VIEW OF INVESTMENT BAKNING

The investment banking industry in Chile: our view.

International investment banks are increasingly focusing on large transactions.

Aggressive competition on large transactions:

• Fees, costs and resources.
• Use of balance sheet.

Low appetite for middle-size transactions:

• Similar complexity than larger ones.
• Fees need to be very high w/r to transaction size.
• Usually will allocate less experienced/more junior resources.

Banks appear less interested in providing financial advisory in early stages of analysis; they are transaction oriented.

Domestic commercial banks lack the technical knowledge in M&A transactions.

Limited presence of small domestic investment banks with deep knowledge in M&A activities.