BFR Bbva Banco Frances S.A.

Economic Environment

The Monthly Estimator of Economic Activity (known by its acronym in Spanish as EMAE) has changed its base year to 2004 (from the previous base year 1993). The new series recorded for February showed a 1.3% growth compared to the same period of 2013 and 0% during the month. As a consequence of the change in the methodology it is not possible to make a comparative analysis with previous quarters.

The Monthly Industrial Estimator decreased 1.1% during the first quarter of 2014 (seasonally adjusted), showing an improvement respect to the decrease of 2% in the last quarter of 2013. In a year-on-year basis it fell 6% accelerating relative to 5.4% decrease registered in December 2013.

The Synthetic Index of Construction Activity registered a decline of 3.0% in January-March 2014, (seasonally adjusted) in comparison with the previous quarter and decreased 3.2% with respect to the same period of 2013.

Inflation, measured since January by the new official National and Urban Consumer Price Index (which is used to calculate the CER adjustment for some sovereign bonds) increased by 10% in the first quarter of 2014. The new index is national in scope (compared to the previously used indicator which covered the Greater Buenos Aires area) and uses as a base year (2013=100). Given this change, no historical data exits and it is not possible to make a comparative analysis with the previous rates.

The national public sector fiscal balance showed a primary deficit of AR$ 4.8 billion during January-February 2014 compared to a surplus of AR$ 1.1 billion in the same period of 2013. Primary public sector spending increased 34.9% and public sector revenues had a smaller increase, of 31.4% during January-February 2014.

Tax revenues increased by 25.4% due to a decline in export duties, but tax revenues were reinforced by the increase in results from the BCRA and transfers from the National Social Security Administration (ANSES) to the National Treasury.

Interest payments decreased by 11.7% annually and the total deficit reached AR$ 10.8 billion, an increase of 30.5% compared to the same period in 2013. Increased expending in public works (by 44.8%) and in transfers to the private sector (by 33.7%) were

primarily responsible for the increase in primary spending in the period.

In the external sector, the accumulated trade surplus in the first quarter of 2014 reached USD 121 million, 91.9% lower than that recorded in the same period of 2013. The performance of the trade balance is the result of total exports in the first quarter of 2014 of USD 15.9 billion (-9.1%) and total imports of USD 15.8 billion (-1.3%).

In the FX market, the exchange rate (BCRA reference rate) closed at AR$ 8.01 per U.S. dollar on March 31, 2014, increasing 23.4% compared to the AR$ 6.4892 rate registered on December 31, 2013.

In the first quarter of 2014, the stock of international reserves of the BCRA decreased by USD 3.6 billion to USD 27 billion as of March 31, 2014. During the quarter, the Central Bank bought USD 386 million in the FX market, in contrast with the previous quarter when it sold USD 4.9 billion.

The Badlar interest rate for private banks increased 516 b.p. on the first quarter of 2014, averaging 24.5% compared to a 19.3% average in the fourth quarter of 2013.

Private sector loans in pesos increased 1.4% compared to the fourth quarter of 2013, while private sector loans in dollars grew by 2.5%.

Total deposits in pesos in the financial system increased by 3.5% during the same period, private sector deposits in pesos increased by 4.4% and private sector deposits in dollars decreased by -3.7%.

The Bank

BBVA Francés has extensive experience in the market, offering the best products and services through its wide distribution network. Its strength, commitment and flexibility allow it to retain existing clients and to attract new ones every day, achieving a position as one of the leading financial institutions in the Argentine financial system.

At the beginning of 2014, BBVA Francés achieved a significant improvement in the “Prestigious Companies Award” ranking (Premio Prestigio a Empresas), climbing 29 positions and placing 30th in the general ranking and 3rd among banking institutions. The awards are organized by the

consultancy company CEOP (“Centro de Estudios de la Opinión Pública” or “Public Opinion Study Center”) which brings together the opinion of the most important executives and businessmen in the country.

In the first quarter of 2014 BBVA Francés continued its effort to differentiate among other banks.

During the summer, customers enjoyed the best promotions and discounts in entertainment, restaurants, beaches and shops in the Atlantic coast.

By launching a new PREMIUM segment BBVA Francés aims to position itself as a leader in the high income segment, offering specific products, experiences and benefits. In this line, four new VIP spaces were opened during the summer: two of them at the city of Neuquén, one at the Catalinas branch in Capital Federal and the last one in the city of Comodoro Rivadavia in the province of Chubut.

In addition, the 2 ^nd edition of the BBVA Francés Cup took place in the city of Córdoba, between the Boca and River Clubs. Special promotions were launched for the clients of the Xeneize and River Plate credit cards allowing them to participate in raffles for tickets to the games or the teams’ shirts. Some of our clients also had the chance to participate in special events that took place during the game.

