3rd Quarter Results

Banco Comercial Portugues S.A.
22 October 2002

FOR IMMEDIATE RELEASE                                       OCTOBER 22, 2002



                   BANCO COMERCIAL PORTUGUES ('BCP')
       NET INCOME OF EURO 402.8 MILLION IN THE FIRST NINE MONTHS OF 2002



Banco Comercial Portugues (BCP, NYSE: BPC, BCPPRA) today reported consolidated
net income of Euro 402.8 million for the first nine months of 2002, compared to
Euro 515.9 million in the same period of 2001. Return on equity stood at 27.4%,
with return on assets at 0.9%.


                  PROFITABILITY                   30 Sep.       30 Sep.        Change
                    INDICATORS                       2002          2001         2002/2001

                   Net income                      402.80       515.85         -21.9%
                   (Millions of euros)
                   ROE                              27.4%        31.6%              -
                   ROA                               0.9%         1.1%              -
                   ROA before minority interests     1.0%         1.3%              -



Commission growth, the stabilisation of net interest income, continuing control
of domestic costs and an improvement in credit quality were the main highlights
of BCP's activity during the first nine months of 2002. Consolidated net income
was however penalised by the poor performance of capital markets, which led to
lower trading gains and additional provisions relating to unrealised losses on
securities.



'In the light of current economic conditions, marked by long-term uncertainty,
BCP's strategy during the third quarter of 2002 was underpinned by prudent risk
management and provisioning. This policy has constrained net income, but has
strengthened the quality of our balance sheet and the provisioning of past-due
loans, as we maintained our focus on a sound financial structure', commented Mr.
Jardim Goncalves, Chairman and CEO of BCP. He added:



'Bearing in mind the operating environment, the growth of our commercial
activity is worth highlighting. On a comparable basis, loans to customers
increased by 6.0%, while total customers' funds were 3.4% up from September 30,
2001. This demonstrates the dynamism of our commercial networks and their
effectiveness in attracting new customers and exploiting new business
opportunities through the successful management of their operating platforms and
staff.'



BCP's consolidated financial statements for the first nine months of 2002
include non-recurring capital gains, booked during the first half of 2002 under
the process of rationalisation of real-estate and in order to optimise capital
allocation. These transactions compensated for the impact that decreasing
returns on financial assets had on the pension fund assets. Capital gains were
in the same amount as additional pension fund, market and credit risk provisions
(Euro 85 million) with the result that the impact from non-recurring
transactions on consolidated net income was negligible.



The Bank's increased shareholding in NovaBank and the fact that BCP became the
majority shareholder of Banco Internacional de Mocambique after having merged it
with Banco Comercial de Mocambique led to both these institutions being fully
consolidated from the end of 2001. As these interests were previously
consolidated using the proportional method, we have produced pro forma financial
statements for the first nine months of 2001, allowing a comparable basis with
the figures now presented.




Benefiting from measures the Bank has been implementing, notably close pricing
monitoring, and also from increased business volumes, net interest income
amounted to Euro 996 million from January to September 2002, compared to Euro
1,021 million in the same period of 2001 on a pro forma basis. This resulted in
a net interest margin of 2.6%, the same level as seen in the first nine months
of 2001. These impacts were offset by credit securitisation totalling Euro 1,499
million from the end of September 2001.



The increase in charges for provisions for credit risks to Euro 250 million
during the first nine months of 2002 from pro forma Euro 162 million in the same
period of 2001 was attributable to prudent risk provisioning, with the aim of
maintaining high coverage ratios. This line item was also influenced by the
application of Regulation 7/2000 of the Bank of Portugal, under which full
provisioning was required for loans overdue by more than 18 months collaterised
by personal guarantees.

Net commissions totalled Euro 371 million to September 30, 2002, 1.0% up from
Euro 367 million in the first nine months of 2001 on a comparable basis.
Increased fees on debit and credit cards, on guarantees granted and on credit
operations have more than compensated for lower fees on securities trading
resulting from the poor performance of capital markets. This has also caused
trading gains to decrease to Euro 80 million for the nine months to September
2002 from Euro 120 million during the same period of 2001, on a pro forma basis.



