<PAGE>


================================================================================

                       SECURITIES AND EXCHANGE COMMISSION

                              Washington D.C. 20549

                             ----------------------

                                    FORM 20-F

                             ----------------------

[_]  REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES
     EXCHANGE ACT OF 1934
[X]  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
     ACT OF 1934
     For the fiscal year ended: December 31, 2001
[_]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
     EXCHANGE ACT OF 1934
     For the transition period from ____ to ____

                         Commission file number 1-14694

                           BANCO RIO DE LA PLATA S.A.
             (Exact name of Registrant as specified in its charter)


                              Rio de la Plata Bank
                 (Translation of Registrant's name into English)

                                    Argentina
                 (Jurisdiction of incorporation of organization)


                               Bartolome Mitre 480
                               (1036) Buenos Aires
                                    Argentina
                    (Address of principal executive offices)


 Securities registered or to be registered pursuant to Section 12(b) of the Act:
<TABLE>
<S>                                                                 <C>
            (Title of Each Class)                                   (Name of Each Exchange on Which Registered)
American Depositary Shares (as evidenced by American                           New York Stock Exchange
     Depositary Receipts), each representing two Class B
     Ordinary Shares
Class B Ordinary Shares, par value Ps.1.00 per share                           New York Stock Exchange*
</TABLE>

Securities registered or to be registered pursuant to Section 12(g) of the Act:
                                      None
                                (Title of Class)

     Securities for which there is a reporting obligation to Section 15(d)
                                  of the Act:
                                      None
                                (Title of Class)

Indicate the number of outstanding shares of each of the issuer's classes of
capital or common stock as of the close of the period covered by the annual
report:

Class A Ordinary Shares, par value Ps.1.0 per share ................ 142,665,414
Class B Ordinary Shares, par value Ps.1.0 per share ................ 204,076,251

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the Registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days: Yes :                No [X]

Indicate by check mark which financial statement item the Registrant has elected
to follow:                         Item 17 :            Item 18 [X]

================================================================================
* Not for trading, but only in connection with the registration of American
Depositary Shares, pursuant to the requirements of the Securities and Exchange
Commission.

<PAGE>


                                TABLE OF CONTENTS

                                                                            Page

                                     PART I

Item 1.  IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS ................1
Item 2.  OFFER STATISTICS AND EXPECTED TIMETABLE ..............................1
Item 3.  KEY INFORMATION ......................................................1
Item 4.  INFORMATION ON THE COMPANY ..........................................18
Item 5.  OPERATING AND FINANCIAL REVIEW AND PROSPECTS ........................90
Item 6.  DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES .........................106
Item 7.  MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS ..................112
Item 8.  FINANCIAL INFORMATION ..............................................116
Item 9.  OFFER AND LISTING DETAILS ..........................................117
Item 10. ADDITIONAL INFORMATION .............................................121
Item 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK .........134
Item 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES .............140

                                    PART II

Item 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES ....................140
Item 14. MATERIAL MODIFICATIONS TO THE RIGHT OF SECUTITYHOLDERS
         AND USE OF PROCEEDS ................................................140
Item 15. [RESERVED] .........................................................140
Item 16. [RESERVED] .........................................................140

                                    PART III

Item 17. FINANCIAL INFORMATION ..............................................140
Item 18. FINANCIAL INFORMATION ..............................................140
Item 19. EXHIBITS ...........................................................140


     Other statements contained in this Annual Report on Form 20-F (the "Annual
Report") are forward-looking statements and are not based on historical fact,
such as statements containing the words "believe," "may," "will," "estimate,"
"continue," "anticipate," "intend," "expect" and similar words. These
forward-looking statements involve risks and uncertainties that could
significantly affect expected results, including those discussed in "Item 4:
Information on the Company," "Item 5: Operating and Financial Review and
Prospects" and elsewhere in this Annual Report.

     Actual results may differ materially from Banco Rio's estimates. Banco Rio
believes that its estimates are reasonable; but you should not unduly rely on
these estimates, which are based on its current expectations. Banco Rio
undertakes no obligation to update any forward-looking statement or statements
to reflect events or circumstances after the date on which the statement is made
or to reflect the occurrence of unanticipated events. New factors emerge from
time to time, and it is not possible for Banco Rio to predict all of these
factors. Further, Banco Rio cannot assess the impact of each factor on its
business or the extent to which any factor, or combination of factors, may cause
actual results to be materially different from those contained in any
forward-looking statements.

                                       i

<PAGE>

                                     PART I

Item 1.  IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS

         Not applicable.

Item 2.  OFFER STATISTICS AND EXPECTED TIMETABLE

         Not applicable.

Item 3.  KEY INFORMATION

     A.  Selected Financial Data

             SELECTED CONSOLIDATED FINANCIAL INFORMATION OF THE BANK

                      PRESENTATION OF FINANCIAL INFORMATION

     The term "Bank" refers to Banco Rio de la Plata S.A. ("Banco Rio"), a
corporation (sociedad anonima) organized under the laws of the Republic of
Argentina ("Argentina"), and its consolidated subsidiaries. The financial
statements of the Bank that form part of this Annual Report are presented in
Argentine pesos and are prepared in conformity with generally accepted
accounting principles in Argentina ("Argentine GAAP") and the accounting
standards of Banco Central de la Republica Argentina (the "Central Bank")
("Argentine Banking GAAP"). Argentine Banking GAAP differs in certain respects
from accounting principles generally accepted in the United States ("U.S. GAAP")
and Argentine GAAP. See the description under "--Accounting for the Merger"
below, Note 30 to the audited consolidated financial statements of the Bank
(together with the notes thereto, the "Consolidated Financial Statements")
included elsewhere in this Annual Report, for a description of the differences
between Argentine Banking GAAP and U.S. GAAP as they relate to the Bank and a
reconciliation to U.S. GAAP of net income and stockholders' equity. For the
fiscal years ending June 30, 1997, the "Bank" refers to Banco Rio and its
consolidated subsidiaries, Rio Valores S.A. Sociedad de Bolsa ("Rio Valores"),
Santander Riobank (Grand Cayman), formerly Riobank International, a bank
incorporated in the Cayman Islands ("Riobank"), and, up until the time of its
sale on June 26, 1997, Compania Previsional Rio-Citi S.A. ("Compania Rio-Citi").
For the six-month transition reporting period ending December 31, 1997, the
"Bank" refers to Banco Rio and its consolidated subsidiaries Rio Valores,
Riobank and Geinver Gerente de Fondos Comunes de Inversion S.A. ("Geinver"). For
the fiscal year ending December 31, 1998, the "Bank" refers to Banco Rio and its
consolidated subsidiaries Riobank, Santander Sociedad de Bolsa S.A. ("Santander
Bolsa"), which merged with Rio Valores on June 12, 1998, Geinver and Santander
Investment Gerente de Fondos Comunes de Inversion S.A. ("Santander Fondos") and
further reflects the business combination with Santander Argentina (as defined
below) from January 1, 1998. For the fiscal year ending December 31, 1999, the
"Bank" refers to Banco Rio and its consolidated subsidiaries Riobank, Santander
Bolsa and Santander Fondos, which merged with Geinver on September 30, 1999. For
the fiscal years ending December 31, 2000 and 2001, the "Bank" refers to Banco
Rio and its consolidated subsidiaries Riobank, Santander Bolsa, Santander Fondos
and Gire S.A. Additionally, as of December 31, 2000, it includes the assets,
liabilities and results of operations of Banco Tornquist S.A. ("Banco
Tornquist") as a consequence of its merger with and into Banco Rio in January,
2000. See Notes 1 and 2 to the Consolidated Financial Statements and "Item 4.
Information on the Company--History and Development of the Company." The term
"Santander Argentina" refers to Banco Santander S.A. of Argentina, a wholly
owned subsidiary of Banco Santander S.A. of Spain prior to the merger with and
into the Bank.

Accounting for the Merger

     As a result of the merger of Santander Argentina into the Bank (the
"Merger"), the balance sheet and income statement data of Santander Argentina
for the fiscal year ended December 31, 1998 are included in the financial
statements of Banco Rio, which survived the Merger. This is in accordance with
Argentine GAAP, under which the Merger is viewed as a business combination
effective January 1, 1998 and results in a combination of the operating results
of the two entities from that date. Under U.S. GAAP, the Merger is accounted for
as a reverse

                                       1

<PAGE>

acquisition, on August 22, 1997, of Banco Rio by Banco Santander S.A. of Spain,
through its wholly owned subsidiary Santander Argentina. Under the U.S.
accounting rules, Santander Argentina would be treated as having survived the
Merger and assumed the legal charter and name of Banco Rio. As such, under U.S.
accounting rules the historical financial statements of the post-merger combined
Banco Rio represent the historical financial statements of Santander Argentina
adjusted to reflect the acquisition of Banco Rio effective as of August 22,
1997. Under U.S. securities regulations, these historical financial statements,
reconciled to U.S. GAAP, represent the U.S. GAAP historical financial statements
of the Registrant and normally would comprise the basic financial statements
presented within this 20-F filing. However, because under Argentine GAAP there
is no change of legal or reporting entity, the basic financial statements
included herein pursuant to Item 18 are those presented in accordance with
Argentine GAAP. As the pre-merger Banco Rio was significantly larger than the
pre-merger Santander Argentina, Banco Rio considers this presentation to
represent a more complete and useful presentation of historical changes in the
consolidated banking group. However, in conjunction with the primary Argentine
GAAP financial statements, supplemental disclosure is also provided of
historical financial statements and select financial information of Santander
Argentina. This supplemental information is included for reporting periods prior
to 1998 because according to both Argentine and U.S. GAAP the consolidated
financial statements for the year ended December 31, 1998 are comprised of the
same entities and are included herein under the caption "Capsule Financial
Information of Santander Argentina." Finally, a modest amount of financial data
regarding Santander Argentina for the reporting periods prior to calendar year
1996 is presented in Selected Statistical Information.

General

         In this Annual Report, references to "U.S.$," "$," "dollars" and "U.S.
dollars" are to United States dollars and references to "Ps." or "pesos" are to
Argentine pesos. All references herein to fiscal year 1997, the six-month fiscal
year 1997 and fiscal years 1998, 1999, 2000 and 2001 refer to the fiscal years
of the Bank ended June 30, 1997, the irregular six-month fiscal year ended
December 31, 1997 and the fiscal years ended December 31, 1998, 1999, 2000 and
2001, respectively. In this Annual Report, the term "billion" means one thousand
million. Unless otherwise stated, all market share and other industry
information has been derived from information published by the Central Bank.

         In order to present the financial information of the Bank in a format
more familiar to U.S. investors, certain classifications and groupings have been
made, and certain subtotals introduced, in "Item 3. Key Information--Selected
Consolidated Financial Information of the Bank" and "Item 5. Operating and
Financial Review and Prospects" which differ from those used in the Consolidated
Financial Statements presented on the basis of Argentine Banking GAAP.

         The Argentine federal government (the "Argentine Government") published
Decree 316/95 on August 22, 1995, which eliminated the requirement that
financial information at any date or for any period after August 31, 1995 be
restated for inflation. Pursuant to such decree, the Comision Nacional de
Valores ("CNV") issued its General Resolution 272 and the Central Bank issued
its Communication "A" 2365, which eliminated such requirement with respect to
those companies that are subject to their respective jurisdictions, such as the
Bank. Therefore, the Consolidated Financial Statements have been restated for
inflation through August 31, 1995 but not for periods thereafter. See Note 3 to
the Consolidated Financial Statements.

         On January 11, 2002, the exchange rate in the free market began to
float for the first time since April 1991, causing a significant devaluation of
the local currency. The devaluation of the peso has created pressures on the
domestic price system that have generated inflation in 2002, after several years
of price stability. In the period January-May of 2002, the consumer price index
and the wholesale price index have exhibited cumulative increases of 25.93% and
80.76%, respectively.

         Certain amounts that appear in this Annual Report (including percentage
amounts) may not sum due to rounding. The rate of exchange on December 31, 2001
was Ps.1.00 = U.S.$1.00, and on June 25, 2002 was Ps.3.85 = U.S.$1.00. See "Item
3. Key Information--Exchange Rates."

         The following table sets forth selected consolidated financial and
operating information of the Bank for each of fiscal year 1997, the six-month
period ended December 31, 1996, the six-month fiscal year 1997 and fiscal years
1998, 1999, 2000 and 2001. This information should be read in conjunction with,
and is qualified in its

                                       2

<PAGE>

entirety by reference to, as applicable, the Consolidated Financial Statements,
"Item 3. Key Information--Selected Consolidated Financial Information of the
Bank" and "Item 5. Operating and Financial Review and Prospects" included
elsewhere in this Annual Report. The selected consolidated financial information
of the Bank for each of fiscal year 1997, the six-month period ended December
31, 1996, the six-month fiscal year 1997 and fiscal years 1998, 1999, 2000 and
2001 has been derived from the Consolidated Financial Statements. The report of
Pistrelli, Diaz y Asociados (a member of Andersen) on the Consolidated Financial
Statements appears elsewhere in this Annual Report. The Consolidated Financial
Statements have been prepared in accordance with Argentine Banking GAAP, which
differs in certain respects from U.S. GAAP. Note 30 to the Consolidated
Financial Statements provides a description of the principal differences between
Argentine Banking GAAP and U.S. GAAP, as they relate to the Bank, and a
reconciliation to U.S. GAAP of net income and stockholders' equity. Deloitte &
Touche will replace Pistrelli, Diaz y Asociados as our accountants, in the third
quarter of the fiscal year 2002.

                                       3

<PAGE>

                   SELECTED CONSOLIDATED FINANCIAL INFORMATION

<TABLE>
<CAPTION>
                                                             For the
                                                  For the   six-month
                                        For the  six-month   fiscal
                                         fiscal    period      year
                                          year     ended      ended
                                         ended    December   December            For the fiscal year ended
                                        June 30,    31,        31,                      December 31,
                                        -------- ---------  ---------   -------------------------------------------
                                        1997 (1)  1996 (2)   1997 (1)   1998 (3)    1999 (4)   2000 (5)    2001 (6)
                                        -------- ---------  ---------   --------    --------   --------    --------
                                                                (in millions of pesos) (7)
<S>                                     <C>      <C>        <C>         <C>         <C>        <C>         <C>
INCOME STATEMENT DATA (8)
Amounts in Accordance with Argentine
GAAP:
Interest Income (9)                        695.3     338.6      374.9     835.7       987.6     1,213.2     1,054.8
Interest Expense (10)                     (321.0)   (154.4)    (198.4)   (407.9)     (470.1)     (603.3)     (615.8)
                                        -------- ---------  ---------   --------    --------   --------    --------
    Net Interest Income before
    Adjustments                            374.3     184.2      176.5     427.8       517.5       609.9       439.0
                                        -------- ---------  ---------   --------    --------   --------    --------

Adjustments to Interest
    Gains on Foreign Exchange (11)          15.7      10.2        5.7      18.0        45.8        52.1        63.9
                                        -------- ---------  ---------   --------    --------   --------    --------
    Total Adjustments to Interest           15.7      10.2        5.7      18.0        45.8        52.1        63.9
                                        -------- ---------  ---------   --------    --------   --------    --------
    Net Interest Income after
    Adjustments                           390.0     194.3      182.2     445.8       563.3       662.0       502.9
                                        -------- ---------  ---------   --------    --------   --------    --------
Other Financial Expenses                   (38.4)    (13.2)     (12.4)    (30.1)      (38.0)      (31.1)      (32.7)
    Net Interest Income before
    Provisions                             351.6     181.1      169.8     415.7       525.3       630.9       470.2
                                        -------- ---------  ---------   --------    --------   --------    --------
Provisions                                 (47.5)    (24.4)     (20.1)    (70.4)     (112.4)     (147.3)     (264.1)
    Net Financial Income after
    Provisions                             304.1     156.7      149.7     345.3       412.8       483.5       206.0
                                        -------- ---------  ---------   --------    --------   --------    --------

Service Charge Income, net (12)            300.4     140.9      105.9     228.7       232.3       310.8       326.4
Operating Expenses                        (477.4)   (225.9)    (222.3)   (467.6)     (483.2)     (543.1)     (527.4)
    Net Gain on Financial Transactions     127.1      71.7       33.3     106.5       162.0       251.2         5.0
                                        -------- ---------  ---------   --------    --------   --------    --------

Other Income, net (13)                     245.3      35.3       30.8       8.5        (1.2)       11.1        (3.0)
                                        -------- ---------  ---------   --------    --------   --------    --------
    Net Income Before Income Tax           372.4     107.0       64.1     114.9       160.8       262.3         2.0

Income Tax                                 (87.4)    (34.0)      (2.8)    (13.9)      (41.6)      (54.7)      (12.2)
                                        -------- ---------  ---------   --------    --------   --------    --------
Net Income                                 285.0      73.0       61.3     101.1       119.2       207.6       (10.2)
                                        ======== =========  =========   ========    ========   ========    ========
   -Net Income (Ordinary) (14)             145.9      73.0       61.3     101.1       119.2       207.6       (10.2)
   -Net Income (Nonrecurring) (14)         139.1         -          -         -           -           -           -

Average Ordinary Shares outstanding
(000s) (15)                              300,000   300,000    300,000   318,025     335,268     341,005     346,742
Net Income per  share (15)                  0.95      0.24       0.20      0.32        0.36        0.60      (0.03)
Net Income (ordinary) per share (16)(15)    0.49      0.24       0.20      0.32        0.36        0.60      (0.03)
Net Income per ADS (15)                     1.90      0.49       0.41      0.65        0.71        1.20      (0.06)
Net Income (ordinary) per ADS (14)(15)      0.97      0.49       0.41      0.65        0.71        1.20      (0.06)
Cash Dividends per share (15)               0.15        N/A      0.06      0.09        0.11        0.18        0.00
Cash Dividends per ADS (15)                 0.30        N/A      0.12      0.18        0.21        0.36        0.00

Approximate Amounts in Accordance with
    U.S. GAAP:
Net Income                                 295.5      77.4       32.1      48.3        (6.7)      113.0    (1,494.3)
   -Net Income before net gain on
      sale of Rio-Citi Group (14) (16)     141.1      77.4       32.1      48.3        (6.7)      113.0    (1,494.3)
   -Net gain on sale of Rio-Citi
      Group (14) (16)                      154.4         -          -         -           -           -           -
Net Income per share (15)                   0.98      0.26       0.10      0.14       (0.02)       0.33       (4.31)
   -Net Income before net gain on
      sale of Rio-Citi Group (14)
      (15) (16)                             0.47      0.26       0.10      0.14       (0.02)       0.33       (4.31)
Net Income per ADS (15)                     1.97      0.52       0.19      0.29       (0.04)       0.65       (8.62)
    Net Income before net gain on
      sale of Rio-Citi Group per ADS
      (14) (15) (16)                        0.94      0.52       0.19      0.29       (0.04)       0.65       (8.62)
</TABLE>

                                       4

<PAGE>

<TABLE>
<CAPTION>
                                                                  For the
                                                      For the    six-month
                                          For the    six-month     fiscal
                                          fiscal       period       year
                                           year         ended      ended
                                           ended      December    December               For the fiscal year ended
                                          June 30,       31,         31,                       December 31,
                                         ---------   ---------   ---------   ----------------------------------------------

                                          1997 (1)    1996 (2)    1997 (1)    1998 (3)    1999 (4)    2000 (5)     2001 (6)
                                         ---------   ---------   ---------   ---------   ---------  ----------   ----------
                                                                  (in millions of pesos) (7)
<S>                                      <C>         <C>         <C>         <C>       <C>         <C>          <C>
BALANCE SHEET DATA:
Amounts in Accordance with Argentine GAAP:

Cash and Due from Banks                     875.9       513.7       803.4       616.5     1,048.4     1,091.6      1,294.5
Goverment and Private Securities, Net of
     Allowances                             960.2       543.6     1,273.4     1,111.4     1,509.2     1,952.6        455.9
Loans and Financial Leases, Net of
     Allowances                           5,316.3     4,796.7     5,191.1     6,046.7     6,064.7     6,436.1      6,723.6
Investments in Other Companies               26.8       103.9        31.6        29.4        22.4        14.6         50.4
Other Receivables from Financial
     Transactions                         1,310.1       937.4     2,252.3     3,377.8     3,105.3     4,347.0        889.1
Bank Premises and Equipment                 273.7       256.6       295.0       334.8       337.2       347.8        322.4
Other Assets                                 98.5       174.3       117.6       178.9       154.2       148.4        207.4
                                         ---------   ---------   ---------   ---------   ---------  ----------   ----------
     Total Assets                         8,861.5     7,326.2     9,964.4    11,695.4    12,241.4    14,338.1      9,943.3
                                         =========   =========   =========   =========   =========  ==========   ==========

Deposits                                  4,441.2     3,565.2     4,149.3     5,323.4     6,260.3     7,065.6      6,370.4
Other Liabilities from Financial
     Transactions                         3,373.1     2,742.6     4,833.6     5,113.3     4,617.6     5,698.1      2,312.5
Other Liabilities                           117.3       302.7        65.1       138.6       157.9       234.8        198.9
     Total Liabilities                    7,931.6     6,610.5     9,048.0    10,575.3    11,035.8    12,998.5      8,881.8
                                         ---------   ---------   ---------   ---------   ---------  ----------   ----------
Stockholders' Equity                        929.9       715.7       916.4     1,120.1     1,205.6     1,339.6      1,061.5
                                         ---------   ---------   ---------   ---------   ---------  ----------   ----------
     Total Liabilities and
     Stockholders' Equity                 8,861.5     7,326.2     9,964.4    11,695.4    12,241.4    14,338.1      9,943.3
                                         =========   =========   =========   =========   =========  ==========   ==========

Average Total Assets (17)                 7,668.5     6,816.7     9,700.9    13,063.9    11,479.2    13,438.2     12,340.1
Average Stockholders' Equity (17)           738.5       697.3       884.7     1,067.4     1,149.8     1,310.4      1,309.3
Book Value per Ordinary Share (Ps.)          3.10        2.39        3.05        3.34        3.60        3.86         3.06
Book Value per ADS                           6.20        4.77        6.11        6.68        7.19        7.73         6.12

Percentage of Balance Sheet Items
     Denominated in Dollars
     Loans, Net of Allowances              80.01%      80.35%      80.03%      79.14%      77.06%      79.76%       93.40%
     Total Assets                          72.29%      73.84%      71.46%      69.77%      71.40%      74.02%       83.05%
     Deposits                              67.78%      67.44%      63.69%      63.07%      69.85%      74.03%       79.39%
     Total Liabilities                     76.57%      77.47%      75.54%      74.60%      78.46%      78.41%       80.40%

Amounts in Accordance with United
States GAAP:

Stockholders' Equity                        939.7       721.8       890.4     1,480.0     1,667.9     1,672.6       (76.6)
</TABLE>

                                       5




<PAGE>

<TABLE>
<CAPTION>
                                                                             For the
                                                                For the     six-month
                                                     For the   six-month     fiscal
                                                     fiscal     period       year
                                                      year      ended        ended
                                                      ended    December     December            For the fiscal year
                                                     June 30,     31,          31,               ended December 31,
                                                     --------  ---------    ---------   ------------------------------------
                                                     1997 (1)   1996 (2)     1997 (1)   1998 (3)  1999 (4) 2000 (5) 2001 (6)
                                                     --------  ---------    ---------   ------------------------------------
<S>                                                  <C>       <C>          <C>         <C>      <C>      <C>      <C>
                                                                            (in millions of pesos) (7)
FINANCIAL RATIOS:
Ratios in Accordance with Argentine GAAP:
Profitability
    Net Interest Margin (18)                           5.46 %     5.98 %    *  4.76 %   * 5.39 %    5.88 %   6.04 %   4.57 %
    Nominal Yield Spread (19)                          4.88       5.24      *  3.70     * 4.45      4.89     5.00     3.44
    Gross Yield Adjusted (20)                         10.23      10.99      * 11.46     *17.89     10.00     9.42    17.20
    Return on Average Assets (Total)                   3.72       2.12      *  1.25     * 0.77      1.04     1.54    (0.08)
    Return on Average Assets (Ordinary) (21)           1.91       2.12      *  1.25     * 0.77      1.04     1.54    (0.08)
    Return on Average Equity (Total)                  38.59      20.76      * 13.75     * 9.47     10.36    15.84    (0.78)
    Return on Average Equity (Ordinary)  (22)         20.07      20.76      * 13.75     * 9.47     10.36    15.84    (0.78)
    Operating Expenses to Average Assets               6.23       6.57      *  4.55     * 3.58      4.21     4.04     4.27
    Service Charge Income, net to Operating
    Expenses                                          62.92      62.38        47.66      48.92     48.08    57.22    61.88
    Service Charge Income, net to Operating
    Income (23)                                       46.07      43.76        38.42      35.50     30.66    33.00    40.97
    Efficiency Ratio (24)                             73.22      70.15        80.62      72.56     63.78    57.68    66.21

Capital
    Stockholders' Equity to Total Assets              10.49       9.77         9.20       9.58      9.85     9.33    10.68
    Tangible Stockholders' Equity to Total
    Assets (25)                                       10.28       9.00         8.91       9.04      9.34     9.01    10.32
    Total Liabilities to Stockholders' Equity          8.53 x     9.24 x       9.87x      9.44 x    9.15 x   9.71 x   8.37 x
    Risk adjusted capital ratio (26)                  13.58      13.93        15.44      15.55     17.77    16.06    13.58
    Excess capital over required minimum
    capital (27)                                      131.9      116.7        228.0      259.6     381.0    342.1    141.9

Credit Quality
    Past Due Loans to Total Loans (28)                 3.74       4.52         4.45       4.30      4.42     5.22     4.38
    Non-Performing Loans to Total Loans (29)           2.43       2.63         2.67       2.75      2.49     3.40     2.41
    Allowances to Total Loans                          2.69       2.88         2.85       2.79      2.71     3.58     3.27
    Allowances to Past Due Loans (28)                 71.87      63.69        64.14      64.92     61.19    68.61    74.62
    Allowances to Non-Performing Loans (29)          110.67     109.51       106.87     101.64    108.53   105.28   135.51
    Net charge offs (thousands of pesos)             25,220     10,904       11,828     48,341   115,905  236,032  268,724
    Net charge offs to average loans                   0.53       0.24         0.22       0.84      1.93     3.63     4.01

Liquidity
       Liquid Assets to Deposits  (30)                36.07      29.66        45.26      32.46     40.85    43.08    27.48
       Loans, Net of Allowances to Total
       Assets                                         59.93      65.47        52.01      51.55     49.39    44.52    66.97
       Deposits to Total Liabilities                  55.99      53.93        45.86      50.34     56.73    54.32    71.72

INFLATION AND DEPRECIATION RATES:
       Inflation Rate (W.P.I.) (31)                   (0.1) %     0.2 %       (0.7)%     (6.3)%     1.1 %    2.4 %   (5.3)%
       Inflation Rate (C.P.I.) (31)                    0.9        0.7          0.2        0.7      (1.8)    (0.7)    (1.5)
       Depreciation Rate (Peso relative to U.S. $)
       (32)                                            0.0        0.0          0.0        0.0       0.0      0.0      0.0
</TABLE>

--------------------
(1)  Consolidated to include the financial statements of Rio Valores and Riobank
     and, for the six-month fiscal year 1997, Geinver. Includes the results of
     operations of Compania Rio-Citi through the time of its sale on June 26,
     1997 and its average balance sheets through May 31, 1997.
(2)  Consolidated to include the financial statements of Rio Valores, Riobank
     and Compania Rio-Citi.
(3)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Geinver and Santander Fondos. Includes the results of operations and
     average balance sheets of Rio Valores through the time of its merger with
     and into Santander Bolsa. Additionally, it includes the assets, liabilities
     and results of operations of Santander Argentina, as a consequence of its
     merger with and into Banco Rio.
(4)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa and Santander Fondos. Additionally, it includes the assets,
     liabilities and results of operations of Geinver, as a consequence of its
     merger with and into Santander Fondos.
(5)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A. Additionally, it includes the assets,
     liabilities and results of operations of Banco Tornquist, as a consequence
     of its merger with and into Banco Rio.
(6)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A.

(7)  Except per share and per ADS data, which are actual peso amounts, and
     percentages, unless otherwise indicated.

(8)  The income statement data have been derived from the financial statements
     of the Bank. In order to present the financial information of the Bank in a
     format more familiar to U.S. investors, certain classifications and
     groupings have been made, and certain subtotals introduced,

                                       6

<PAGE>

     which differ from those used in the Consolidated Financial Statements
     presented on the basis of Argentine Banking GAAP. See "Item 5. Operating
     and Financial Review and Prospects--Presentation of Net Financial Income."
     In addition, see Note 30 to the Consolidated Financial Statements for a
     reconciliation to U.S. GAAP of the Bank's net income and stockholders'
     equity.
(9)  Includes premiums on repurchase agreements and options sold and income from
     financial leases. Also includes gain from government securities, short-term
     investments and corporate bonds purchased, including interest received,
     capital gains and losses, and mark to market adjustments.
(10) Includes premiums on repurchase agreements and options purchased and loss
     from government securities and short-term investments.
(11) Reflects the gains (losses) realized by the Bank on its net
     dollar-denominated monetary asset position as the Argentine currency
     depreciates (appreciates). Also includes commissions on foreign currency
     exchange activities and net premiums on forwards sales and purchases of
     foreign currency.
(12) Net of taxes and certain commissions paid.
(13) Includes primarily income from investments in other companies, expenses
     recovered and provision for losses on other receivables and other
     allowances, net of monetary (loss) gain on other transactions. For fiscal
     year ended June 30, 1997, includes a Ps.168.0 million nonrecurring gain on
     the sale of Compania Rio-Citi, Siembra AFJP S.A., Siembra Seguros de Retiro
     S.A. and Sur Seguros de Vida S.A. (collectively, the "Rio-Citi Group") and
     a nonrecurring provision of Ps.18.0 million related primarily to the
     Acquisition (as defined in "Item 4. Information on the Company--History and
     Development of the Company--History").
(14) Net income (ordinary) excludes the after-tax net gain from the sale of the
     Rio-Citi Group of Ps.154.4 million, less certain other tax adjusted
     nonrecurring expenses and estimated restructuring costs aggregating Ps.15.4
     million resulting from the Acquisition and the Combined Offering (as
     defined in "Item 4. Information on the Company--History and Development of
     the Company--History). These excluded gain and expense provisions are,
     collectively, classified as nonrecurring or extraordinary pursuant to
     Central Bank regulations.
(15) Until December 31, 1997, per share numbers are calculated on the basis of
     300,000,000 shares outstanding. On June 25, 1997, the Board of Directors of
     Banco Rio declared a one-for-one stock dividend on the 150,000,000 shares
     outstanding on that date, increasing the number of outstanding shares by
     150,000,000. The number of shares outstanding in prior fiscal years has
     been restated proportionately. On June 26, 1998, the number of shares were
     increased by 35,267,675 Class B because of the merger with Santander
     Argentina. On April 28, 2000, the number of shares were increased by
     11,473,990 Class B because of the merger with Banco Tornquist. No ADSs were
     outstanding prior to the six-month fiscal year 1997 and per ADS data prior
     to such period are therefore pro forma based on the ratio of two Class B
     Shares (as defined in "Item 4. Information on the Company--History and
     Development of the Company--History) to one ADS.
(16) On June 26, 1997, the Bank and its subsidiary Riobank sold their entire
     equity interests (direct and indirect) in Compania Previsional Rio-Citi
     S.A., Siembra AFJP S.A., Siembra Seguros de Retiro S.A. and Sur Seguros de
     Vida, generating a profit, less applicable income tax of Ps.154,436 which
     was credited to the "Other income" account in the Consolidated Statements
     of Income as of June 30, 1997.
(17) The average balance for each period is the average of the month-end
     balances in such period.
(18) Net interest income as calculated from "Item 4. Information on the
     Company--Selected Statistical Information--Average Balance Sheet and Income
     From Earning Assets" divided by total average interest-earning assets.
     Included in net interest income are capital gains and losses and mark to
     market adjustments on government securities and short-term investments.
(19) Represents the difference between the average nominal rates earned on
     interest-earning assets (nominal gross yield) and the average nominal rates
     paid on interest-bearing liabilities.
(20) Interest earned divided by average interest-earning assets, adjusted for
     the effects of inflation and currency fluctuations.
(21) Defined as net income divided by average total assets adjusted for the
     effects of any nonrecurring income.
(22) Defined as net income divided by average stockholders' equity adjusted for
     the effects of any nonrecurring income.
(23) Operating income is defined as the sum of net financial income before
     provision, and service charge income, net.
(24) Defined as operating expenses, net divided by the sum of net financial
     income before provision, and service charge income, net.
(25) Defined as stockholders' equity minus intangible assets divided by total
     assets. Intangible assets for all periods are comprised principally of
     expenses related to the administrative and systems reorganization incurred
     in that fiscal years.
(26) Based on the Basle Committee on Banking Regulations and Supervisory
     Practices (the "Basle Committee") framework for capital measurement and
     capital standards of banking institutions. The Central Bank's minimum
     capital adequacy rules are based on those recommended by the Basle
     Committee but are stricter in some respects. See "Item 4. Information on
     the Company--Selected Statistical Information--Capital Resources--Capital
     Adequacy."
(27) Defined as the excess of the Bank's capital, as calculated under Central
     Bank requirements, over the Central Bank's minimum capital requirement. See
     "Item 4. Information on the Company--Selected Statistical
     Information--Capital Resources--Capital Adequacy."
(28) Past-due loans are equal to the loans classified in the Potential Risk,
     Problematic, High Risk of Insolvency, Uncollectible and Irrecoverable for
     Technical Reasons categories for the Bank's commercial portfolio and in the
     Inadequate Performance, Deficient Performance, Difficult Collection,
     Uncollectible and Irrecoverable for Technical Reasons categories for the
     Bank's consumer loan portfolio categories of the loan classification system
     of the Central Bank at June 30, 1997 and December 31, 1996, 1997, 1998,
     1999, 2000 and 2001. See "Item 4. Information on the Company--Argentine
     Banking System and Regulation--Argentine Banking Regulation--Liquidity and
     Solvency Requirements--Loan Loss Provisions."
(29) Includes loans in the Problematic, High Risk of Insolvency, Uncollectible
     and Irrecoverable for Technical Reasons categories for the Bank's
     commercial portfolio and in the Deficient Performance, Difficult
     Collection, Uncollectible and Irrecoverable for Technical Reasons
     categories for the Bank's consumer portfolio at June 30, 1997 and December
     31, 1996, 1997, 1998, 1999, 2000 and 2001. See "Item 4. Information on the
     Company--Argentine Banking System and Regulation--Argentine Banking
     Regulation--Liquidity and Solvency Requirements--Loan Loss Provisions."
(30) Liquid assets include cash and due from banks and government securities,
     net of allowances.
(31) Source: INDEC.
(32) Source: Banco de la Nacion Argentina.

                                       7




<PAGE>

              CAPSULE FINANCIAL INFORMATION OF SANTANDER ARGENTINA

Business of Santander Argentina

         Pursuant to the Merger, Santander Argentina merged into Banco Rio on
October 15, 1998, effective for Argentine GAAP purposes from January 1, 1998.
Banco Rio thereby succeeded to all Santander Argentina's business, which has
been integrated with that of Banco Rio. As further described under
"--Presentation of Financial Information--Accounting for the Merger,"
significant differences exist between the merger accounting under Argentine and
U.S. GAAP, including differences in identification of historical financial
statements.

         Santander Argentina began operations under that name on December 4,
1963. Substantially all of its shares were indirectly controlled by the group of
companies controlled by or affiliated with Banco Santander (collectively, "Grupo
Santander," "Santander Group" or the "Group") from that time until the Merger.

         Initially, Santander Argentina provided typical retail banking
services, credit facilities to local businesses and financing of foreign trade
transactions. Its business was subsequently redefined, primarily as a result of
the development of Argentina's capital markets. Santander Argentina refocused
its activities on wholesale banking and investment banking, concentrating
specifically on advisory services relating to structuring debt and equity
financing, on brokerage of Argentine and foreign government bonds and related
securities custody services for Argentine and foreign investors, on foreign
exchange transactions, on depositary services for mutual funds, and on
development of financing facilities for businesses based in Argentina. Santander
Argentina actively participated in the development of new financial products.
Santander Argentina had two subsidiaries, Santander Bolsa and Santander Fondos,
engaged in brokerage and mutual fund services, respectively.

         Santander Argentina was licensed in 1963 by the Central Bank to engage
in a banking business. Its only office was in Buenos Aires, and it operated
outside Argentina through Banco Santander's branches and other companies in
Grupo Santander. At the time of its merger with the Bank, Santander Argentina
employed approximately 100 persons.

         As explained under "--Presentation of Financial Information--Accounting
for the Merger," under U.S. GAAP the merger resulted in the separate legal
entity Santander Argentina being absorbed into Banco Rio. However, under U.S.
GAAP the former consolidated operations of Banco Rio would be treated as
acquired by Santander Argentina as of August 22, 1997. Accordingly, these U.S.
GAAP balances and ratios relating to calendar 1998 are not comparable with the
stand-alone U.S. GAAP balances and ratios of the pre-merger Banco Rio as
reflected in columns dated prior to 1998.