Consolidating the strategic alliance with LAN, the Bank offered the possibility of exchanging LANPASS kilometers for tickets to the upcoming Cirque du Soleil shows, in the cities of Buenos Aires and Córdoba. Additionally, a promotion called “Más seguro estás, más kms sumás” (“The more secure you are, the more kms you earn”), allowing customers buying insurance with BBVA Francés during March and April to earn LANPASS Kms.

In the commercial segment and understanding the needs of Institutional and Agro clients, BBVA Francés was part of “Expoagro 2014”, the most important exhibition of the agro sector in the country. In its exclusive stand the Bank not only advised about the different financing alternatives available for the

segment but also presented its services addressed and providing exclusive attention to the agro segment and promoted the benefits of its Agro LANPASS credit card. Furthermore, it is important to mention that BBVA Francés has successfully complied with the quotas established to finance investment projects in the productive sector.

It is also important to highlight the social role played by BBVA Francés, represented by the “Social Commitment Plan 2014”. The Bank presented the 8th edition of the “Finance Education Program, Scholarships for Inclusion”, which is used as an instrument of social inclusion. In addition, under the program “Artists for Education”, the Bank sponsored a concert of the “Instituto Superior de Arte del Teatro Colón” at the city of Esquel in Chubut.

Presentation of Financial Information

BBVA Francés’ total net income reached AR$ 1,362.1 million as of March 31, 2014. Such result includes a gain of AR$ 192.1 million due to variations in public bond portfolio valuations.

In recurring terms, net income for the period was AR$ 1,151.0 million.

The following “pro forma” table presents the non-recurring earnings.

In order to standardize the comparison with previous quarters, the analysis of the variations is made in terms of recurring results.

As of March 31, 2014, recurring net income was AR$ 1,151.0 million, showing a considerable increase compared to the first quarter of 2013, whereas it registered an increase of 25.2% compared to the previous quarter.

Net financial income grew 114.2% and 35.6% compared to the first quarter of 2013 and the previous quarter, respectively. Such growth was mainly due to higher income originated by the intermediation with the private sector and gains from foreign exchange differences and the forward position. In addition, the public bond portfolio also registered significant gains.

Provisions for loan losses increased compared to the first quarter of 2013 due to a higher volume of lending

and the deterioration of the loan portfolio. Compared to the previous quarter it recorded a slight decrease.

Net income from services increased 33.8% and 9.2% compared to the quarters ended March 31 and December 31, 2013, respectively. Administrative expenses increased, growing 32.9% and 22.1%, compared to the first quarter of 2013 and to the previous quarter, respectively.

Other/income expenses registered a gain of AR$ 41.1 million as of March 31, 2014, showing an important increase compared to the both, the first quarter of 2013 and to the previous quarter.

Net Financial Income

Net financial income arising from the intermediation with the private sector grew 10.4% compared to the first quarter of 2013. It registered a decrease of 6.3% compared with the previous quarter, mainly due to a lower volume of lending and an increase in the cost of funds, as result of a change in the mix of deposits.

Income from securities and short term investments includes non-recurring income originated by variations in the valuation of public securities. Such results totaled a gain of AR$ 192.1 million during the

quarter under analysis and of AR$ 49.1 million as of March 31, 2013, whereas the previous quarter recorded a loss of AR$ 66.2 million. In addition, it is important to mention that the line item “CER Adjustment” also registered a significant increase as result of the new CPI index applied since January 2014.

Furthermore, the line item “Foreign exchange difference and others” reflected the effect of the appreciation of the foreign exchange that took place during the quarter.

Income from Public and Private Securities

The Bank has the discretion to mark-to-market its total public bonds portfolio; because of that, such income includes the unrealized losses/gains from variations in the valuations of the portfolio.

As was previously mentioned, it is important to note that during the quarter a new CPI index was released registering an increase in the CER Adjustment.

Net Income from Services

Net income form services increased by 33.8% compared to the first quarter of 2013 and by 9.2% compared to the previous quarter.

In the annual comparison, growth was due mainly by higher consumption with credit cards, fees associated with insurance and fees generated by an increase in the stock of deposit accounts. Such growth was partially offset by an increase in service charge expenses related to promotions associated with the LANPASS kilometers program.

In the quarterly comparison, income from services increased 7.0% during the quarter due to higher fees generated by capital markets and securities activities, by insurance and by credit and debit cards purchases. Service charge expenses also grew 1.6% during this period.

Administrative Expenses

Administrative expenses increased by 32.9% compared to the first quarter of 2013 and 22.1% compared to the previous quarter.

Personnel expenses, during both periods, mainly reflected the advance for future salary increases and a higher number of employees.

General expenses grew 35.8% compared to the first quarter of 2013 and 24.3% during the quarter, as a consequence of a higher volume of activity, as well as of the increase in prices and the effect of the devaluation.