Other net operating income was influenced by a capital gain of Euro 85 million
on the sale of premises to the Bank's pension fund, following the Group's
strategy to rationalise real-estate assigned to operations and to optimise
capital allocation. Net of this impact, other net operating income increased
17.1% on a comparable basis, to Euro 238 million in the first nine months of
2002 from Euro 204 million during the same period of 2001. This reflects higher
recoveries of overdue loans and interest and growing income from sundry services
to customers.



A lower contribution from equity accounted associates led to a drop in income
from securities, to Euro 138 million in the first nine months of 2002 from pro
forma Euro 175 million in the same period of the previous year. This reduction
was mainly attributable to the decreased contribution from Eureko. Dividends
received in the second quarter of 2002 have resulted in a quarterly decrease of
this heading.


                    OTHER INCOME                              30 Sep.     30 Sep.     30 Sep.       Change
                 (Millions of euros)                             2002        2001        2001    2002/2001
                                                                          Pro forma              Pro forma

      Net Commissions                                           371.1       367.3       363.3          1.0%
      Of which: domestic activity                               335.7       335.1       335.1          0.2%

      Trading Gains                                              80.0       119.9       110.6        -33.0%
      Of which: domestic activity                                74.9       102.1       102.1        -26.6%

      Other Net Operating Income (1)                            238.4       203.5       203.9         17.1%
      Of which: domestic activity                               227.4       198.7       198.7         14.4%

      Other Income /Total Income (1)
      - Total                                                   45.4%       45.9%       45.6%             -
      - Domestic activity                                       46.6%       46.6%       46.6%             -

   (1) Excludes non-recurring transactions.



Domestic operating costs (staff costs, other administrative expenses and
depreciation) were favourably influenced by continuing rationalisation, showing
the impact of the ongoing operational efficiency improvement programme. Domestic
cost-to-income stood at 55.2% during the first nine months of 2002, compared to
52.8% in the same period of 2001, reflecting the impact on income of the
performance of capital markets. The increase in operating costs on the Group's
international activities was caused by network expansion and increased turnover,
with emphasis on NovaBank, in Greece, and in BPABank in the USA. Consolidated
operating costs totalled Euro 1,099 million in the first nine months of 2002,
increasing 3.5% from Euro 1,062 million in the same period of 2001, on a
comparable basis.

Increased pension fund provisions resulted in growing staff costs, which
amounted to Euro 581 million from January to September 2002, up 4.7% from Euro
554 million in the same period of 2001, on a pro forma basis. The impact of
non-domestic operations was particularly clear in the evolution of other
administrative expenses, which decreased by 0.8%, and of depreciation, which
grew by 12.4%. For the Group's domestic business alone, other administrative
expenses decreased by 4.5%, while depreciation was 4.2% up from the first nine
months of 2001.

The increase in other provisions, to Euro 8 million in the first nine months of
2002 from Euro 51 million in the same period of 2001, resulted from the need to
provide unrealised losses on securities, caused by falling market prices,
particularly in the third quarter of 2002, and from charging non-recurring
provisions in the second quarter.

                  OPERATING COSTS                        30 Sep.       30 Sep.   30 Sep.        Change
                (Millions of euros)                         2002          2001      2001     2002/2001
                                                                     Pro forma               Pro forma

Staff Costs                                                580.6         554.4     544.4          4.7%
Of which: domestic activity                                499.1         484.3     484.3          3.1%

Other Administrative Expenses                              393.5         396.5     386.0         -0.8%
Of which: domestic activity                                327.3         342.7     342.7         -4.5%

Depreciation                                               124.5         110.8     105.8         12.4%
Of which: domestic activity                                 94.2          90.4      90.4          4.2%

Operating Costs/ Total Income (1)
- Total                                                    60.3%         56.3%     55.6%             -
- Domestic activity                                        55.2%         52.8%     52.8%             -

    (1) Excludes non-recurring transactions.