         The following capsule financial information of Santander Argentina,
presented in accordance with Argentine GAAP, as of and for December 31, 1996 and
1997 has been derived from, is qualified by reference to, and should be read in
conjunction with the audited consolidated financial statements of Santander
Argentina, which have not been included in this Annual Report as of and for each
of the fiscal years ended December 31, 1996 and 1997 and the related notes
thereto.

                                    Fiscal Year Ended     Fiscal Year Ended
                                    December 31, 1996    December 31, 1997(1)
                                    -----------------    --------------------
INCOME STATEMENT DATA                       (in thousands of pesos)

Financial Income ................   Ps.       22,101     Ps.          85,285
Financial Expense ...............            (16,810)                (77,262)
Provision for Loan Losses .......               (350)                   (371)
Service Charge Income, net ......              6,143                  11,499
Operating Expenses ..............            (16,471)                (20,181)
Other Income (Expense, Net) .....                (55)                    242
                                    -----------------    --------------------

      Net Income (loss) .........   Ps.       (5,442)    Ps.            (788)
                                    =================    ====================

                                       8

<PAGE>


                                          As of                 As of
                                    December 31, 1996    December 31, 1997(1)
                                    -----------------    --------------------
BALANCE SHEET DATA                          (in thousands of pesos)

Loans, Net of Allowances ........   Ps.        85,520    Ps.          300,088
Other Receivables from
Financial Transactions, Net of
Allowances ......................             797,610                 253,563
Other Assets ....................             237,707                  98,106
                                    -----------------    --------------------

      Total Assets ..............           1,120,837                 651,757
                                    =================    ====================


Deposits ........................             102,343                 368,425

Other Liabilities from
Financial Transactions ..........             922,160                 185,852
Other Liabilities ...............               4,939                   7,402
Subordinated Debt ...............              25,547                  25,018
                                    -----------------    --------------------

      Total Liabilities .........           1,054,989                 586,697
                                    =================    ====================

      Total Stockholders'
      Equity ....................   Ps.        65,848    Ps.           65,060
                                    =================    ====================

--------------------
(1)  Consolidated to include the financial statements of Santander Bolsa and
     Santander Fondos.

                                       9




<PAGE>

Exchange Rates

     The following table sets forth, for the periods indicated, the high, low,
average and period-end exchange rates for the purchase of U.S. dollars,
expressed in nominal pesos per U.S. dollar. The Federal Reserve Bank of New York
does not report a noon buying rate for pesos.

<TABLE>
<CAPTION>
                                                  Exchange Rate of Pesos per US$1.00
                                      -------------------------------------------------------------
Year Ended December 31,                    Low            High        Average (1)     Period-end
                                           ---            ----        -----------     ----------

<S>                                   <C>            <C>             <C>            <C>
1997                                        1.00           1.00            1.00           1.00
1998                                        1.00           1.00            1.00           1.00
1999                                        1.00           1.00            1.00           1.00
2000                                        1.00           1.00            1.00           1.00
2001 (2)                                    1.00           1.00            1.00           1.00
Month Ended
December 31, 2001 (2)                       1.00           1.00            1.00           1.00
January 31, 2002                            1.40           2.05            1.46           2.05
February 28, 2002                           1.70           2.15            1.99           2.15
March 31, 2002                              2.05           3.15            2.45           3.00
April 30, 2002                              2.68           3.15            2.86           2.98
May 31, 2002                                3.10           3.60            3.33           3.60
June 2002 (through June 25, 2002)           3.50           3.85            3.59           3.85
</TABLE>

--------------------
(1)  Represents the daily average exchange rate during each of the relevant
     periods.
(2)  The Bank's assets and liabilities denominated in foreign currency as of
     December 31, 2001, were valued at the exchange rate of ARS 1 to each US
     dollar, as required by Resolution MD No. 01/02 of the "Consejo Profesional
     de Ciencias Economicas de la Cuidad Autonoma de Buenos Aires"
     (CPCECABA-Professional Council in Economic Sciences of Buenos Aires
     Autonomus City), by BCRA Communiques "A" 3439 and "A" 3574, by "Comision
     Nacional de Valores" (CNV - Argentine National Securities Commission)
     Resolution No. 392 and "Inspeccion General de Justicia" (IGJ - Governmental
     Regulatory Agency of Corporations) Resolution No. 2/02.
Source:  Banco de la Nacion Argentina.


     B.   Capitalization and Indebtedness

          Not applicable.

     C.   Reasons for the Offer and Use of Proceeds

          Not applicable.

     D.   Risk Factors

     Factors relating to Argentina
     -----------------------------

     The recent political and economic turmoil has halted commercial and
     -------------------------------------------------------------------
financial activities.
---------------------

     After the presidential elections of October 1999, President Fernando De la
Rua had to face the economic recession affecting Argentina and the need to
obtain political consensus on critical issues related to the economy, government
spending, legal reform and social programs. However, President De la Rua did not
obtain Congress support, as Congress was controlled by the Peronist opposition
party, or cooperation from a number of provincial Peronist governors. De la
Rua's political strength was weakened by conflicts within his party, which
reached a peak with the resignation of the Argentine Vice-president in October
2000.

     De la Rua's Administration was not able to resolve the growing government
deficit, both at federal and provincial level. Taxation revenues dropped due to
the recession and the government sought refuge in financing granted by local
banks and, to a lesser extent, by foreign banks. In practice, this was a
limitation to the capacity of private companies to obtain financing from banks.
As the government's financial health deteriorated, interest rates

                                       10

<PAGE>

reached historical peaks, which halted the economy. The lack of credibility in
Argentina's economic future and in its capacity to maintain the Argentine peso
pegged one to one to the US dollar triggered a dramatic deposit flight. Despite
the statements to the contrary, on December 1, 2001, the Argentine government
froze bank deposits and incorporated exchange controls that thwarted capital
outflows. Such measures deepened the stagnation of the Argentine economy to
benefit the banking system, increasing social dissatisfaction, triggering
lootings all over Argentina in December 19, 2001, and followed by the
resignation of Economy Minister Domingo Cavallo on December 20, 2001. On
December 21, 2001, after declaring the state of siege, President De la Rua
resigned in midst of escalating political, social and economic unrest.

     On January 1, 2002, after resignation of a pro tempore president that held
office for only one week, the Legislative Assembly appointed Peronist senator
Mr. Eduardo Duhalde as Argentine President to hold office for the unfinished De
la Rua's term of office until December 2003.

     Since his appointment on January 2, 2002, President Duhalde and the
incumbent administration have implemented a number of significant measures such
as:

     o    Confirmation of the default on payments of a portion of the Argentine
          external debt declared by the pro tempore president;
     o    Abrogation of certain provisions of the Convertibility Law (currency
          board) and creation of the regulatory framework for the Argentine peso
          devaluation;
     o    De-dollarization of certain debts denominated in US dollars at the
          Ps.1 to USD 1 rate, other than a number of express exceptions;
     o    De-dollarization of bank deposits denominated in US dollars at the
          Ps.1.40 to USD 1 rate;
     o    Restructuring of bank deposits and maintenance of the restriction on
          the withdrawals of funds and transfers abroad;
     o    Enactment of the bankruptcy law to protect debtors;
     o    Enactment of a reform to the charter of the Central Bank of
          Argentina to enable the bank to issue Argentine pesos in excess of the
          reserves in foreign currency, make short-term loans to the federal
          government and provide financial assistance to financial institutions
          with liquidity or financial problems; and
     o    Obligation of all banks to sell all their holdings in foreign currency
          within Argentina to the Central Bank of Argentina at the USD 1 to
          Ps.1.40 exchange rate (this obligation is currently suspended).

     We cannot predict how the Argentine government will resolve the economic
crisis. To that end, the internal and external support granted to the Duhalde
Administration is not clear. Political protests and social turmoil are
continuing on a regular basis all over Argentina and, to date, the International
Monetary Fund (IMF) and other multilateral and public lenders have expressed
their reluctance to grant financial assistance to Argentina before development
of a sustainable economic model. The current government has enormous challenges
to manage the current crisis, to obtain the support required to implement the
reforms to resume economic growth and restore public confidence and, finally
support the policies of the newly elected government next year. The fast and
dramatic changes to Argentine social, political, economic and legal conditions
and the absence of clear political consensus to support the new Government or
any economic measure have created great uncertainty. As a result, all commercial
and trading activities have almost halted, which aggravated the economic
recession that triggered the current crisis.

     Argentina's lack of creditworthiness and the recent default on payment of
     -------------------------------------------------------------------------
Argentina's public debt have deepened the current financial crisis
------------------------------------------------------------------

     As of September 2001, the aggregate gross Argentine public debt was
approximately USD 141.2 billion. On December 23, 2001, the former pro tempore
president, Mr. Rodriguez Saa, declared the default on payments of a portion of
the Argentine external debt and, on January 2, 2002, President Duhalde ratified
such default and the restrictions on the withdrawal of bank deposits imposed on
December 1, 2001. These measures contributed to deepen the recession and there
was a sharp fall of taxation revenues of the last few months.

     Furthermore, the main international rating agencies have repeatedly
downgraded the rating of Argentina's external debt. On November 6, 2001,
Standard & Poor's downgraded the rating of long-term debt in foreign and

                                       11

<PAGE>

Argentine currency secured by the government from "CC" to "SD" (selective
default). On December 3, 2001, Fitch IBCA, Duff & Phelps downgraded the rating
of long-term debt from "CCC-" to "DDD" and the rating of short-term debt from
"B" to "C". On December 21, 2001, Moody's Investors Service downgraded
Argentina's foreign currency country ceiling for bonds to "Ca" from "Caa3",
stating that the downgrading reflected the fast deterioration of economic,
financial and social conditions.

     It may be expected that the lack of solvency of the Argentine government,
its default and inability to obtain financing will affect significantly its
capacity to implement reforms, weakening the capacity of the private sector to
resume economic growth. As a result, recession may deepen, inflation and
unemployment may rise and there may be new social turmoil. This may
significantly affect the financial and commercial position and the results of
operations of the Issuer.

     The recent Argentine peso devaluation creates increased uncertainty about
     -------------------------------------------------------------------------
Argentina's economic future
---------------------------

     On January 6, 2002, Congress passed the Law on Public Emergency and
Exchange System Reform No. 25,561 (the "Public Emergency Law") which terminated
a period over which the peso had been pegged one to one to the US dollar under
the so-called "Convertibility Law" and eliminated the obligation to maintain, at
all times, reserves in gold, foreign currency and bonds denominated in foreign
currency at the Central Bank of Argentina for an amount equivalent to at least
100% of currency in circulation plus deposits in Argentine pesos of financial
institutions with the Central Bank of Argentina. The Public Emergency Law grants
the Executive the power to fix the exchange rate of the Argentine peso to
foreign currencies and to issue regulations related to the exchange system. On
the same date, the Executive established a dual temporary exchange system which
established a fixed exchange rate for exports and imports at ARS 1.4 to USD 1
and a floating exchange rate determined by the market for any other transaction.

     On January 11, 2002, once the Central Bank of Argentina lifted the bank
holiday it had imposed on December 21, 2001, the exchange rate began to float
freely for the first time since April 1991. The market had few US dollars to
offer and the high demand took the exchange rate far above the USD 1 = Ps.1.4
used by the government in transactions related to its negotiation. This led the
Central Bank of Argentina to intervene on several occasions by selling dollars
to support the peso. But the Central Bank's capacity to support the peso by
selling dollars is dependent on its limited dollar reserves and financial aid
from the IMF, which has not been made available to date. Thereafter, the
Argentine peso continued to fluctuate significantly. On February 3, 2002, the
Federal Executive announced the elimination of the dual exchange rate system, to
be replaced by a single floating exchange rate for all transactions and, on that
same day, another banking holiday was imposed, which precluded the conversion of
pesos until February 11, 2002. Since January 11, 2002, the volume of foreign
currency trading has been limited and involved small amounts, mainly due to the
restrictions imposed on withdrawal of bank deposits. In addition, until August
12, 2002, Central Bank of Argentina authorization is required for all transfers
abroad made by the non-financial private sector, the financial sector and
government-owned companies independent from the budget of their respective
departments, when such transfers are for servicing the principal of financial
loans or to pay out earnings and dividends, whatever the manner of payment,
other than in cases of (a) payables to International Organizations, (b) payables
to banks that with Multilateral Organizations co-financed investment projects,
(c) payables to governmental lending agencies or guaranteed by such agencies,
(d) payables to Multilateral Credit Organizations in which the Argentine Federal
Government has equity interests through the Central Bank of Argentina or other
federal-government owned banks, or guaranteed by such entities, and (e) payables
to other Multilateral Credit Organizations under formalized agreements including
covenants providing for treatment no less favorable than that given to the most
favored creditor multilateral organization, or guaranteed by such Organizations.

     The devaluation is expected to create serious problems for the Argentine
government. Most of its revenues come from taxes collected in Argentine pesos,
while most of its financial obligations are denominated in US dollars.
Accordingly, the Argentine government's capacity to service its foreign debt has
been badly affected by the devaluation of the peso. The adoption of measures to
restore fiscal accounts so as to allow servicing of government debt and
balancing the budget after the devaluation would be sure to increase social
disturbance and political instability.

                                       12

<PAGE>

     Historical experience prior to the enactment of the Convertibility Law
leads to serious doubts as to the Argentine government's capacity to maintain
strict monetary policy and control inflation. In the past, inflation has
significantly weakened the Argentine economy and the Argentine government's
capacity to create conditions enabling growth.

     The paralysis of the Argentine payment systems is adversely impacting
     ---------------------------------------------------------------------
economic activity and financial system normal operations and asset quality
--------------------------------------------------------------------------

     Argentina's economy is currently suffering from a disruption in traditional
systems of payment due to a severe shortage of liquidity in the marketplace. The
severe economic recession, the restrictions to cash withdrawals, the devaluation
of the peso, and the lack of confidence in the financial system are the main
causes of the current shortage.

     The ensuing shortage of cash disrupted Argentina's payment system which has
historically favored cash settlements. The shortage of cash and resulting
scarcity of working capital has contributed to a severe contraction of customary
trade credit which in turn has brought many commercial activities to a
standstill. The disruption of the payment system has had a particularly
significant impact on Argentina's cash-based informal economy and those who
depend on it. In addition, the disruption of the cash-based payment system is
adversely affecting the ability of debtors to make payments in connection with
outstanding credits and overall economic and, as a result, fiancial system
normal operation and asset quality.

     Exchange controls may prevent us from servicing our external debt
     ------------------------------------------------------------------
obligations
------------

     The Argentine foreign exchange market was subject to exchange controls
until December 1989. From 1989 to December 3, 2001, there were no foreign
exchange controls preventing or restricting the conversion of pesos into U.S.
dollars.

     However, since December 3, 2001, the majority of transfers of funds abroad
to effect payment of indebtedness require the prior authorization of the
Argentine Central Bank. On February 8, 2002, the Argentine Central Bank issued
Communication "A" 3471 which specified that until June 13, 2002, transfers from
Argentina to other countries for the payments of principal on certain
indebtedness, and the distribution of dividends, require the approval of the
Argentina Central Bank. On March 25, 2002, the Argentine Central Bank issued
Communication "A" 3537 that established the requirement of such approval for
payments of interest for a specified period of time which pursuant to
Communication "A" 3584, issued on April 29, 2002, will remain in effect until
August 12, 2002. We cannot assure you that the Argentine Central Bank will
modify its policy.

     Recent Argentine policies have restricted financial activities for an
     ---------------------------------------------------------------------
undetermined period of time
---------------------------

     The various measures recently implemented by the Argentine government have
significantly deteriorated the confidence of depositors and investors in the
Argentine financial system and in all financial institutions in Argentina as
well as public sentiment towards banks. In addition, financial institutions have
been blamed by the media and politicians for the enforcement of the "corralito".
As a result, depositors are only withdrawing, and nor depositing, funds from the
financial system which is losing approximately Ps.4,000 million deposits per
month. In such a scenario, the ability of financial institutions to act as
intermediaries between the public's funds and credit has been severely hampered.

     In a scenario where depositor confidence as well as public sentiment
towards banks has been seriously affected, for an uncertain period of time, and
to a larger extent than in the past, banking activity will most likely be
limited to the provision of certain traditional commercial banking services
which include the management of means of payment (with emphasis on electronic
means), the provision of bank account for transactional purposes and operation
of credit card, transactional deposit taking, the provision of credit facilities
limited to overdrafts on demand accounts and credit-card financing and
foreign-trade services and financing.

                                       13

<PAGE>

     Under these circumstances, the scale of the operations of Argentine-based
financial institutions and their business volume, the size of their assets and
liabilities and most likely their income generation capacity could be much lower
than in the past. We cannot assure you that these adverse circumstances will
change in the future.

     The solvency of the financial system is currently in jeopardy
     -------------------------------------------------------------

     Even though deposits in the Argentine financial system have been decreasing
for several years, a very significant volume of deposits was withdrawn from
Argentine financial institutions in the last quarter of 2001, owing to
increasing uncertainty and political instability. This run on deposits had
substantial detrimental effects on the Argentine financial system overall. Most
banks ceased to disburse new loans and concentrated on collection efforts to be
able to pay their depositors. Despite such efforts, the general lack of external
and domestic credit caused a liquidity crisis and hence numerous cases of missed
payments, which, in turn, compromised the capacity of many Argentine banks to
pay their depositors.

     On December 1, 2001, to forestall a run on the US dollar reserves of banks
in Argentina, President De la Rua's government limited the amount of funds that
account holders could withdraw from banks. Subsequently, President Duhalde's
government announced a schedule setting the manner in and date on which deposits
would be released. These restrictions, are still in effect, although withdrawal
restrictions have been relaxed. Furthermore, on February 4, 2002, through Decree
No. 214, the Argentine government resolved that all deposits denominated in
foreign currency were to be switched into deposits denominated in Argentine
pesos and for such purpose set the exchange rate at ARS 1.4 to each US dollar,
as well as the issuance of Government bonds denominated in US dollars for which
the depositors would be allowed to swap the currency-switched deposits, up to a
certain amount.

     While the withdrawal restrictions and rescheduling of deposits and the
recent compulsory switch into pesos of deposits originally denominated in US
dollars have protected the banks from any further massive withdrawal of
deposits, they have also paralyzed virtually all business and financial
activities, cut consumption and significantly increased social disturbances,
resulting in general rejection by the public and protests aimed at financial
institutions, all of which has affected the Argentine financial system including
the Central Bank of Argentina. On February 1, 2002, the Argentine Supreme Court
ruled that certain measures adopted by the government to stem the withdrawal of
deposits were unconstitutional. Notwithstanding, the government has continued to
enforce the withdrawal restrictions and rescheduling of deposits, although it
has relaxed certain limitations so as to allow the withdrawal of salaries. The
solvency of the Argentine financial system is currently in jeopardy and such
system's failure would have substantive adverse effects on economic recovery and
political stability.

     With the Convertibility Law having been amended, inflation could reach high
     ---------------------------------------------------------------------------
levels
------

     The Argentine Federal Government incurred fiscal deficits of USD 4.1
billion in 1998, of USD 4.8 billion in 1999, and of USD 9.2 billion in 2000, and
the fiscal for 2001 is expected to be of around USD 7.4 billion. The fiscal
deficit is mainly due to the economic recession, the Argentine government's
inability to reduce government spending, and decline in tax collection.

     Due to its fiscal deficit, Argentina's capacity to stimulate economic
growth, prevent social disturbances and repay its debts in the short term is
dependent on financial assistance from abroad. In December 2000 the IMF granted
Argentina a contingent assistance package amounting to USD 39.7 billion;
however, the IMF made availability of a large portion of the package contingent,
among other things, on the Argentine government being able to cut its fiscal
deficit and increase gross domestic product. Argentina was unable to meet the
IMF's conditions, and as from December 5, 2002, this organization suspended
other disbursements. In January 2002, the government resumed negotiations with
the IMF but such negotiations have not yet resulted in any commitment on the
part of the IMF. The Issuer cannot provide any assurance that negotiations with
the IMF will continue nor that their outcome will be favorable to Argentina.

     On January 24, 2002, the Argentine government introduced amendments to the
Central Bank of Argentina Charter, whereby such bank is allowed to issue money
without being required to maintain any fixed or direct relationship with foreign
currency and gold reserves, as well as to make short-term advances to the
federal government to cover foreseen budget deficits. There is considerable
concern that issuance of money by the Central Bank to finance government
spending could unleash high inflation. Moreover, Argentina has a record of
falling into

                                       14

<PAGE>

hyperinflation, peaking in 1989, particularly coinciding in time with fiscal
deficits and social disturbances. High inflation rates would worsen the current
recession in Argentina. The devaluation of the peso has created pressures on the
domestic price system that have generated inflation in 2002, after several years
of price stability. In the period January-May of 2002, the consumer price index
and the wholesale price index have exhibited cumulative increases of 25.93% and
80.76%, respectively.

     The Argentine economy is susceptible to be affected by the policies that
     --------------------------------------------------------------------------
the Argentine government might adopt in the future
---------------------------------------------------

     Historically, the Argentine government has exerted great influence over the
economy. Owing to the current crisis in Argentina, over the last few months the
Argentine government has promulgated many laws of great import - and sometimes
have negative affect on the economy. The Issuer cannot provide any assurance
that the legislation and regulations currently governing the economy will not be
changed in the future, particularly in light of the ongoing economic crisis, nor
can any assurance be provided that any such changes will not affect the Issuer's
business operations, financial position or results of operations or its capacity
to settle its debt instruments denominated in foreign currency, including the
Securities.

     Emerging markets volatility; certain recent developments
     ---------------------------------------------------------

     Financial and securities markets in Argentina are influenced, to varying
degrees, by the economic and market conditions in other emerging-market
countries. Although the economic conditions vary form country to country,
investors' reactions to the events occurring in a certain country may
substantially affect securities from issuers from other countries, including
Argentina. In 1994, the political and economic events occurred in Mexico
adversely impacted on emerging markets in general and Argentina in particular.
The lack of investors' trust resulted from a feeling that risk in Argentina and
risk related to the currency in view of the Mexican crisis had worsened.
Consequently, local and international investors and depositors withdrew the
funds previously invested in financial assets and with banks in Argentina. This
capital flight, which was reversed in 1996 and 1997, caused the Central Bank of
Argentina's international reserves to fall; in addition, currency was issued and
liquidity dropped. Therefore, interest rates skyrocketed and Argentina faced
several adverse economic consequences, including a decrease in foreign currency
reserves and increased financial market volatility. The world economic crisis
which broke out at the end of 1997 originated in a fall in several Asian
economies which continued during 1999, adversely affecting the Argentine
economy. Such crisis was intensified by the devaluation of the Russian crisis
and Russia's defaulting on debt payments in 1998. In January 1999, Brazil,
Argentina's main commercial partner, devaluated its currency causing Argentine
exports to fall, increasing the cost of Argentine credit, and creating major
financial uncertainty in Latin American markets. After the Brazilian crisis,
Argentine economy fell by 3% during the first quarter of 1999.

     It is impossible to assure that the capital flight and decreasing liquidity
levels in the Argentine financial system or any other of the situations
described herein will not occur again. Moreover, it is impossible to assure or
guarantee that Argentina or its financial market or the Issuer's possibility to
settle its obligations in due time will not experience substantial unfavorable
effects as a result of such issues.

     Subordination of Deposits
     --------------------------

     Argentine Law No. 24,485 effective as from April 18, 1995, as amended by
Law No. 24,627 establishing that in the event of bankruptcy or liquidation of
the Bank, all depositors, regardless of whether they are individuals or
companies, and regardless of the type, amount or currency of their deposits, are
entitled to a general and absolute preferential right over all other Bank
creditors (such as Holders), except for creditors with labor claims, those
secured through a pledge or mortgage, or those granted under section 17,
subsections (b), (c), and (f) of the Central Bank of Argentina's Charter
(rediscounts granted to financial institutions based on transitory iliquidity,
overdrafts granted to financial institutions with collateral, collateral
assignment, pledge or special allocation of certain assets), to collect the
related receivables with 100% of the funds in liquidations or from the Bank's
assets. In addition, the depositors of any kind of deposits are entitled to
special privileges as compared to the rest of the creditors, except for those
with labor claims and of those secured by pledges or mortgages, to collect the
receivables (i) from Bank funds held by the Central Bank of Argentina as
reserves; (ii) from other Bank funds existing as of the date on which the Bank's
license is revoked; or (iii) from any proceeds resulting from compulsory
transfer of the Bank's assets as ruled by the Central Bank of Argentina
according to the following priority: (a) deposits of up to Ps.5,000 per person

                                       15

<PAGE>

or the equivalent amount in foreign currency; (b) all deposits exceeding 90
(ninety days); (c) and all other deposits proportionately.

     As of December 31, 2000, and 2001, bank deposits totaled Ps.7.07 billion
and Ps.6.37 billion, respectively.

     Inexistence of a Public Market for Securities

     Securities from any Series in particular may be listed on any stock
exchange or securities market, or any automated quotation system. However, it is
impossible to assure the existence of any secondary market for the Securities or
the liquidity thereof on a secondary market should such market exist.

Factors Relating to Us
-----------------------

     Aggravation of the liquidity crisis
     ------------------------------------

     As a result of the loss in demand deposits starting in January 2002 which
still affects the Argentine financial system, liquid assets with which financial
institutions bear this drain in liabilities could be reduced reaching levels
below those needed to maintain normal business operations. Therefore, the
behavoir of the Bank's customers will have a significant impact on the financial
condition of the Bank. This loss in liquid assets is partially offset by Central
Bank through financial assistance.

     Increase in number of defaulting debtors
     -----------------------------------------

     Within a context of deepening recession and where salaries lose purchasing
power by an increase in general price levels, the payment capacity of companies
as well as individuals is impaired thus deteriorating the quality of loans
granted to the private sector and an increase in defaulting debtors. We have
been experiencing difficulties in collecting fees and payments from our
customers. Our ability to collect such fees, or obtain the repayment of our
loans, will adversaly impact the Bank.

     The inability to adjust our loans to the CER or CVS index will materially
     -------------------------------------------------------------------------
affect the Bank
----------------

     Pursuant to Decree No. 214/02 and complementary rules, assets and
liabilities in foreign currency that were converted into peso-denominated assets
and liabilities would, commencing 180 days from February 4, 2002, be adjusted
pursuant to a coefficient to be published monthly by the Argentine Central Bank
based on changes in the consumer price index. This coefficient was denominated
CER (initials for the Spanish words Coeficiente de Estabilizacion de Referencia
or Stabilization Coefficient of Reference). However, certain loans to
individuals were subsequently excluded from such adjustment according to the CER
value and became subject to adjustment according to an index that reflects the
general level of wages in Argentina. This coefficient was denominated CVS
(initials for the Spanish words Coeficiente de Variacion Salarial or Salary
Variation Coefficient) which will become effective as of October 1, 2002,
pursuant to Decree 762/02. We cannot assure you that any indexation will apply
to our loans or that such indexation would increase our revenues in a manner
commensurate with our increased costs. As a result, an increase in our funding
and other costs due to inflation may not be offset by such indexation. This
could have a material adverse affect on our financial condition and results of
operations.

     Reduction of Income from Financial Intermediation
     --------------------------------------------------

     Constant deposits loss occurring in the Argentine financial system as from
June 2001 together with a strong decrease in assets (as a result of loan
repayment by the private sector) imply a major reduction in intermediation
business. Additionally, the Argentine Government and the Central Bank of
Argentina established a regulated rate for de-dollarized deposits resulting in a
significant reduction in intermediation margins regarding prior-year levels. The
combined effect of the reduction in business volumes and intermediation margins
would cause an important fall in revenues.

                                       16

<PAGE>

     Cash Flow Maturity Gaps
     ------------------------

     The de-dollarization of deposits at the USD 1 = Ps.1.40 exchange rate and
of most of the loans granted at the USD 1 = Ps.1 means an asymmetric
de-dollarization generating a major equity difference. Such gap will be
compensated with bonds to be issued by the Argentine Government, to be assigned
to the financial institutions bearing losses from the de-dollarization mentioned
above. The bond issuance terms and conditions provide that they will be
amortized over a ten-year period while the contra to the liabilities are
de-dollarized deposits where the Government established a rescheduling plan
extending the amortization for no more than three years. However, as of the date
of this Report, the Executive Branch and the Argentine Central Bank have not yet
published all of the criteria necessary to determine the exact amount of
compensation to be received by each financial institution, in the form of
government bonds. This difference in the terms for amortizing assets and
liabilities implies a significant increase regarding cash flow maturity gaps in
normal business conditions effective in 2001. As a result of such foreign
currency position, in the absence of compensation, the devaluation of the peso
has resulted in a significant loss for the Bank and any further devaluation of
the peso will increase the Bank's losses. If compensation for the
above-mentioned short foreign currency position is received by us, our balance
sheet will be matched in terms of currencies.

     A Major Increase in Government Risk
     ------------------------------------

     The asymmetric de-dollarization (at different exchange rates) in assets and
liabilities and subsequent compensation against Government bonds resulted in an
increase in financing granted to the Government (either through securities or
loans) as a portion of total bank assets. Furthermore, the Argentine public
sector, including the federal and the provincial governments, is currently in
default.

     Issues before the courts
     ------------------------

     As of the date of this Prospectus, the Bank was subject to legal claims
filed by depositors against deposits reprogramming and de-dollarization provided
for by the Argentine Government with about 7,800 filings. As a result of such
actions, courts have issued resolutions (many of which have not been met because
the Banks filed the applicable appeals) obliging the Bank to provide amounts
from such deposits totaling Ps.112 million and USD 108.7 million. Such amounts
are related to the actions for which courts have ruled in favor either totally,
partially or precautionary (most cases); increase in the number of actions with
favorable rulings is possible with the subsequent impact it would entail. In
addition, the Bank does not rule out the possibility of new suits being filed.
Notwithstanding the fact that on February 1, 2002, the Argentine Supreme Court
ruled that certain measures adopted by the Government to prevent fund
withdrawals were unconstitutional, the Government continued to issue regulations
aimed at decreasing the depletion of money from banks. For these measures to be
effective they need to be ratified by the Argentine Supreme Court. This has not
happened yet and it is impossible to determine whether it will do so.

     Factors beyond our control
     --------------------------

     Historically, the Argentine government has exerted great influence over the
economy. We cannot predict how the Argentine government will resolve the
economic crisis. The ability of the Bank to manage the crisis and to obtain
financial assistance and compensation for the losses that the current economic
and financial policies have otherwise prompted, as well as the level of our
activity (and therefore our internal cash generation), depends to a large extent
upon factors beyond our control including Argentina's successful negotiation of
a substantial assistance package from the IMF and other multilateral lender.

     Differences in corporate disclosure and accounting standards
     ------------------------------------------------------------

     A principal objective of the securities laws of the United States,
Argentina and other countries is to promote full and fair disclosure of all
material information of companies issuing securities. However, there may be less
publicly available information about Banco Rio than is regularly published by or
about listed companies in certain countries with highly developed capital
markets, such as the United States. Furthermore, while Banco Rio is

                                       17

<PAGE>

subject to the periodic reporting requirements of the US Securities Exchange
Act, the periodic disclosure required by foreign issuers under the Exchange Act
is more limited than the periodic disclosure required by U.S. issuers.

     The Bank maintains its financial books and records in pesos and prepares
its financial statements in conformity with Argentine Banking GAAP. Argentine
Banking GAAP differs in certain respects from both U.S. GAAP and Argentine GAAP.
See Note 30 to the Consolidated Financial Statements for a description of the
principal differences between Argentine Banking GAAP and U.S. GAAP as they
relate to the Bank, and reconciliation to U.S. GAAP of net income and
stockholders' equity.

Item 4. INFORMATION ON THE COMPANY

     A.   History and Development of the Company

History

     Banco Rio was founded in 1908 in the city of La Plata, capital of the
province of Buenos Aires, as an insurance company under the name of Rio de la
Plata Compania de Seguros Contra Incendios. As banking transactions increased
during the 1930s, the insurance company expanded into banking operations in 1932
under the name of Banco de Creditos y Seguros Rio de la Plata S. A. In 1935, the
name was changed to Banco Rio de la Plata S.A., and the insurance activities
were transferred to a separate company.

     Carlos Perez Companc acquired over 90.00% of the shares of Banco Rio in
1960, and held the position of Chairman of the Board of Directors of Banco Rio
until his death in 1977, when he was replaced by his brother, Jorge Gregorio
Perez Companc. Jorge Gregorio Perez Companc held this position until his
resignation as a consequence of the Acquisition (as defined below). In 1964,
Banco Rio acquired Banco del Este, an Uruguayan bank with a branch in Buenos
Aires. Banco del Este was subsequently merged with and into Banco Rio in 1968.
In 1968, Banco Rio moved its legal headquarters from the city of La Plata to the
city of Buenos Aires. The principal executive office of Banco Rio is at
Bartolome Mitre 480, Buenos Aires, Argentina (1036). The main telephone number
is 5411-4341-1000.

     Banco Rio acquired Banco Delta S.A., a local commercial bank, in 1981,
which marked the beginning of a period of sustained growth that involved the
acquisition of branches of Banco Rural S.A., Banco Espanol S.A. and Banco
Comercial del Norte S.A. Between 1985 and 1987, Banco Rio acquired another local
commercial bank, Banco Ganadero Argentino S.A.

     Since the late 1970s, when it opened a branch in Panama, an agency in New
York and a representative office in Paris, the Bank has had an international
presence. In 1987, Banco Rio, together with certain of its shareholders,
established Riobank in the Cayman Islands, acquiring Sudacia's 70% equity
interest in 1996. In 1996, Banco Rio opened a representative office in Sao
Paulo, Brazil, in order to provide an institutional presence in that country and
to support the Bank's relationships with corporations and correspondent banks
operating in the Mercosur area. The Bank closed its New York agency in December
1997.

     On May 26, 1997 and June 26, 1997, Jorge Gregorio Perez Companc and Maria
Carmen Sundblad de Perez Companc (the "Perez Companc Family") and Sudacia, then
holders of an aggregate of 78.93% of the capital stock and 91.50% of the voting
power of Banco Rio, entered into agreements (the "Acquisition Agreements") with
Santander Investment S.A. ("Santander Investment" or the "Controlling
Shareholder") and Banco Santander S.A., a Spanish corporation (sociedad anonima)
("Banco Santander"), which resulted in the transfer to Santander Investment on
August 22, 1997 of 105,180,556 Class A Shares, representing 35.06% of the
capital stock and 51.00% of the voting rights of Banco Rio (the "Acquisition").

     The Controlling Shareholder and Banco Santander agreed in the Acquisition
Agreements that, so long as Banco Santander directly or indirectly controls
Banco Rio and so long as Sudacia and/or the Perez Companc Family (or any of
their respective successors, controlling or controlled entities or entities
under common control) continue to own at least 10.00% of the outstanding common
stock of Banco Rio ("Common Stock"), Banco Santander will conduct all of its
banking business with Argentine corporate and individual clients through Banco
Rio, provided such business is profitable and consistent with sound business
policy.

                                       18

<PAGE>

     As provided in the Acquisition Agreements, the Controlling Shareholder and
Sudacia entered into the Shareholders Agreement and Banco Rio and Banco
Santander entered into the Management Agreement. See "Item 7. Major Shareholders
and Related Party Transactions" for a further description of these agreements.

     On June 26, 1997, the Bank sold its direct and indirect equity
participation in Compania Rio-Citi, Siembra AFJP S.A., Siembra Seguros de Retiro
S.A. and Sur Seguros de Vida S.A. (collectively, the "Rio-Citi Group") to
Citicorp Pension Management Company Limited, Citicorp Banking Corporation and
other related companies for an aggregate amount of U.S.$229.0 million. This
transaction resulted in a gain for the Bank of approximately Ps.154.4 million
for fiscal year 1997.

     In October 1997, 84,640,000 Class B Ordinary Shares of Banco Rio with one
vote per share, par value Ps.1.00 per share (the "Class B Shares"), were offered
to the public in and outside Argentina (the "Combined Offering") by Sudacia and
the Foundation.

     Pursuant to the Acquisition Agreements, Sudacia and Banco Santander and
Santander Investment also agreed to cause the merger of Santander Argentina with
and into Banco Rio. The Merger was consummated on October 15, 1998 and, at such
time, became retroactively effective as of January 1, 1998 under Argentine GAAP.
See "Item 3. Key Information--Selected Consolidated Financial Information of the
Bank--Presentation of Financial Information--Accounting for the Merger." The
Merger resulted in the issuance of 35,267,675 newly issued Class B Shares in
exchange for all of the shares of common stock, par value Ps.0.01, of Santander
Argentina. In connection with the Merger, Banco Rio acquired 99.99% of the
capital stock of Santander Fondos, a subsidiary that subsequently merged with
Geinver and that manages and administrates mutual funds, and 99.96% of the
capital stock of Santander Bolsa, an investment banking subsidiary that
subsequently merged with Rio Valores.

     On September 25, 1998, Sudacia transferred all of its Class A shares and
Class B shares to BRS Investments S.A. ("BRS Investments"), a company that is
wholly owned by the Perez Companc Family and was formed initially to hold these
shares. BRS Investments is a successor in interest to the rights and obligations
of Sudacia under the Registration Rights Agreement, the Shareholders Agreement
and the option granted to Banco Santander.

