.043

9.883 37.974 28.534 3.304 26.335 18.972 2.658 21.315 15.265

SAN BBVA POP SAB BKT SAN BBVA POP SAB BKT SAN BBVA POP SAB BKT

Customer deposits Mutual funds Bancassurance € m € m € m

180.797 71.923 48.293 161.982 50.518 21.476

23.064 5.851 5.417 17.058 4.731 3.550 13.553 2.864 1.372

SAN BBVA POP SAB BKT SAN BBVA POPBKT SAB BBVA SAN SABPOP BKT 7 BANCO SABADELL HIGHLIGHTS (I)

% growth € m mar-01 dec-01 mar-02 1T02/1T01

Total Assets 23.355,9 26.547,5 26.335,1 12,76% Loans to customers (net) 15.705,6 18.735,3 18.972,3 20,80%

Customer deposits 15.614,0 16.974,4 17.058,3 9,25% Assets under management 23.538,2 25.649,0 26.443,8 12,34% Shareholder's equity1 2.268,7 2.355,7 2.334,2 2,89%

Employees 7.750 7.788 7.773 Domestic Branches 956 903 904 ATM's 1.035 1.053 1.060

GROUP NET PROFIT 63,1 50,1 64,4 2,03%

1 Banco Herrero Pending Goodwill € 370m 8 BANCO SABADELL HIGHLIGHTS (II)

mar-01 dec-01 mar-02

BIS ratio 10,68% 11,46% 11,05% of which Tier 1 9,52% 8,72% 8,38%

ROE 1 14,44% 12,49% 13,26%

ROA 1,13% 0,93% 1,03%

NPL ratio 0,56% 0,46% 0,52%

NPL coverage ratio 281,38% 334,94% 307,63%

COST/ INCOME ratio 56,11% 56,34% 55,92%

1 Adjusted by Banco Herrero goodwill 9 STAFF

n Total employees: 7.788

n Average age: 38 years

n Average length of employment with Banco Sabadell: 16 years

n 42% employees with University education

n Internal promotion

As of 31/12/2001 10 AGENDA

1. INTRODUCTION

2. COMMERCIAL STRATEGY

3. OUTLOOK

4. 1Q02 RESULTS

5. SUMMARY

11 VALUE PROPOSAL CONTENTS

QUALITY PRODUCT CLIENT

RISK CHANNELS

12 COMMERCIAL SEGMENTATION (I)

€ m

• Commercial Banking • Individuals: High concentration in - Individuals: Medium/high Medium / low net worth (Asturias) net worth - Companies: turnover <€ 6m • Companies : turnover <€ 6 m • SME Banking - Companies: turnover >€ 6m

Highlights (31/03/02) Highlights (31/03/02)

Branches 542 Branches 312 Employees 3.884 Employees 1.264

Volumes* Volumes* Loans 13.802 Loans 3.395 On-balance sheet On-balance sheet deposits 9.446 deposits 3.436

13 * Average volumes COMMERCIAL SEGMENTATION (II)

€ m

• Foreigners resident in Spain • High net worth individuals (medium/high-medium/ high net >€ 0,5m worth) • Shops/ companies in areas with • Legal entities used to net worth residential tourism and turnover management and familiar < € 6m • Access through: agents, building companies developers, brokers. • Institutions

Highlights (31/03/02) Highlights (31/03/02)

Branches 44 Branches 6 Employees 264 Employees 41

Volumes* Volumes* Loans 355 Loans 37 On-balance sheet AuM 1.798 deposits 570 14 * Average volumes BASIC MARGIN BY BUSINESS UNITS

€ m (31/03/02)

57%

26%

10% 4% 3%

Commercial SMEs Banco Solbank Sabadell Banking Banking Herrero Banca Privada

15 15 BRANDS: GEOGRAPHICAL DISTRIBUTION

ASTURIAS CANTABRIA BASQUE COUNTRY GALICIA NAVARRE

LA RIOJA CATALONIA CASTILE- LEON ARAGON

MADRID

CASTILE-LA MANCHA VALENCIA EXTREMADURA BS

BS- SBK MURCIA ANDALUSIA BH BS-BH

CANARY ISLANDS

16 MARKET SHARE

Resident Sector (31/12/01)

