6th ACSDA International Seminar Punta del Este, Uruguay - October 27-28, 2004 CBLC Brazilian Settlement and Depository Models for International Investment Brazil & Mexico - Integration Model Agenor Silva Junior October 28, 2005

General guidelines Since November 2004, BOVESPA, BMV, CBLC and INDEVAL have been working together to set a integration model between Brazil and Mexico This presentation intends to explain the current model for international investments in Brazil and to explore the new integration model between Brazil and Mexico

Settlement Flow

International Investors Settlement – Abroad Flow CBLC/Bovespa International Broker Local Broker Local Custodian Global Custodian Asset / International Investor 1. Order 2. Repass Order Desk Phone Bloomberg 4. Reports trade 7. Settlement Instructions SWIFT – 54X Brazilian Flow 3. Reports trade Desk Phone Bloomberg 3’. Reports trade and ask for allocation Back Office 5’. Allocation Process Back Office 5. (If Asset) Allocation Process OMGEO / Phone 6. Settlement Instructions 6’. Settlement Instructions Back Office / Fax/File 8. Inform inconsistencies SWIFT – 54X/ Phone 8’. Inform inconsistencies / Fax 8’’. Inform inconsistencies 9. Confirm Settlement Back Office Phone/ 9’. Confirm Settlement Back Office Swift/ XML Message provided by CBLC / BOVESPA

International Investors Settlement – FOREX Flow CBLC International Broker Local Broker Local Custodian Global Custodian Asset / International Investor Exchange FX Bank Clearing Agent Exchange Payment

Depository Flow

Issuer Global Custodian Local Custodian CBLC / Bovespa International Investor 6. Instructs voluntary corporate actions 5. Informs corporate actions 3. Notifies corporate actions 2. Informs corporate actions 9. Process and informs corporate actions 10. Process and informs corporate actions 8. Instructs voluntary corporate actions 7. Instructs voluntary corporate actions (MT 565 or MT 568) 4. Notifies corporate actions (MT 564 or MT 566) International Investor Corporate Actions Information Flow 1. Informs corporate actions Transfer Agent 8’. Instructs voluntary corporate actions (option)

International Investor Corporate Actions Payment Flow 1. Informs payment values IV. LDL008R2 II. LDL008 III. LDL008R1 VI. LDL009R1 VII. LDL009R2 CBLC 4. Confirms credit of funds Local Custodian STR V. LDL009 I. LDL007 Issuer´s Bank 3. Confirms credit of funds (MT 566) International Investor Global Custodian Local Custodian´s Bank 2. Confirms credit of funds

Integration Model Trading, Settlement and Depository Flow

Integration Model Orders –Mexican broker pass the order to the correspondent Brazilian broker in Brazil Allocation Process –Correspondent Brazilian broker allocates the delivery/receive of shares at the Mexican investor´s account that is under responsibility of a Local Custodian According Brazilian rules the Local Custodian could be CBLC or any other Brazilian custodian Settlement –Same settlement procedures as usual –The Mexican Broker give the instruction to the local custodian for settlement (delivery versus payment) –The foreign exchange procedures is made by the Mexican Broker with the guaranty of the Local Custodian Depository –The shares will be register and kept at the Mexican investor´s account under the Local Custodian responsibility

MEXICO BRAZIL Mexican Investor Mexican Broker Indeval Depository Brazilian Broker Local Custodian (CBLC/others) CBLC Clearing and Depository 1 Order (*) Infornation about the mexican investor, Mexican na Brazilian Broker BOVESPA 3 Execute order Settlement Instructions 6 Match the instructions and autrorizes the trade 7 8 CBLC process the settlement 2 Repass order and inform CBLC´s account number 10 Deliver brazilian shares at the mexican broker´s account 5 Settlement Instructions 9 Inform delivery of brazilian shares for the mexican investor and receive confirmation ( SWIFT) 9 4c Allocation Process 4b Reports trade 4a Reports trade