     On December 12, 2000, the Foundation entered into a contract with Merrill
Lynch International, London ("Merrill") to sell to Merrill all of the 24,999,998
class B shares owned by the Foundation. On the same date, the Perez Companc
Family entered into a separate contract with Merrill to transfer to Merrill all
the 36,730,452 Class A shares and 2,539,000 Class B shares owned indirectly
through BRS Investments, by the sale to Merrill of all the shares of BRS
Investments, which was wholly owned by the Perez Companc Family. The sale of BRS
Investments was consummated on December 18, 2000. The Foundation sale was
consummated on February 8, 2001. On January 2002, as a consequence of the
exercise of these options, Banco Santander holds, directiy and indirectly
through other entities of the SCH Group, class "A" and class "B" shares
representing of the 98.85% stockholders'equity and 99.24% of the votes.

     After the year-end, on January 3, 2002, controlling shareholders of Banco
Rio de la Plata S.A. and Origenes Vivienda y Consumo Compania Financiera S.A.
(former Origenes Vivienda S.A., company fully and indirectly controlled by SCH
Group), a financial institution, signed an agreement to merge both companies,
whereby all transactions of the absorbed company, Origenes Vivienda y Consumo
Compania Financiera S.A., are assumed by the absorbing company, Banco Rio de la
Plata S.A. Such merger will be retroactively effective for legal purposes as
from January 1, 2002, upon approval by the related oversight authorities.

     Additionally, on January 4, 2002, an agreement was signed for the purchase
of Santander Riobank (Grand Cayman)'s stock, whereby Banco Rio de la Plata S.A.
sold Santander Overseas Bank Inc. its 100% equity interest Santander Riobank
(Grand Cayman).

                                       19

<PAGE>

Recent Developments

     Banco Santander Exchange Offer and Delisting

     On June 21, 2000, the Santander Central Hispano group (the "BSCH Group")
launched a Public Tender Offer in Argentina and the United States for shares and
American Depositary Shares in Banco Rio de la Plata S.A. totaling 94,666,698
Class B book-entry shares, each with a face value of Ps.1.0 and entitled to one
vote, representing 28.24% of capital stock. This Public Tender Offer closed on
July 20, 2000; 88,830,009 Class B shares were tendered in acceptance, resulting
in the exchange of shares in Banco Rio de la Plata S.A. representing 26.50% of
capital stock and carrying 9.80% of the votes for shares in Banco Santander
Central Hispano S.A. ("BSCH"). The exchange ratio was five BSCH shares for every
seven Banco Rio de la Plata S.A. shares.

     The Shareholders' meeting of the Bank of April 27, 2001 agreed to delist
from the New York Stock Exchange the ADRs because of the low number of holders
and volume traded. On November 1, 2001, the Bank announced that its ADRs would
be delisted from the New York Stock Exchange. On December 14, 2001, the Bank's
ADRs were suspended and delisted from the New York Stock Exchange, as instructed
by the Securities and Exchange Commission.

     Banco Tornquist Merger

     On April 17, 1999, Banco Santander S.A. of Spain merged with Banco Central
Hispanoamericano S.A. ("BCH") in a transaction in which the surviving corporate
entity upon consummation of the merger was Banco Santander Central Hispano S.A.
The term "Banco Santander" in this Annual Report means Banco Santander S.A. of
Spain if it refers to the period of time prior to the merger with BCH and Banco
Santander Central Hispano S.A. if it refers to the period of time thereafter.

     Prior to the merger, BCH owned 50.00% of the shares of Banco Tornquist and
about 9.90% of the shares of Banco de Galicia y Buenos Aires S.A., each of which
is an Argentine commercial bank. After the merger of Banco Santander with BCH,
on May 3, 1999, Banco Santander acquired a Chilean company which owned the
remaining 50.00% of Banco Tornquist. Therefore, after that purchase, Banco
Santander Central Hispano S.A. owned 100.00% of Banco Tornquist.

     On January 6, 2000, the controlling shareholders of Banco Rio and Banco
Tornquist signed an agreement to merge both institutions effective as of January
1, 2000, thereby integrating the operations of Banco Tornquist into Banco Rio.
Banco Tornquist is an indirect, wholly owned subsidiary of Banco Santander
Central Hispano.

     Under the merger agreement, Banco Rio immediately assumed the management of
Banco Tornquist. The merger was approved by the boards of directors of both
banks. On April 28, 2000, the general shareholders meetings of both banks
approved the merger and the exchange ratio.

     Subject to a number of customary conditions, including approval by
regulators, Banco Rio increased its share capital in the amount of 11,473,990
Banco Rio class B shares. Banco Tornquist was valued at Ps.71.4 million. The
exchange ratio was set at approximately 11.96 Banco Tornquist shares for each
class B share of Banco Rio, based on the valuation report prepared by Deloitte &
Touche L.L.P. of the financial condition of Banco Tornquist as of December 31,
1999 and its contribution to the business of Banco Rio compared to the average
value of the listed share capital of Banco Rio for the three months prior to
January 6, 2000. The merger between Banco Rio and Banco Tornquist was authorized
by the Argentine Central Bank on March 9, 2000.

     In anticipation of the future integration of its business into Banco Rio,
Banco Tornquist established, in the last quarter of 1999, loan loss provisions
in order to reach the same level of coverage of non-performing loans as Banco
Rio plus other adjustments required by the integration process. In order to
counteract the effect on Banco Tornquist's net worth resulting from these
provisions, Banco Santander Central Hispano invested an additional Ps.55 million
in equity capital in Banco Tornquist effective as of December 31, 1999. At
December 31, 1999, Banco Tornquist had total assets of Ps.980.5 million, loans
(net of allowances) of Ps.473.9 million and stockholders' equity of Ps.17.3
million. Banco Tornquist's non-performing loan portfolio was Ps.109.0 million at
December 31,

                                       20

<PAGE>

1999. For the year ended December 31, 1999, Banco Tornquist had a net loss of
Ps.190.4 million, which reflected in substantial part the loan loss provisions
and other adjustments made in the fourth quarter of 1999.

     The merger of Banco Tornquist with and into Banco Rio became final on June
30, 2000, and was given retroactive effect as from January 1, 2000. All Banco
Tornquist business outstanding as of such date that was transferred to the Bank
discontinued all operations. The merger of Banco Tornquist with and into Banco
Rio and the former's subsequent dissolution was registered with the Inspeccion
General de Justicia (governmental regulatory agency of corporations) on July 13,
2000.

     Also due to the merger mentioned in the preceding paragraph, Banco Rio
holds 58.33% of the capital stock and votes of Gire S.A. In addition, on
December 26, 2000, the Boards of Directors of Santander Investment Gerente de
Fondos Comunes de Inversion S.A. and Administradora Tornquist S.A. Gerente de
Fondos Comunes de Inversion decided that the latter was to be merged into the
former.

     Capital Expenditures and Divestitures

     Since 1998, the Bank has carried out significant investments in four basic
areas:

     o    The adjustment of the branch network to a new business strategy, which
          involved the remodeling of 170 branches during the first half of 1998,
          with U.S.$45 million invested.

     o    The expansion of the branch network, a process that begun in the
          second half of 1998 and was finalized in June 1999 for the most part.
          During this period, 87 new branches were added to the Bank's
          distribution network, with U.S.$35 million invested.

     o    The adaptation of the Bank's computer systems to the Y2K effect, with
          an investment of U.S.$12 million.

     o    The replacement of the Bank's core systems and the migration to a
          framework based on Altamira, an integral solution broadly adopted by
          top-ranked international financial institutions. The investments
          involved in this process amounted to U.S.$10 million.

     During the year 2001, the Bank has made no new significant investments, and
it has been limited to making small maintenance investments. The Bank has not
carried out significant divestitures during the last three years.

     B.   Business Overview

Introduction

     The Bank is one of the largest private sector commercial banks in
Argentina, with assets of Ps.9.9 billion, loans (net of allowances) of Ps.6.7
billion, deposits of Ps.6.4 billion and stockholders' equity of Ps.1.1 billion
at December 31, 2001. For fiscal year 2001, the Bank had net income of Ps. minus
10.2 million. Based on net income, for the fiscal year 2001 the Bank had a
return on average equity of minus 0.78% and a return on average assets of minus
0.08%. The Bank had a market share of 8.45% in terms of total loans (net of
allowances) and 8.70% in terms of total deposits in the Argentine financial
system at December 31, 2001. Its service offering is channeled through one of
the widest distribution networks in Argentina. It is based on 274 branches in
real time connection, 83 of which are located in Inner Buenos Aires, 59 in Outer
Buenos Aires, and the remaining 132 branches are distributed among 20 of the 23
Argentine provinces. Furthermore, the Bank has 593 ATMs, 667 self-service
information terminals, 37 customer service positions at companies and 114
customer service positions in public places, a telemarketing center, phone
banking and access through the Internet. The Bank is headquartered in the city
of Buenos Aires

     The Bank is a universal bank engaged in a wide variety of commercial and
investment banking activities and related financial services directed towards
large corporations, small- and medium-sized companies, and individuals. The
commercial banking activities of the Bank include providing products and
services such as

                                       21

<PAGE>

personal and corporate loans, deposit-taking, credit and debit cards and
overdraft facilities. The Bank also engages in investment banking and project
finance. In addition, the Bank develops and sells mutual funds, markets and
sells insurance products, and provides foreign trade financing and other
transactional and cash management services.

     The Bank has historically been one of the leading corporate banks in
Argentina and has taken advantage of its strong relationships with its corporate
customers as a base for increased expansion into the consumer and middle
markets. Over the last several years, and in response to the significant
political and economic changes in Argentina, the Bank has begun to emphasize its
consumer business and has sought to build its middle market business.

     During 2001, the aggregate gross Argentine public debt grew enormously and
as of September 2001, was of about USD 141.2 billion. The default on payments of
external debt and the restrictions on the withdrawal of bank deposits further
contributed to deepen the recession in Argentina. The measures adopted by the
Argentine government have significantly deteriorated the confidence of
depositors and investors in financial institutions, and in financial system as a
whole. As a result, depositors are not only withdrawing, but also not depositing
funds, this led to the enforcement in December 2001, of various restrictions on
cash withdrawals from bank deposits, otherwise known as the "corralito". Due to
prevailing crisis, most of the banks have ceased to disburse new loans and
concentrate on collection efforts to be able to pay their depositors. The
general lack of external and domestic credit has aggravated liquidity crisis in
Argentina. Further devaluation of the peso, exchange controls preventing
conversion of pesos into U.S. dollars has significantly weakened Argentine
economy and the Argentine government's capacity to create conditions enabling
growth.

     As a consequence, the Bank's business activities have substantially
contracted compared to historical levels since December 2001 in light of the
liquidity crisis and economic and political environment in Argentina. Since that
date, the Bank has suspended most new originations of all types of loans, has
big difficulties to get new deposits and decreased the sale of related-financial
products. In spite of the fact that we have acted proactively to reinforce
credit risk controls by strengthening credit approval, follow-up and recover
processes, the asset quality of our loan portfolio will deteriorate. In this
context, the Bank's strategy gave priority to maintaining ample liquidity and
decreasing exposure to the government sector, as the main measures aimed at
protecting shareholders' and depositors' equity and interests. Also, we have
begun planning to reduce expenses and we are working to redefine our offer of
products and services to face this new situation.

     As a result, the Bank's future business operations may differ from the
description of the Bank's business contained in this annual report for the
fiscal year ended December 31, 2001.

Business Strategy

     The Bank's overall long-term strategy is to maintain its position as one of
the leading universal banks in Argentina, providing a full range of financial
and financial-related products and services to large corporations, small- and
medium-sized companies and individuals nationwide. To this end, Banco Rio has
adopted a clear and definite customer-oriented approach. That requires that it
first gets to know the customer and identify and satisfy its financial needs.
The customer-oriented approach as the basis of income and growth has driven the
design and organization of the Bank.

     Our commitment is to provide customers with high quality products and
services that meet their specific needs, primarily through a segmented service
and product offering that groups customers based on their preferences and needs.
Individuals, for example, are offered products and serviced fitted to their
social and economic level and designed to enhance our relationship with the
customer. Over time, we strive to meet the changing needs of each customer with
new products and services. This process, which may be described as a process of
maturing and customer loyalty, actually creates value that is perceived by
customers. This is shown by the fact that at present 65% of customers use three
or more products.

     Another customer-oriented approach is our distribution strategy which is
based on an extensive network of branches all over the country giving us an
extensive multi-channel network with strong emphasis on automated channels.
Automation, that started to expand in conjunction with the development of
information technology to improve internal administrative processes, is today a
customer strategy in itself. Electronic facilities have become a feasible and
secure alternative of widespread acceptance in order to obtain accurate and
timely information and

                                       22

<PAGE>

perform on-the-spot transactions. The growing acceptance of electronic
interfacing with our customers through computers, automated teller machines
(ATMs) and other means has increased productivity and customer satisfaction.

     Distribution and automation also help multiply points of contact and
facilitate transactions. Along with the 274 branches scattered in the major
urban centers of the country, Banco Rio owns 593 ATMs, 667 self-service
information terminals, 37 customer service positions at some of our larger
customers, and 114 customer public service positions, one telemarketing center,
a customer call or phone banking center, and Internet access through the Bank's
specialized Web site. Customer segmentation at electronic facility level is made
by offering three different products on the Internet: RIO Serv, Net Banking, and
RIO Home Banking, oriented towards corporations, small and medium-sized
companies, and individual segments, respectively. Automated transactions have
become increasingly accepted, now accounting for 78% of total transactions.

     Our commitment to quality service is the major part of our strategy,
particularly in difficult times. The Bank tries to steadily enhance customer
satisfaction. Therefore, Service Principles have been set and Performance
Appraisal Programs have been implemented for the employees and work teams. The
Quality Committee created during the fiscal year 2000 and made up of the Bank's
highest authorities controls the plan and decides on future actions, in
conjunction with the Claim Committee, who receives and process the client's
compliants about the quality of the services.

     The Bank recognizes that risk management policies, processes and controls
are also key factors in successfully carrying out its strategy - particularly in
light of recent events throughout Argentina. The Bank continuously seeks to
improve the quality of its loan portfolio and its overall risk index by
requiring continual adherence to its credit management policies. The Bank has
sought to establish a strong risk management culture, particularly for its
consumer and middle-market banking activities, in order to maintain the quality
of its loan portfolio. In 2000 the Bank created a middle-market risk unit in the
risk management area, which plays an important role in the credit management
process. In 2000, the Bank also put in place a credit approval delegation system
based on a credit-risk committee structure, and developed a training program for
all credit and account officers. In the consumer sector, the Bank in 1999
implemented a credit scoring system and segmented the consumer market in order
to develop products that closely match the needs of the various segments of the
consumer market. The Bank believes that its investments in developing risk
management and credit management policies will enable it to take advantage of
growth opportunities while maintaining the high quality of its loan portfolio
even in times of economic uncertainty. During the fiscal year 2001, the Bank
acted proactively to reinforce credit risk controls by strengthening credit
approval, follow-up and recovery processes and centralizing the approval of some
types of credits.

     After a period of three years of outstanding evolution and growth for Banco
Rio since its incorporation into the regional franchise of SCH Group, in 2001,
its activity and results have been severely affected by the deep economic and
institutional crisis by which Argentina is enmeshed. In this context, the Bank
focused its strategy on prioritizing liquidity and solvency by adopting policies
aimed at tightening requirements to assume new risks and reducing public sector
risk exposure, in spite of the impact on results. Therefore, the traditional
objectives of growth and the launching of new products and services, have been
subordinated awaiting the resolution of the crisis. Since the end of the year
2001, we have reduced the sale of products substantially and we suspended
practically all new originations of loans.

Business Operations

     The Bank is a universal bank engaged in commercial banking, investment
banking and other financial activities directed towards its three major customer
segments: consumer, middle market and corporate. Commercial banking activities
include the provision of traditional banking products and services such as
deposit-taking, lending (including overdraft facilities), promissory notes, bill
discounts, personal loans, secured loans (including mortgages and chattel
mortgages), credit lines for financing foreign trade and investment projects,
and non-credit services to large corporations, small- and medium-sized companies
and individuals. The Bank offers short- and medium-term loans denominated in
pesos and dollars.

                                       23

<PAGE>

     Investment banking activities are, on the origination side, directed
primarily to government, corporate and middle-market clients of the Bank and, on
the distribution side, to institutional investors with whom the Bank has
established relationships and to individual investors. The Bank's activities
include merger and acquisition advisory work, debt and equity underwriting, and
securities sales and trading.

     Other financial activities include the issuance of credit and debit cards,
including Visa and American Express, the development and sale of mutual funds,
the marketing and sale of insurance products, and the provision of foreign trade
products and certain other transactional and cash management services.

     Commercial Banking

     The commercial banking business unit provides a wide range of financial
products and services to individuals and middle-market businesses. It is an
important area for the Bank's funding and its generation of interest and fee
income.

     The more stable economic conditions experienced since the implementation of
the convertibility plan (the "Convertibility Plan") have resulted in
substantially increased loan demand from the consumer- and-middle market
sectors, an increase in the availability of credit, lower interest rates and
longer credit terms for loans. Through the Bank's extensive distribution
network, the commercial banking unit of the Bank serviced more than 1.25 million
customers at December 31, 2001. Approximately 66.69% of the Bank's total
dollar-denominated deposits and 63.58% of its total peso-denominated deposits
were attributable to this unit at such date. As a result of the repeal of the
Convertibility Law and decrease in confidence of the depositors in Argentine
institutions, we like most Argentine institutions have seen a dramatic decrease
in deposits with no significant deposits having been obtained since December,
2001.

     Its service offering is channeled through one of the widest distribution
networks in Argentina. It is based on 268 branches in real time connection, 81
of which are located in Inner Buenos Aires, 57 in Outer Buenos Aires, and the
remaining 130 branches are distributed among 20 of the 23 Argentine provinces.
Furthermore, the Bank has 593 ATMs, 667 self-service information terminals, 37
customer service positions at companies and 114 customer service positions in
public places (primarily at the service gas stations of Repsol-YPF and ESSO
networks), a telemarketing center, phone banking and access through the
Internet.

     Innovation and segmentation are combined to respond to the different needs
and lifestyles of the customers. Personalized and tailored customer assistance
provided by the "RIO Infinity" product line is recognized in the market. Through
exclusive publications for customers of each group, the bank has continued its
actions to promote and sale products and services that are advantageous to
customers and that have been specially selected. This strategy adds value to the
Bank's services and stimulates cross-sales.

     The "SuperCuenta" product line, the first account that rewards savings in
cash, has consolidated as market model. Under its 1, 2 and 3 models, designed to
fit cost and functionality to the specific characteristics of each segment,
SuperCuenta is the vehicle that enabled a growth in mortgage loans, collateral
loans and insurance, affirming the "long-term relationship" marketing strategy.
Over the year, the Bank has redoubled its efforts to grow in the salary account
in the consumer segment.

     The bank assurance concept (sale of insurance products to Bank customers
through the Bank's own channels) has maintained its steady growth as compared to
prior years, since its grew by 20% as compared to the prior year, both in terms
of commissions and policies. Commission income exceeded Ps.40 million, which
supported the improvement in the efficiency ratio (Commission/expenses). We sell
assurance policies mainly to the individual segment.

     Over the year, insurance products were incorporated to RIO Home Banking
that placed the bank as one of the few institutions, including insurance
companies, that allows its customers to purchase coverage through this channel.
Furthermore, the Bank's customers have access to all the information about the
insurance purchased (coverage, due dates, payments, etc.).

                                       24

<PAGE>

     The mortgage loan product line "Super Hipoteca" continued offering the
widest range of products to acquire/condition homes. From 2000, the products
benefited from the "Super Recompensa" that constitutes compliance incentives and
is a powerful tool for customer-loyalty building and cross sales. Under this
concept, customers with a good credit record and that hold Infinity or
SuperCuenta accounts are awarded a discount covering a portion of the loan's
installment. As of December 31, 2001, there were more than 34,000 loans for an
aggregate of Ps.1,07 billion.

     Regarding collateral loans to finance the acquisition of cars, "Cuotitas"
is a concept that includes the benefits provided by low financing costs,
agreements with the best car dealers and a discount system for good credit
performance. As of period-end, the portfolio included 24,600 loans that reached
Ps.142 million.

     Small and medium sized companies were seriously affected in 2001. More than
25,000 small and medium sized companies are Banco Rio's customers, which led the
Bank to implement efforts to understand their new reality and generate responses
to enable such small and medium sized companies to continue growing and
operating in an environment with decreased sales and restricted access to
credits. In 2001, the Bank continued training its Company Account Officers to
reach a high degree of specialization and creativity upon evaluating solutions
to the different issues affecting our customers in the difficult macroeconomic
context.

     Day-to-day business transactions received the support of our "Cuenta
Comercio", as an overall response to usual business operations, including
automatic crediting of payments related to credit cards and permanent services.
By midyear, the Bank developed the Special Checking Account to enable companies
to continue with the operations that they conducted through their savings
accounts.

     The group of automatic banking tools exclusively available for companies is
"Super Banca Facil Empresas". All companies that are customers may have the
following products, according to their business methods: "Net Banking" and
"RIOself Empresas". "Net Banking" enables customers to access to and manage
their accounts, investments and loans, make payments through transfers and
receive information from any PC. Security and confidentiality of the data is
assured through state-of-the-art encrypting technology. The service is free and
even companies that do not have an Internet connection can have the service
through Infovia.

     "RIOself Empresas" is a service provided through self-service terminals
that are located at Banco Rio branches and at RIO24 areas. They are operational
everyday from 7 a.m. to 9 p.m. and accept deposits, payments, investments,
requests and account inquiries. Companies may operate with these channels only
or supplementing them with other channels. For example, they may request a
checkbook through RIOself and then authorize the transactions by calling RIOline
(phone banking) or by visiting Net Banking (through the Internet).

     To attain a faster response, the Bank has a fast credit analysis process
"CPP" or Small Loan Central that enables an overnight response to a great number
of applications of our enterprise customers. Small business, service companies,
industrial customers and agribusinesses are generally assisted by qualified
professional that form a structure focused on listening and sharing information
to attain the best results.

     For the agricultural sector, "Super Agro" is a full line of products and
services focused on supporting the growth of the production capacity. All
branches located in rural areas have the capacity and experience to offer
appropriate financing. The Bank continued supporting producers by financing the
2001-2002 harvest, prefinancing exports at competitive international rates and
selling the production whether through warrants or grain warehouse receipts of
storage companies. The Bank commenced the operations of the first Futures and
Options Groups developed jointly with AACREA in 2000 to finance operations of
customers in the futures markets.

     The Bank forecast is that Enterprise banking will be strongly
transactional, focused on facilitating payments and collections of the customers
within and without Argentina through our wide branch network and correspondent
banks, respectively. The focus on transactions will not constitute a barrier to
evaluate and develop financial tools and vehicles to finance working capital and
investments to the extent that the financial system recovers adequate
reliability and stability levels. Furthermore, another goal for the coming years
is to support small and medium sized companies to conquer external markets
through the bank network based in Latin America and Europe.

                                       25

<PAGE>

     Corporate Banking

     This is the Bank's business unit that provides commercial and investment
banking services to large corporations, public-sector institutions and other
financial institutions. It is the leader in the Argentine financial system in
the provision of services to large corporations, based on its experience,
membership to the SCH Group and the high financial capacity of Banco Rio.

     Corporate and Investment Banking offers services in the following areas:

     o    Corporate financing;

     o    Investment banking;

     o    Transactional services;

     o    Custody; and

     o    Foreign trade.

     Four specialized units per activity sector are in charge of covering all
the needs of the different Corporate Banking customers (i) Manufacturing
Industries, (ii) Primary Industries, (iii) Consumption Industries and (iv)
Public Sector and Financial Institutions. In the case of Investment Banking,
there is a unit in charge of providing M&A, capital and debt issuance and
investment project financing advisory services.

     In fiscal year 2001, within a context marked by adverse economic conditions
for wholesale business and the restrictions to grant new credit assistance due
to the Argentine situation, the area participated in the following transactions:

     o    Issuance of corporate bonds of Origenes Vivienda in the amount of
          U.S.$.93 million.

     o    Syndicated loan in the amount of Ps.120 million to Alto Palermo, where
          the bank participated with Ps.25 million.

     o    Issuance of debt securities secured by oil & gas royalties (joint lead
          managers together with Lehman Brother and Banco Macro) in the amount
          of U.S.$234 million for the Province of Salta.

     o    Obtained an Engagement to advise Edenor to obtain long-term financing
          of the BEI for up to U.S.$50 million in Euros to finance new
          investments.

     During the year, trust activities expanded. The growing need to structure
more complex financing and security methods allowed us to consolidate as the
leading provider with the related benefits, both from the commission and
financing margin viewpoint. In fiduciary services, the Bank stands out for its
experience and capacity to be a reliable "third party" through the use of this
mechanism that provides protection and security to complex transactions. Over
the year, the Bank has participated in the most important security trusts
organized in Argentina, and has had a very important role in the agreements with
Swiss Medical, Mastellone, Aguas de Campana y Riverview, among others.

     Furthermore, the Bank has participated in more the 90 agreements related to
registration and payment agencies, in the capacity of transfer agent and
representative of the trustee in Argentina.

     The Custody area provides settlement, income collection, advising and legal
and tax advisory services. The policies, proceedings and controls have been
established at SCH Group levels to guarantee a uniform quality standard for the
entire Group, regardless of the different locations and markets where the Group
operates. Banco Rio is also one of the main ADR conversion agents.

                                       26

<PAGE>

     Transactional Services was defined as a key area in the current and future
relationship between the Bank and its customers. The comprehensive solution
offered by Banco Rio to corporations for transactional, banking and commercial
activities is RIO Serv. Launched in 1999, RIO Serv is the tool that enables
implementing and controlling the services required by companies, enabling them
to operate from their offices in the most reliable and secure manner, operating
in real time and conducting transactions in Argentina and abroad. It has the
maximum security in management of information and monetary flow, providing a top
confidentiality environment for transactions, since information is encrypted and
we use digital certificates by each of the company's representatives. This tool
has the essential infrastructure to support electronic B-to-B, permitting links
between a company's IT system and those of its customers, vendors or the Bank,
assuring automatic allocation of transactions, reducing costs and time
significantly and increasing reliability.

     Some of the main companies that have trusted Banco Rio for the provision of
specific solutions to their complex transactional processes are: Repsol-YPF,
DaimlerChrysler, Renault Argentina, Ford Motor Argentina, Unilever, Kodak,
Cargill, Massalin Particulares, Nobleza Piccardo and DuPont, among others.

     The Bank has consolidated as "Direct Debit" leader, and it is the leader in
terms of number of debits. Some of our customers are the main Argentine utility
companies, such as Telecom, CTI, Edea, Aguas Argentinas, Cablevision and
Multicanal, representing more than 60% of the market of the companies with the
largest revenues in Argentina.

     Electronic exchange of information between companies, as part of the
customer-vendor relationship or between competitors, fostered the creation of
"Comunidades de Negocios" (business communities). Business communities are large
corporations together with their vendors and customers. We believe that value
creation is higher in a group where all participants are integrated favorably.
To that end, we have two services:

     o    PIRYP (collection and payment integrated process), a base system
          required for the fluid exchange of collection and payment information.
          The main purpose is to create a commercial vehicle for development of
          payment, collection and value information businesses that may be
          highly efficient for the bank and all its customers; and

     o    Rio Serv, the Internet electronic channel that interacts between the
          company and PITYP, resulting in a rich date electronic exchange.

     Trading Activities

     Trading activities are conducted through the treasury department of Banco
Rio and were also conducted through Rio Valores until it merged with Santander
Bolsa. Rio Valores was Banco Rio's brokerage subsidiary, established in 1992 to
facilitate the Bank's trading for its customers on the Argentine
over-the-counter market (the "Argentine OTC Market") and on the Buenos Aires
Stock Exchange. The Bank is one of the largest traders of Argentine securities
and Argentine Government securities. In June 1998, Rio Valores merged with
Santander Sociedad de Bolsa, a subsidiary of Santander Argentina, which as of
December 31, 2001 is the largest brokerage firm in Argentina with a 13.00%
market share based on trading volume in the Buenos Aires Stock Exchange.

     The Bank's portfolio of Argentine Government and foreign government
securities provides the Bank with a liquidity reserve and serves as inventory
for the Bank's trading operations. See "--Selected Statistical
Information--Investment Securities."

     Mutual Funds

     The Bank developed, and is the depository for, the Superfondos Fondos
Comunes de Inversion, a family of 16 open- and closed-end funds (resulting from
the integration of the "BR" funds of Banco Rio and the "Superfondos" of Banco
Santander of Argentina). The Bank markets the Superfondos Family of Mutual Funds
as an investment alternative to both individuals and companies.

                                       27

<PAGE>

     The mutual fund industry plummeted in 2001 with the lowest equity in five
years as of closing. Within this context, Superfondos were consistent with this
trend ending the year with total equity managed in the amount of Ps.555 million.
The pricing strategy implemented during the period enabled the Bank to meet
revenue targets despite the serious difficulties. As regards profitability,
investment objectives were undoubtedly met since 85% of funds were well over the
benchmarks; such figure exceeds the 69% growth of the prior year.

     The fiscal year 2001 brought major risk challenges, which were
satisfactorily overcome. The liquidity risk was addressed with adequate
investment alternatives privileging time-deposit fund availability and
easily-resizable assets, and profiting from market opportunities. As regards
market risk, we privileged actual valuation while implementing innovations aimed
at treating quota holders as other savers in different investment alternatives.
In connection with credit risk, the activity was focused on a careful selection
of counterparts, issuers, and financial institutions. Sudden market changes were
fertile soil for operating risks, which were however adequately addressed.

     Other Services

     To facilitate the export and import operations of its customers, the Bank
offers traditional foreign trade financing, including letters of credit, credit
facilities, collections, bank drafts, fund transfers, bank acceptances and
foreign currency transactions. The Bank also offers its business customers a
wide range of cash management and transaction services aimed at improving their
cash management and their ability to interact with their commercial
counterparts. The Bank has a large corporate collections business operating
through its extensive customer service network. Other important services are
payroll services, accelerated check clearing, zero balance accounts and general
account services.

     Through its SWIFT facility and its extensive correspondent network, the
Bank supports its customers' needs for overseas funds transfers and collections.
The Bank also provides electronic payment and banking facilities and automated
data interchange services to its customers. In 1998, the Bank launched "RioEDI,"
a new Electronic Data Interchange-based customer access mechanism that offers
real-time, secure, encrypted payments and collections, and "Debito Directo," an
electronic payment mechanism that simplifies bill collection for the Bank's
corporate customers.

     International Operations

     The Bank's main international activities are related to the development of
new sources of funds in the international markets, including expanding credit
lines, as well as trading activities, placement of debt and equity issues,
foreign trade financing, money market and foreign exchange operations and
lending and deposit-taking activities. As of December 2001, the Bank maintains
relationships with approximately 400 correspondent banks worldwide.

     Investments in Other Companies

     The following table provides information with respect to the principal
equity ownership of the Bank at December 31, 2001 in unconsolidated companies
and other information about such companies at the end of their most recent
respective fiscal year:

                         INVESTMENTS IN OTHER COMPANIES

<TABLE>
<CAPTION>
                                                                          Last Published
                                                                           Stockholders'
                                   % of Shares                                Equity            Fiscal
                   Company             Owned      Principal Activity      (In thousands)      Period End
                   -------         -----------    ------------------      --------------      ----------
<S>                                <C>            <C>                   <C>                   <C>
Bladex S.A.                                (1)    Banking               US$       699,204      12-31-00
Banelco S.A.                            20.00%    Services              Ps.        18,369      09-30-01
Visa Argentina S.A.                      5.00%    Services              Ps.        15,534      05-31-01
Interbanking S.A.                       15.00%    Services              Ps.         5,640      12-31-00
</TABLE>

                                       28

<PAGE>

<TABLE>
<S>                                             <C>       <C>                   <C>               <C>
Mercado de Valores de Buenos Aires S.A.          0.94%    Securities Market     Ps.  155,797      03-31-02
Caminos de las Sierras S.A.                     37.97%    Roads works           Ps.  124,700      09-30-01
Origenes Vivienda y Consumo Cia Financiera
S.A. (Former Origenes Vivienda S.A.)            12.50%    Services              Ps.   28,133      09-30-01
Rio Cia de Seguros S.A.                         12.50%    Insurance             Ps.   10,351      09-30-01
</TABLE>

--------------------
(1)  The Bank and Santander Riobank hold 47,386 Class "B" shares, no par value,
     one vote per share, and 7,812 preferred shares, par value U.S.$10 per
     share, non-voting.

Competition

     The Bank has a presence in every market segment of the Argentine financial
sector and a broad geographic base from which it offers a wide variety of
financial products in Argentina. Competition in each market segment of the
Argentine financial sector is strong. There are banks that have similar general
objectives, while other banks, financial institutions, securities brokers,
financial advisers and other entities compete with the Bank in specific products
or types of activities, or in particular geographic areas. The Bank recognizes
all of these banks and companies as competitors.

     From the last quarter of 1996 to the date of this Annual Report, there has
been a substantial increase in foreign ownership of Argentine privately-owned
commercial banks, including Banco Rio. The Bank believes that these banks will
become stronger competitors because of their access to new technologies,
services, products, financing and processes. See "--Argentine Banking System and
Regulation--Recent Developments in the Argentine Banking System." The Bank
believes that it will continue to face strong competition in all of its
activities and that competition may increase as Argentina's financial system and
markets continue to develop.

     The Bank believes that it has an important competitive advantage because of
its historically strong relationships with large corporations and small- and
medium-sized companies, its extensive customer service network and its advanced
technology, which enables it to serve individual customers efficiently and
provide them with high-quality service. In addition, the Bank follows credit
policies designed to maintain and improve the quality of its loan portfolio.
Finally, the Bank believes that its relationship with Santander Central
Hispanico Group gave it access to products and technology that enabled it to
compete more effectively in the Argentine financial sector.

                                       29

<PAGE>

                        SELECTED STATISTICAL INFORMATION

     In the following selected statistical information, assets and liabilities
have been classified by currency of denomination (pesos or dollars), rather than
by country of origin, because substantially all of the Bank's transactions are
effected in Argentina or on behalf of Argentine residents in pesos or dollars.
The following information should be read in conjunction with "Item 5. Operating
and Financial Review and Prospects" and the Consolidated Financial Statements
included elsewhere in this Annual Report.

     On August 22, 1995, the Argentine Government published Decree 316/95, which
eliminated the requirement that financial information at any date or for any
period after August 31, 1995 be restated for inflation. Pursuant to such decree,
the CNV issued its General Resolution 272 and the Central Bank issued its
Communication "A" 2365, which eliminated such requirement with respect to those
companies that are subject to their respective jurisdictions, such as the Bank.

                  SELECTED STATISTICAL INFORMATION OF THE BANK

Average Balance Sheet and Interest Rate Data

     Peso-Denominated Average Balances and Interest Income

     Average balances for peso-denominated assets and liabilities have been
calculated in the following manner: For each month, the month-end balance
expressed in nominal pesos was determined. The average balance for each year
presented below is the average of the month-end balances in such year so
determined. Interest income (expense) for each category has been calculated in
the following manner: Interest income (expense) for each year is the total of
the interest income (expense) for the months in such year so determined.

     Dollar-Denominated Average Balances and Interest Income

     Average balances and interest income (expense) for dollar-denominated
assets and liabilities have been calculated in the following manner: For each
month, a month-end balance and the interest income (expense) for such year was
determined. Each month-end balance and interest income (expense) amount was then
translated into pesos at the exchange rate in effect at the end of such month.
The peso average balances for each year presented below are the average of the
monthly balances so determined. Interest income (expense) for each year is the
total of the income (expense) for the months in such year so determined.

     Average Nominal and Real Rates

     The tables that follow present both the nominal and real rates earned on
interest-earning assets and paid on interest-bearing liabilities. Average
nominal rates have been calculated by dividing the amount of interest earned or
paid during the period by the related average balance, calculated in the manner
described below. The average nominal rates for each period were converted to
average real rates as follows:

                  Rp   = 1 + Np       -1
                         ----------
                         1 + I

                  Rd   = (1 + Nd)(1+D)     -1
                         ---------------
                         1 + I

where:

         Rp   =   average real rate for peso-denominated assets and liabilities
                  for the period;

         Rd   =   average real rate for dollar-denominated assets and
                  liabilities for the period;

         Np   =   nominal peso average rate for peso-denominated assets and
                  liabilities for the period;

                                       30

<PAGE>

         Nd  =  nominal dollar average rate for dollar-denominated assets and
                liabilities for the period;

         D   =  devaluation rate of the peso relative to the dollar for the
                period; and

         I   =  Argentine inflation rate (WPI).

     The formula for the average real rates for peso-denominated assets and
liabilities (Rp) deflates the average nominal rates for each period by the WPI
for the period. The formula for the average real interest rates for
dollar-denominated assets and liabilities (Rd) reflects the loss, or gain, in
purchasing power caused by the difference between the rate of depreciation of
the peso relative to the dollar and the rate of inflation in Argentina for each
period. Negative average real rates occur in periods when the inflation rate
exceeds the nominal interest rate in pesos or the combination of the nominal
interest rate on dollar-denominated assets or liabilities and the rate of
depreciation of the peso.