LOANS 2,82%

DEPOSITS 2,75%

LOANS + DEPOSITS 2,78%

BRANCHES 2,34%

COMMERCIAL EFFICIENCY RATIO 118,80%

17 GROSS LOANS TO CUSTOMERS

(31/03/02) 8% 1% 31% Individuals

76% Mortgages

SMEs 60% 24% Consumer lending

Others Public Administrations 18 NPL HISTORICAL PERFOMANCE

NPL /Total Loans % Total system 9 Banco Sabadell

6

3 1,24% 0,52% 0 91 92 93 94 95 96 97 98 99 00 01 mar- 02 %NPL Coverage: 78 89 98 138 174 280 335 308

Source:Bank of Spain (Boletín Estadístico) 19 AGENDA

1. INTRODUCTION

2. COMMERCIAL STRATEGY

3. OUTLOOK

4. 1Q02 RESULTS

5. SUMMARY

20 A HISTORY OF GROWTH

% growth 99/98 00/99 01/00 01/001 1Q02/1Q01 CAGR

Total assets 4,7% 21,0% 42,6% 20,1% 12,8% 19,7%

Loans to customers (net) 26,8% 25,8% 46,3% 21,0% 20,8% 30,3%

Customer deposits 6,8% 8,9% 40,8% 15,0% 9,2% 16,6%

Shareholder's Equity 22,7% 34,9% 47,7% 3,9% 2,9% 31,3%

Branches 2,1% 2,3% 30,0% -4,7% -3,9% 9,9%

Employees 0,1% 1,5% 17,9% -0,8% 0,3% 5,6%

1 Pro-forma including Banco Herrero

21 CONSOLIDATION

n New IT Platform implementation (expected by 2003) :

➨ to help to homogenise the group’s IT systems

➨ more client-orientated platform, increasing cross-selling potential

n Banco Herrero Merger

➨ Allowing branch rationalisation

➨ Revenue / cost synergies

22 NEW BUSINESS PLAN. MAIN HEADINGS

n Organic growth. Plans to open around 50 new branches (Banco Sabadell brand)

n Banco Herrero brand as the exclusive brand for the group in the North of Spain , where it enjoys a very high recognition. Agent network in Castile-León under development process

n Full deployment of the Solbank project: Sabadell will continue to promote the Solbank brand to cater for foreigners living on the Spanish coastal areas (20 new branches in 2002)

23 QUALITY AND RISK CONTROL

n Sabadell continues to develop its credit risk systems: SME’s Internal Rating based

models to meet BIS criteria are already in place together with private individual

scoring systems. Sabadell is in the process of assigning capital to its different units

in order to apply the RAROC methodology

n Sabadell has developed an internal model to measure operational risk which is

being implemented throughout the organisation

n Sabadell has established Quality Plan 2002-2005 involving the whole organisation

to consolidate its customer base service standards and obtain two ISO certificates

this year

24 AGENDA

1. INTRODUCTION

2. COMMERCIAL STRATEGY

3. OUTLOOK

4. 1Q02 RESULTS

5. SUMMARY

25 NET INTEREST INCOME

€ m

7,0% wth: gro YoY

175,5 164,0

1Q01 1Q02

26 COMMISSIONS

€ m

0,4% wth: gro YoY

68,6 68,9

1Q01 1Q02

27 PERSONNEL AND ADMINISTRATIVE EXPENSES

€ m

4,7% wth: gro YoY

136,7 130,5

1Q01 1Q02

28 COST / INCOME RATIO

1Q01 2001 1Q02

Base 56,1% 56,3% 55,9%

Base: (staff cost + other administrative expenses)/ (Net interest income + commissions)

29 NET INCOME

€ m

YoY 1Q01 1Q02 Growth %

Net interest income 164,0 175,5 7,0%

Gross operating income 251,6 249,6 -0,8%

Net operating income 107,7 101,0 -6,2%

PROFIT BEFORE TAXES 99,2 103,7 4,6%

Taxes 34,8 36,4 4,5%

Minority Interests 1,3 2,9 125,6%

GROUP NET PROFIT 63,1 64,4 2,1%

30 AGENDA

1. INTRODUCTION

2. COMMERCIAL STRATEGY

3. OUTLOOK

4. 1Q02 RESULTS

5. SUMMARY

31 GROWTH AND CONSOLIDATION

➨ Business plan

➨ Strict credit and operational risk control

➨ Total quality plan

32