Loans to customers increased 6.0% on comparable terms, standing at Euro 44,860
million at September 30, 2002 (Euro 42,334 million at the end of September
2001). Loans to individuals grew at a steep pace, with mortgage loans, up by
16.6% from September 30, 2001, standing out. The growth in corporate loans, at
1.7%, was more moderate, as the Group continued its efforts to optimise the
risks resulting from the acquisitions in 2000.

Total customer's funds were 3.4% up to Euro 47,700 million at the end of
September 2002 from Euro 46,150 million at September 30, 2001. This performance
was mainly attributable to strong growth in capitalisation insurance and
securities, reflecting the effect of the Group's new commercial model, based on
a specialised approach to both the creation and distribution of financial
products and services. Higher risk aversion by customers and the effectiveness
of the Group's distribution channels resulted in both deposits and assets under
management being maintained at roughly the same level as seen at September 30,
2001 on a comparable basis, in spite of the continuing unstable financial
markets.

                 ACTIVITY                      30 Sep.        30 Sep.     30 Sep.         Change
                INDICATORS                        2002           2001        2001      2002/2001
                                                            Pro forma                  Pro forma   
           (Millions of euros)                                                      

Total Assets (1)                                61,255         61,464      60,667          -0.3%

Loans to Customers (1)                          44,860         42,334      42,175           6.0%

Total Customers' Funds
- Deposits                                      27,454         27,415      26,786           0.1%
- Assets under Management                        9,183          9,320       9,320          -1.5%
- Capitalisation Insurance                       6,184          5,390       5,390          14.7%
- Securities                                     4,880          4,026       4,026          21.2%
- Total                                         47,700         46,150      45,521           3.4%

Own Funds (2)                                    5,993          6,345       6,345          -5.6%

(1) Does not include securitised assets.

(2) Shareholders' Equity, Preference Shares and Subordinated Debt.



Loan quality improved from the third quarter of 2001. Prudent analysis,
granting, monitoring and recovery of credit allowed the impact of the
unfavourable economic framework to be compensated for, with past due loans as a
percentage of total loans decreasing to 1.5% at September 30, 2002 from 1.6% at
the same date of 2001. Provisioning stood at adequate levels, improving to
140.3% from 137.1% at the end of the first half of 2002 (148.8% at September 30,
2001, on a comparable basis).


                 LOAN QUALITY INDICATORS (1)                      30 Sep.     30 Sep.         30 Sep. 
                                                                     2002        2001            2001
                                                                            Pro forma

Total overdue loans/Total loans                                      1.5%         1.6%           1.6%
Provisions/Total overdue loans                                     140.3%       148.8%         148.7%

(1) Does not include securitized loans.



Solvency indicators continued to be satisfactory. The consolidated solvency
ratio stood at 9.8% at the end of September 2002, according to BIS principles,
with tier one amounting to 6.0%. In accordance with the ruling of the Bank of
Portugal, the consolidated solvency ratio was 8.9% at the end of September 2002.



'We have taken important steps in reinforcing our strategic focus on what we
consider to be our core businesses and countries, notably on retail banking in
Portugal, Poland and Greece. Pursuant to this process, we have realigned our
partnership with Eureko. This has resulted in the purchase by BCP of Seguros e
Pensoes, Portugal's leading insurer, while keeping a 5% shareholding in Eureko's
capital, with a view to jointly pursuing interests in asset management and
bancassurance in other countries in which we have a banking presence', Mr.
Jardim Goncalves commented. 'This transaction reinforces our control of BCP's
domestic bancassurance activities, and also allows greater flexibility in
exploring value creation opportunities through future partnerships in the
domestic insurance market'. Within this context, he also added:



'BCP and its partner Banco Sabadell have decided to further develop the
activities and to increase coordination of ActivoBank7 in Portugal and
ActivoBank in Spain, with the aim of better exploiting operating and commercial
synergies. The shareholding structure of both ActivoBank7 and ActivoBank has
therefore been realigned, with BCP and Banco Sabadell now controlling the local
operations of their subsidiaries.'