     The following illustrates the calculation of the average real rate for a
dollar-denominated asset yielding an average nominal rate of 15.00% per annum
(Nd =0.15), a rate of depreciation of the peso of 10% per annum (D=0.10) and a
rate of inflation in Argentina of 20.00% per annum (I=0.20):

              Rd   =  (1 / 0.15)(1 + 0.10)    -1        = 5.40% per annum
                      -----------------------
                               (1 + 0.20)

     Because the inflation rate exceeds the devaluation rate, the average real
interest rate in peso terms is less than the average nominal interest rate in
dollars. In this example, if the devaluation rate had been 25.00% per annum, and
the other assumptions had remained the same, then the average real interest rate
in peso terms would have been 19.80% per annum, which is more than the average
nominal interest rate in dollars. In the above example, if the inflation rate
were to exceed 26.50% per annum, then the average real interest rate on this
dollar-denominated asset would become negative.

     Included in interest earned are capital gains and losses and mark-to-market
adjustments on government securities and short-term investments. The Bank does
not, as a matter of practice, distinguish between interest income and the market
gain or loss on its government securities portfolio. Neither the monetary (loss)
gain on financial transactions nor the gains on foreign exchange are included as
a component of interest earned or paid, but are instead accounted for as part of
the calculation of average real rates. See "Item 5. Operating and Financial
Review and Prospects--Presentation of Net Financial Income". Non-accrual loans
have been included in the related average loan balance calculation.

     The dollar-denominated portion of average assets and liabilities has been
separated into those assets and liabilities related to the Bank's Argentine
operations (dollars domestic) and those related to the Bank's Grand Cayman
branch and New York agency and, where applicable, Riobank (dollars foreign).

     The classification of line items in the following average balance sheets
differs in certain respects from the balance sheets as reported in the
Consolidated Financial Statements. The classification system employed in the
average balance sheets corresponds to the classifications used in Note 24 of the
Consolidated Financial Statements in order to present the balance sheets using
the classifications of Regulation S-X of the Commission.

                                       31

<PAGE>

<TABLE>
<CAPTION>
                                                    AVERAGE BALANCE SHEET AND INCOME FROM EARNING ASSETS
                                                                    (Average Real Rates)
                                                                 For the fiscal years ended
                                                                        December 31,
                          ---------------------------------------------------------------------------------------------------------
                                 1999 (1)                                 2000 (2)                           2001 (3)
                          ---------------------------------------------------------------------------------------------------------
                           Average    Interest      Average    Average    Interest     Average     Average    Interest    Average
                           --------   --------      -------    --------   --------     -------     --------   --------    --------
                            Balance                  Rate       Balance                  Rate      Balance                  Rate
                            -------                  ----       -------                  ----      -------                  ----
<S>                       <C>         <C>           <C>       <C>         <C>          <C>       <C>          <C>         <C>
ASSETS
Cash and Due From Banks (4)
    Pesos                         -           -           -           -           -          -       52,421       1,607      8.83%
    Dollars domestic        571,096      27,912       3.73%     684,637      41,400      3.59%      702,811      25,913      9.49%
    Dollars foreign               -           -           -           -           -          -            -           -          -
                          ---------   ---------               ---------   ---------              ----------   ---------
                            571,096      27,912       3.73%     684,637      41,400      3.59%      755,232      27,520      9.45%
                          ---------   ---------               ---------   ---------              ----------   ---------
Government Securities
    Pesos                   230,791      36,532      14.55%      75,553      13,661     15.35%       15,289       2,513     22.95%
    Dollars domestic        940,279      76,623       6.96%   1,607,559     188,384      9.13%    1,363,747      10,705      6.43%
    Dollars foreign          10,321       3,001      27.65%     178,062      18,493      7.83%      118,470       2,803      8.10%
                          ---------   ---------               ---------   ---------              ----------   ---------
                          1,181,391     116,156       8.62%   1,861,174     220,538      9.26%    1,497,506      16,021      6.73%
                          ---------   ---------               ---------   ---------              ----------   ---------
Marketable Securities (5)
    Pesos                    21,147       2,378      10.02%      20,500       (138)     -2.97%       25,262     (8,320)    -29.18%
    Dollars domestic         12,786       3,683      27.38%      33,173       8,460     22.60%       30,927      16,587     62.23%
    Dollars foreign          27,674         262      -0.17%      15,721          71     -1.87%       46,054       3,271     13.10%
                          ---------   ---------               ---------   ---------              ----------   ---------
                             61,607       6,323       9.05%      69,394       8,393      9.50%      102,243      11,538     17.51%
                          ---------   ---------               ---------   ---------              ----------   ---------
Loans and Financial Leases (6)
    Pesos                 1,330,720     248,452      17.36%   1,399,399     269,505     16.50%    1,226,881     289,514     30.52%
    Dollars domestic      4,199,922     478,503      10.16%   4,871,220     595,200      9.62%    4,963,783     667,804     19.80%
    Dollars foreign         488,957      53,375       9.69%     229,473      18,160      5.41%      504,508      24,893     10.81%
                          ---------   ---------               ---------   ---------              ----------   ---------
                          6,019,599     780,330      11.72%   6,500,092     882,865     10.95%    6,695,172     982,211     21.09%
                          ---------   ---------               ---------   ---------              ----------   ---------
Other Interest Earning Receivables (7)
    Pesos                     7,106         182       1.43%      10,924         296      0.33%       15,798         650      9.94%
    Dollars domestic        754,225      39,707       4.10%     852,048      48,253      3.22%      497,103      16,321      9.06%
    Dollars foreign         200,546      16,965       7.26%     122,782      11,465      6.81%       33,931         491      7.13%
                          ---------   ---------               ---------   ---------              ----------   ---------
                            961,877      56,854       4.74%     985,754      60,014      3.63%      546,832      17,462      8.97%
                          ---------   ---------               ---------   ---------              ----------   ---------

Total Interest Earning
Assets
    Pesos                 1,589,764     287,544      16.78%   1,506,376     283,324     16.06%    1,335,651     285,964     28.21%
    Dollars domestic      6,478,308     626,428       8.46%   8,048,637     881,697      8.39%    7,558,371     737,330     15.90%
    Dollars foreign         727,498      73,603       8.90%     546,038      48,189      6.31%      702,963      31,458     10.32%
                          ---------   ---------               ---------   ---------              ----------   ---------
                          8,795,570     987,575      10.00%   10,101,051  1,213,210      9.42%    9,596,985   1,054,752     17.20%
                          ---------   ---------               ---------   ---------              ----------   ---------


Investment Securities (8)
    Pesos                    24,437           -           -      20,991           -          -       30,985           -          -
    Dollars domestic            311           -           -         462           -          -          342           -          -
    Dollars foreign           2,240           -           -           -           -          -            -           -          -
                          ---------                           ---------                          ----------
                             26,988           -           -      21,453           -          -       31,327           -          -
                          ---------                           ---------                          ----------
Cash and Due From Banks  (9)
    Pesos                   148,084           -           -     158,398           -          -      137,639           -          -
    Dollars domestic         72,455           -           -      87,897           -          -       99,476           -          -
    Dollars foreign           7,065           -           -      10,303           -          -       53,504           -          -
                          ---------                           ---------                          ----------
                            227,604           -           -     256,598           -          -      290,619           -          -
                          ---------                           ---------                          ----------
Allowances
    Pesos                  (70,042)           -           -   (103,161)           -          -     (79,506)           -          -
    Dollars domestic      (105,856)           -           -   (173,214)           -          -    (146,911)           -          -
    Dollars foreign         (6,625)           -           -     (5,295)           -          -      (4,454)           -          -
                          ---------                           ---------                          ----------
                          (182,523)           -           -   (281,670)           -          -    (230,871)           -          -
                          ---------                           ---------                          ----------
</TABLE>

                                       32

<PAGE>

<TABLE>
<CAPTION>
                                                                 For the fiscal years ended
                                                                       December 31,
                           -------------------------------------------------------------------------------------------------------
                                 1999 (1)                                   2000 (2)                            2001 (3)
                           -------------------------------------------------------------------------------------------------------
                            Average    Interest    Average     Average     Interest   Average      Average     Interest   Average
                            -------    --------    -------     -------     --------   -------      -------     --------   -------
                            Balance                 Rate       Balance                 Rate        Balance                  Rate
                            -------                 ----       -------                 ----        -------                  ----
<S>                        <C>         <C>         <C>         <C>         <C>        <C>          <C>         <C>        <C>
  Premises and Equipment
    Pesos                     432,988         -           -       433,648          -          -       400,923          -         -
    Dollars domestic                -         -           -             -          -          -             -          -         -
    Dollars foreign             1,310         -           -           720          -          -           694          -         -
                           ----------                          ----------                          ----------
                              434,298         -           -       434,368          -          -       401,617          -         -
                           ----------                          ----------                          ----------
Other Non-Interest Bearning Assets (10)
    Pesos                   1,214,094         -           -     1,446,759          -          -     1,274,838          -         -
    Dollars domestic          915,010         -           -     1,457,225          -                  975,188          -
    Dollars foreign            48,201         -           -         2,461          -                      395          -
                           ----------                          ----------                          ----------
                            2,177,305         -           -     2,906,445          -                2,250,421          -
                           ----------                          ----------                          ----------

TOTAL ASSETS

    Pesos                   3,339,325   287,544       7.41%     3,463,011    283,324      5.68%     3,100,530    285,964    15.34%
    Dollars domestic        7,360,228   626,428       7.31%     9,421,007    881,697      6.83%     8,486,466    737,330    14.77%
    Dollars foreign           779,689    73,603       8.23%       554,227     48,189      6.18%       753,102     31,458    10.01%
                           ----------   -------                ----------  ---------               ----------  ---------
                           11,479,242   987,575       7.40%    13,438,245  1,213,210      6.50%    12,340,098  1,054,752    14.62%
                           ----------   -------                ----------  ---------               ----------  ---------
</TABLE>
 -------------------

(1)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa and Santander Fondos.
(2)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A. Includes the result of operations and
     average balance sheets of Banco Tornquist through the time of its merger
     with and into Banco Rio.
(3)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A.
(4)  Includes a portion of "Cash and due from banks" relating to amounts
     invested in interest-earning instruments. See "--Argentine Banking System
     and Regulation--Argentine Banking Regulation--Liquidity and Solvency
     Requirements."
(5)  Includes shares and corporate bonds listed on the Buenos Aires Stock
     Exchange and the Argentine OTC Market.
(6)  Includes loans and financial leases to financial institutions, federal
     funds sold and overnight deposits in foreign branches.
(7)  Includes other receivables from financial transactions.
(8)  Includes investment in unlisted companies. See Note 12 to the Consolidated
     Financial Statements.
(9)  Includes "Cash" in "Cash and due from banks" in the Balance Sheet in the
     Consolidated Financial Statements and the balance in current accounts in
     correspondent banks.
(10) Includes "Other receivables from financial transactions" in the Balance
     Sheet in the Consolidated Financial Statements, except "Central Bank of the
     Republic of Argentina" and "Corporate bonds purchased". Also includes
     "Other receivables", "Other assets", and "Suspense items".

                                       33

<PAGE>

<TABLE>
<CAPTION>
                                                   AVERAGE BALANCE SHEET AND INTEREST PAID ON LIABILITIES
                                                                    (Average Real Rates)
                                                                 For the fiscal years ended
                                                                        December 31,
                          ---------------------------------------------------------------------------------------------------------
                                       1999 (1)                           2000 (2)                           2001 (3)
                          ---------------------------------------------------------------------------------------------------------
                            Average    Interest      Average    Average    Interest     Average    Average    Interest    Average
                            -------    --------      -------    -------    --------     -------    -------    --------    -------
                            Balance                  Rate       Balance                 Rate       Balance                Rate
                            -------                  ----       -------                 ----       -------                ----
<S>                       <C>         <C>            <C>      <C>         <C>          <C>       <C>          <C>         <C>

LIABILITIES
Interest-Bearing
Liabilities
Checking Deposits
    Pesos                         -           -           -           -           -          -       32,862       1,830     11.48%
    Dollars domestic              -           -           -           -           -          -      166,434      10,647     12.35%
    Dollars foreign               -           -           -           -           -          -            -           -          -
                          ----------  ----------              ----------  ----------             -----------  ----------
                                  -           -           -           -           -          -      199,296      12,477     12.21%
                          ----------  ----------              ----------  ----------             -----------  ----------
Deposits-Savings
    Pesos                   759,729      21,562       1.70%     809,516      24,428      0.63%      540,032      14,789      8.49%
    Dollars domestic        530,353       9,782       0.72%     603,989      16,250      0.31%      532,645       8,507      7.28%
    Dollars foreign               -           -           -           -           -          -        5,662         723     19.08%
                          ----------  ----------              ----------  ----------             -----------  ----------
                          1,290,082      31,344       1.30%   1,413,505      40,678      0.50%    1,078,339      24,019      7.95%
                          ----------  ----------              ----------  ----------             -----------  ----------
Deposits-Time
    Pesos                   695,353      50,271       6.05%     538,206      47,968      6.39%      518,964      53,223     16.43%
    Dollars domestic      2,900,330     196,518       5.60%   4,019,904     292,802      4.80%    3,921,259     357,014     15.21%
    Dollars foreign         287,127      19,532       5.62%     217,436      10,794      2.53%      407,777      15,224      9.54%
                          ----------  ----------              ----------  ----------             -----------  ----------
                          3,882,810     266,321       5.68%   4,775,546     351,564      4.88%    4,848,000     425,461     14.86%
                          ----------  ----------              ----------  ----------             -----------  ----------
Short-term Borrowings (4)
    Pesos                    37,049       2,149       4.63%      40,238       2,018      2.58%       29,369         472      7.29%
    Dollars domestic        899,920      61,090       5.61%   1,157,068     107,026      6.72%      884,664      68,626     13.79%
    Dollars foreign         287,358      28,071       8.56%     155,476      11,523      4.92%      102,662       9,043     14.90%
                          ----------  ----------              ----------  ----------             -----------  ----------
                          1,224,327      91,310       6.27%   1,352,782     120,567      6.39%    1,016,695      78,141     13.71%
                          ----------  ----------              ----------  ----------             -----------  ----------
Long-term Debt (5)
    Pesos                         -           -           -           -           -          -            -           -          -
    Dollars domestic      1,016,723      81,108       6.79%   1,068,467      90,465      5.96%    1,013,138      75,673     13.48%
    Dollars foreign               -           -           -           -           -          -            -           -          -
                          ----------  ----------              ----------  ----------             -----------  ----------
                          1,016,723      81,108       6.79%   1,068,467      90,465      5.96%    1,013,138      75,673     13.48%
                          ----------  ----------              ----------  ----------             -----------  ----------

Total Interest Bearing Liabilities
    Pesos                 1,492,131      73,982       3.80%   1,387,960      74,414      2.92%    1,121,227      70,314     12.22%
    Dollars domestic      5,347,326     348,498       5.34%   6,849,428     506,543      4.91%    6,518,140     520,467     14.03%
    Dollars foreign         574,485      47,603       7.09%     372,912      22,317      3.53%      516,101      24,990     10.71%
                          ----------  ----------              ----------  ----------             -----------  ----------
                          7,413,942     470,083       5.17%   8,610,300     603,274      4.53%    8,155,468     615,771     13.57%
                          ----------  ----------              ----------  ----------             -----------  ----------

Deposits-Checking and Other
    Pesos                   397,552           -           -     428,460           -          -      363,764           -          -
    Dollars domestic        126,439           -           -     146,605           -          -      172,619           -          -
    Dollars foreign          38,806           -           -      18,189           -          -       88,662           -          -
                          ----------                          ----------                         -----------
                            562,797           -           -     593,254           -          -      625,045           -          -
                          ----------                          ----------                         -----------
Other Liabilities (6)
    Pesos                   487,999           -           -     775,619           -          -      793,057           -          -
    Dollars domestic      1,858,695           -           -   2,145,501           -          -    1,455,205           -          -
    Dollars foreign           5,996           -           -       3,160           -          -        2,071           -          -
                          ----------                          ----------                         -----------
                          2,352,690           -           -   2,924,280           -          -    2,250,333           -          -
                          ----------                          ----------                         -----------

Stockholders' Equity
    Pesos                 1,149,813           -           -   1,310,411           -          -    1,309,252           -          -
    Dollars domestic              -           -           -           -           -          -            -           -          -
    Dollars foreign               -           -           -           -           -          -            -           -          -
                          ----------                          ----------                         -----------
                          1,149,813           -           -   1,310,411           -          -    1,309,252           -          -
                          ----------                          ----------                         -----------
</TABLE>

                                       34

<PAGE>

<TABLE>
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

<S>                       <C>         <C>         <C>      <C>         <C>         <C>        <C>          <C>         <C>
    Pesos                  3,527,495      73,982    0.97%   3,902,450      74,414     -0.45%    3,587,300      70,314      7.67%
    Dollars domestic       7,332,460     348,498    3.60%   9,141,534     506,543      3.10%    8,145,964     520,467     12.34%
    Dollars foreign          619,287      47,603    6.50%     394,261      22,317      3.21%      606,834      24,990      9.95%
                          ----------  ----------           ----------  ----------             -----------  ----------
                          11,479,242     470,083    2.95%  13,438,245     603,274      2.07%   12,340,098     615,771     10.87%
                          ----------  ----------           ----------  ----------             -----------  ----------
</TABLE>

--------------------
(1)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa and Santander Fondos.
(2)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A. Includes the result of operations and
     average balance sheets of Banco Tornquist through the time of its merger
     with and into Banco Rio.
(3)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A.
(4)  Includes "Central Bank of Argentina" and the other banks of "Banks and
     international organizations" (call money and credit lines).
(5)  Includes "Unsubordinated Corporate bonds."
(6)  Includes other non-interest bearing liabilities, spot and forward sales and
     purchases of foreign currency pending settlement from "Other liabilities
     from financial transactions," "Other liabilities", "Contingent liabilities"
     and "Suspense items."

                                       35

<PAGE>

              AVERAGE BALANCE SHEET AND INCOME FROM EARNING ASSETS
                             (Average Nominal Rates)
<TABLE>
<CAPTION>
                                                               For the fiscal years ended December 31,
                            --------------------------------------------------------------------------------------------------------
                                        1999 (1)                            2000 (2)                           2001 (3)
                            --------------------------------------------------------------------------------------------------------
                             Average     Interest    Average    Average     Interest     Average   Average     Interest    Average
                             -------     --------    -------    -------     --------     -------   -------     --------    -------
                             Balance                   Rate     Balance                    Rate    Balance                   Rate
                             -------                   ----     -------                    ----    -------                   ----
<S>                         <C>          <C>         <C>        <C>         <C>          <C>       <C>         <C>         <C>
ASSETS

Interest-Earning Assets
 Cash and Due From Banks(4)
   Pesos                            -            -          -          -            -          -      52,421        1,607     3.07%
   Dollars domestic           571,096       27,912      4.89%    684,637       41,400      6.05%     702,811       25,913     3.69%
   Dollars foreign                  -            -          -          -            -          -           -            -         -
                            ----------  -----------            ----------  -----------             ---------- ------------
                              571,096       27,912      4.89%    684,637       41,400      6.05%     755,232       27,520     3.64%
                            ----------  -----------            ----------  -----------             ---------- ------------
Government Securities
   Pesos                      230,791       36,532     15.83%     75,553       13,661     18.08%      15,289        2,513    16.44%
   Dollars domestic           940,279       76,623      8.15%  1,607,559      188,384     11.72%   1,363,747       10,705     0.78%
   Dollars foreign             10,321        3,001     29.08%    178,062       18,493     10.39%     118,470        2,803     2.37%
                            ----------  -----------            ----------  -----------             ---------- ------------
                            1,181,391      116,156      9.83%  1,861,174      220,538     11.85%   1,497,506       16,021     1.07%
                            ----------  -----------            ----------  -----------             ---------- ------------
Marketable Securities (5)
   Pesos                       21,147        2,378     11.25%     20,500        (138)     -0.67%      25,262      (8,320)   -32.93%
   Dollars domestic            12,786        3,683     28.80%     33,173        8,460     25.50%      30,927       16,587    53.63%
   Dollars foreign             27,674          262      0.95%     15,721           71      0.45%      46,054        3,271     7.10%
                            ----------  -----------            ----------  -----------             ---------- ------------
                               61,607        6,323     10.26%     69,394        8,393     12.09%     102,243       11,538    11.28%
                            ----------  -----------            ----------  -----------             ---------- ------------
Loans and Financial
 Leases (6)
   Pesos                    1,330,720      248,452     18.67%  1,399,399      269,505     19.26%   1,226,881      289,514    23.60%
   Dollars domestic         4,199,922      478,503     11.39%  4,871,220      595,200     12.22%   4,963,783      667,804    13.45%
   Dollars foreign            488,957       53,375     10.92%    229,473       18,160      7.91%     504,508       24,893     4.93%
                            ----------  -----------            ----------  -----------             ---------- ------------
                            6,019,599      780,330     12.96%  6,500,092      882,865     13.58%   6,695,172      982,211    14.67%
                            ----------  -----------            ----------  -----------             ---------- ------------
Other Interest Earning
 Receivables (7)
   Pesos                        7,106          182      2.56%     10,924          296      2.71%      15,798          650     4.11%
   Dollars domestic           754,225       39,707      5.26%    852,048       48,253      5.66%     497,103       16,321     3.28%
   Dollars foreign            200,546       16,965      8.46%    122,782       11,465      9.34%      33,931          491     1.45%
                            ----------  -----------            ----------  -----------             ---------- ------------
                              961,877       56,854      5.91%    985,754       60,014      6.09%     546,832       17,462     3.19%
                            ----------  -----------            ----------  -----------             ---------- ------------
Total Interest Earning
 Assets
   Pesos                    1,589,764      287,544     18.09%  1,506,376      283,324     18.81%   1,335,651      285,964    21.41%
   Dollars domestic         6,478,308      626,428      9.67%  8,048,637      881,697     10.95%   7,558,371      737,330     9.76%
   Dollars foreign            727,498       73,603     10.12%    546,038       48,189      8.83%     702,963       31,458     4.48%
                            ----------  -----------            ----------  -----------             ---------- ------------
                            8,795,570      987,575     11.23%  10,101,051   1,213,210     12.01%   9,596,985    1,054,752    10.99%
                            ----------  -----------            ----------  -----------             ---------- ------------

Non-interest-Earning Assets
 Investments Securities(8)

   Pesos                       24,437            -          -     20,991            -          -      30,985            -         -

   Dollars domestic               311            -          -        462            -          -         342            -         -

   Dollars foreign              2,240            -          -          -            -          -           -            -         -
                            ----------  -----------            ----------  -----------             ---------- ------------
                               26,988            -          -     21,453            -                 31,327            -         -
                            ----------  -----------            ----------  -----------             ---------- ------------
Cash and Due From Banks(9)

   Pesos                      148,084            -          -    158,398            -          -     137,639            -         -

   Dollars domestic            72,455            -          -     87,897            -          -      99,476            -         -

   Dollars foreign              7,065            -          -     10,303            -          -      53,504            -         -
                            ----------  -----------            ----------  -----------             ---------- ------------
                              227,604            -               256,598            -          -     290,619            -         -
                            ----------  -----------            ----------  -----------             ---------- ------------
</TABLE>

                                       36

<PAGE>

              AVERAGE BALANCE SHEET AND INCOME FROM EARNING ASSETS
                             (Average Nominal Rates)
<TABLE>
<CAPTION>
                                                             For the fiscal years ended December 31,
                            -----------------------------------------------------------------------------------------------------
                                        1999 (1)                             2000 (2)                         2001 (3)
                            -----------------------------------------------------------------------------------------------------
                             Average     Interest     Average    Average     Interest      Average   Average    Interest  Average
                             -------     --------     -------    -------     --------      -------   -------    --------  -------
                             Balance                    Rate     Balance                     Rate    Balance                Rate
                             -------                    ----     -------                     ----    -------                ----
<S>                         <C>          <C>          <C>        <C>         <C>           <C>       <C>        <C>       <C>
Allowances

   Pesos                     (70,042)            -         -    (103,161)           -           -    (79,506)         -        -

   Dollars domestic         (105,856)            -         -    (173,214)           -           -   (146,911)         -        -

   Dollars foreign            (6,625)            -         -      (5,295)           -           -     (4,454)         -        -
                            ----------  -----------             ----------  ----------              ----------  --------
                            (182,523)            -         -    (281,670)           -           -   (230,871)         -        -
                            ----------  -----------             ----------  ----------              ----------  --------
Premises and Equipment

   Pesos                      432,988            -         -      433,648           -           -     400,923         -        -

   Dollars domestic                 -            -         -            -           -           -           -         -        -

   Dollars foreign              1,310            -         -          720           -           -         694         -        -
                            ----------  -----------             ----------  ----------              ----------  --------
                              434,298            -         -      434,368           -           -     401,617         -        -
                            ----------  -----------             ----------  ----------              ----------  --------
Other Non-Interest
 Bearning Assets (10)

   Pesos                    1,214,094            -         -    1,446,759           -           -   1,274,838         -        -

   Dollars domestic           915,010            -         -    1,457,225           -           -     975,188         -        -

   Dollars foreign             48,201            -         -        2,461           -           -         395         -        -
                            ----------  -----------             ----------  ----------              ----------  --------
                            2,177,305            -         -    2,906,445           -           -   2,250,421         -        -
                            ----------  -----------             ----------  ----------              ----------  --------

TOTAL ASSETS
   Pesos                    3,339,325      287,544     8.61%    3,463,011     283,324       8.18%   3,100,530   285,964    9.22%
   Dollars domestic         7,360,228      626,428     8.51%    9,421,007     881,697       9.36%   8,486,466   737,330    8.69%
   Dollars foreign            779,689       73,603     9.44%      554,227      48,189       8.69%     753,102    31,458    4.18%
                            ----------  -----------             ----------  ----------              ----------  --------
                            11,479,242     987,575     8.60%    13,438,245  1,213,210       9.03%   12,340,098  1,054,752  8.55%
                            ----------  -----------             ----------  ----------              ----------  --------
-------------------
</TABLE>
(1)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa and Santander Fondos.
(2)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A. Includes the result of operations and
     average balance sheets of Banco Tornquist through the time of its merger
     with and into Banco Rio.
(3)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A.
(4)  Includes a portion of "Cash and due from banks" relating to amounts
     invested in interest-earning instruments. See "--Argentine Banking System
     and Regulation--Argentine Banking Regulation--Liquidity and Solvency
     Requirements."
(5)  Includes shares and corporate bonds listed on the Buenos Aires Stock
     Exchange and the Argentine OTC Market.
(6)  Includes loans and financial leases to financial institutions, federal
     funds sold and overnight deposits in foreign branches.
(7)  Includes other receivables from financial transactions.
(8)  Includes investment in unlisted companies. See Note 12 to the Consolidated
     Financial Statements.
(9)  Includes "Cash" in "Cash and due from banks" in the Balance Sheet in the
     Consolidated Financial Statements and the balance in current accounts in
     correspondent banks.
(10) Includes "Other receivables from financial transactions" in the Balance
     Sheet in the Consolidated Financial Statements, except "Central Bank of the
     Republic of Argentina" and "Corporate bonds purchased". Also includes
     "Other receivables", "Other assets" and "Suspense items".

                                       37

<PAGE>

             AVERAGE BALANCE SHEET AND INTEREST PAID ON LIABILITIES
                             (Average Nominal Rates)

<TABLE>
<CAPTION>
                                                                For the fiscal years ended December 31,
                            --------------------------------------------------------------------------------------------------------
                                        1999 (1)                            2000 (2)                           2001 (3)
                            --------------------------------------------------------------------------------------------------------
                             Average     Interest    Average    Average     Interest     Average   Average     Interest    Average
                             --------    --------    --------   --------    --------     -------   --------    --------    --------
                              Balance                  Rate      Balance                   Rate     Balance                  Rate
                              -------                  ----      -------                   ----     -------                  ----
<S>                         <C>          <C>         <C>        <C>         <C>          <C>       <C>         <C>         <C>
LIABILITIES
Interest-Bearing
 Liabilities
 Checking Deposits
   Pesos                            -            -          -          -            -          -      32,862        1,830     5.57%
   Dollars domestic                 -            -          -          -            -          -     166,434       10,647     6.40%
   Dollars foreign                  -            -          -          -            -          -           -            -         -
                            ----------  -----------            ----------  -----------             ---------- ------------
                                    -            -          -          -            -          -     199,296       12,477     6.26%
                            ----------  -----------            ----------  -----------             ---------- ------------
Deposits-Savings
   Pesos                      759,729       21,562      2.84%    809,516       24,428      3.02%     540,032       14,789     2.74%
   Dollars domestic           530,353        9,782      1.84%    603,989       16,250      2.69%     532,645        8,507     1.60%
   Dollars foreign                  -            -          -          -            -          -       5,662          723    12.77%
                            ----------  -----------            ----------  -----------             ---------- ------------
                            1,290,082       31,344      2.43%  1,413,505       40,678      2.88%   1,078,339       24,019     2.23%
                            ----------  -----------            ----------  -----------             ---------- ------------
Deposits-Time
   Pesos                      695,353       50,271      7.23%    538,206       47,968      8.91%     518,964       53,223    10.26%
   Dollars domestic         2,900,330      196,518      6.78%  4,019,904      292,802      7.28%   3,921,259      357,014     9.10%
   Dollars foreign            287,127       19,532      6.80%    217,436       10,794      4.96%     407,777       15,224     3.73%
                            ----------  -----------            ----------  -----------             ---------- ------------
                            3,882,810      266,321      6.86%  4,775,546      351,564      7.36%   4,848,000      425,461     8.78%
                            ----------  -----------            ----------  -----------             ---------- ------------
Short-term Borrowings (4)
   Pesos                       37,049        2,149      5.80%     40,238        2,018      5.02%      29,369          472     1.61%
   Dollars domestic           899,920       61,090      6.79%  1,157,068      107,026      9.25%     884,664       68,626     7.76%
   Dollars foreign            287,358       28,071      9.77%    155,476       11,523      7.41%     102,662        9,043     8.81%
                            ----------  -----------            ----------  -----------             ---------- ------------
                            1,224,327       91,310      7.46%  1,352,782      120,567      8.91%   1,016,695       78,141     7.69%
                            ----------  -----------            ----------  -----------             ---------- ------------
Long-term Debt (5)
   Pesos                            -            -          -          -            -          -           -            -         -
   Dollars domestic         1,016,723       81,108      7.98%  1,068,467       90,465      8.47%   1,013,138       75,673     7.47%
   Dollars foreign                  -            -          -          -            -          -           -            -         -
                            ----------  -----------            ----------  -----------             ---------- ------------
                            1,016,723       81,108      7.98%  1,068,467       90,465      8.47%   1,013,138       75,673     7.47%
                            ----------  -----------            ----------  -----------             ---------- ------------

Total Interest Bearing
 Liabilities
   Pesos                    1,492,131       73,982      4.96%  1,387,960       74,414      5.36%   1,121,227       70,314     6.27%
   Dollars domestic         5,347,326      348,498      6.52%  6,849,428      506,543      7.40%   6,518,140      520,467     7.98%
   Dollars foreign            574,485       47,603      8.29%    372,912       22,317      5.98%     516,101       24,990     4.84%
                            ----------  -----------            ----------  -----------             ---------- ------------
                            7,413,942      470,083      6.34%  8,610,300      603,274      7.01%   8,155,468      615,771     7.55%
                            ----------  -----------            ----------  -----------             ---------- ------------

Deposits-Checking and
 Other
   Pesos                      397,552            -          -    428,460            -          -     363,764            -         -
   Dollars domestic           126,439            -          -    146,605            -          -     172,619            -         -
   Dollars foreign             38,806            -          -     18,189            -          -      88,662            -         -
                            ----------  -----------            ----------  -----------             ---------- ------------
                              562,797            -          -    593,254            -          -     625,045            -         -
                            ----------  -----------            ----------  -----------             ---------- ------------
Other Liabilities (6)
   Pesos                      487,999            -          -    775,619            -          -     793,057            -         -
   Dollars domestic         1,858,695            -          -  2,145,501            -          -   1,455,205            -         -
   Dollars foreign              5,996            -          -      3,160            -          -       2,071            -         -
                            ----------  -----------            ----------  -----------             ---------- ------------
                            2,352,690            -          -  2,924,280            -          -   2,250,333            -         -
                            ----------  -----------            ----------  -----------             ---------- ------------

Stockholders' Equity
   Pesos                    1,149,813            -          -  1,310,411            -          -   1,309,252            -         -
   Dollars domestic                 -            -          -          -            -          -           -            -         -
   Dollars foreign                  -            -          -          -            -          -           -            -         -
                            ----------  -----------            ----------  -----------             ---------- ------------
                            1,149,813            -          -  1,310,411            -          -   1,309,252            -         -
                            ----------  -----------            ----------  -----------             ---------- ------------

TOTAL LIABILITIES AND
 STOCKHOLDERS' EQUITY
   Pesos                    3,527,495       73,982      2.10%  3,902,450       74,414      1.91%   3,587,300       70,314     1.96%
   Dollars domestic         7,332,460      348,498      4.75%  9,141,534      506,543      5.54%   8,145,964      520,467     6.39%
   Dollars foreign            619,287       47,603      7.69%    394,261       22,317      5.66%     606,834       24,990     4.12%
                            ----------  -----------            ----------  -----------             ---------- ------------
                            11,479,242     470,083      4.10%  13,438,245     603,274      4.49%   12,340,098     615,771     4.99%
                            ----------  -----------            ----------  -----------             ---------- ------------
</TABLE>

                                       38

<PAGE>

-----------------------
(1)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa and Santander Fondos.
(2)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A. Includes the result of operations and
     average balance sheets of Banco Tornquist through the time of its merger
     with and into Banco Rio.
(3)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A.
(4)  Includes "Central Bank of Argentina" and the other banks of "Banks and
     international organizations" (call money and credit lines).
(5)  Includes "Unsubordinated Corporate bonds".
(6)  Includes other non-interest bearing liabilities, spot and forward sales and
     purchases of foreign currency pending settlement from "Other liabilities
     from financial transactions", "Other liabilities", "Contingent liabilities"
     and "Suspense items".

                                       39

<PAGE>

Changes in Net Interest Income--Volume and Rate Analysis

     The following table allocates, by currency of denomination, changes in the
Bank's net interest income between changes in average volume, changes in nominal
rates and the variances caused by changes in both average volume and nominal
rate for the fiscal year 1999 compared to the fiscal year 1998, for fiscal year
2000 compared to fiscal year 1999, and for fiscal year 2001 compared to fiscal
year 2000. Volume and rate variances have been calculated based on movements in
average balances over the period and changes in nominal interest rates on
average interest-earning assets and average interest-bearing liabilities. The
net change attributable to changes in both volume and interest rate has been
allocated to the change due to changes in volume.

