Unibanco Holdings S.A. equity is substantially invested in Unibanco - União de Bancos Brasileiros S.A.. Consequently, both its performance and operating results directly reflect this fact.
All information pertaining to Unibanco's performance is detailed in the the Management Report and the accompanying Consolidated Financial Statements.
Result and Shareholders Equity
Unibanco Holdings net income in 2004 was R$708 million, equivalent to earnings of R$0.84 per 1,000 shares, calculated by the number of shares outstanding at year-end. Annualized return on average equity was 15.6%. On December 31, net equity was R$4.9 billion, equivalent to a R$5.81 book value per 1,000 shares.
Dividends
For the year ended December 31, 2004, Unibanco Holdings S.A. proposed, as an advance against the mandatory dividends, the payment of interest on own capital for the shareholders, in the amount of R$262.6 million, being R$118.7 million paid in advance during the year. The amount proposed in 2004 of R$223.2 million, net of applicable tax, represent R$0.26 per share at the end of the year.
Independent Auditing
In order to safeguard the independence of its external auditors, Unibanco Holdings and Unibanco adopt the policy of limiting their services other than independent auditing. During 2004, Unibanco retained professional services other than independent auditing from PricewaterehouseCoopers Auditores Independentes to a total of R$1,606 thousand, or approximately 33.2% of the fees for external auditing of Consolidated Unibanco. Of that amount, R$1,553 thousand refer to technical support for the project implemented in order to fulfill the requirements of article 404 of the US-sanctioned Sarbanes-Oxley law. Such project began in October 2004 and is scheduled for completion no later than September 2005.
The policy adopted by Unibanco Holdings and Unibanco fulfill the principles that preserve auditor?s independence, according to Brazilian and international legal requirements. The contracts signed with independent auditors after the date of implementation of the Audit Committee have been duly revised and signed by the committee. Moreover, Unibanco and Unibanco Holdings, in agreement with its independent auditors, concluded that the services mentioned above are consistent with the function of independent auditing, neither representing any violation the applicable independence rules nor affecting the auditors? objectivity, because of the scope of the procedures carried out.
Closing Remarks
The results attained in 2004 were in large part due to the confidence bestowed
upon us by our shareholders. To them we extend our deepest gratitude.