'These arrangements will increase the focus on what we consider to be our key
strategic businesses, leading to clear benefits for the capital control and
management of these operations, and also resulting in lower exposure to non-core
risks and markets. However, the execution of these transactions requires
adequate own funds and, as such, we will take the necessary steps to strengthen
our capital, using whichever means we consider to be most appropriate under
current market conditions, with a focus on creating shareholder value, a
principle that has always guided us', he concluded.



For further information:

Miguel Duarte                             Banco Comercial Portugues                Tel: [phone]
Toby Moore/Catriona Cockburn              Citigate Dewe Rogerson                   Tel: [phone]






                         BANCO COMERCIAL PORTUGUES
          Consolidated Balance Sheet as at 30 September, 2002 and 2001

 

                                                                                                   
                                                                                  2002         2001
                                                                                (Thousands of Euros)               
                    Assets                                                                         
                    Cash and deposits at central banks                       1,039,013    1,140,629
                    Loans and advances to credit institutions                                      
                    Repayable on demand                                        691,217      770,121
                    Other loans and advances                                 3,858,774    4,912,660
                    Loans and advances to customers                         44,860,200   43,674,340
                    Securities                                               3,929,871    4,571,751
                    Treasury stock                                              16,434        8,315
                    Investments                                              2,685,672    2,772,301
                    Intangible assets                                          142,881      100,675
                    Tangible assets                                          1,144,838    1,269,130
                    Other debtors                                              854,508      901,676
                    Prepayments and accrued income                           2,031,355    2,044,505
                                                                            61,254,763   62,166,103
                    Liabilities                                                                    
                    Amounts owed to credit institutions                                            
                    Repayable on demand                                        539,997      427,609
                    With agreed maturity date                               12,243,756   14,577,083
                    Amounts owed to customers                                                      
                    Repayable on demand                                     11,809,412   11,660,524
                    With agreed maturity date                               15,634,689   15,115,473
                    Debt securities                                         12,287,275   11,042,848
                    Other liabilities                                          482,067      319,644
                    Accruals and deferred income                             1,293,080    1,580,247
                    Provision for liabilities and charges                      813,727    1,055,812
                    Subordinated debt                                        2,857,055    2,858,823

                    Total Liabilities                                       57,961,058   58,638,063

                    Shareholders' Equity                                                           
                    Share capital                                            2,326,715    2,326,715
                    Share premium                                              715,117      715,203
                    Reserves and retained earnings                         (1,113,281)    (774,088)

                    Total Shareholders' Equity                               1,928,551    2,267,830

                    Minority interests                                         158,167       41,488
                    Minority interests in preference shares                  1,206,987    1,218,722

                    Total Minority Interests                                 1,365,154    1,260,210

                                                                            61,254,763   62,166,103


                              BANCO COMERCIAL PORTUGUES
                           Consolidated Statement of Income  
                for the nine months ended 30 September, 2002 and 2001 

                                                                                                       
                                                                                       2002        2001
                                                                                   (Thousands of Euros) 
             
                Interest income                                                   2,238,191   2,572,004
                Interest expense                                                  1,242,622   1,558,813

                Net interest income                                                 995,569   1,013,191
                Provision for loan losses                                           249,839     160,174

                Net interest income after                                                              
                provision for loan losses                                           745,730     853,017

                Other operating income                                                                 

                Income from securities                                              138,156     172,471
                Commissions                                                         437,428     421,617
                Profit arising from trading activity                                311,388     362,562
                Other income                                                        379,341     254,203

                                                                                  1,266,313   1,210,853
                Other operating expenses                                                               

                Commissions                                                          66,312      58,271
                Losses arising from trading activity                                231,431     251,948
                Staff costs                                                         580,642     544,390
                Other administrative costs                                          393,475     385,966
                Depreciation                                                        124,508     105,817
                Other provisions                                                     51,049       7,982
                Other expenses                                                       55,483      50,284

                                                                                  1,502,900   1,404,658

                Income before income taxes                                          509,143     659,212
                Income taxes                                                         54,572      71,434

                Net income                                                          454,571     587,778
                Minority interests                                                   51,771      71,924

                Net income for the period attributable to the Bank                  402,800     515,854


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