                                       40

<PAGE>

<TABLE>
<CAPTION>
                                                   CHANGES IN NET INTEREST INCOME - VOLUME AND RATE ANALYSIS
                          ----------------------------------------------------------------------------------------------------------
                          December 1999/ December 1998       December 2000/ December 1999        December 2001/ December 2000
                          --------------------------------   ---------------------------------   -----------------------------------
                          Increase (Decrease) Due to         Increase (Decrease) Due to          Increase (Decrease) Due to
                           Changes in:                        Changes in:                         Changes in:
                                                    Net                                 Net                                   Net
                            Volume      Rate      Change      Volume        Rate      Change      Volume        Rate        Change
                          ---------   --------   ---------   ---------   ---------   ---------   ---------   ----------   ----------
<S>                       <C>         <C>        <C>         <C>         <C>         <C>         <C>         <C>          <C>
INTEREST-EARNING ASSETS

Cash and Due From Banks(1)
    Pesos                        -          -           -           -           -           -       1,607            -        1,607
    Dollars domestic         5,547    (3,665)       1,882       6,866       6,622      13,488         670     (16,157)     (15,487)
    Dollars foreign              -          -           -           -           -           -           -            -            -
                          ---------   --------   ---------   ---------   ---------   ---------   ---------   ----------   ----------
                             5,547    (3,665)       1,882       6,866       6,622      13,488       2,277     (16,157)     (13,880)
                          ---------   --------   ---------   ---------   ---------   ---------   ---------   ----------   ----------
Government Securities
    Pesos                   10,071      5,204      15,275    (28,069)       5,198    (22,871)     (9,906)      (1,242)     (11,148)
    Dollars domestic        21,057     18,974      40,031      78,196      33,565     111,761     (1,913)    (175,766)    (177,679)
    Dollars foreign       (24,409)     19,956     (4,453)      17,421     (1,929)      15,492     (1,410)     (14,280)     (15,690)
                          ---------   --------   ---------   ---------   ---------   ---------   ---------   ----------   ----------
                             6,719     44,134      50,853      67,548      36,834     104,382    (13,229)    (191,288)    (204,517)
                          ---------   --------   ---------   ---------   ---------   ---------   ---------   ----------   ----------
Marketable Securities(2)
    Pesos                  (1,142)      2,454       1,312           4     (2,520)     (2,516)     (1,568)      (6,614)      (8,182)
    Dollars domestic       (4,700)      5,013         313       5,199       (422)       4,777     (1,205)        9,332        8,127
    Dollars foreign          (381)    (5,674)     (6,055)        (54)       (137)       (191)          47         (47)        3,200
                          ---------   --------   ---------   ---------   ---------   ---------   ---------   ----------   ----------
                           (6,223)      1,793     (4,430)       5,149     (3,079)       2,070     (2,726)        2,671        3,145
                          ---------   --------   ---------   ---------   ---------   ---------   ---------   ----------   ----------
Loans and Financial
 Leases(3)
    Pesos                   33,328    (2,649)      30,679      13,227       7,826      21,053    (40,710)       60,719       20,009
    Dollars domestic        45,700     22,721      68,421      82,024      34,673     116,697      12,453       60,151       72,604
    Dollars foreign       (37,379)     19,720    (17,659)    (20,535)    (14,680)    (35,215)      13,571      (6,838)        6,733
                          ---------   --------   ---------   ---------   ---------   ---------   ---------   ----------   ----------
                            41,649     39,792      81,441      74,716      27,819     102,535    (14,686)      114,032       99,346
                          ---------   --------   ---------   ---------   ---------   ---------   ---------   ----------   ----------
Other Interest-Earning
 Receivables(4)
    Pesos                     (94)         82        (12)         104          10         114         201          153          354
    Dollars domestic         7,065    (1,865)       5,200       5,540       3,006       8,546    (11,654)     (20,278)     (31,932)
    Dollars foreign         16,965          -      16,965     (7,261)       1,761     (5,500)     (9,666)        1,891     (10,974)
                          ---------   --------   ---------   ---------   ---------   ---------   ---------   ----------   ----------
                            23,936    (1,783)      22,153     (1,617)       4,777       3,160    (21,119)     (18,234)     (42,552)
                          ---------   --------   ---------   ---------   ---------   ---------   ---------   ----------   ----------
Total Interest-Earning
 Assets
    Pesos                   42,163      5,091      47,254    (14,734)      10,514     (4,220)    (50,376)       53,016        2,640
    Dollars domestic        74,669     41,178     115,847     177,825      77,444     255,269     (1,649)    (142,718)    (144,367)
    Dollars foreign       (45,204)     34,002    (11,202)    (10,429)    (14,985)    (25,414)       2,542     (19,273)     (16,731)
                          ---------   --------   ---------   ---------   ---------   ---------   ---------   ----------   ----------
                            71,628     80,271     151,899     152,662      72,973     225,635    (49,483)    (108,975)    (158,458)
                          ---------   --------   ---------   ---------   ---------   ---------   ---------   ----------   ----------
</TABLE>

                                       41

<PAGE>

<TABLE>
<CAPTION>
                          December 1999/ December 1998       December 2000/ December 1999        December 2001/ December 2000
                          --------------------------------   ---------------------------------   -----------------------------------
                          Increase (Decrease) Due to         Increase (Decrease) Due to          Increase (Decrease) Due to
                           Changes in:                        Changes in:                         Changes in:
                                                    Net                                 Net                                   Net
                            Volume      Rate      Change      Volume        Rate      Change      Volume        Rate        Change
                          ---------   --------   ---------   ---------   ---------   ---------   ---------   ----------   ----------
<S>                       <C>         <C>        <C>         <C>         <C>         <C>         <C>         <C>          <C>
INTEREST-BEARING
 LIABILITIES

Deposits-Checking
    Pesos                        -          -           -           -           -           -       1,830            -        1,830
    Dollars domestic             -          -           -           -           -           -      10,647            -       10,647
    Dollars foreign              -          -           -           -           -           -           -            -            -
                          ---------   --------   ---------   ---------   ---------   ---------   ---------    ---------    ---------
                                 -          -           -           -           -           -      12,477            -       12,477
                          ---------   --------   ---------   ---------   ---------   ---------   ---------    ---------    ---------
Deposits-Savings
    Pesos                    1,918    (2,869)       (951)       1,502       1,364       2,866     (7,380)      (2,259)      (9,639)
    Dollars domestic         1,496      (914)         582       1,981       4,487       6,468     (1,139)      (6,604)      (7,743)
    Dollars foreign              -          -           -           -           -           -        723            -          723
                          ---------   --------   ---------   ---------   ---------   ---------   ---------    ---------    ---------
                             3,414    (3,783)       (369)       3,483       5,851       9,334     (7,796)      (8,863)     (16,659)
                          ---------   --------   ---------   ---------   ---------   ---------   ---------    ---------    ---------
Deposits-Time
    Pesos                    3,671      1,152       4,823    (14,006)      11,703     (2,303)     (1,973)        7,228        5,255
    Dollars domestic        59,791      8,245      68,036      81,547      14,737      96,284     (8,981)       73,193       64,212
    Dollars foreign          1,094      2,778       3,872     (3,460)     (5,278)     (8,738)       7,106      (2,676)        4,430
                          ---------   --------   ---------   ---------   ---------   ---------   ---------    ---------    ---------
                            64,556     12,175      76,731      64,081      21,162      85,243     (3,848)       77,745       73,897
                          ---------   --------   ---------   ---------   ---------   ---------   ---------    ---------    ---------
Short-term Borrowings(5)
    Pesos                  (1,748)    (1,167)     (2,915)         160       (291)       (131)       (175)      (1,371)      (1,546)
    Dollars domestic        12,403        714      13,117      23,785      22,151      45,936    (21,131)     (17,269)     (38,400)
    Dollars foreign       (35,598)     15,344    (20,254)     (9,774)     (6,774)    (16,548)     (4,652)        2,172      (2,480)
                          ---------   --------   ---------   ---------   ---------   ---------   ---------    ---------    ---------
                          (24,943)     14,891    (10,052)      14,171      15,086      29,257    (25,958)     (16,468)     (42,426)
                          ---------   --------   ---------   ---------   ---------   ---------   ---------    ---------    ---------
Long-term Debt(6)
    Pesos                        -          -           -           -           -           -           -            -            -
    Dollars domestic      (15,470)     11,327     (4,143)       4,381       4,976       9,357     (4,133)     (10,659)     (14,792)
    Dollars foreign              -          -           -           -           -           -           -            -            -
                          ---------   --------   ---------   ---------   ---------   ---------   ---------    ---------    ---------
                          (15,470)     11,327     (4,143)       4,381       4,976       9,357     (4,133)     (10,659)     (14,792)
                          ---------   --------   ---------   ---------   ---------   ---------   ---------    ---------    ---------

Total Interest-Bearing
 Liabilities
    Pesos                    3,841    (2,884)         957    (12,344)      12,776         432     (7,698)        3,598      (4,100)
    Dollars domestic        58,220     19,372      77,592     111,694      46,351     158,045    (24,737)       38,661       13,924
    Dollars foreign       (34,504)     18,122    (16,382)    (13,234)    (12,052)    (25,286)       3,177        (504)        2,673
                          ---------   --------   ---------   ---------   ---------   ---------   ---------    ---------    ---------
                            27,557     34,610      62,167      86,116      47,075     133,191    (29,258)       41,755       12,497
                          ---------   --------   ---------   ---------   ---------   ---------   ---------    ---------    ---------
----------------------
</TABLE>
(1)  Includes cash and amounts due to the Bank in respect of amounts invested in
     interest-earning instruments in accordance with Central Bank requirements.
     See "--Argentine Banking System and Regulation--Argentine Banking
     Regulation--Liquidity and Solvency Requirements".
(2)  Includes shares and corporate bonds listed on the Buenos Aires Stock
     Exchange and the Argentine OTC Market.
(3)  Includes loans and financial leases to financial institutions, federal
     funds sold and overnight deposits in foreign branches.
(4)  Includes other receivables from financial transactions.
(5)  Includes "Central Bank of Argentina", "Banks and International
     Organizations" (call money and credit lines).
(6)  Includes "Unsubordinated Corporate Bonds".

                                       42

<PAGE>

Interest-Earning Assets-Yield Spread

     The following table analyzes, by currency of denomination, the levels of
average interest-earning assets and net interest income of the Bank, and
illustrates the comparative net yield obtained, for each of the fiscal years
indicated.

     In addition, the table presents the yield spread in both nominal and real
(adjusted) terms and the cross yield (adjusted for the effects of inflation and
currency fluctuation) on average interest-earning assets. Yields presented on a
real basis were calculated based on the methodology explained under "--Average
Balance Sheet and Interest Rate Data."

                     INTEREST-EARNING ASSETS - YIELD SPREAD

                                               For the fiscal year ended
                                      -----------------------------------------
                                                    At December 31,
                                      -----------------------------------------
                                          1999           2000          2001
                                          ----           ----          ----
                                           (1)            (2)           (3)
                                     (In thousands of pesos, except percentages)

Total Average Interest-Earning
 Assets
     Pesos                               1,589,764     1,506,376     1,335,651
     Dollars Domestic                    6,478,308     8,048,637     7,558,371
     Dollars Foreign                       727,498       546,038       702,963
                                      -------------   -------------------------
         Total                           8,795,570    10,101,051     9,596,985
                                      =============   =========================

Net Interest Income (4)
     Pesos                                 213,562       208,910       215,650
     Dollars Domestic                      277,930       375,154       216,863
     Dollars Foreign                        26,000        25,872         6,468
                                      -------------   -------------------------
         Total                             517,492       609,936       438,981
                                      =============   =========================

Nominal Gross Yield  (5)
     Pesos                                  18.09%        18.81%        21.41%
     Dollars Domestic                        9.67%        10.95%         9.76%
     Dollars Foreign                        10.12%         8.83%         4.48%
         Total                              11.23%        12.01%        10.99%

Gross Yield Adjusted (6)
     Pesos                                  16.78%        16.06%        28.21%
     Dollars Domestic                        8.46%         8.39%        15.90%
     Dollars Foreign                         8.90%         6.31%        10.32%
         Weighted Average Rate              10.00%         9.42%        17.20%

Net Interest Margin (7)
     Pesos                                  13.43%        13.87%        16.15%
     Dollars Domestic                        4.29%         4.66%         2.87%
     Dollars Foreign                         3.57%         4.74%         0.92%
         Weighted Average Rate               5.88%         6.04%         4.57%

Nominal Yield Spread (8)
     Pesos                                  13.13%        13.45%        15.14%
     Dollars Domestic                        3.15%         3.56%         1.78%
     Dollars Foreign                         1.83%         2.84%       (-0.36%)
         Weighted Average Rate               4.89%         5.00%         3.44%

Adjusted Yield Spread (9)
     Pesos                                  12.98%        13.14%        15.79%
     Dollars Domestic                        3.12%         3.48%         1.65%
     Dollars Foreign                         1.81%         2.77%       (-0.39%)
         Weighted Average Rate               4.83%         4.89%         3.43%

                                       43

<PAGE>

--------------------
(1)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa and Santander Fondos.
(2)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A. Includes the result of operations and
     average balance sheets of Banco Tornquist through the time of its merger
     with and into Banco Rio.
(3)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A.
(4)  Includes capital gains and losses and mark-to-market adjustments on
     government securities and short-term investments. The difference between
     this line item and "Net interest income before adjustments" as derived from
     the Statement of Income in the Consolidated Financial Statements is
     miscellaneous interest income/expense (e.g., punitive interest and interest
     on other liabilities) included in "Other income" and "Other expense" in the
     Statement of Income in the Consolidated Financial Statements.
(5)  Average nominal rate earned on interest-earning assets or interest earned
     divided by interest-earning assets.
(6)  Average real rate earned on interest-earning assets, or nominal gross yield
     adjusted for the effects of inflation and currency fluctuations. Nominal
     net yield represents the difference between the average nominal rate on
     interest-earning assets and the average nominal rate on interest-bearing
     liabilities.
(7)  Net interest margin is net interest income divided by total average
     interest-earning assets.
(8)  Nominal yield spread represents the difference between the average nominal
     rate on interest-earning assets (nominal gross yield) and the average
     nominal rate on interest-bearing liabilities.
(9)  Adjusted yield spread represents the difference between the average real
     rate on interest-earning assets (gross yield adjusted) and the average real
     rate on interest-bearing liabilities.

Return on Equity and Assets

     The following table presents certain selected financial ratios for the Bank
for the periods indicated:

                           RETURN ON EQUITY AND ASSETS

                                                 For the fiscal year ended
                                                      At December 31,
                                            ------------------------------------
                                              1999 (1)    2000 (2)    2001 (3)
                                              --------    --------    --------



Net Income                                      119,168     207,593    (10,208)
Average Total Assets                         11,479,242  13,438,245  12,340,098
Average Stockholders' Equity                  1,149,813   1,310,411   1,309,252
Net Income as a percentage of:
     Average Total Assets                         1.04%       1.54%     (0.08%)
     Average Stockholders' Equity                10.36%      15.84%     (0.78%)
Average Stockholders' Equity as a
     percentage of Average Total Assets          10.02%       9.75%      10.61%
Declared Cash Dividend (4)                       35,750      62,278           0
Dividend Payout Ratio                            30.00%      30.00%       0.00%

------------------
(1)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa and Santander Fondos.
(2)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A. Includes the result of operations and
     average balance sheets of Banco Tornquist through the time of its merger
     with and into Banco Rio.
(3)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A.
(4)  Under the FIL, financial institutions are only permitted to pay dividends
     in respect of net earnings arising from yearly financial statements
     approved by their shareholders. Banco Rio declares dividends at its annual
     ordinary shareholders' meeting out of earnings of the previous fiscal year.
     Dividends have been classified according to the fiscal year's earnings to
     which they relate, rather than the year in which they were paid.

                                       44

<PAGE>

Investment Securities

     Total investment securities of the Bank amounted to approximately Ps.455.9
million at December 31, 2001, representing 4.58% of the Bank's total assets. The
following table sets out the Bank's investments in government and private
securities as of December 31, 2000 and 2001, by type and currency. Listed
government securities are valued at market price, net of estimated selling
expenses, or at acquisition cost, increased by accruing a compound internal rate
of return over the period elapsed since the acquisition date, depending on the
classification of each security. Unlisted government securities are valued at
acquisition cost plus accrued interest. Private securities are valued at market
price, net of estimated selling expenses.

                              INVESTMENT SECURITIES
<TABLE>
<CAPTION>
                                                                  For the fiscal year
                                                                  ended, December 31,
                                                               ------------------------
                                                                 2000 (1)      2001 (2)
                                                               ------------------------
                                                                (in thousands of pesos)
<S>                                                            <C>             <C>
PESO-DENOMINATED(3)
Argentine Government Securities
     Economic Consolidation Bonds                                  6,622            61
     External Global Bonds                                             -            17
     Treasury Bills to settle obligations of the
      Province of Buenos Aires                                         -         1,515
     External Notes                                               48,143             -
     Other                                                         4,527           943
                                                               ----------      --------
   Total Argentine Government Securities                          59,292         2,536
                                                               ----------      --------

Marketable Securities
     Mutual Funds                                                  6,587        10,571
     Marketable Equity Securities                                  6,003         1,900
     Corporate Bonds(4)                                                -         1,625
                                                               ----------      --------
   Total Marketable Securities                                    12,590        14,096
                                                               ----------      --------
TOTAL PESO-DENOMINATED
 INVESTMENT SECURITIES                                            71,882        16,632
                                                               ----------      --------
DOLLAR-DENOMINATED(3)(5)
Argentine Government Securities
     External Bonds                                                  545         1,093
     External Global Bonds                                       210,945           330
     Treasury Bonds                                              842,219           539
     Treasury Bills                                               72,188             -
     Par Bonds, Discount Bonds and Floating Rate Bonds            70,475           262
     Economic Consolidation Bonds                                 17,835            64
     Variable Rate Bonds                                         578,403           100
     External Bills in Pesetas and Euros                           1,900             -
     External Bills                                                    -       179,208
     Fixed-Rate Government Bond                                        -       192,634
     Tax Credit Certificate                                            -        57,371
     Other                                                        31,077            11
                                                               ----------      --------
   Total Argentine Government Securities                       1,825,587       431,612
                                                               ----------      --------
   Total Foreign Government Securities                             1,472         1,442
                                                               ----------      --------
</TABLE>

                                       45

<PAGE>

Marketable Securities
        Mutual Funds                                       14,645             -
        Corporate Bonds (4)                                39,013         6,184
                                                        ----------      --------
   Total Marketable Securities                             53,658         6,184
                                                        ----------      --------
TOTAL DOLLAR-DENOMINATED
                                                        ----------      --------
     INVESTMENT SECURITIES                              1,880,717       439,238
                                                        ----------      --------

TOTAL INVESTMENT SECURITIES                             1,952,599       455,870
                                                        ==========      ========
--------------------
(1)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A. Includes the assets of Banco
     Tornquist through the time of its merger with and into Banco Rio.
(2)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A.
(3)  Before allowances.
(4)  Includes listed corporate bonds.
(5)  Includes investment securities denominated in currencies other than pesos.
     The majority of these investment securities are denominated in U.S.
     dollars.

     The following table analyzes the remaining maturities at December 31, 2001
and weighted average yields of the Bank's government securities:

                                       46

<PAGE>

                     GOVERNMENT SECURITIES PORTFOLIO MATURITY
<TABLE>
<CAPTION>
                                                                             At December 31, 2001
                                   -------------------------------------------------------------------------------------------------
                                                    Maturing after  Maturing after    Maturing after   Maturing in
                                      Maturing       6 months but     1 year but       5 years but      more than
                                   within 6 months  within 1 year   within 5 years   within 10 years    10 years          Total
                                   -------------------------------------------------------------------------------------------------
                                   Amount   Yield   Amount  Yield   Amount    Yield   Amount   Yield  Amount  Yield   Amount  Yield
                                   ------   -----   ------  -----   ------    -----   ------   -----  ------  -----   ------  -----
                                                               (in thousands of pesos, except percentages)
ARGENTINE
<S>                                <C>      <C>     <C>     <C>     <C>       <C>     <C>    <C>      <C>   <C>     <C>      <C>
GOVERNMENT BONDS

  EXTERNAL BONDS                         -       -   1,093   9.44%        -        -     -        -      -       -    1,093   9.44%
  EXTERNAL BILLS US$                     -       -       -       -  179,208   11.40%     -        -      -       -  179,208  11.40%
  EXTERNAL GLOBAL BONDS Ps.              -       -       -       -        -        -    17   10.00%      -       -       17  10.00%
  ECONOMIC CONSOL. BONDS Ps.            15  15.12%       9  15.26%       21   16.06%    16    7.62%      -       -       61  13.50%
  ECONOMIC CONSOL. BONDS US$            42  11.05%      21  11.06%        1   12.01%     -        -      -       -       64  11.07%
  EXTERNAL GLOBAL BONDS US$              -       -       -       -       71    9.16%    66   11.51%    193  11.30%      330  10.88%
  TREASURY BONDS US$                    11  11.50%       -       -      528   11.89%     -        -      -       -      539  11.88%
  TAX CREDIT CERTIFICATE US$             -       -       -       -   57,371    7.50%     -        -      -       -   57,371   7.50%
  FIXED RATE GOVERNMENT BONDS      192,634   9.00%       -       -        -        -     -        -      -       -  192,634   9.00%
  FLOATING AND DISCOUNT RATE BONDS       1  11.48%       1  11.48%        2   11.48%     -        -    258   9.30%      262   9.33%
  VARIABLE RATE GOVERNMENT BOND          -       -       -       -      100   12.80%     -        -      -       -      100  12.80%
  PROVINCIAL BONDS Ps.                   -       -   1,515   7.00%      942    5.95%     1        -      -       -    2,458   6.59%
  COUPONS AND OTHER                      8       -       -       -        3        -     -        -      -       -       11       -

TOTAL ARGENTINE

GOVERNMENT BONDS                   192,711   9.00%   2,639   8.07%  238,245   10.44%   102   10.31%    451  10.16%  434,148   9.79%
                                   -------           -----          -------            ---             ---          -------

  OTHER                                 25       -       -       -        -        -     -        -  1,417   6.75%    1,442   6.63%

TOTAL                              192,736   9.00%   2,639   8.07%  238,245   10.44%   102   10.31%  1,868   7.57%  435,590   9.78%
                                   -------           -----          -------            ---           -----          -------
</TABLE>
(1)  The exchange rate prevailing in the Argentine foreign exchange market on
     December 31, 2001 was Ps.1.00 per U.S.$1.00.

                                       47

<PAGE>

Loan Portfolio

     The following table sets out details of the Bank's loan portfolio by type
of loan as of December 31, 1999, 2000 and 2001:

                         LOAN PORTFOLIO BY TYPE OF LOAN

                                          1999 (1)      2000 (2)      2001 (3)
                                        -----------   -----------   -----------
                                                (in thousands of pesos)
Domestic Loans
Performing loans
Public sector loans
  Secured
    With preferred guarantees              858,799     1,024,570       912,168
    With other guarantees                  101,410        13,520        33,006
  Unsecured                                310,685       588,852     1,030,682
                                        -----------   -----------   -----------
Total public sector loans                1,270,894     1,626,942     1,975,856
                                        -----------   -----------   -----------
Financial sector loans
  Secured
    With preferred guarantees               82,072        38,177        27,152
    With other guarantees                      192            63         2,825
  Unsecured
    Call money                              50,500             -           322
    Other unsecured                         85,174        40,625       106,120
                                        -----------   -----------   -----------
Total financial sector loans               217,938        78,865       136,419
                                        -----------   -----------   -----------
Private sector corporate loans
  Secured
    Real estate mortgage guarantees        124,604       182,761       104,262
    With collateral guarantees              39,671        32,025        24,526
    With other preferred guarantees        143,158       142,895        84,189
    With other guarantees                  405,008       402,972       412,994
  Unsecured
    Overdraft                            1,513,165     1,275,516       853,750
    Term                                   469,031       631,885       425,542
                                        -----------   -----------   -----------
Total private sector corporate loans     2,694,637     2,668,054     1,905,263
                                        -----------   -----------   -----------
Individual loans
  Overdraft                                 94,866        57,513       145,438
  Real estate mortgage                     779,604       932,575     1,002,309
  Collateral                                88,107       116,981       138,944
  Credit card                              244,195       282,827       287,926
  Other secured                             17,077        11,890         4,364
  Other unsecured                          223,924       309,951       246,542
                                        -----------   -----------   -----------
Total individual loans                   1,447,773     1,711,737     1,825,523
                                        -----------   -----------   -----------

Total domestic performing loans          5,631,242     6,085,598     5,843,061
                                        -----------   -----------   -----------
Past due loans
  Secured
    With high liquidity guarantees           1,041           727         1,540
    With senior guarantees                 124,917       167,666        94,385
    Without senior guarantees               26,407        28,284        60,079
  Unsecured                                121,548       147,982       145,793
                                        -----------   -----------   -----------

Total domestic past-due loans              273,913       344,659       301,797
                                        -----------   -----------   -----------

Total domestic loans                     5,905,155     6,430,257     6,144,858
                                        ===========   ===========   ===========

                                       48

<PAGE>

                                          1999 (1)      2000 (2)      2001 (3)
                                        -----------   -----------   -----------
                                                (in thousands of pesos)

Foreign loans
 Performing loans
Public sector loans
  Secured
    With preferred guarantees               40,842         5,848              -
    With other guarantees                        -             -        104,701
  Unsecured                                      -             -              -
Total public sector loans                   40,842         5,848        104,701
                                        -----------   -----------   ------------
Financial sector loans
  Secured
    With preferred guarantees                    -             -              -
    With other guarantees                        -             -              -
  Unsecured
    Call money                                   -             -              -
    Other unsecured                         31,396         5,833              -
Total financial sector loans                31,396         5,833              -
                                        -----------   -----------   ------------
Private sector corporate loans
  Secured
    Real estate mortgage guarantees              -             -              -
    With collateral guarantees                   -             -              -
    With other preferred guarantees              -             -              -
    With other guarantees                        -             -              -
  Unsecured
    Overdraft                                  247            38             22
    Term                                   235,501       169,319        635,017
Total private sector corporate loans        35,748       169,357        635,039
                                        -----------   -----------   ------------

Total foreign performing loans             307,986       181,038        739,740
                                        -----------   -----------   ------------

Past due loans
  Secured
    With high liquidity guarantees               -             -              -
    With senior guarantees                     536             -              -
    Without senior guarantees                  300             -              -
  Unsecured                                      -           500              -
Total foreign past-due loans                   836           500              -
                                        -----------   -----------   ------------
Total foreign loans                        308,822       181,538        739,740
                                        ===========   ===========   ============

Total loans                              6,213,977     6,611,795      6,884,598
Allowances for loan losses               (168,112)     (236,810)      (225,193)
                                        -----------   -----------   ------------
    Total loans, net of allowances       6,045,865     6,374,985      6,659,405
                                        ===========   ===========   ============
--------------------
(1)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa and Santander Fondos.
(2)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A. Includes the assets of Banco
     Tornquist through the time of its merger with and into Banco Rio.
(3)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A.

     The Bank's loan categories are as follows:

     Public Sector Loans. Public sector loans are loans granted to federal
governments and provinces in Argentina and elsewhere and to state-owned
companies. Public sector loans with guarantees (preferred and other) are mainly
loans secured by assignment of provinces' share of taxes collected by the
federal government, tax receivables and/or energy-related royalties.

                                       49

<PAGE>

     Financial Sector Loans. Financial sector loans are loans granted to
financial institutions. Financial sector loans with guarantees (preferred and
other) consist of loans secured by highly liquid assets and promissory notes and
other guarantees. Call money loans are short-term loans to other banks.

     Private Sector Corporate Loans. Private sector corporate loans are loans to
private companies and other legal entities other than financial institutions.
Private sector corporate loans with guarantees (preferred and other) consist
primarily of highly liquid assets, mortgages and pledges of assets. Collateral
guarantees consist primarily of warehouse receipts.

     Individual Loans. Individual loans are loans to individuals. Collateral
loans consist primarily of mortgages and chattel mortgages.

     The Bank's loans (net of allowances) amounted to Ps.6.66 billion at
December 31, 2001, an increase of 4.22% from Ps.6.39 billion at December 31,
2000. This increase in the amount of loans (net of allowances) was because of an
increase in public sector loans, in private individual loans and in the
financial sector, partially offset by a decrease in the private corporate sector
loans. Total public sector loans (excluding past-due loans) increased by 27.42%
from Ps.1,632.8 million at December 31, 2000 to Ps.2,080.6 million at December
31, 2001. Total loans to non-financial private sector companies (excluding
past-due loans) decreased by 10.92%, from Ps.2,851.8 million at December, 31,
2000 to Ps.2,540.3 million at December 31, 2001. Total individual loans
(excluding past-due loans) increased by 6.65% from December 31, 2000 to December
31, 2001, increasing from Ps.1,711.7 million to Ps.1,825.5 million. Total
financial sector loans (excluding past-due loans), including call money loans,
increased by 61.07% from Ps.84.7 million at December 31, 2000 to Ps.136.4
million at December 31, 2001. The Bank considers call money to be part of its
loan portfolio.

     The Bank's loan portfolio is well diversified in terms of business sectors.
For a breakdown of the Bank's loan portfolio by the principal business activity
of the borrower, see the table "Loans by Economic Activity" included in this
Item. The Bank has historically been the leading lender to a number of large
Argentine corporations. At December 31, 2001, the aggregate principal amount of
the Bank's 50 largest loans represented approximately 46.40% of the Bank's total
loans. Substantially all of these loans are dollar denominated. The percentage
of the Bank's total loans that are secured has decreased from 40.63% at December
31, 2000 to 36.16% at December 31, 2001 because of an increase of loans to the
financial sector and unsecured loans to the public sector.

     Total public sector loans, which include loans to governments and companies
owned by governments, represented 31.61% of the Bank's total loans (excluding
past-due loans) at December 31, 2001 as compared to 26.05% in fiscal year 2000.
This increase is attributable to the government-debt restructuring made in
November 2001. A portion of the government-sector risks priorly booked as
government-security holdings was changed to be booked under loans.

     Total private sector corporate loans, which include secured loans, mortgage
loans, overdrafts and term loans, are an important part of the Bank's total loan
portfolio, representing 47.16%, 43.04% and 36.90% of total loans (excluding
past-due loans) at December 31, 1999, 2000 and 2001, respectively. Approximately
24.64% of this portfolio was secured at December 31, 2001.

     Total individual loans, which include overdrafts, mortgage loans, credit
card loans and consumer loans, are an important component of the loan portfolio,
representing 26.52% of total loans (excluding past-due loans) at December 31,
2001. Mortgage loans (excluding past-due loans), representing 54.90% of total
individual loans at December 31, 2001, increased from Ps779.6 million at
December 31, 1999 to Ps.932.6 million at December 31, 2000 and to Ps1,002.3
million at December 31, 2001. Credit card loans, representing 15.77% of the
total individual loans at December 31, 2001, increased from Ps.244.2 million at
December 31, 1999, to Ps.282.8 million at December 31, 2000 and to Ps.287.9
million at December 31, 2001. Total financial sector loans (excluding past-due
loans) increased by 61.07% to Ps.136.4 million at December 31, 2001 from Ps.84.7
million at December 31, 2000 because of the increase in secured loans (with
preferred guarantees) and call money loans.

     Of the total financial sector loans at December 31, 1999, Ps.50.5 million
(23.20%) were overnight and time deposits with other financial institutions
(call money loans). These funds represent a temporary use of funds

                                       50

<PAGE>

awaiting application in the Bank's commercial banking business. At December 31,
2001, there were only Ps.0.3 million of call money loans balances.

     The Bank has a heavy concentration of short-term loans, due in part to the
lack of substantial long-term funding in Argentina. See "Item 5. Operating and
Financial Review and Prospects--Funding." At December 31, 2001, 41.12% of Banco
Rio's total loan portfolio (excluding past-due loans) had maturities of less
than one year and 36.53% had maturities from one year and less than five years,
including overnight and time deposits with other financial institutions. See the
"Maturity Composition of the Loan Portfolio" table below.

     At December 31, 2001, 93.43% of the Bank's total loan portfolio was
dollar-denominated. Most of the Bank's peso-denominated loans represent loans to
individuals and small- and medium-sized companies. Substantially all of the
loans to large corporations and most mortgage loans are in dollars. Large
Argentine companies, including many of the Bank's largest borrowers, that
generate foreign currency in their operations or otherwise have the capacity to
hedge exchange rate risks generally have been able to borrow in dollars at
competitive rates. Dollar lending is typically longer term and less expensive
financing for the Bank's clients. At December 31, 2001, 52.53% of the Bank's
dollar-denominated loans and 27.86% of the Bank's peso-denominated loans had a
maturity of more than one year.

     The following table gives a breakdown of the Bank's total loans classified
according to the principal economic activity of the borrower:

                           LOANS BY ECONOMIC ACTIVITY

                                                  At December 31,
                                    -------------------------------------------
                                     1999 (1)    2000 (2)    2001 (3)
                                    ---------   ---------   ---------
                                    (in thousands of pesos, except percentages)

Services                            1,937,156   2,159,643   2,575,718    37.41%
Finance (4)                           427,250     430,171     701,048    10.18%
Construction Industry                 404,962     443,155     358,164     5.20%
Other Manufacturing Industries        502,693     395,402     240,211     3.49%
Retail Merchants                      371,963     341,559     381,561     5.54%
Wholesale Merchants                   349,344     357,131     189,052     2.75%
Primary Production                    259,132     275,195     250,333     3.64%
Base Metal Industries                  75,614      63,806      26,580     0.39%
Personal Loans                      1,198,244   1,308,148   1,478,112    21.47%
Foodstuffs                            184,757     179,736     114,731     1.67%
Chemical Products                      94,253      91,991      52,313     0.76%
Petroleum and Coal Products            92,434      58,824     111,813     1.62%
Electric, Gas, Water and Health
  Services                            163,149     132,605      32,037     0.47%
Textiles                               41,834      43,406      32,731     0.48%
Others                                111,192     331,023     340,194     4.94%
                                    ---------   ---------   ---------   -------
Total Loans Before Adjustments      6,213,977   6,611,795   6,884,598   100.00%

Allowances                           (168,112)   (236,810)   (225,193)
                                    ---------   ---------   ---------
  Total loans, net of
allowances                          6,045,865   6,374,985   6,659,405
                                    =========   =========   =========
--------------------
(1)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa and Santander Fondos.
(2)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A. Includes the assets of Banco
     Tornquist through the time of its merger with and into Banco Rio.
(3)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A.
(4)  Includes call money loans.

                                       51

<PAGE>

     The following table shows the maturities of the Bank's loan portfolio by
type and time remaining to maturity at December 31, 2001:

                   MATURITY COMPOSITION OF THE LOAN PORTFOLIO
<TABLE>
<CAPTION>
                                                  Maturing      Maturing     Maturing
                                                    after        after        after
                                    Maturing      1 month      6 months      1 year      Maturing
                                     within      but within    but within   but within     after
                                    1 month       6 months       1 year      5 years      5 years     Total Loans
                                 -------------- ------------ ------------- ----------- ------------- -------------
                                                   (in thousands of pesos, except percentages)
<S>                              <C>            <C>          <C>           <C>         <C>           <C>
DOMESTIC LOANS
Performing loans
Public sector loans
    Secured
      With preferred guarantees         21,117       38,119        30,810     512,696       309,426       912,168
      With other guarantees              3,767       15,604        12,492       1,143             -        33,006
    Unsecured                           32,313        3,703        61,685     932,981             -     1,030,682
                                 -------------- ------------ ------------- ----------- ------------- -------------
Total public sector loans               57,197       57,426       104,987   1,446,820       309,426     1,975,856
                                 ============== ============ ============= =========== ============= =============
Financial sector loans
    Secured
      With preferred guarantees            107        7,233            53      19,759             -        27,152
      With other guarantees              2,740            -            85           -             -         2,825
    Unsecured
      Call money                           322            -             -           -             -           322
      Other unsecured                  103,721           60            34       2,305             -       106,120
                                 -------------- ------------ ------------- ----------- ------------- -------------
Total financial sector loans           106,890        7,293           172      22,064             -       136,419
                                 ============== ============ ============= =========== ============= =============

Private sector corporate loans
    Secured
      Real estate mortgage
      guarantees                        22,047       17,690        15,578      47,448         1,499       104,262
      With collateral guarantees        16,213        2,632         1,786       3,895             -        24,526
      With other preferred
      guarantees                        52,427       25,353         5,748         661             -        84,189
      With other guarantees            134,179       74,127        72,359     131,629           700       412,994
    Unsecured
      Overdraft                        544,218      147,429       115,278      46,615           210       853,750
      Term                             194,474      110,116        22,442      98,247           263       425,542
                                 -------------- ------------ ------------- ----------- ------------- -------------
Total private sector corporate
loans                                  963,558      377,347       233,191     328,495         2,672     1,905,263
                                 ============== ============ ============= =========== ============= =============

Individual loans
      Overdraft                         31,068        3,190         1,287       2,745       107,148       145,438
      Real estate mortgage              15,300       36,370        48,238     420,058       482,343     1,002,309
      Collateral                         9,857       21,338        24,193      83,550             6       138,944
      Credit Card                      287,926            -             -           -             -       287,926
      Other secured                      1,012        1,147           580       1,462           163         4,364
      Other unsecured                   35,145       68,833        54,028      81,762         6,774       246,542
                                 -------------- ------------ ------------- ----------- ------------- -------------
Total individual loans                 380,308      130,878       128,326     589,577       596,434     1,825,523
                                 ============== ============ ============= =========== ============= =============

Total domestic performing loans      1,507,953      572,944       466,676   2,386,956       908,532     5,843,061
                                 ============== ============ ============= =========== ============= =============
</TABLE>

                                       52

<PAGE>

<TABLE>

<S>                              <C>            <C>           <C>           <C>         <C>           <C>
FOREIGN LOANS

Performing loans
Public sector loans
    Secured
      With preferred guarantees              -            -             -           -             -             -
      With other guarantees                  -            -             -      12,519        92,182       104,701
    Unsecured                                -            -             -           -             -             -
                                 -------------- ------------ ------------- ----------- ------------- -------------
Total public sector loans                    -            -             -      12,519        92,182       104,701
                                 ============== ============ ============= =========== ============= =============
Financial sector loans
    Secured
      With preferred guarantees              -            -             -           -             -             -
      With other guarantees                  -            -             -           -             -             -
    Unsecured
      Call money                             -            -             -           -             -             -
      Other unsecured                        -            -             -           -             -             -
                                 -------------- ------------ ------------- ----------- ------------- -------------
Total financial sector loans                 -            -             -           -             -             -
                                 ============== ============ ============= =========== ============= =============
Private sector corporate loans
    Secured
      Real estate mortgage
      guarantees                             -            -             -           -             -             -
      With collateral guarantees             -            -             -           -             -             -
      With other preferred
      guarantees                             -            -             -           -             -             -
      With other guarantees                  -            -             -           -             -             -
    Unsecured
      Overdraft                             22            -             -           -             -            22
      Term                             621,601        4,605         3,427       5,384             -       635,017
                                 -------------- ------------ ------------- ----------- ------------- -------------
Total private sector corporate
loans                                  621,623        4,605         3,427       5,384             -       635,039
                                 ============== ============ ============= =========== ============= =============

Total foreign performing loans         621,623        4,605         3,427      17,903        92,182       739,740
                                 ============== ============ ============= =========== ============= =============

Total performing loans               2,129,576      577,549       470,103   2,404,859     1,000,714     6,582,801
                                 -------------- ------------ ------------- ----------- ------------- -------------
Percentage of total performing
loans                                    32.35%        8.77%         7.14%      36.53%        15.20%        100.0%
</TABLE>

                                       53

<PAGE>

         The following table shows the interest rate sensitivity of the Bank's
loan portfolio by currency denomination at December 31, 1999, 2000 and 2001:

                       INTEREST RATE SENSITIVITY OF LOANS
<TABLE>
<CAPTION>
                                                                   At December 31,
                                     ----------------------------------------------------------------------------
                                            1999 (1)                   2000(2)                   2001(3)
                                     ------------------------  ------------------------  ------------------------
                                                     (in thousands of pesos except percentages)
<S>                                  <C>            <C>        <C>            <C>        <C>           <C>
Variable rate loans
  Peso-denominated(4)                     332,421      5.50%        331,759      5.20%        278,404      4.18%
  Dollar-denominated                    1,506,567     24.92%      1,791,389     28.10%      1,490,958     22.39%
                                     -------------  ---------  -------------  ---------  ------------- ----------
       Total variable rate loans        1,838,988     30.42%      2,123,148     33.30%      1,769,362     26.57%
                                     =============  =========  =============  =========  ============= ==========
Fixed rate loans
  Peso-denominated                      1,025,513     16.96%        982,088     15.41%        143,866      2.16%
  Dollar-denominated                    3,074,727     50.86%      3,161,400     49.59%      4,669,573     70.12%
                                     -------------  ---------  -------------  ---------  ------------- ----------
       Total fixed rate loans           4,100,240     67.82%      4,143,488     65.00%      4,813,439     72.28%
                                     =============  =========  =============  =========  ============= ==========
       Total normal loans(5)            5,939,228     98.24%      6,266,636     98.30%      6,582,801     98.81%
Past due loans, net of allowances         106,637      1.76%        108,349      1.70%         76,604      1.15%
                                     -------------  ---------  -------------  ---------  ------------- ----------
      Total loan portfolio, net
           of allowances                6,045,865    100.00%      6,374,985    100.00%      6,659,405    100.00%
                                     =============  =========  =============  =========  ============= ==========
</TABLE>

--------------------
(1)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa and Santander Fondos.
(2)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A. Includes the assets of Banco
     Tornquist through the time of its merger with and into Banco Rio.
(3)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A.
(4)  Includes overdrafts.
(5)  According to Central Bank classifications.