Expenses linked to armored transportation services, taxes and advertising were the items affected by the change in the conditions.

As of March 31, 2014, the Bank has an extensive branch office network of 275 offices, including 245 consumer branch offices and 30 branch offices specializing in middle-market segment companies and institutions. Corporate banking included 7

business units grouped by industry. Complementing its distribution network, the Bank has 13 in-company branches and 2 point of sale outlets, 657 ATM’s and 732 quick deposit boxes (“QDBs”).

Other Income / Expenses

Other income/expenses totaled a gain of AR$ 41.1 million during the first quarter of 2014. During the quarter higher recovered loans and lower charges for legal injunctions and provisions for other contingencies were recorded.

Income from Equity Investments

Income from equity investments sets forth net income from related companies that are not consolidated. During the first quarter of 2014, a gain of AR$ 22.3 million was recorded, mainly due to the stake held by BBVA Francés in Rombo Compañía Financiera.

Total Public Sector Exposure

Exposure to the public sector’s National treasury decreased compared to the first quarter of 2013 and to the previous quarter, mainly due to the sale of part of the portfolio.

The Bank’s portfolio of BCRA bills and notes showed a significant increase both, during the period under analysis and in the last twelve months, reflecting the liquidity management policy implemented by the Bank.

As of March 31, 2014, public sector National treasure assets represented 2.9% of the Bank’s total assets. Total exposure to BCRA’s bills and notes net of holdings linked to reverse repo transactions, represented 7.6% of the Bank’s total assets.

Total exposure to the public sector includes public debt of the National treasury through public securities, guaranteed loans and trustees (canceled on January 2014), as well as the BCRA’s bills and notes.

Loan Portfolio

As of March 31, 2014, the private sector loan portfolio totaled AR$ 36.7 billion, an increase of 22.7% compared to the first quarter of 2013, whereas it maintained a similar level than that registered at the end of December 2013.

In the last twelve months, loans to finance consumption grew 39.7%, mainly driven by higher volume in credit cards, car loans and personal loans, whereas loans to small and medium size companies increase by 24.2% due to increased placements in

commercial loans, checks and leasing. The corporate segment portfolio has maintained a similar level.

During the quarter, finances to consumption grew 4.1% mainly due to higher credit card financings, partially offset by a decrease in the middle market and corporate portfolios.

Asset Quality

BBVA Francés has maintained the best asset quality indicators in the financial system, despite the signs of

deterioration in the ratios observed during the quarter.

As of March 31, 2014, the asset quality ratio (non-performing loans/total loans) was 0.86%, while the coverage ratio (provisions/non-performing loans) reached 235.8%.

Compared to the first quarter of 2013, growth was due to higher non performing loans as well as an increase in the performing

portfolio. While compared with the previous quarter, growth primarily reflects the deterioration in the portfolio.

The following table shows the evolution of provisions for loan losses, including charges relating to

transactions recorded under “Other receivables” from financial intermediation.

Deposits

As of March 31, 2014, total deposits reached AR$ 44.9 billion, increasing 28.5% in the last twelve months and 2.6% during the quarter.

During the year, term deposits registered a significant increase of 41.5%, while sight accounts increased 18.3%, generating a higher cost of funds.

It is important to mention that in the last twelve months total peso-denominated deposits grew 26.1% increasing term deposits by 41.8% and sight accounts by 13.7%.

Compared to the previous quarter, total deposits grew 2.6%, driven by term deposits, increasing 10.5% while sight accounts registered a decrease of 3.5%.

Deposits denominated in foreign currency grew 50.5% and 3.1%, compared to the last twelve months and to the previous quarter, respectively. By the end of March 31, 2014 deposits denominated in foreign currency reached AR$ 4.9 billion (equivalent to US$ 0.6 billion), representing 10.8% of the Bank’s total deposits.

Other Funding Sources

Other funding sources totaled AR$ 2.2 billion as of March 31, 2014, increasing compared to both, the first quarter of 2013 and to the previous quarter.

In the last twelve months, negotiable obligations were issued by the Bank and by PSA Finance and some series matured during the period. Dollar funding increased as well, mainly funding lines aimed at financing exports.

Of the total outstanding senior bonds, AR$ 597.4 million correspond to those issued by PSA Finance and the remaining AR$ 1.1 billion to those issued by BBVA Francés.

On February 11, 2014 the Bank issued its Series 8 and Series 9 of Negotiable Obligations, which were fully subscribed for a total amount of AR$ 258.9 million, due in 18 months and AR$ 145.1 million due in 36 months, respectively.

Capitalization

As of March 31, 2014, the Bank’s total shareholders’ equity totaled AR$ 8.5 billion, while

the excess over the BCRA minimum capital requirements was AR$ 3.6 billon or 79.7%. On the same date, the capital ratio reached 20.5% of assets adjusted to risk.