        The following table provides the amounts of loans to borrowers in
foreign countries as of December 31, 1999, 2000 and 2001:

                              FOREIGN OUTSTANDINGS

                                            At December 31,
                      ----------------------------------------------------------
                        1999 (1)         2000 (2)          2001 (3)
                      ----------   ---------------------------------------------
                             (in thousands of pesos, except percentages)
Country

Brazil                    20,630           18,647                 -          -
United States             45,871          183,513           661,270     100.00%
Mexico                       514                -                 -          -
Other                      3,585                -                 -          -
                      ==========   =============================================
Total (4)                 70,600          202,160           661,270     100.00%
                      ==========   =============================================

--------------------
(1)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa and Santander Fondos.
(2)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A. Includes the results of operations
     and average balance sheets of Banco Tornquist through the time of its
     merger with and into Banco Rio.
(3)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A.
(4)  Accrued interest is not included.

                                       54

<PAGE>

     Credit Review Policies

     The Bank's credit standards and policies aim to achieve a high level of
credit quality in the Bank's loan portfolio, efficiency and flexibility in the
processing of loans and the specific assignment of responsibility for credit
risk determination. The Bank's credit standards and policies in respect of the
evaluation, approval and disbursement of loans are determined and revised by the
Bank's Risk Management Department, while such standards and policies in respect
of the determination of the degree of credit risk in the Bank's loan portfolio
and the classification of loans according to credit quality are determined and
revised by the Bank's Risk Auditing Department. These standards and policies are
specified by type of product and client segment and formalized in a manual of
rules and procedures that must be followed by all persons involved in the loan
origination and approval process. The Bank's Management Committee must approve
all credit standards and policies.

     Corporate loans, depending upon their size, are approved by the Corporate
Banking Credit Committee or the Senior Credit Committee.

     The Corporate Banking Credit Committee is comprised of the Corporate
Banking Manager, managers of the relevant client segments within corporate
banking (depending upon the particular loan being considered) and the Corporate
Banking Risk Manager and the Bank Risk Manager. The Corporate Banking Credit
Committee may approve loans resulting in an aggregate exposure to a client or a
group of related companies ("Aggregate Risk") of up to U.S.$5.0 million
(including proposed loans and loans approved but not yet disbursed).

     Since December 1997, loans to corporate customers resulting in Aggregate
Risk exceeding U.S.$5.0 million must be approved by the Bank's Senior Credit
Committee, which meets twice a week and is composed of the Country Head Manager,
the Bank's Risk Manager and the Corporate Banking Manager. The Senior Credit
Committee may approve loans resulting in Aggregate Risk of up to U.S.$20
million. Loans resulting in Aggregate Risk exceeding U.S.$20 million must be
submitted by the Senior Credit Committee to Banco Santander Central Hispano
Senior Credit Committee for approval.

     Loans to small and medium-sized companies resulting in Aggregate Risk of up
to U.S.$5.0 million are submitted to the Commercial Banking Credit Committee,
comprised of the Commercial Banking Manager, the Commercial Banking Risk Manager
and the relevant Regional Manager and Regional Risk Supervisor. Total exposure
exceeding U.S.$5.0 million must be submitted to the Senior Credit Committee.
Since January 1, 2000, loans up to U.S.$100,000 are approved on a centralized
basis by a Small Loans Unit ("Centro de Pequenos Prestamos").

     Loans to individuals have been rapidly growing since 1991. The Bank uses a
computerized scoring program to evaluate all individual loans. Special
requirements are applied to different products, such as loan to value ratios in
mortgage and chattel mortgage loans, property valuation by independent
appraisers, and maximum percentages of income required for installment payments.
The Bank uses statistically developed scorecards based on the type of loan and
the different socio-economic market and geographical segments in the assessment
process.

     Special requirements regarding the evaluation and approval of loans to
individuals are intended to ensure credit quality and to manage risk arising
from such lending. In home mortgage lending, the Bank will not finance in excess
of 80.00% of a property's value for first home mortgages, as determined by an
independent appraiser, for periods up to fifteen years and 70.00% for such loans
extending from 15 years up to 30 years.

     In automobile lending, the Bank will not finance in excess of 80.00% of the
car's value (60.00% in the case of a used car). The Bank considers the income of
the household in determining whether to make a mortgage loan and does not grant
a loan if the installment payments on the loan would exceed 25.00% of household
income (this percentage goes up to 35.00% in the case of upper-income
customers).

     With respect to loan portfolio management, the Bank has implemented a
credit review process, monitoring all accounts periodically as follows:

                                       55

<PAGE>

     1.   Loans in excess of 5.00% of the Bank's net worth (as determined at the
          end of the month prior to the review) are reviewed during each fiscal
          quarter.

     2.   Loans in excess of 1.00% but not exceeding 5.00% of the Bank's net
          worth (or Ps.1.0 million, whichever is greater) are reviewed
          semiannually.

     3.   All loans exceeding Ps.200,000 are reviewed at least once every fiscal
          year, although loans may be reviewed more frequently if the
          circumstances of particular loans warrant such review.

     4.   All consumer loans and all other loans are reviewed and classified
          based upon payment performance.

     All loans have an internal classification in accordance with Central Bank's
classifying requirements. For loans classified other than normal, the review
process results in the design and implementation of a plan by the Bank's Risk
Auditing department and the department originating the loan in order to improve
the credit quality of the loan.

     As a general policy, small past-due consumer loans are managed by the
Bank's Collections department as soon as principal or interest is three days
overdue. For the following 90 days, this department makes every attempt to
contact the client and recover past-due amounts. Meanwhile, a 5.00% mandatory
reserve is established (3.00% if collateralized) and after 90 days, full
provisions are established for these loans. However, when the specific situation
of the loan suggests a serious risk of loss, more immediate action is taken that
may include the commencement of legal proceedings.

     The Bank's corporate loans are more closely monitored by the Corporate and
Risk Management departments. If weakness is observed in a corporate loan, the
Bank takes immediate action, which may include administrative and legal action,
without waiting for any specific time period to elapse. However, if a corporate
loan is 90 days or more past-due, it is transferred to the Recovery Unit. At the
time of such action, the entire loan is classified as non-accrual and, according
to the Bank's policy, a 100.00% provision is made. This policy exceeds the
requirements of the Central Bank. See "--Allowance for Loan Losses."

     In line with Banco Rio's and SCH Group's traditionally conservative credit
culture, the Bank in 1999 decided to implement a more conservative method of
risk management by accelerating its write-off policies, an objective which has
been accomplished in the year 2000, writing off those unsecured loans of the
individual segment after 180 days past-due, which had originally been 360 days
in the beginning of 1999. This change in risk management had no impact in the
income statement due to the Bank's policy of maintaining a 100.00% allowance for
non-performing loans.

                                       56

<PAGE>

     Classification of Loan Portfolio Based on Central Bank Regulations

     The following table classifies the Bank's total loan portfolio (net of
allowance) by the classification categories of the Central Bank relating to
credit quality by type of loan at the dates indicated below:

                                                   LOAN CLASSIFICATION

                                                     At December 31,
                                        ----------------------------------------
                                          1999 (1)      2000 (2)      2001 (3)
                                        ----------------------------------------
                                                 (in thousands of pesos)
Commercial loan portfolio
Normal
Public sector                             1,311,678     1,632,778     2,080,557
Financial sector
  Public                                    123,845        67,258        26,917
  Private
        High liquidity                          606             -         7,108
        With preferred guarantees            28,421           273           295
        Without preferred guarantees         95,213        16,992       100,963
Private sector
        High liquidity                       68,197       145,624        65,381
        With preferred guarantees           293,569       338,375       138,917
        Without preferred guarantees      2,530,233     2,225,913     2,220,219
                                        ------------  ------------  ------------
Total                                     4,451,762     4,427,213     4,640,357
                                        ============  ============  ============
Potential risk
Public sector                                     -             -             -
Financial sector                                  -             -             -
Private sector
        High liquidity                            -           489             -
        With preferred guarantees             3,212         5,074         4,730
        Without preferred guarantees         31,156        12,738        27,282
                                        ------------  ------------  ------------
Total                                        34,368        18,301        32,012
                                        ============  ============  ============
Problematic
Not past-due
  Public sector                                   -             -             -
  Financial sector                                -             -             -
  Private sector
        High liquidity                            -             -            45
        With preferred guarantees               803           292         1,642
        Without preferred guarantees            462           680         3,772
                                        ------------  ------------  ------------
Total not past-due                            1,265           972         5,459
                                        ============  ============  ============


                                       57

<PAGE>

                                                     At December 31,
                                        ----------------------------------------
                                          1999 (1)      2000 (2)      2001 (3)
                                        ----------------------------------------
                                                 (in thousands of pesos)
Past-due
  Public sector                                   -             -             -
  Financial sector                                -             -             -
  Private sector
        High liquidity                            -             -             -
        With preferred guarantees             1,854         7,057         3,511
        Without preferred guarantees          1,927         3,748         1,456
                                        ------------  ------------  ------------
Total past-due                                3,781        10,805         4,967
                                        ------------  ------------  ------------
Total                                         5,046        11,777        10,426
                                        ============  ============  ============
High risk of insolvency
Not past-due
  Public sector                                   -             -             -
  Financial sector                                -             -             -
  Private sector
        High liquidity                          520             -           761
        With preferred guarantees               667         5,283         3,436
        Without preferred guarantees          1,998         2,815         5,320
                                        ------------  ------------  ------------
Total not past-due                            3,185         8,098         9,517
                                        ============  ============  ============

Past due
  Public sector                                   -             -             -
  Financial sector                                -             -             -
  Private sector
          High liquidity                        297             -           166
          With preferred guarantees           2,751        15,270         6,341
          Without preferred guarantees        6,850        26,812        28,813
                                        ------------  ------------  ------------
Total past-due                                9,898        42,082        35,320
                                        ------------  ------------  ------------
Total                                        13,083        50,180        44,837
                                        ============  ============  ============

Uncollectible
Public sector                                     -             -             -
Financial sector                                  -             -             -
Private sector
        High liquidity                          214           177             -
        With preferred guarantees                 -         2,112             -
        Without preferred guarantees              -             -             -
                                        ------------  ------------  ------------
Total                                           214         2,289             -
                                        ============  ============  ============

Irrecoverable for technical reasons
Public sector                                     -             -             -
Financial sector                                  -             -             -
Private sector
        High liquidity                            -             -             -
        With preferred guarantees                 -             -             -
        Without preferred guarantees              -             -             -
                                        ------------  ------------  ------------
Total                                             -             -             -
                                        ------------  ------------  ------------
  Total commercial loan portfolio         4,504,473     4,509,760     4,727,632
                                        ============  ============  ============


                                       58

<PAGE>

                                                     At December 31,
                                        ----------------------------------------
                                          1999 (1)      2000 (2)      2001 (3)
                                        ----------------------------------------
                                                 (in thousands of pesos)

Consumer loan portfolio (4)
Normal performance
Public sector                                    58            12             -
Private sector
        High liquidity                        1,533         1,692         5,441
        With preferred guarantees           786,955     1,025,957     1,122,091
        Without preferred guarantees        653,926       765,952       770,159
                                        ------------  ------------  ------------
Total                                     1,442,472     1,793,613     1,897,691
                                        ============  ============  ============
Inadequate performance
Public sector                                     -             -             -
Private sector
        High liquidity                            -            50           141
        With preferred guarantees            44,047        60,604        45,112
        Without preferred guarantees         36,418        36,643        52,605
                                        ------------  ------------  ------------
Total                                        80,465        97,297        97,858
                                        ============  ============  ============
Deficient performance
Not past-due public sector                        -             -             -
  Private sector high liquidity                   -             -             -
        With preferred guarantees             1,921         3,929         3,296
        Without preferred guarantees          2,050         4,219         7,215
                                        ------------  ------------  ------------
Total not past-due                            3,971         8,148        10,511
                                        ============  ============  ============

Past-due public sector                            -             -             -
  Private sector high liquidity                   -             4            12
        With preferred guarantees             2,228         4,877         1,071
        Without preferred guarantees         10,104        16,907        11,026
                                        ------------  ------------  ------------
Total past-due                               12,332        21,788        12,109
                                        ------------  ------------  ------------
Total                                        16,303        29,936        22,620
                                        ============  ============  ============
Difficult collection
Not past-due public sector                        -             -             -
  Private sector high liquidity                   -             -             -
        With preferred guarantees             1,266         1,237         3,011
        Without preferred guarantees          1,485           708         2,465
                                        ------------  ------------  ------------
Total not past-due                            2,751         1,945         5,476
                                        ============  ============  ============

Past-due public sector                            -             -             -
  Private sector high liquidity                   -             -             8
        With preferred guarantees             8,439        11,499         9,887
        Without preferred guarantees         13,393         3,148         3,596
                                        ------------  ------------  ------------
Total past-due                               21,832        14,647        13,491
                                        ------------  ------------  ------------
Total                                        24,583        16,592        18,967
                                        ============  ============  ============


                                       59

<PAGE>

                                                     At December 31,
                                        ----------------------------------------
                                          1999 (1)      2000 (2)      2001 (3)
                                        ----------------------------------------
                                                 (in thousands of pesos)
Uncollectible
Public sector                                     -             -             -
Private sector high liquidity                     -             -             3
        With preferred guarantees             8,531         9,489           798
        Without preferred guarantees              -             -             -
                                        ------------  ------------  ------------
Total                                         8,531         9,489           801
                                        ============  ============  ============

Irrecoverable for technical reasons
Public sector                                     -             -             -
Private sector high liquidity                     -             -             -
        With preferred guarantees                 -             -             -
        Without preferred guarantees              -             -             -
                                        ------------  ------------  ------------
Total                                             -             -             -
                                        ============  ============  ============
  Total consumer loan portfolio           1,572,354     1,946,927     2,037,937
                                        ============  ============  ============

Total loan portfolio                      6,076,827     6,456,687     6,765,569
Allowances in excess over minimum
  required                                  (30,962)      (81,702)     (106,164)
                                        ------------  ------------  ------------
  Total loans, net of allowances          6,045,865     6,374,985     6,659,405
                                        ============  ============  ============
--------------------
(1)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa and Santander Fondos.
(2)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A. Includes the assets of Banco
     Tornquist through the time of its merger with and into Banco Rio.
(3)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A.
(4)  Consumer loans include loans of up to Ps.100,000 without preferred
     guarantees and loans up to Ps.200,000 with preferred guarantees.

     Past-due Loan Portfolio

     On a monthly basis, banks are required to classify loan obligors according
to the Central Bank's six different loan classification categories based upon
the highest level of repayment risk of any of the loans to an obligor, and to
submit reports to the Central Bank. For further information with respect to such
loan classification categories, see "--Argentine Banking System and
Regulation--Argentine Banking Regulation--Liquidity and Solvency
Requirements--Loan Loss Provisions."

     Account managers monitor past-due loans on a regular basis. In addition,
the Risk Management department monitors all loans that are considered
non-performing and continually revises estimates of the collectibility of such
loans, adjusting the provision levels accordingly. The Bank has a general
allowance that is allocated to specific loans upon review in accordance with the
Bank's credit review process. See "--Credit Review Policies."

                                       60

<PAGE>

     The following table presents information with respect to past-due and
nonperforming loans at December 31, 1999, 2000 and 2001:

                        PAST-DUE AND NONPERFORMING LOANS

                                          At December 31,
                            ----------------------------------------------
                              1999 (1)       2000 (2)         2001 (3)
                            ------------- ---------------  ---------------
                             (in thousands of pesos, except percentages)

Total loans(4)                 6,213,977       6,611,795        6,884,598
Past due loan portfolio(5)       274,749         345,159          301,797
Non-performing loan
 portfolio(6)                    154,898         224,926          166,180
Past due loans to total
 loans                              4.42%           5.22%            4.38%
Non-performing
  loans to total loans              2.49%           3.40%            2.41%

--------------------
(1)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa and Santander Fondos.
(2)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A. Includes the assets of Banco
     Tornquist through the time of its merger with and into Banco Rio.
(3)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A.
(4)  Includes loans to public sector entities, financial institutions (including
     call money), corporations and individuals. Includes past-due loan
     portfolio.
(5)  Past-due loans are equal to the loans classified in the Potential Risk,
     Problematic, High Risk of Insolvency, Uncollectible and Irrecoverable for
     Technical Reasons categories for the Bank's commercial portfolio and in the
     Inadequate Performance, Deficient Performance, Difficult Collection,
     Uncollectible and Irrecoverable for Technical Reasons categories for the
     Bank's consumer loan portfolio.
(6)  Includes loans in the Problematic, High Risk of Insolvency, Uncollectible
     and Irrecoverable for Technical Reasons categories for the Bank's
     commercial portfolio and in the Deficient Performance, Difficult
     Collection, Uncollectible and Irrecoverable for Technical Reasons
     categories for the Bank's consumer portfolio at December 31, 1999, 2000 and
     2001.

     The Bank's policy is to cease accruing interest on loans classified as
non-performing. The Central Bank has specific provisioning requirements with
respect to non-performing loans. The Bank's provisioning policies with respect
to these loans are more conservative than the policies of the Central Bank.

     At December 1999, the ratios of non-performing loans to total loans and
past-due loans to total loans show approximately the same level as on December
31, 1998. At December 31, 2000, the increases of both ratios was due to the
merger with Banco Tornquist. At December 31, 2001, the decrease of both ratios
was due to the strong write-offs realized during the year.

     None of the Bank's loans regarding approximately the top 25% of the loan
portfolio in terms of principal amount was past-due at December 31, 2001.

     Allowance for Loan Losses

     The Central Bank requires that specified loan loss provisions be taken with
respect to loans of obligors that fall in the classification categories of the
Central Bank. See "--Argentine Banking System and Regulation--Argentine Banking
Regulation--Liquidity and Solvency Requirements--Loan Loss Provisions."

                                       61

<PAGE>

     The following table presents allowance ratios for the Bank at December 31,
1999, 2000 and 2001:

                           ALLOWANCES FOR LOAN LOSSES

                                                At December 31,
                                ------------------------------------------------
                                    1999 (1)         2000 (2)         2001 (3)
                                ---------------- ---------------  --------------
                                  (in thousands of pesos, except percentages)

Allowances                          Ps. 168,112     Ps. 236,810      Ps. 225,193
Allowances as a % of:
Total loan portfolio                      2.71%           3.58%            3.27%
Past due loan
  portfolio                              61.19%          68.61%           74.62%
Non-performing loan
  portfolio                             108.53%         105.28%          135.51%
Past due loan portfolio without
  senior guarantees                     113.39%         133.97%          234.12%
Non-performing loan portfolio
  without senior guarantees             217.97%         189.77%          504.23%

--------------------
(1)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa and Santander Fondos.
(2)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A. Includes the assets of Banco
     Tornquist through the time of its merger with and into Banco Rio.
(3)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A.

     The following table shows changes in the Bank's loan loss provision at
December 31, 1999, 2000 and 2001:

                         CHANGES IN LOAN LOSS PROVISION

                                                 At December 31,
                                   --------------------------------------------
                                      1999 (1)        2000 (2)       2001 (3)
                                   -------------   -------------- -------------
                                             (in thousands of pesos)
Allowance at beginning of
the year                                 173,300         168,112        236,810
Provision, net (4)                       111,050         304,730        257,107
Application of allowances
(charge offs)                           (115,905)       (231,673)      (268,724)
Allowances restored to income
                                            (333)         (4,359)             -
                                   -------------   -------------  -------------
Allowance at end of the year             168,112         236,810        225,193
                                   =============   =============  =============
--------------------
(1)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa and Santander Fondos.
(2)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A. Includes the assets of Banco
     Tornquist through the time of its merger with and into Banco Rio.
(3)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A. (4) The difference in provisions as
     set forth in this table and the Bank's income statement represents direct
     charges to income.
(4)  The difference in provisions as set forth in this table and the Bank's
     income statement represents direct charges to income.

                                       62

<PAGE>

     The following table presents the Bank's allowances for loan losses by type
of loan in accordance with the loan classification system of the Central Bank
for December 31, 1999, 2000 and 2001:

                           ALLOWANCES FOR LOAN LOSSES

                                                   At December 31,
                                     -------------------------------------------
                                       1999 (1)       2000 (2)       2001 (3)
                                     -------------  -------------  -------------
                                               (in thousands of pesos)
Commercial loan portfolio

Normal
Public sector                                   -              -               -
Financial sector
  Public                                        -              -               -
  Private
      High liquidity                            -              -              72
      With preferred guarantees                 -              3               3
      Without preferred guarantees          1,249            172           1,020
Private sector
      High liquidity                          689          1,471             661
      With preferred guarantees             2,923          3,418           1,403
      Without preferred guarantees         25,567         22,629          22,426
                                     -------------  -------------  -------------
Total                                      30,428         27,693          25,585
                                     =============  =============  =============

Potential risk
Public sector                                   -              -               -
Financial sector                                -              -               -
Private sector
      High liquidity                            -              5               -
      With preferred guarantees                99            157             146
      Without preferred guarantees          1,640            670           1,436
                                     -------------  -------------  -------------
Total                                       1,739            832           1,582
                                     =============  =============  =============

Problematic
Not past-due
  Public sector                                 -              -               -
  Financial sector                              -              -               -
  Private sector
      High liquidity                            -              -               -
      With preferred guarantees               110             40             224
      Without preferred guarantees            154            226           1,258
                                     -------------  -------------  -------------
Total not past-due                            264            266           1,482
                                     =============  =============  =============

Past-due
  Public sector                                 -              -               -
  Financial sector                              -              -               -
  Private sector
      High liquidity                            -              -               -
      With preferred guarantees               253            962             479
      Without preferred guarantees            642          1,250             485
                                     -------------  -------------  -------------
Total past-due                                895          2,212             964
                                     -------------  -------------  -------------
Total                                       1,159          2,478           2,446
                                     =============  =============  =============


                                       63

<PAGE>

                                                   At December 31,
                                     -------------------------------------------
                                       1999 (1)       2000 (2)       2001 (3)
                                     -------------  -------------  -------------
                                               (in thousands of pesos)
High risk of insolvency
Not past-due
  Public sector                                 -              -               -
  Financial sector                              -              -               -
  Private sector
      High liquidity                            5              -               8
      With preferred guarantees               598          1,761           1,145
      Without preferred guarantees          1,998          2,816           5,321
                                     ------------   ------------   -------------
Total not past-due                          2,601          4,577           6,474
                                     ============   ============   =============

Past due
  Public sector                                 -              -               -
  Financial sector                              -              -               -
  Private sector
      High liquidity                            3              -               1
      With preferred guarantees             2,750          5,254           2,114
      Without preferred guarantees          6,850         26,813          28,813
                                     ------------   ------------   -------------
Total past-due                              9,603         32,067          30,928
                                     ------------   ------------   -------------
Total                                      12,204         36,644          37,402
                                     ============   ============   =============

Uncollectible
Public sector                                   -              -               -
Financial sector                                -              -              41
Private sector
      High liquidity                            2              2               -
      With preferred guarantees             6,079          5,135               -
      Without preferred guarantees          2,171          9,160             977
                                     ------------   ------------   -------------
Total                                       8,252         14,297           1,018
                                     ============   ============   =============

Irrecoverable for technical reasons
Public sector                                   -              -               -
Financial sector                                -              -               -
Private sector
      High liquidity                            -              -             395
      With preferred guarantees               351            409             614
      Without preferred guarantees              -            950           7,918
                                     ------------   ------------   -------------
Total                                         351          1,359           8,927
                                     ------------   ------------   -------------
Total commercial loan portfolio            54,133         83,303          76,960
                                     ============   ============   =============

Consumer loan portfolio(4)

Normal performance
Public sector                                   -              -               -
Private sector
      High liquidity                           16             17              55
      With preferred guarantees             7,951         10,364          11,334
      Without preferred guarantees          6,599          7,736           7,779
                                     ------------   ------------   -------------
Total                                      14,566         18,117          19,168
                                     ============   ============   =============


                                       64

<PAGE>

                                                   At December 31,
                                     -------------------------------------------
                                       1999 (1)       2000 (2)       2001 (3)
                                     -------------  -------------  -------------
                                               (in thousands of pesos)
Inadequate performance
Public sector                                   -              -              -
Private sector
      High liquidity                            -              -              1
      With preferred guarantees             1,362          1,874          1,395
      Without preferred guarantees          1,917          1,929          2,769
                                     ------------   ------------  -------------
Total                                       3,279          3,803          4,165
                                     ============   ============  =============

Deficient performance
Not past-due
  Public sector                                 -              -              -
  Private sector
      High liquidity                            -              -              -
      With preferred guarantees               262            536            449
      Without preferred guarantees            684          1,406          2,405
                                     ------------   ------------  -------------
Total not past-due                            946          1,942          2,854
                                     ============   ============  =============

Past due
  Public sector                                 -              -              -
  Private sector
      High liquidity                            -              -              -
      With preferred guarantees               304            665            146
      Without preferred guarantees          3,367          5,636          3,676
                                     ------------   ------------  -------------
Total past-due                              3,671          6,301          3,822
                                     ------------   ------------  -------------
Total                                       4,617          8,243          6,676
                                     ============   ============  =============

Difficult collection
Not past-due
  Public sector                                 -              -              -
  Private sector
      High liquidity                            -              -              -
      With preferred guarantees               422            412          1,004
      Without preferred guarantees          1,485            708          2,465
                                     ------------   ------------  -------------
Total not past-due                          1,907          1,120          3,469
                                     ============   ============  =============

Past due
  Public sector                                 -              -              -
  Private sector
      High liquidity                            -              -              -
      With preferred guarantees             2,813          3,918          3,296
      Without preferred guarantees         13,601          3,148          3,595
                                     ------------   ------------  -------------
Total past-due                             16,414          7,066          6,891
                                     ------------   ------------  -------------
Total                                      18,321          8,186         10,360
                                     ============   ============  =============

Uncollectible
Public sector                                   -              -              -
Private sector
      High liquidity                            -              -              -


                                       65

<PAGE>

                                                   At December 31,
                                     -------------------------------------------
                                       1999 (1)       2000 (2)       2001 (3)
                                     -------------  -------------  -------------
                                               (in thousands of pesos)

      With preferred guarantees            34,237         19,826             798
      Without preferred guarantees          7,895         13,630             902
                                     -------------  -------------  -------------
Total                                      42,132         33,456           1,700
                                     =============  =============  =============

Irrecoverable for technical reasons
Public sector                                   -              -               -
Private sector
      High liquidity                            -              -               -
      With preferred guarantees                91              -               -
      Without preferred guarantees             11              -               -
                                     -------------  -------------  -------------
Total                                         102              -               -
                                     -------------  -------------  -------------
Total consumer loan portfolio              83,017         71,805          42,069
                                     =============  =============  =============

Total assigned allowance                  137,150        155,108         119,029
Excess of allowances over
  minimum required                         30,962         81,702         106,164
                                     -------------  -------------  -------------
Total allowances                          168,112        236,810         225,193
                                     =============  =============  =============

--------------------
(1)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa and Santander Fondos.
(2)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A. Includes the assets of Banco
     Tornquist through the time of its merger with and into Banco Rio.
(3)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A.
(4)  Consumer loans include loans of up to Ps.100,000 without preferred
     guarantees and loans of up to Ps.200,000 with preferred guarantees. All
     loans were classified according to the categories of the Central Bank in
     effect at December 31, 2001.

     The following table sets out charge offs and recoveries classified by type
of loan at December 31, 1999, 2000 and 2001:

                                           CHARGE OFFS AND RECOVERIES

                                                At December 31,
                                   -----------------------------------------
                                     1999 (1)      2000 (2)       2001 (3)
                                   ------------  ------------  -------------
                                            (in thousands of pesos)
Private sector
  Corporate loans
      Secured
           Overdraft                         -             -              -
           Term                              -        16,970         22,406
      Unsecured
           Overdraft                    18,284        29,691         31,506
           Term                          4,257        41,717         60,866
                                   ------------  ------------  -------------
Total private sector corporate
  loan charge offs                      22,541        88,378        114,778
                                   ============  ============  =============
Individual loans
      Secured
           Overdraft                         -             -              -
           Credit cards                      -             -              -
           Other individual loans          218        12,690         51,315
      Unsecured

                                       66

<PAGE>

                                                At December 31,
                                   -----------------------------------------
                                     1999 (1)      2000 (2)       2001 (3)
                                   ------------  ------------  -------------
                                            (in thousands of pesos)

           Overdraft                    59,778        53,148         71,603
           Credit cards                 27,470         8,027          5,782
           Other individual loans        5,898        69,430         25,246
                                   ------------  ------------  -------------
Total individual loan
  charge offs                           93,364       143,295        153,946
                                   ============  ============  =============
Total charge offs                      115,905       231,673        268,724
                                   ============  ============  =============
Recoveries                              11,247        28,229         44,030

--------------------
(1)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa and Santander Fondos.
(2)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A. Includes the assets of Banco
     Tornquist through the time of its merger with and into Banco Rio.
(3)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A.

Deposits

     The following table presents information regarding the maturity of deposits
held by the Bank at December 31, 2001:

<TABLE>
<CAPTION>

                                                     DEPOSITS BY MATURITY

                                                     At December 31, 2001
                               ----------------------------------------------------------------
                                 Peso-denominated     Dollar-denominated          Total
                               ----------------------------------------------------------------
                                         (in thousands of pesos, except percentages)
<S>                            <C>         <C>       <C>         <C>       <C>         <C>
Demand and savings
 deposits(1)                   1,028,251    78.30%   2,220,070    43.90%   3,248,321    50.99%
                               ----------  --------  ----------  --------  ----------  --------

Time deposits maturing(2)
Up to 1 month                    100,855     7.68%   1,603,979    31.72%   1,704,834    26.76%
From 1 to 3 months                16,882     1.29%     363,713     7.19%     380,595     5.97%
From 3 to 6 months               120,389     9.17%     551,430    10.90%     671,819    10.55%
From 6 to 12 months               46,849     3.57%     311,315     6.16%     358,164     5.62%
More than 12 months                    0     0.00%       6,642     0.13%       6,642     0.10%
                               ----------  --------  ----------  --------  ----------  --------
Total time deposits              284,975    21.70%   2,837,079    56.10%   3,122,054    49.01%
                               ----------  --------  ----------  --------  ----------  --------

Total deposits                 1,313,226   100.00%   5,057,149   100.00%   6,370,375   100.00%
                               ==========  ========  ==========  ========  ==========  ========
</TABLE>

--------------------
(1)  Includes demand deposits, saving deposits and all other deposits that are
     not time deposits. Includes accrued interest and exchange differences
     payable.
(2)  Includes accrued interest and exchange differences payable.

                                       67

<PAGE>

     The following table shows the time deposits held by the Bank at December
31, 2001, by amount and maturity for deposits in excess of Ps.100,000:

                            TIME DEPOSITS BY MATURITY

                                            At December 31, 2001
                                          (In thousands of pesos)

Peso-Denominated Time Deposits (1)
Up to 100,000 Pesos                                           228,228
More than 100,000 Pesos
              Up to 1 month                                     8,073
              From 1 to 3 months                                3,267
              From 3 to 6 months                                  116
              From 6 to 12 months                              45,291
              More than 12 months                                   0

                                                            ---------
Total more than 100,000 Pesos                                  56,747
                                                            ---------
Total Peso-denominated time deposits                          284,975
                                                            =========

Dollar-Denominated Time Deposits (1)
Up to 100,000 Dollars                                       1,430,930
More than 100,000 Dollars
              Up to 1 month                                   529,641
              From 1 to 3 months                              128,860
              From 3 to 6 months                              469,795
              From 6 to 12 months                             273,318
              More than 12 months                               4,535

                                                            ---------
Total more than 100,000 Dollars                             1,406,149
                                                            ---------
Total Dollar-denominated time deposits                      2,837,079
                                                            =========

Total Time Deposits                                         3,122,054
                                                            =========
--------------------
(1)  Includes accrued interest and exchange differences payable.

                                     68

<PAGE>

Short Term Borrowings

     The following table shows information relating to short-term borrowings by
the Bank at December 31, 2000 and 2001:

                            SHORT TERM BORROWINGS (1)

                                            At December 31,
                                  ----------------------------------
                                      2000 (2)           2001 (3)
                                  ---------------    ---------------

          Balance                   1,435,319          1,166,412
          Average                   1,376,223          1,285,122
          Maximum                   1,517,462 (4)      1,402,443 (5)
          Average interest rate         7.95%              4.15%
--------------------
(1)  Short-term borrowings in excess of 30.00% of stockholders' equity are
     comprised of lines of credit to finance foreign trade operations.
(2)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A. Includes the liabilities of Banco
     Tornquist through the time of its merger with and into Banco Rio.
(3)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A.
(4)  Maximum at the end of March 2000.
(5)  Maximum at the end of September 2001.

Capital Resources

     Stockholders' Equity

     The Bank's stockholders' equity was Ps.1.1 billion at December 31, 2001, a
decrease from Ps.1.3 billion at December 31, 2000, which was an increase from
Ps1.2 billion at December 31, 1999. The Bank's ratio of tangible stockholders'
equity to total assets decreased from 9.34% at December 31, 1999, to 9.01% at
December 31, 2000 and increased to 10.32% at December 31, 2000, as a result of
earnings and losses plus stockholders' equity (less dividends paid) either
increasing or decreasing at a higher rate than total assets. The Bank's
"Stockholders' Equity" is comprised of "Capital Stock," "Non Capitalized
Contributions," "Adjustments to Stockholders' Equity" resulting from accounting
for inflation in accordance with Argentine Banking GAAP, "Earnings Reserved"
("Legal and Other Reserves") and "Unappropriated Earnings" (retained earnings
less the earnings reserved).

     The changes in stockholders' equity for fiscal years 1999, 2000 and 2001
reflect net income of, Ps.119.2 million, Ps.207.6 million and net loss of
Ps.10.2, respectively, reduced by the payment of cash dividends of Ps.30.3
million, Ps.35.7 million and Ps.62.3 million respectively. In the fiscal year
1999, 2000 and 2001, Ps.20.2 million, Ps.23.8 million and Ps.41.5 million,
respectively, were transferred from unappropriated earnings (retained earnings)
to legal reserves. In fiscal year 2000, stockholders' equity increased by Ps17.3
million due to the Banco Tornquist incorporation. In fiscal year 2001,
stockholders' equity decreased by Ps.38 million due to the distribution of the
irrevocable contribution received on July 31, 1996. (See: "Major Shareholders
and Related Party Transactions--Dividend Policy").

     "Adjustments to Stockholders' Equity" reflects the restatement of "Capital
Stock" in equivalent purchasing power. The "Capital Stock" account generally
maintains its nominal value at each balance sheet date. In fiscal year 2000, due
to the merger with Banco Tornquist, capital stock increased by Ps.11.5 million
to reach Ps.346.7 million at December 31, 2000 and 2001. The Central Bank
requires that 20.00% of a bank's annual net income be added to its legal
reserve. "Earnings Reserved" includes this annual reserve as well as other
reserves (primarily voluntary reserves), from which the Bank cannot pay
dividends. "Earnings Reserved" are unrelated to the Bank's allowances for loans.

     Capital Adequacy

     Following in many respects the criteria set forth in the directives of the
Basle Committee for the Supervision of Banking Practices, in July 1991 the
Central Bank substantially amended its capital adequacy

                                       69

<PAGE>

guidelines. Under these guidelines, a bank is required to have specified levels
of capital based on a percentage of the value of its non-liquid assets and the
risk-weighted value of its financial and other liquid assets. See "--Argentine
Banking System and Regulation--Argentine Banking Regulation--Liquidity and
Solvency Requirements."

     The table below sets forth the Bank's capital calculated pursuant to
Central Bank requirements and Central Bank minimum capital requirements in
effect at December 31, 1999, 2000 and 2001:

                 CAPITAL IN EXCESS OF CENTRAL BANK REQUIREMENTS

                                                         December 31,
                                              ----------------------------------
                                               1999 (1)    2000 (2)    2001 (3)
                                              ----------  ----------  ----------
                                                   (in thousands of pesos)
Central Bank minimum capital requirements

  Allocated to loans, other receivables
  and other assets and guarantees given         698,900     863,594     785,642
  Allocated to fixed assets                      58,831      60,543      63,706
  Allocated to market risk value                  2,348       9,148       3,173
  Allocated to interest rate risk                 6,887       6,103       6,648
                                              ---------   ---------   ---------
  Central Bank minimum capital requirements     766,966     939,388     859,169
                                              =========   =========   =========


Bank capital calculated under Central Bank
requirements

  Core capital                                1,086,411   1,138,342   1,076,559
  Supplemental capital                          124,135     204,225      11,505
  Deductions                                    (68,425)    (61,697)    (80,409)
  Additional integration market valuation         5,813         579      (6,554)
  Bank capital calculated under Central
                                              ---------   ---------   ---------
  Bank requirements                           1,147,934   1,281,449   1,001,101
                                              =========   =========   =========

Excess capital over required capital            380,968     342,061     141,932
                                              =========   =========   =========
--------------------
(1)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa and Santander Fondos.
(2)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A. Includes the result of operations and
     average balance sheets of Banco Tornquist through the time of its merger
     with and into Banco Rio.
(3)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A.


                                       70

<PAGE>


                     ARGENTINE BANKING SYSTEM AND REGULATION

The Argentine Banking System

         The Argentine financial system consisted of 86 commercial banks, of
which 73 were privately owned banks and 13 were Argentine Government owned or
related banks, as of December 31, 2001. The total number of financial
institutions--including the other 21 non-banking financial institutions--was 107
as of December 31, 2001.

         Of the 73 privately owned commercial banks at December 31, 2001, 32
were privately owned locally based banks (sociedades anonimas), 39 were
foreign-owned banks (i.e., local branches or subsidiaries of foreign banks) and
2 were cooperative banks (bancos cooperativos limitados). The largest privately
owned locally based commercial banks, in terms of total assets, were the
following: Banco de Galicia y Buenos Aires S.A., Banco Hipotecario S.A. and
Banco Credicoop S.A. According to information published by the Central Bank, as
of December 31, 2001, privately owned locally based commercial banks accounted
for approximately 12.70% of deposits and approximately 18.07% of loans in the
Argentine financial system. The largest foreign banks as of such date were the
Bank, BBVA Banco Frances, BankBoston and Citibank. Foreign banks compete under
the same regulatory conditions as Argentine banks. According to information
published by the Central Bank, as of December 31, 2001, foreign-owned commercial
banks accounted for 51.80% of deposits and approximately 47.60% of loans in the
Argentine financial system. Cooperative banks are active principally in consumer
banking, with a special emphasis on the lower end of the market. As of December
31, 2001, cooperative banks accounted for approximately 2.33% of deposits and
2.13% of loans in the Argentine financial system.

         The largest Argentine Government-owned or related banks, in terms of
total assets, were Banco de la Nacion Argentina, Banco de la Provincia de Buenos
Aires and Banco de la Ciudad de Buenos Aires. Under the provisions of the
Financial Institutions Law ("FIL"), public banks have comparable rights and
obligations as private banks, except that public banks handle public revenues
and promote regional development and certain public banks have preferential tax
treatment. The by-laws of some Argentine Government-owned banks provide that the
governments that own them (national and provincial) guarantee their commitments.
According to information published by the Central Bank, as of December 31, 2001,
Argentine Government-owned and Government-related commercial banks accounted for
approximately 32.83% of deposits and approximately 29.85% of loans in the
Argentine financial system.

         In the last few years, the Argentine Government has implemented a
series of reforms of the financial system, with particular emphasis on the
public sector. International trade financing was transferred from the Central
Bank to Banco de Inversion y Comercio Exterior (BICE). Banco Nacional de
Desarrollo (BANADE) has been taken over by the largest government-owned bank,
Banco de la Nacion Argentina, and the savings bank Caja Nacional de Ahorro y
Seguros has been privatized. In addition, Banco Hipotecario Nacional, which was
renamed Banco Hipotecario S.A., was privatized during 1999.

         Consolidation has been a dominant theme in the banking sector since the
Convertibility Plan was implemented in 1991, with the total number of banks
declining from 214 in 1991 to 205 in 1994, and to 86 at the end of 2001. Total
deposits decreased 22.64% during the year 2001, reduced to Ps.66.97 billion,
principally due to the crisis and the lack of confidence in the Financial
System. Total loans decreased as well to the level of Ps.70.19 billion. The
system is somewhat concentrated, with the 10 largest private banks holding
49.02% of the system's deposits as of December 31, 2001, with significant
differences in operating statistics (credit quality, efficiency and
profitability ratios) between the top-tier and bottom-tier banks. Thus, within
the group of private banks, 73.34% of the deposits correspond to the 10 largest
ones.

         Remedial Measures Adopted

         The economic and financial situation in Argentina deteriorated
unrelentingly over the last few months; since June 30, 2001, this was basically
reflected in an increase in sovereign risk, diminishing reserves, continuing
fiscal imbalance, lower deposits in the financial system overall, deeply
recessionary conditions with significant drops in both consumption and
investment, decreased actual cash flows, difficulties to settle short-term debt
and a deteriorating chain of payments.

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<PAGE>


         On November 1, 2001, the Argentine Government announced a new economic
plan, the main measures of which related to the comprehensive restructuring of
public debt at lower interest rates, launching a plan to revive the economy, and
other fiscal measures, while the convertibility law (whereby the Argentine peso
was pegged at par with the US dollar) and the balanced-budget law were to remain
in effect.

         In response to the outflow of deposits and resulting tightening of
liquidity which occurred during December 2001, the Argentine Government adopted
several remedial measures. Those provisions included that pursuant to Decree No.
1,570/2001, as well as implementing regulations of the Central Bank, Argentine
individuals and corporations were subject to restrictions on making certain
payments and transferring funds abroad. According to Communication "A" 3471 of
the Central Bank, as amended, transfers of foreign currency outside of Argentina
(1) to pay the principal and interest of certain financial obligations until
August 12, 2002, or (2) to repatriate invested capital or dividends are subject
to prior approval of the Central Bank provided, however, that no such approval
is required for the payment of obligations of persons or private sector legal
entities arising from: (a) debts with international organizations; (b) debts
with banks party to a project financing co-financed by international
organizations; (c) debts with official credit agencies and export credit
insurance companies which are members of the International Union of Credit and
Investment Insurers or guaranteed thereby; (d) debts with multilateral credit
organizations in which the Argentine government holds an interest through the
Central Bank or national official banks, and (e) debts with other multilateral
credit organizations party to agreements which include provisions to be treated
in terms not less favorable than those applicable to the most-favored treatment
to a multilateral financial organization, or guaranteed by such organizations.

         Subsequent to year-end, the deterioration of the economic and financial
situation affected the institutions, with several successive changes taking
place at the highest levels of the Federal Executive, which culminated with
National Congress electing a new President to complete the constitutional period
until December 10, 2003. In the interim, the suspension of payments on public
debt, domestic and foreign, was declared.

         On January 6, 2002, National Congress enacted Public Emergency and
Foreign Exchange System Reform Law No. 25,561, which introduced deep changes to
the economic framework effective until then and, particularly, abolished the
Convertibility Law (whereby the ARS was pegged at par with the US dollar) which
had been in effect since March 1991, in particular Law No. 25,561 also empowered
the Federal Executive to issue additional monetary, financial and foreign
exchange measures aimed at overcoming the economic crisis in the medium term.
The law included, among others, the following measures:

               (a) The switch into ARS of certain debts towards the financial
          sector originally denominated in US dollars and outstanding as of
          December 31, 2001, at the exchange rate of one Argentine pesos (ARS)
          to each US dollar;

               (b) The switch into ARS of private contracts stipulated in US
          dollars or including indexation clauses, over a term of 180 days, at
          the exchange rate of one ARS 1 to each US dollar;

               (c) The switch into ARSs at the exchange rate of one ARS 1 to
          each US dollar of public utility rates priorly stipulated in US
          dollars, to be subsequently renegotiated on a case-by-case basis;

               (d) The implementation of a new system levying duties on the
          export of oil and gas;

               (e) Empowering the Federal Executive to establish compensatory
          measures to avoid imbalances in financial institutions that may result
          from the switch into ARSs of certain receivables.

         Furthermore, Federal Executive Decree No. 71/02 and "Banco Central de
la Republica Argentina" (Central Bank) Communique "A" 3425 established an
"officially-ruled" foreign exchange market, basically for exports and certain
imports and financial transactions, and another "free" exchange market (floating
rate) for all other transactions. The officially-ruled exchange rate was set at
ARS 1.4 to each US dollar, while the exchange rate on the "free market" at close
of business of January 11, 2002 (the first day the foreign exchange market
reopened after being suspended since December 23, 2001), ranged from ARS 1.60 to
ARS 1.70 to each US dollar, selling price. Later, by Decree No. 260/02 of
February 8, 2002, the Federal Executive Branch established a single and free
market

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<PAGE>


through which all foreign exchange transactions are to be channeled as from the
date of issuance of such Decree. Foreign exchange transactions are to take place
at freely agreed-upon rates, subject to certain requirements and to the
regulations to be set by the Central Bank.

         Subsequently, through Decrees No. 214/02 of February 3, 2002, and No.
410/02 of March 1, 2002, the Federal Executive took, among others, the following
measures were adopted:

               (a) The switch into ARS of all obligations, whatever their cause
          or origin, to deliver sums of money stipulated in US dollars or any
          other foreign currency outstanding of the date of enactment of Law No.
          25,561, with the exceptions, mainly, of financing related to foreign
          trade granted by financial institutions, and the private and
          government sectors' obligations to deliver sums to which foreign law
          is applicable;

               (b) The switch into ARS of all deposits with all financial
          institutions stipulated in US dollars or other foreign currencies at
          an exchange rate of ARS 1.4 to each US dollar, or its equivalent in
          other currencies;

               (c) The switch into ARS of all debts towards financial
          institutions stipulated in US dollars or other foreign currencies,
          whatever the amount or nature, at the exchange rate of ARS 1 to each
          US dollar, or its equivalent in other currencies;

               (d) The conversion into ARS of obligations to deliver monies,
          stipulated in US dollars or other foreign currencies, unrelated to
          financial institutions and whatever their origin or nature, at the
          exchange rate of ARS 1 to each US dollar, or its equivalent in other
          currencies;

               (e) The adjustment of all receivables and payables referred to in
          points (b) through (d) by applying a "Coeficiente de Estabilizacion de
          Referencia" (CER -Benchmark Stabilization Coefficient) that is to be
          published by the Central Bank and, additionally, the application of a
          minimum set interest rate for deposits and a maximum set interest rate
          for loans. The CER is applicable as from the publication of Decree No.
          214/02. Obligations of any nature or origin arising after the
          enactment of such Law No. 25,561, are not allowed to contain and shall
          not be subject to adjustment clauses;

               (f) The issuance of a Bond to be borne by the Federal Treasury to
          compensate the imbalances in the financial system resulting from the
          exchange difference caused by the switch of deposits with and payables
          to the financial entities.

Argentine Banking Regulation

         General

         Banking activities in Argentina have been regulated primarily under the
FIL, which empowers the Central Bank to regulate and supervise the Argentine
banking system, since 1977. In practice, the Central Bank has vested the
Superintendencia de Entidades Financieras y Cambiarias (Superintendency of
Financial Institutions and Exchange, hereinafter referred to as the
"Superintendency"), with most of the Central Bank's supervisory powers. In this
section, unless the context otherwise requires, references to the Central Bank
shall be understood as references to the Central Bank acting through the
Superintendency. The FIL confers numerous powers on the Central Bank, including
the ability to grant and revoke bank licenses, to authorize the establishment of
branches outside Argentina, to approve bank mergers, capital increases and
certain transfers of stock, to fix minimum capital, liquidity and solvency
requirements, to grant certain financial facilities to financial institutions in
cases of temporary liquidity problems and to promulgate other regulations that
further the intent of the FIL.

         As supervisor of the system, the Central Bank requires financial
institutions to submit information on a daily, monthly, quarterly, semiannual
and annual basis. These reports, which include balance sheets and income
statements, information relating to reserve funds, use of deposits, indications
of portfolio quality (including details on principal debtors and any reserve for
loan losses established) and other pertinent information, allow the Central

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<PAGE>


Bank to monitor the financial institutions' business practices. If the Central
Bank's rules are breached, various sanctions may be imposed depending on the
gravity of the violation. These sanctions range from calling attention to the
infraction to imposing fines or even revoking the institution's operating
license. Moreover, non-compliance with certain rules may result in the
obligatory presentation to the Central Bank of specific adequacy or
regularization plans. These plans must be approved by the Central Bank in order
for the financial institution to remain in business.

         Additionally, the Central Bank is authorized to make inspections in
order to confirm the accuracy of information it receives from financial
institutions.

         Consolidated Supervision

         Financial institutions have been subject to the supervision of the
Central Bank on a consolidated basis since 1994. Accordingly, the requirements
set forth under the captions "--Liquidity and Solvency Requirements--Minimum
Capital Requirements," "--Concentration of Risk" and "--Reserve for Loan
Losses," among others, are calculated on a consolidated basis. Neither the
deposit portfolio of a financial institution nor its depositors is subject to
consolidated supervision.

         In order to exercise supervision, the Central Bank requires financial
institutions to submit certain information including the following:

                  (i) monthly consolidated financial statements of the financial
         institution, its local and foreign branches and its "material
         subsidiaries" (as defined below);

                  (ii) quarterly and annual consolidated financial statements of
         the financial institution, its local and foreign branches, its
         "subsidiaries" (as defined below), material subsidiaries of material
         subsidiaries, those "associated entities" (as defined below) determined
         by the Central Bank and companies not mentioned above but elected by
         the financial institution to be consolidated with the prior approval of
         the Central Bank;

                  (iii) a detailed list, at June 30 and December 31 of each
         year, of local and foreign companies "related" (as such concept is
         defined in "--Liquidity and Solvency Requirements--Concentration of
         Risk") either to the directors of the financial institution or to
         holders of at least 5.00% of the financial institution's capital stock
         or its voting stock; and

                  (iv) consolidated semi-annual financial statements of the
         economic group comprised of the controlling shareholders or controlling
         group of the financial institution, except where the controlling
         shareholders are local financial institutions or foreign financial
         institutions subject to a consolidated supervision regime in the
         country of origin.

         For purposes of this regulation: (i) "subsidiary" of a local financial
institution means any local or foreign financial institution or any company
providing services complementary to those provided by such local financial
institution when the local financial institution (a) directly or indirectly owns
50.00% or more of the voting stock of the subsidiary, (b) directly or indirectly
has the power to elect the majority of the members of the administrative body of
the subsidiary or (c) the majority of the directors of the local financial
institution also forms the majority of the directors of the subsidiary; (ii)
"material subsidiary" means any subsidiary (a) whose assets, contingencies and
off-balance sheet operations amount to 10.00% or more of the financial
institution's computable net worth, (b) whose current fiscal year results of
operations amount to 10.00% or more of the current fiscal year results of
operations of the local financial institution and its foreign branches or (c)
who owns one or more subsidiaries which, on a consolidated basis, would qualify
as a material subsidiary; and (iii) "associated institutions" means any local or
foreign financial institution or any company providing services complementary to
the services provided by such local financial institution which, directly or
indirectly through another controlled legal institution, owns or controls more
than 12.5% of the total voting stock of such associated institution.

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<PAGE>


         Permitted Activities and Investments

         The FIL provides for the following types of financial institutions:
commercial banks, investment banks, mortgage banks, financial companies, savings
and loan companies (sociedades de ahorro y prestamo para la vivienda) and credit
unions (cajas de credito). Except for commercial banks, which are authorized to
conduct all financial activities and services that are not specifically
prohibited by law or by regulations of the Central Bank, the activities that may
be carried out by Argentine financial institutions are basically set forth in
the FIL. Some of the activities that are permitted for commercial banks include
the ability: (i) to make and receive loans; (ii) to receive deposits from the
public in both local currency and dollars; (iii) to receive deposits from the
public in foreign currencies subject to the restrictions that may be imposed by
the Central Bank from time to time, (iv) to guarantee clients' debts; (v) to
acquire, place or negotiate stock or debt securities, including government
securities, in the over-the-counter market (subject to the prior approval of the
CNV); (vi) to conduct transactions in foreign currency; (vii) to act as
fiduciary; (viii) to issue credit cards; (ix) to act, subject to certain
conditions, as brokers in real estate transactions; and (x) to conduct trade
finance transactions.

         In addition, pursuant to the FIL, as implemented by Central Bank
regulations, commercial banks are permitted to own commercial, industrial,
agricultural and other types of enterprises subject to prior authorization of
the Central Bank. Under Central Bank regulations, the aggregate amount of
investments of a commercial bank in the stock of third parties, including
participation in Argentine mutual funds, may not exceed 50.00% of such bank's
Computable Net Worth (as defined below), with the aggregate amount of such
investments in certain assets being limited to 15.00% of such bank's Computable
Net Worth. Such assets are: (i) unlisted stock excluding (a) stock of companies
that provide services complementary to the services offered by the bank, and (b)
any stock participation that is necessary in order to obtain the rendering of
public services; (ii) listed stock and participations in mutual funds that are
not taken into account in order to determine the market risk related capital
requirements referred to below; and (iii) listed stock that does not have a
"largely publicly available" market price. Under the regulations, a stock's
market price is considered to be "largely publicly available" when daily quotes
of relevant transactions are available, which quotes would not be significantly
affected by the disposition of the bank's holdings of such stock.

         In addition, an equity investment of a commercial bank in another
company that does not provide services complementary to the services provided by
the commercial bank may not exceed 12.50% of such company's net worth.

         On July 17, 1997, the Central Bank issued Communication A 2563, as
amended, which established, effective January 1, 1998, new requirements with
which banks must comply in order to grant real estate financing secured by
mortgages to individuals. These requirements are intended to standardize the way
in which banks grant mortgages and thereby to promote the securitization of
mortgage loans by Argentine banks. Moreover, the Central Bank standardized the
mortgage notes (letras hipotecarias) to be issued in connection with mortgage
loans. There has been an important reduction of market rates in mortgage loans
because of aggressive competition.

         The Central Bank regulations establish several requirements for the
establishment of local or foreign branches, including receipt of authorization
of the Central Bank. However, the establishment of mini-branches and permanent
promotion stands requires only notification to the Central Bank. Mini-branches
are permitted to engage only in minor activities (i.e., payment of pensions,
collection of up to Ps.2,000 loan payments, collections of public services and
taxes). A promotion stand may be established only to engage in the receipt and
delivery of forms related to services provided by the bank, and is not permitted
to deal with money and securities.

Liquidity and Solvency Requirements

         Minimum Capital Requirements

         Pursuant to the FIL, Argentine financial institutions must comply at
all times with the minimum capital requirements of the Central Bank.

         According to the regulations in effect at the date of this Annual
Report, the minimum capital required for wholesale commercial banks must be
equal to the higher of (i) Ps. 10,000,000 in the case of commercial banks and

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<PAGE>


Ps. 15,000,000 in the case of other financial entities, or (ii) the sum of a
specific portion of the value of the bank's non-liquid assets (the "Non-Liquid
Assets") plus a certain portion of the "risk value" of its liquid assets (the
"Liquid Assets") multiplied by a given figure ranging from 0.970 to 1.150
depending upon the rating granted to such bank by the Central Bank based on such
bank's net worth, asset quality, management, profitability and liquidity.

         Minimum capital requirements aimed at covering the exposure of
financial entities to market risk are a function of a bank's portfolio of
government securities (excluding securities for investment purposes), equity,
foreign currency (other than the U.S. dollar) and derivatives. The methodology
adopted by the Argentine regulation is based on the Basle Committee and European
Union regulations. A risk value is calculated for three portfolios: (1) local
government bonds and equity from local companies, (2) foreign bonds and equity
and (3) foreign currency. Total capital requirements to cover exposure to market
volatility will be equal to the total risk value, which is the sum of the risk
value of each portfolio.

         Applicable regulations related to minimum capital requirements take
into account, among other factors, the interest rates applied to financing
granted to the non financial public sector. Accordingly, the method implemented
uses a risk indicator chart which, by considering the material factors of the
interest rates applicable to financing of the two different type of credits -
individual credits for consumer, and the rest - assigns a higher risk value on
such credits when the interest rates values increases.

         In addition, a specified minimum capital requirement to be assigned to
financing granted to the non financial public sector and to the holding of
securities allocated to inversion accounts.

         The Argentine Central Bank has also established capital requirements to
cover the risk of changes in market interest rates based on the bank's interest
rate gap.

         For purposes of these regulations, the computable net worth of a
financial institution must be greater than or equal to the minimum capital
requirement calculated as described in the previous paragraph. The computable
net worth of a financial institution ("Computable Net Worth") is basically equal
to the sum of (i) the so-called "Basic Net Worth," which includes capital stock,
capital adjustments, reserves, irrevocable capital contributions, retained
audited earnings and, pursuant to the consolidated supervision regime, third
party holdings, plus (ii) the so-called "Complementary Net Worth" (without
exceeding 100.00% of "Basic Net Worth"), which includes certain subordinated
debt securities, the minimum level of allowances required by the Central Bank in
respect of provisioned obligations in the Normal and Normal Performance
categories (as such terms are defined below in "--Loan Loss Provisions") plus
certain unaudited net income and less certain items such as permanent
investments in other financial institutions, capital assigned to offshore
affiliates, certain intangible assets and nonintegrated capital.

         For purposes of determining the risk value of Liquid Assets, the
Central Bank has assigned to each type of Liquid Asset a certain risk value
based on the type of borrower (public sector or private sector), the presence or
absence of guarantees or collateral and the type of transaction.

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<PAGE>


         The following are the risk values assigned to some of the most relevant
Liquid Assets:

<TABLE>
<CAPTION>
Liquid Assets                                                                                         Risk Value
-------------                                                                                         ----------
                                                                                                         (in %)
<S>                                                                                                   <C>
Cash and gold .........................................................................................       0

             Demand Deposits

          -  In the Central Bank when the relevant demand deposits comply with certain requirements ...       0
          -  In local banks or in foreign banks rated "investment grade" by an international rating
             agency ...................................................................................      20
          -  In foreign banks controlling the local bank, in its subsidiaries and branches in other
             countries, if such banks are subject to a consolidated supervision and the mother
             company is domiciled in a member country of the O.C.D.E. (Organization for Economic
             Cooperation and Development) and they rated with "A" or a higher rating ..................       0

             Government Securities

          -  Subject to market risk minimum capital requirement .......................................       0
          -  Issued by the Argentine provinces, municipalities or the city of Buenos Aires and not
             secured with the fiduciary transfer of the collection rights related to national taxes ...     100
          -  Issued by state companies of the Argentine Government, without the guarantee of the
             Argentine Government .....................................................................      50
          -  Issued by agencies whose governments belong to OECD and rated "investment grade" by an
             international rating agency ..............................................................      20

             Loans

          -  Secured with cash, gold or certificates of deposit denominated in ARSs or U.S. dollars
             issued by the creditor entity itself .....................................................       0
          -  Secured with Argentine Government securities, only for operations effective to
             June 6th, 1993 ...........................................................................       0
          -  Automatic Reimbursements deriving from export operations corresponding to multilateral
             and bilateral credit agreements of foreign trade .........................................       0
          -  Provincial guarantee funds, only when such funds have a specific application of
             funds deriving from tax coparticipation ..................................................       0
          -  With government securities, computed for the 90% of their market value ...................       0
          -  Secured with a senior mortgage
              -  On private homes (for the purchase or improvement of the private home if the
                 relevant loan does not exceed 75% of the value of the private home) ..................      50
              -  On other real estate (if the relevant loan does not exceed 50% of the value of the
                 particular real estate) ..............................................................      75
          -  Secured with a senior pledge
              -  On automobiles (if the relevant loan does not exceed 75% of the automobile's
                 market value) ........................................................................      50
              -  On automobiles (when the relevant loan exceeds 75% of the automobile's
                 market value) ........................................................................     100
          -  Interbank loans guaranteed by foreign banks (excluding local branches of foreign
             banks) rated "investment grade" by an international rating agency ........................      20
          -  Loans to the Argentine Government (other than national public sector companies) ..........       0
          -  Unsecured loans ..........................................................................     100
</TABLE>

         In addition to the above, loans and other extensions of credit are
subject to a second risk valuation depending on the interest rate thereon,
determined, for interest rates between 0.00% and 86.00%, as follows:

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<PAGE>


<TABLE>
<CAPTION>
                                         Local and foreign currency loans
                                           Annual nominal interest rate
Personal loans, credit
cards and overdrafts                            Remaining type of credits                   Actual Risk Index
--------------------                            -------------------------                   -----------------
<S>                                             <C>                                         <C>
Up to 26%                                             Up to 16%                                     1.00
from 26 to 29%                                        from 16 to 19%                                1.10
from 29 to 32%                                        from 19 to 22%                                1.20
from 32 to 35%                                        from 22 to 25%                                1.30
from 35 to 38%                                        from 25 to 28%                                1.40
from 38 to 41%                                        from 28 to 31%                                1.50
from 41 to 44%                                        from 31 to 34%                                1.60
from 44 to 47%                                        from 34 to 37%                                1.90
from 47 to 50%                                        from 37 to 40%                                2.20
from 50 to 53%                                        from 40 to 43%                                2.50
from 53 to 56%                                        from 43 to 46%                                2.80
from 56 to 59%                                        from 46 to 49%                                3.10
from 59 to 62%                                        from 49 to 52%                                3.40
from 62 to 65%                                        from 52 to 55%                                3.70
from 65 to 68%                                        from 55 to 58%                                4.00
from 68 to 71%                                        from 58 to 61%                                4.30
from 71 to 74%                                        from 61 to 64%                                4.60
from 74 to 77%                                        from 64 to 67%                                5.00
from 77 to 80%                                        from 67 to 70%                                5.40
from 80 to 83%                                        from 70 to 73%                                6.00
from 83 to 86%                                        from 73 to 76%                                6.50
more than 86%                                         more than 76%                                 7.00
Clients are given the same rating as the one granted to Argentine government securities.            0.80
</TABLE>

         The Central Bank established certain additional minimum capital
requirements based on the risks derived from the variations experienced in the
interest rates. For purposes of determining this additional minimum capital
requirement, all assets and liabilities for financial operations, including the
securities held in the investment account, are taken into account.

         Additional minimum capital requirements were implemented effective
September 1, 1996 in relation to market risk associated with positions
(including derivatives bought or sold on such positions) held by financial
institutions in "local assets," "foreign assets" and "foreign currency."

         "Local assets" are defined for this purpose to include:

                  (i) debt securities (securities issued by the national
         government and participations in mutual funds, the underlying assets of
         which are those included in this subparagraph; provided that such
         securities and/or participations are usually listed on stock markets);
         and

                  (ii) shares (shares of capital stock of Argentine companies
         that are included in the "Indice MERVAL" (Argentine stock market
         index)) and/or participations in mutual funds, the underlying assets of
         which are included in this subparagraph and are listed on stock
         exchanges.

         "Foreign assets" are defined to include:

                  (i) debt securities (debt securities issued by foreign
         companies, sovereign securities issued by foreign governments and
         participations in mutual funds, the underlying assets of which are
         those included in this subparagraph; provided that such securities
         participations are usually listed on stock markets); and

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<PAGE>


                  (ii) shares (shares of capital stock of foreign companies and
         participations in mutual funds, the underlying assets of which are
         those included in this subparagraph: provided that such securities
         and/or participations are usually listed on stock markets).

         If any of the assets mentioned in (ii) above are listed on different
stock markets in foreign currencies, other than U.S. dollars, the listing price
and foreign currency of the most representative stock market (in terms of volume
of transactions in the relevant asset) will be taken into consideration for
purposes of these new capital requirements.

         "Foreign currency" is defined to include positions (bought or sold)
held in foreign currencies, other than in U.S. dollars, derivatives bought or
sold on such positions and the value in U.S. dollars of positions held in any of
the foreign assets described in the previous paragraph under "Foreign Assets,"
which assets are denominated in any foreign currency other than U.S. dollars;
provided, however, that any of such positions in foreign currencies, other than
U.S. dollars that individually considered do not exceed the equivalent of
U.S.$100,000 and, taken as a whole, do not exceed the equivalent of U.S.$500,000
at the close of business of each day, not be taken into consideration for
determining these additional minimum capital requirements.

         Purchase or sale of option contracts entered into in connection with
"local assets" and "foreign assets" must be considered in the calculation of
these market risks related to minimum capital requirements.

         These additional capital requirements were progressively implemented
and on March 1, 1997 became fully implemented.

         The market risk related capital requirements are determined by using
specific risk methodologies and are based on the financial institution's daily
net positions in any of the above-mentioned assets. These new requirements
follow, in general, standards established by the Basle Committee and the
European Union.

         If a financial institution does not comply with the minimum capital
requirements discussed above, the Central Bank may impose various penalties
depending on the importance of the violation, including monetary penalties,
application of temporary limits to the amount of deposits that the bank may
take, revocation of the license of the bank to deal in foreign exchange or, in
certain extreme cases, revocation of the license of the bank to operate as such.

         The Bank's minimum capital exceeded the minimum capital requirements
applicable to the Bank by Ps.141.9 million as of December 31, 2001. See
"--Selected Statistical Information--Capital Resources--Capital Adequacy."

         Minimum Liquidity Requirements

         The previously existing system of cash reserve requirements of the
Central Bank was eliminated on March 1, 2002. As a replacement for such system,
the Central Bank imposed the following minimum liquidity requirements on
financial institutions:

                  (i) minimum liquidity requirements are applied on the monthly
         average of daily balances of all deposits and other obligations from
         financial transactions, both dollar- and peso-denominated, which
         residual term shall not exceed one year;

                  (ii) the following categories, among others, are not subject
         to such minimum liquidity requirements: interest and premiums accrued
         in connection with the debts above mentioned in (i), obligations with
         the Central Bank, obligations with local financial institutions and
         trade finance credit lines from foreign banks; obligations derived from
         spot and forward transactions.

                  (iii) monthly averages of daily balances are obtained by
         dividing the aggregate of daily balances by the number of days in the
         calendar month; and

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<PAGE>


                  (iv) in order to fulfill the minimum liquidity requirements,
         financial institutions may invest the resulting amounts in any of the
         following instruments: (a) cash, (b) accounts of the financial entities
         in the Central Bank, (c) minimum capital accounts in U.S. dollars and
         other foreign currencies, opened by the financial entities in the
         Central Bank, (d) special guarantee accounts in favor of electronic
         compensation chambers and for the guarantee of credit card related
         operations and operations with cash dispensers, (e) accounts in non
         banking financial entities, (f) in transit cash; and (g) special
         guarantee accounts related to operations with cancellatory checks.

         The minimum liquidity requirements have been modified recently by the
Central Bank through the Communication "A" 3498. Thus, under its latest
regulation, the rates to be applied in order to meet the liquidity requirements
are the following:

<TABLE>
<CAPTION>
Concept                                                                                                      Rates
-------------------------------------------------------------------------------------------------------      -----
                                                                                                             (in %)
<S>                                                                                                          <C>
Deposits in checking accounts .........................................................................         40

Deposits in savings accounts ..........................................................................         40

Deposit accounts for payment of salaries and unemployment funds. ......................................         40

Other deposits for the Social Security and Employment National Agency and immovable balances ..........         40

Term deposits, negotiable obligations and obligation for repurchase agreements ........................         40

Deposits in connection with the reprogrammed deposits system ..........................................         40

Deposits in connection with the reprogrammed deposits system after the twelfth month of deposits ......          0

Notes (financial external debt) .......................................................................          0

Reprogrammed deposits assigned to other financial entities maintained under the same conditions .......        100

Minimum deposits of mutual funds, as per the CNV's requirements .......................................         50
</TABLE>

         In relation to the maximum investment limits, Communication "A" 3498
establishes that in order to determine the integration of the obligations in
foreign currency it will be admitted to compute up to 50% of cash.

         As for minimum daily integration, the sum of the balances of the
concepts admitted for integration registered at the end of the day can never be
inferior to the 60% of the total minimum cash requirements.

         Reporting Requirements on Liquidity Position

         Central Bank's regulations, as amended by Communication A 3275
(effective as from May 28, 2001) establish, in respect to the reporting
requirements on liquidity position that banks are required to present monthly
reports on cash-flow, detailing the following: (i) contractual cash flow of
assets and liabilities, (ii) cash flow to renew assets and liabilities, (iii)
cash-flow designed to prevent illiquidity of the bank, and (iv) cash flow
designed to anticipate illiquidity in the financial system. Financial
institutions are further required to adopt management and control policies to
assure the availability of reasonable levels of liquidity in order to
effectively manage the different potential scenarios that may affect deposits
and other financial obligations. Such policies are required to establish
procedures to evaluate and sufficiently anticipate the liquidity of the
institutions in the context of the market so as to revise projections, adopt
measures to eliminate liquidity problems and obtain funds on market terms
sufficient to maintain a prudent level of assets over the long term. Such
policies are also required to address (i) the concentration of assets and
liabilities in particular clients; (ii) the general economic situation, probable
trends and the impact on available credit; and (iii) the ability to obtain funds
through the sale of public debt instruments and/or liquid assets.

                                       80

<PAGE>


Furthermore, financial institutions are required to establish "daily tracking"
of their liquidity and of the market, calling for the participation of and
coordination with the most senior manager of each institution. In addition, one
member of the board of directors of each institution must be appointed to be
informed at least weekly of any changes in the liquidity condition of such
institution and the market that may require new strategies to protect the
liquidity of the institution.

         Ratings

         Financial institutions are required to be rated by at least one rating
agency registered with the Central Bank. Ratings must be obtained on a
three-month basis and reflect the relevant financial institution's liquidity,
solvency and asset quality; the position of the entity and its sensitivity to
alternative scenarios of the Argentine economy. In order to be admitted to the
Central Bank's register, the rating agencies must prove that they rate financial
entities in at least 10 countries, 5 of which must belong to Latin America. The
Central Bank outlined a series of situations in which the rating agencies or
their employees will be ineligible to carry out a rating process (e.g., when
both the rating agency and the financial institution have common employees). The
ratings must be included in every advertisement inviting the public to enter
into financial transactions with the financial institution.

         The main objective of this requirement is to obtain an independent
opinion as to the capacity of the relevant financial institution to repay
principal and interest accrued in connection with any financial transaction
entered into by it. The rating agencies will be required to apply rating
standards similar to those employed by international rating agencies.

         Lack of compliance on the part of the financial institution with the
described rating requirements (i.e., not having a rating) will lead to penalties
being applied, ranging from fines to the revocation of the institution's banking
license.

         Valuation of Government Securities

         Prior to March 1, 1999, banks could classify their Argentine government
securities into three categories: "held-for-investment," "available-for-sale,"
or "trading." Effective March 1, 1999, the Argentine Central Bank eliminated the
available-for-sale category.

         Prior to March 1, 1999, government securities classified by a bank as
"held for investment" were required to be held for a minimum of one year, and
the bank had to have at all times third-party funding (such as debt securities,
deposits denominated in local or foreign currency, government securities or
lines of credit) with a duration that matched that of the government securities
held-for-investment, with certain exceptions. Such government securities and
third-party sources of funds were required to be matched also on a currency- and
interest-rate (either fixed or floating) basis. Commencing in March 1999, there
have been no limits to the time a portfolio must be held and no funds matching
requirement. Commencing in March 2000, investment account securities have been
valued at acquisition cost increased by the interest rate of the current coupon,
with a limit of 120.00% of market value as of the same date, if applicable, in
accordance with Communication "A" 3039 and supplements of the Central Bank.

         Argentine government securities classified by a bank as
"available-for-sale" formerly had to be held by a bank for a minimum of three
months. Such securities were valued at their market price. Any difference
between such securities' period-end market price and acquisition cost, increased
by accruing a compound internal rate of return over the period elapsed since the
acquisition date, was accounted for in a separate account ("Unrealized Valuation
Difference") in such bank's stockholders' equity. With the elimination of the
available-for-sale category, the balance of a bank's shareholders' equity
account "Unrealized Valuation Difference" after March 1, 1999 was reclassified
under the shareholders' equity account "Retained Earnings."

         Government securities held by a bank not classified in either of the
two previous categories are classified as "held-for-trading." These securities
are marked-to-market, and any difference between book value and the price at the
end of each month is accounted for in a bank's income statement.

                                       81

<PAGE>


         Concentration of Risk

         The amount of equity participation and credit, including guarantees,
that a financial institution may have or grant to any particular client at any
time is limited based on the institution's computable net worth on the last day
of the immediately preceding month or on the client's computable net worth.
According to Central Bank rules, a commercial bank may not lend or otherwise
provide credit assistance to (referred to herein as "financial assistance"), or
invest in the capital stock of, a single non-related client in amounts in excess
of 10.00% of such bank's computable net worth or 100.00% of such client's
computable net worth, provided that the bank may grant additional financial
assistance to such client up to an amount equal to 200.00% of such client's
computable net worth if such additional financial assistance does not exceed
2.50% of the bank's computable net worth. Such additional financial assistance
must be approved by a majority of the board of directors, council of
administration or similar corporate body.

         If such financial assistance is secured in accordance with relevant
Central Bank regulations, such 15.00% limit shall increase to 25.00% of the
bank's computable net worth. In addition, in the case of financial assistance to
Argentine financial institutions or deposits in or advances to foreign financial
institutions holding an investment grade rating from an international rating
agency, the 15.00% limitation referred to above is increased to 25.00% of the
bank's computable net worth, while for deposits in and advances to foreign
financial institutions that do not hold an investment grade rating from an
international rating agency, the limitation is reduced to 5.00% of the bank's
computable net worth. In cases in which the client qualifies as a "related
person" in respect of the bank, the aggregate unsecured financial assistance
granted must not be greater that 5.00% of the bank's computable net worth; while
the limit increases to 10.00% of the computable net worth of the bank if the
financial assistance is guaranteed by certain liquid assets such as: bonds of
the private or public sectors, deposit certificates issued by the bank, etc.
Furthermore, if the "related person" exclusively provides services related to
those provided by the bank, the limitation concerning financial assistance
without guarantee or capital participation increases to 10.00% of the bank's
computable net worth. Notwithstanding the foregoing, the aggregate financial
assistance granted to, and the bank's interests in the capital stock of, related
persons plus the aggregate financial assistance granted by the bank to its
directors, managers and direct relatives of such managers (subject to a 5.00%
limit on the banks' computable net worth) may not be higher than 20.00% of such
bank's computable net worth. For purposes of such calculation, all companies
belonging to the same economic group will be considered as one client. However,
limits to operations with related persons do not apply in the following cases:
(a) financing granted to any financial institutions in Argentina for which,
under Central Bank regulations, the lender is required to report consolidated
with itself; (b) financing granted to the Argentine financial institution's
parent or to the latter's branches or subsidiaries in other countries, provided
the parent: (i) in its own country, is subject to regulatory oversight on a
consolidated basis, (ii) has been awarded an international rating of "A" or
higher issued by one of the international rating agencies; and (iii) provides
explicit surety for all obligations of its subsidiary in Argentina; (c)
financing covered by "A" rated preferred guarantees that are computed towards
the credit limit of the party obligated under the notes or securities that
comprise such collateral and (d) exceptionally, when decided by the
Superintendency of Financial Entities, taking into account the spirit and
purpose of the Central Bank's regulations.

         Under Central Bank regulations, a person is related to a financial
institution: (i) if the financial institution controls, is controlled by, or is
under common control with such person, (ii) if the financial institution, or the
person that controls the financial institution and such person have common
directors to the extent such directors, voting together, will constitute a
simple majority of each board or (iii) in certain exceptional cases, if such
person has a relationship with the financial institution or the person
controlling such financial institution, and it is determined by the Board of
Directors of the Central Bank that such person may adversely affect the economic
condition of the financial institution. In turn, control by one person of
another is defined under such regulations as: (i) holding or controlling,
directly or indirectly, 25.00% of the voting stock of the controlled person,
(ii) having held 50.00% or more of the voting stock of the controlled person at
the time of the last election of directors, (iii) holding, directly or
indirectly, any other kind of participation in the controlled person so as to be
able to prevail in its shareholders' or Board of Directors' meetings or (iv)
exercising an influence, directly or indirectly, in the direction or policies of
another person, as determined by the Board of Directors of the Central Bank. The
regulations contain several nonexclusive factors to be used in determining the
existence of such controlling influence, including, among other factors: (i) the
holding of a sufficient amount of the controlled person's capital stock to
permit the controlling person to exercise influence over the approval of the
controlled person's financial statements and payment of dividends, (ii)
representation by the controlling person on the controlled person's board of
directors, (iii) significant

                                       82

<PAGE>

transactions between the controlling and the controlled person, (iv) transfers
of directors or senior officers from the controlling person to the controlled
person or vice versa, (v) technical and administrative subordination by the
controlled person to the controlling person and (vi) participation in the
creation of policies of the financial institution.

         Notwithstanding the limitations described above, the amount of all
non-excluded financial assistance to and equity participations in each client
(related or not) as to which such assistance and participation exceeds 10.00% of
a commercial bank's computable net worth may not be in excess, in the aggregate,
of three or five times such bank's computable net worth, including financial
assistance to and equity participations in local financial institutions,
respectively.

         Finally, financial assistance that 2.50% of a bank's computable net
worth may only be granted following the authorization of the branch's manager,
regional manager, relevant first-line administrative officer of its credit unit,
the general manager and credit committee (if any) of such bank and must be
approved by the board of directors, council of administration or similar
corporate body of the relevant bank.

         Financial Institutions Indebtedness

         Prior to March 1, 2002, financial institutions had the obligation to,
on an annual basis, issue debt or equity securities equivalent to 2.00% of their
total deposits ARSs, dollars and government securities. The following entities
were not covered by this resolution: (i) branches of foreign banks rated
"investment grade" and subject to consolidated supervision and (ii) subsidiaries
of banks whose parent entity meets the previous requirement and explicitly
guarantees the subsidiaries' liabilities. Such requirement was eliminated by
Communication A 3498, issued by the Central Bank on March 1, 2002. Under the new
regulations, financial institutions are free to determine the terms and
conditions under which the issuance will be carried out, but the securities (i)
can not have a maturity term of less than 30 days, with principal payment on the
maturity date or with partial payments as from 30 days counted from the date of
the placement of the securities/1/; (ii) the titles representing such securities
must have a minimum nominal value of $ 100.000 or its equivalent in other
currencies; (iii) interest payments must be done on the maturity date in the
case of securities with a maturity date of 30 days (in the case the maturity
date is longer, periodic payments of interest are allowed; and (iv) securities
can not be issued with general guarantee ("garantia flotante") or collateral,
but they can be guaranteed by another local financial entity or by a foreign
financial entity.

         Foreign Deposits and Foreign Exchange

         Before January 1996, a commercial bank's deposits denominated in a
foreign currency could not exceed six times its computable net worth. Such limit
was eliminated and there are currently no limits for deposits denominated in
local currency or for new deposits denominated in foreign currency as permitted
by applicable regulations.

         Loan Loss Provisions

         The Central Bank requires financial institutions to make certain loss
provisions with respect to all loans, guarantees and other extensions of credit
granted by such institutions, the amounts of which depend on the category in
which the obligors thereunder are classified.

         Banks must classify their loan portfolio in two different categories:
(i) "Consumer Loans," which includes loans for housing and allows banks to
classify under this category loans and guarantees of a commercial nature of up
to Ps.200,000 with preferred guarantees; and (ii) "Commercial Loans." Central
Bank regulations allow financial institutions to apply the Consumer Loan
Classification criteria to commercial loans with or without guarantees of up to
Ps.200,000. If a borrower has loans both with and without preferred guarantees,
the credit backed by the preferred guarantees is considered to be at 50.00% of
its face value and added to the borrower's other credit to determine eligibility
for classification in the consumer portfolio.
----------------------
      /1/The Argentine National Securities Comision has issued regulations
         establishing that debt or equity securities may have a maturity term of
         at least 7 days. The Central Bank has not issued any comment or
         regulation in relation to such CNV's resolution yet.

                                       83

<PAGE>


         In this loan classification system, each customer, together with all
its outstanding liabilities, is then classified in one of the six subcategories
described below. The loan classification criteria applied to loans in the
consumer portfolio are based mainly on an objective criteria, analyzed on a
monthly basis, related to the grade of the fulfillment of its obligations. The
same information is provided to the center of debtors of the financial system
managed by the Central Bank, while the principal criterion of classification of
loans in the commercial portfolio is each borrower's ability to pay as measured
by such borrower's future cash flow. In applying the Central Bank's
classifications to commercial loans, a bank must assess the following factors:
(i) the management and operating history of the borrower and the adequacy of its
internal control system, (ii) the recent and projected financial situation of
the borrower, with a review of the borrower's financial statements, (iii) the
borrower's last payment record and its ability to service debt, (iv) the ability
of the borrower's internal information and control systems to provide accurate
and timely information regarding its financial and economic situation, (v) the
general risk of the sector in which the borrower operates and (vi) its relative
position within that sector.

         An evaluation team independent of the bank's commercial lending
officers, such as the bank's internal auditors, must carry out a periodic review
of the commercial portfolio. Alternatively, the bank's commercial lending
officers may carry out the review, subject to an independent evaluation of the
review. The evaluation must be carried out on each borrower.

         The Central Bank requires that the larger the exposure to a borrower,
the more frequent the review. The Central Bank requires a review be conducted
every calendar quarter when credit exposure to that borrower is equal to or in
excess of 5.00% of the bank's minimum capital on the last day of the month prior
to the review, or every six months when exposure amounts to the lesser of .$1
million or 1.00% of the bank's capital net worth on the last day of the month
prior to the review. In any case, at least 50.00% of the bank's commercial
portfolio must be reviewed by the end of each six months, and all other
borrowers in the bank's commercial portfolio must be reviewed during the bank's
fiscal year such that the entire commercial portfolio is reviewed every fiscal
year.

         Reviews must be reevaluated and documented in a borrower's file upon a
negative change in objective criteria such as an increase in days past-due, a
filing for bankruptcy or protection from creditors or a judicial proceeding
initiated against the borrower. In addition, a reevaluation will be triggered if
an independent rating agency downgrades its rating of the borrower's bonds.

         In addition, only one level of discrepancy is permitted between the
classifications assigned by a bank and the lowest classification assigned by at
least two other banks whose combined credit to the borrower represents more than
20.00% of the total credit of the borrower reported to the Central Bank.
Information regarding each bank's classification of its borrowers, including
loans per bank of at least Ps.200,000 and loans granted by each bank to at least
its 70 largest debtors, is expected to be released by the Central Bank on a
monthly basis. If a bank's classification differs by more than one level from
the lowest such classification of another bank, it must immediately downgrade
its classification of the borrower to the same classification, or to within one
classification level.

         The following listings show the above-mentioned risk subcategories and
give a brief description of each one, listed in decreasing order of quality of
the classification. A bank's total exposure to a private client must be
classified in the riskiest classification that corresponds to any part of such
exposure.

                                       84

<PAGE>


<TABLE>
<CAPTION>
                              COMMERCIAL PORTFOLIO

Loan Classification                                                            Description
-------------------                                      ---------------------------------------------------------
<S>                                                      <C>
Normal ..............................................    The borrower can easily service all financial
                                                         obligations, shows strong cash flow, liquid current
                                                         financial situation, adequate financial structure,
                                                         punctual payment record, capable management, timely and
                                                         precise available information and satisfactory internal
                                                         controls.  The borrower is determined to be in the top
                                                         50.00% of an industry that is performing well and has a
                                                         good outlook.

Potential Risk ......................................    Cash flow analysis indicates debt can be serviced with
                                                         possibility that if not closely observed future
                                                         payment capacity could be impaired.

Problematic .........................................    Cash flow analysis evidences problems in normal servicing
                                                         of existing debt such that if the problems are not solved,
                                                         they may result in some loss for the bank.

High Risk of Insolvency .............................    Cash flow analysis demonstrates that full repayment of the
                                                         borrower's obligations is highly improbable.

Uncollectible .......................................    Debts in this category are considered total losses.
                                                         Although an asset could have a possibility of recovery
                                                         under certain future circumstances, lack of
                                                         collectibility is evident at the date of analysis.
                                                         Includes loans to insolvent or bankrupt borrowers as well
                                                         as all debt to borrowers indicated by the Central Bank to
                                                         be in arrears to any liquidated or bankrupt financial
                                                         institution.

Irrecoverable for Technical Reasons .................    The borrower is (A) in arrears for more than 180 days
                                                         according to a list provided by the Central Bank, which
                                                         list includes (i) financial institutions liquidated by
                                                         the Central Bank, (ii) entities created as a result of
                                                         the privatization of public financial institutions and
                                                         (iii) financial institutions whose license has been
                                                         revoked by the Central Bank under judicial liquidation or
                                                         bankruptcy and/or (B) a certain kind of foreign borrower
                                                         (including banks or other financial institutions that are
                                                         not subject to the supervision of the Central Bank or
                                                         similar authority of the country in which they are
                                                         incorporated) that is not classified as "investment
                                                         grade" by any of the rating agencies approved by the
                                                         Central Bank.
</TABLE>

                                       85

<PAGE>


<TABLE>
<CAPTION>
                               CONSUMER PORTFOLIO

Loan Classification                                                             Description
-------------------                                      -----------------------------------------------------------
<S>                                                      <C>
Normal Performance ..................................    The loan is no more than 31 days past-due on principal
                                                         and/or interest, including loans that are current.
                                                         are current.

Inadequate Performance ..............................    The debt payment is delinquent with arrears from 32 to 90
                                                         days past-due.

Deficient Performance ...............................    The debt is in arrears at least 91 days and up to 180 days.

Difficult Collection ................................    Judicial proceedings demanding payment have been initiated
                                                         against the borrower, or the borrower is delinquent with
                                                         arrears greater than 180 days and up to one year.

Uncollectible .......................................    Loan to an insolvent or bankrupt borrower, or a borrower is
                                                         subject to judicial proceedings with little or no
                                                         possibility of collection, or in arrears in excess of one
                                                         year. Also includes all debt to borrowers indicated by the
                                                         Central Bank to be in arrears to any liquidated or bankrupt
                                                         financial institution.

Irrecoverable for Technical Reasons .................    The borrower meets the same criteria as those described
                                                         above for commercial borrowers.
</TABLE>

         The following minimum provisions are required to be made by Argentine
banks in relation to the above-mentioned categories.

<TABLE>
<CAPTION>
                                                                                      With             Without
                                                                                    Preferred         Preferred
Category                                                                           Guarantees         Guarantees
--------                                                                           ----------         ----------
<S>                                                                                <C>                <C>
"Normal" and "Normal Performance" ..............................................        1.00%              1.00%
"Potential Risk" and "Inadequate Performance" ..................................        3.00%              5.00%
"With Problems" and "Deficient Performance" ....................................       12.00%             25.00%
"High Risk of Insolvency" and "Difficult Collection" ...........................       25.00%             50.00%
"Uncollectible" ................................................................       50.00%            100.00%
"Irrecoverable for Technical Reasons" ..........................................      100.00%            100.00%
</TABLE>

         The above-mentioned provisions are, however, not applicable to
outstanding interbank financial transactions (not past-due) of up to 30 days, or
to loans to government-owned banks that benefit from a governmental guarantee on
their commitments.

         Refinancing of existing loans as well as new loans granted by financial
institutions to their clients in order to cancel taxes and social
security-related obligations are, however, not taken into account in the
classification of the relevant clients and in the assignment of their
corresponding categories.

         In case the financial assistance granted by a financial institution is
in excess of 2.50% of its computable net worth, the relevant classification of
debtors and loan loss provisions must be approved by the board of directors,
council of administration or similar corporate body of the financial
institution.

                                       86

<PAGE>


         The Bank's allowances for loan losses as of December 31, 2001 of
Ps.225.2 million were in compliance with, and exceed by Ps.106.2 million, these
Central Bank minimum requirements.

         Priority Right of Depositors

         Argentine Law No. 24,485, in effect since April 18, 1995 and as amended
by Law No. 24,627, provides that in the event of restructuring, judicial
liquidation or bankruptcy of a bank, all depositors, regardless of the type,
amount or currency of their deposits, whether individuals or corporations, would
have a general and absolute priority right over all creditors, with the
exception of certain labor creditors and those creditors secured by a pledge or
mortgage, to be paid out of 100.00% of the proceeds of the liquidation or the
assets of a failed bank. In addition, depositors of any type of deposits have a
special priority right over all other creditors of a bank, with the exception of
certain labor creditors, to be paid out of: (i) any funds of such bank that may
be held by the Central Bank as reserves, (ii) any other funds of such bank
existing at the date the license of such bank is revoked, or (iii) any proceeds
that may result from the mandatory transfer of certain assets of such bank as
determined by the Central Bank, in the following order of priority: (a) deposits
of up to Ps.5,000 per person or its equivalent in foreign currency, (b) all
deposits with maturities of more than 90 days, and (c) all other deposits on a
pro rata basis. Furthermore, the Central Bank has a special and absolute
priority right over all other creditors, with the exception of certain labor
creditors, certain creditors secured by mortgage or pledge and depositors.

         The bondholders do not have priority rights over any assets of the Bank
in case of judicial liquidation or bankruptcy of the Bank. They will be treated
as regular creditors of the Bank and will be subject to any priority established
by the law (with respect to judicial costs, fiscal claims, guaranteed creditors,
depositors), and the Central Bank.

         Mandatory Deposit Guarantee Insurance System

         Argentine Law No. 24,485 and Decree No. 540, both passed on April 12,
1995, created a Deposit Guarantee Insurance System (the "DGIS") for bank
deposits and delegated to the Central Bank the organization and start-up of the
DGIS.

         The DGIS has been implemented through the creation of a fund named
"Fondo de Garantia de los Depositos" ("FGD"), which is administered by a private
legal entity named "Seguro de Depositos Sociedad Anonima" ("SEDESA"). The
shareholders of SEDESA are the Argentine Government, which holds at least one
share, and a trust constituted by the financial institutions authorized by the
Central Bank that wish to participate in the fund. The extent of participation
by each institution is established by the Central Bank in proportion to the
resources contributed by each such institution to the FGD.

         The DGIS covers deposits of individuals and legal entities in local and
foreign currency held in accounts in participating financial institutions,
including checking accounts and savings deposits up to Ps.30,000. Deposits for
amounts over Ps.30,000 are also covered by the guaranty system but only up to
such amount. The Central Bank may change the amount covered by the guaranty
system at any time, provided that the change is applied to all system
participants on the basis of developments in the Argentine financial system
consolidation process, and any other indicators the Central Bank may consider
appropriate.

         The effective payment on this guarantee will be made within 30 days of
the revocation of the license of the financial institution in which such funds
are held and is subordinated to the exercise of priority rights of depositors
described under "--Priority Rights of Depositors."

         The DGIS does not cover: (i) deposits of financial institutions in
other financial institutions, including certificates of deposit acquired in the
secondary market, (ii) deposits made by persons related directly or indirectly
to the entity, (iii) time deposits in bonds or shares, acceptances or
guarantees, (iv) deposits made by individuals related to the bank either
directly or indirectly, certificates of deposit in securities, acceptances or
guarantees, and (v) deposits made after July 1, 1995 and through September 17,
1998 at a rate two or more percentage points per annum above that offered by the
Banco de la Nacion Argentina for equivalent terms and, since the latter date, at
a rate two or more percentage points per annum above the rolling average for the
last five days of interest rates on

                                       87

<PAGE>


savings accounts for an equivalent term as determined by a survey conducted by
the Central Bank. Communication "A" 2399, as amended, extended the stated
grounds for exclusion from the DGIS to include negotiable certificates of
deposits acquired by endorsement and deposits obtained through systems offering
other incentives in addition to agreed-upon interest rates.

         On January 21, 2000 the Central Bank issued Communication "A" 3064, as
amended, that set the normal contribution to the deposit guarantee insurance
system at 0.015% effective from the contributions due for January 2000, subject
to the banks' executing with SEDESA agreements for loans earmarked for the
Deposit Guarantee Fund with the conditions provided in such Communication.
Subsequently, in Communication "A" 3153, as amended, the Central Bank rescinded
the requirement to execute loan agreements with SEDESA starting from September
2000. However, previous loan agreements will remain in effect under originally
agreed-upon terms and conditions until their respective repayments. That same
Communication increased the normal contribution up to 0.03%.

         The first contribution was made on May 24, 1995. For the fiscal year
ended December 31, 2001, the Bank contributed approximately Ps.12.9 million.
Banco Rio's participation in the FGD is approximately 10.11% of the fund.

         The Central Bank may (i) require financial institutions to advance the
payment of up to the equivalent of two years of monthly contributions and (ii)
debit the past-due contributions from funds of the financial institutions
deposited with the Central Bank. The Central Bank may require additional
contributions by certain entities, depending on its evaluation of the financial
condition of such entities.

         When the contributions to the FGD reach the greater of Ps.2.0 billion
or 5.00% of the total deposits of the system, the Central Bank may suspend or
reduce the monthly contributions and reinstate them when the contributions fall
below that level.

         Other Restrictions

         The FIL prohibits commercial banks from: (i) creating security
interests over their assets without prior authorization from the Central Bank,
(ii) entering into transactions with their directors and administrators and with
affiliated entities on terms more favorable than those offered to their clients,
and (iii) accepting their own shares as guarantees.

         Capital Markets

         Pursuant to the FIL, commercial banks are authorized to underwrite and
place both equity and debt securities. There are currently no statutory
limitations as to the amount of securities a bank may commit to underwrite.
However, under Central Bank regulations, the underwriting of equity and debt
securities by a bank will be treated as "credit assistance" and, accordingly,
until the time the securities are placed with third parties, such underwriting
would be subject to the limitations discussed under "--Liquidity and Solvency
Requirements--Concentration of Risk" above.

         Commercial banks are authorized to trade equity and debt securities in
the Argentine OTC Market if they are registered with the OTC Market as OTC
brokers (agentes de mercado abierto). In its capacity as OTC broker, a
commercial bank will be subject to the supervision of the CNV and, as a result,
must comply with certain reporting requirements.

         The Mercado de Valores de Buenos Aires S.A. (the "Buenos Aires Stock
Market") has authorized brokerage firms organized as sole-purpose corporations
(sociedades de bolsa), in addition to individuals, to operate as securities
brokers at the Buenos Aires Stock Exchange since 1990. There are currently no
restrictions on a commercial bank owning a sociedad de bolsa and, in fact, most
of the principal commercial banks operating in Argentina have established their
own sociedad de bolsa. All brokers (individuals or firms) are required to
purchase at least one share of the Buenos Aires Stock Market as a condition to
operating as a securities broker at the Buenos Aires Stock Exchange.

                                       88

<PAGE>


         Commercial banks may operate as both managers and depositories of
Argentine mutual funds, provided that a bank may not act simultaneously as a
manager and depositary for the same fund.

         Financial Institutions with Economic Difficulties

         The FIL establishes that any financial institution, including
commercial banks, with a cash reserve deficiency, operating below certain
technical standards and with substandard minimum net worth levels or, according
to the Central Bank, operating with impaired solvency or liquidity, must prepare
a restructuring plan (a "Restructuring Plan"). The Restructuring Plan must be
submitted to the Central Bank on a specified date, not later than 30 calendar
days from the date on which the request is made by the Central Bank. The Central
Bank can assign a trustee to the financial institution and limit dividend
distributions. In connection with a Restructuring Plan, the Central Bank is
authorized to provide a temporary exemption from compliance with technical
regulations and/or payment of fines that arise from such non-compliance.

         In addition, the Central Bank's charter authorizes the Superintendent
of Financial Entities within the Central Bank, subject only to the approval of
the president of the Central Bank, to suspend for up to 90 days, in whole or in
part, the operations of a financial entity if its liquidity or solvency has been
adversely affected. During the suspension, there is an automatic stay of claims,
enforcement actions and precautionary measures, any commitment increasing the
financial entity's liabilities is void and acceleration of indebtedness and
interest accrual is suspended.

         If, in the judgment of the Central Bank, a financial entity is in a
situation that, under the FIL, would authorize the Central Bank to revoke the
financial entity's license to operate as such, the Central Bank may, prior to
considering such revocation, order a variety of measures, including (i) taking
steps to capitalize or increase the financial entity's capital, (ii) revoking of
the approval granted to the shareholders of the financial entity to own an
interest therein, (iii) restructuring and/or transferring assets and
liabilities, (iv) granting temporary exemptions to comply with technical
regulations and/or charges and fines arising from such defective compliance, or
(v) appointing a delegate or intervener who may eventually replace the board of
directors of the financial entity.

         In response to the Argentine crisis, and as a means of ensuring the
liquidity and solvency of the Argentine banking system, the Federal Congress
modified the Central Bank's charter and the FIL in order to allow the Central
Bank to assume a more active role in the case of financial entities facing
liquidity or solvency difficulties. Law 24.144, as amended, grants the Central
Bank the power to decide upon the restructuring of the financial entity facing
liquidity or solvency difficulties through various measures. Among the measures
available to the Central Bank, it may (i) exclude all or part of the assets (the
"Excluded Assets") of the financial entity facing liquidity or solvency
difficulties to cover its deposits and credits owed to the Central Bank in the
terms of Section 53 of the FIL (the "Excluded Liabilities"), provided that the
value of the Excluded Assets equals at least the value of the Excluded
Liabilities, and (ii) transfer from such financial entity the Excluded Assets
and the Excluded Liabilities.

         Dissolution and Liquidation of Financial Institutions

         The Central Bank must be notified of any decision to dissolve a
financial institution pursuant to the FIL. The Central Bank, in turn, must then
notify a competent court that will determine who will liquidate the entity: the
corporate authorities or an appointed, independent liquidator. This
determination is based on whether sufficient assurances exist to indicate that
such corporate authorities are able to carry out the liquidation properly.

         Pursuant to the FIL, the Central Bank no longer acts as liquidator of
financial institutions. However, if a Restructuring Plan has failed or is not
considered viable, or local and regulatory violations exist, or when substantial
changes have occurred in the entity's condition since the original authorization
was granted, the Central Bank may decide to revoke a bank's license to operate
as a financial institution. In this case, the law allows judicial or
extrajudicial liquidation as in the case of voluntary liquidation described in
the preceding paragraph. During the liquidation process, bankruptcy proceedings
may be instituted against a bank by the competent court or by any creditor of
the bank, provided that, in certain cases, a waiting period of 60 days will
apply.

                                       89

<PAGE>


         C. Organization Structure

         Banco Rio is part of the worldwide network of the SCH Group, a leading
financial group in Latin America, with a policy of combining global balance
sheet strength with local management and regional training. The group has a long
connection with Latin America and a commitment that is reflected in the U.S.$15
billion invested in the region to date. The SCH Group comprises a large number
of banks which are deeply rooted in the financial tradition of their respective
countries, and a wide range of specialist financial institutions: mutual funds
and pension funds managers, insurance companies, leasing and factoring
companies, securities firms, etc. The Group also manages an industrial portfolio
in the most prosperous sectors of the economy.

         The American Division is the business unit of the Group, with the
responsibility of managing operations in Latin America. Therefore, the Bank is
part of the American Division for Argentine operations. The main subsidiaries
and related companies of Banco Rio as of December 31, 2001 are Santander
Sociedad de Bolsa, a business unit that offers integral brokerage services;
Santander Investment Gerente de Fondos Comunes de Inversion, which administrates
mutual funds; Santander Riobank, a bank that was incorporated in 1986 with
offices in Grand Cayman to carry out financial and commercial operations; and
Gire S.A., which offers collection services, administration and settlements.
Banco Rio has a direct and indirect 100.00% equity interest in these companies,
except in Gire S.A. where has an equity interest of 58.33% On January 4, 2002,
agreement was signed for the purchase of Santander Riobank's stock, whereby
Banco Rio sells Santander Overseas Bank Inc. Its 100% equity interest Santander
Riobank.

         In addition, Banco Rio has equity interests in other companies which
carry out activities complementary to financial services. Among these companies
are Banelco S.A. (20.00% of equity interest), which manages the largest network
of automatic teller machines (ATMs) in Argentina; Coelsa S.A. (10.72% of equity
interest), an electronic clearing house; Visa Argentina S.A. (5.00% of equity
interest), which manages Visa credit card in Argentina; and Rio Compania de
Seguros (12.50% of equity interest), an insurance company.

         D. Property, Plants and Equipment

         The Bank owns the 23,305 square meter building and the underlying land
of its executive offices located at Bartolome Mitre 480, (1036) Buenos Aires,
Argentina. In 1994, the Bank purchased an office building located at 25 de Mayo
130, (1002) Buenos Aires, Argentina, consisting of 14,500 square meters of
office space. During 1995 some of its executive offices moved to this building
and a new branch was opened in the building. At December 31, 2001, the Bank had
274 full service branches in Argentina, of which 145 were owned and 129 were
leased by the Bank. The lease agreements with respect to these branches are
generally for three-year periods, although the Bank retains the right to cancel
any lease. The Bank also owns or leases properties at various locations in
Argentina for the storage of documents and for back office and administrative
operations.

Item 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS

Discussion of Critical Accounting Policies

         The consolidated financial statements are prepared in accordance with
the rules prescribed by de Central Bank of Argentina, which differ in certain
respects from generally accepted accounting principles in Argentina, as
mentioned in note 4 to the consolidated financial statement. These rules require
the Bank and its subsidiaries to make some estimates and assumptions. The
following estimates and assumptions may involve a higher degree of judgment and
complexity by the Bank.

         Allowance for Commercial Loan Losses

         The Bank provides for estimated possible losses on loans and the
related accrued interest generally through the establishment of an allowance for
loan losses. The allowance for commercial loan losses charged to expense is
determined by management based on a periodic analysis of updated financial
information provided by the debtor at the request of the Bank. The basic
assessment criterion is the future debt payment capacity or the collateral
granted to the bank on the basis of the estimated cash flow. The Bank also takes
into account other circumstances such as

                                       90

<PAGE>


timely compliance with obligations, qualified and honest management or whether
the company is engaged in economic activities with acceptable prospects and
whether the debtor is competitive within its industry. On the basis of these
conditions, the customer is placed in any of the six categories established by
the Central Bank of Argentina that have been assigned minimum fixed allowance
requirements. On the basis of the analysis mentioned above, the Bank books
additional allowances for certain debtors which does not imply re-categorizing
the debtor under the rules of the Central Bank of Argentina.

         The use of different estimates or assumptions could result in different
allowances for commercial loan losses.

         Contingent Liabilities

         We are subject to proceedings, lawsuits and other claims related to
labor, commercial, civil and other matters. A determination of the amount of
reserves required, if any, for these contingencies was made after careful
analysis of each individual issue. The required reserves may change in the
future due to new developments in each matter or changes in approach such as a
change in the settlement strategy upon dealing with these matters. We believe
that the effect of the resolution of such claims will not have a material impact
on the Bank consolidated financial position.

         A. Operating Results

Presentation of Net Financial Income

         In order to present the financial information of the Bank in a format
more familiar to U.S. investors, certain classifications and groupings have been
made, and certain subtotals introduced, in "Item 4. Information on the
Company--Selected Statistical Information," "Item 3. Key Information" and in
this Item 5 that differ from those used in the Consolidated Financial Statements
presented on the basis of Argentine Banking GAAP. In addition, the financial
presentation in Banco Rio's prior annual reports on Form 20-F reclassified
commissions on foreign exchange activities from gain on foreign exchange (a
component of financial income) to fees related to foreign currency exchange
(service charge income). The Bank no longer reclassifies these commissions and
no such reclassification has been made in any period presented herein. The Bank
believes that this is an appropriate format to use in analyzing its results.

Analysis of the Bank's Results of Operations for Fiscal Years ended December 31,
2001, December 31, 2000 and December 31, 1999.

         The following discussion of the results of operations of the Bank for
fiscal year 2001, fiscal year 2000 and fiscal year 1999 should be read in
conjunction with the Consolidated Financial Statements included elsewhere
herein.

         Net Income

         The Bank's net income for the fiscal year 2001 was a loss of Ps.10.2
million, which represents a significant descent from the net income of Ps.207.6
million obtained in fiscal year 2000. The net loss per share amounted to Ps.0.03
as compared to earnings per share of Ps.0.60 for the prior year. The Bank's net
income for the fiscal year 2000 represents an increase of 74.20% compared to the
Ps.119.2 million recorded for fiscal year 1999. The components of the Bank's net
income for these periods are discussed in greater detail in the following
sections. Return on average assets was -0.08% for fiscal year 2001, 1.54% for
fiscal year 2000 and 1.04% for fiscal year 1999, respectively, and return on
average equity was -0.78% for fiscal year 2001, 15.84% for fiscal year 2000 and,
10.36% for fiscal year 1999, respectively.

         The components of net income for fiscal years 2001, 2000 and 1999 are
discussed in greater detail in the following sections.

                                       91

<PAGE>


         Net Financial Income After Provision

         Net financial income after provision decreased by 57.39% to Ps.206.0
million for fiscal year 2001 as compared to Ps.483.6 million for fiscal year
2000, which was 17.13% greater than the Ps.412.8 million recorded for fiscal
year 1999.

                      NET FINANCIAL INCOME AFTER PROVISION

<TABLE>
<CAPTION>
                                                                For the fiscal year ended
                                                     -------------------------------------------------
                                                                       December 31,
                                                     -------------------------------------------------
                                                         1999 (1)         2000 (2)         2001 (3)
                                                         --------         --------         --------
<S>                                                  <C>               <C>              <C>
                                                               (in thousands of pesos)

Interest Income (4)
     Interest on cash and due from banks                   27,912           41,400           27,520
     Interest on loans and financial leases               780,330          882,865          982,211
     Net gain on government and private securities        122,479          228,931           27,559
     Other                                                 56,854           60,014           17,462
                                                       ----------      -----------      -----------
     Total interest income                                987,575        1,213,210        1,054,752

Interest Expense (5)
     Interest on current account                                -                -          (12,477)
     Interest on saving deposits                          (31,344)         (40,678)         (24,019)
     Interest on certificates of deposits                (266,321)        (351,564)        (425,461)
     Other                                               (172,418)        (211,032)        (153,814)
                                                       ----------      -----------      -----------
     Total interest expense                              (470,083)        (603,274)        (615,771)
Net interest income before adjustments                    517,492          609,936          438,981
                                                       ----------      -----------      -----------

Adjustments to Interest
     Gain (losses) on foreign exchange (6)                 45,792           52,060           63,881
                                                       ----------      -----------      -----------
     Total adjustments to interest                         45,792           52,060           63,881
Net interest income after adjustments                     563,284          661,996          502,862
                                                       ----------      -----------      -----------

Other Financial Expenses
     Contribution to Guarantee of Deposits Fund           (18,414)         (10,924)         (12,926)
     Taxes on financial income                            (19,620)         (20,210)         (19,762)
                                                       ----------      -----------      -----------
     Total other financial expenses                       (38,034)         (31,134)         (32,688)
Net financial income before provision                     525,250          630,862          470,174
                                                       ----------      -----------      -----------
Provision for loan losses                                (112,433)        (147,329)        (264,148)
Net financial income after provision                      412,817          483,533          206,026
                                                       ==========      ===========      ===========
</TABLE>

(1) Consolidated to include the financial statements of Riobank, Santander Bolsa
and Santander Fondos.
(2) Consolidated to include the financial statements of Riobank, Santander
Bolsa, Santander Fondos and Gire S.A. Includes the result of operations and
average balance sheets of Banco Tornquist through the time of its merger with
and into Banco Rio.
(3) Consolidated to include the financial statements of Riobank, Santander
Bolsa, Santander Fondos and Gire S.A.
(4) Includes all items shown in "Financial Income" on the Bank's Statement of
Income except "Foreign exchange gains and premiums on the sales of foreign
currency," which is included under "Gain on foreign exchange" herein.
(5) The remaining items shown in "Financial expense" on the Bank's Statement of
Income have been reclassified and are set forth under other headings herein.
(6) Reflects the gains (losses) realized by the Bank on its net
dollar-denominated monetary asset position as the Argentine currency depreciates
(appreciates), and net premiums on sold and purchased foreign currency.

                                       92

<PAGE>

                      NET FINANCIAL INCOME AFTER PROVISION

<TABLE>
<CAPTION>
                                                                                  (By currency denomination)
                                                                      Peso-denominated                Dollar-denominated
                                                               -------------------------------  -------------------------------
                                                                  For the fiscal year ended        For the fiscal year ended
                                                               -------------------------------  -------------------------------
                                                                        December 31,                     December 31,
                                                               -------------------------------  -------------------------------
                                                               1999(1)     2000(2)    2001(3)    1999(1)    2000(2)    2001(3)
                                                               -------     -------    -------    -------    -------    -------
                                                                                    (in thousands of pesos)
<S>                                                            <C>         <C>      <C>         <C>        <C>        <C>
Interest Income (4)
    Interest on cash and due from banks                              --          --      1,607     27,912     41,400     25,913
    Interest on loans and financial leases                      248,452     269,505    289,514    531,878    613,360    692,697
    Net gain on government and private securities                38,910      13,523     (5,807)    83,569    215,408     33,366
    Other                                                           182         296        650     56,672     59,718     16,812
                                                               --------    --------  ---------  ---------  ---------  ---------
    Total interest income                                       287,544     283,324    285,964    700,031    929,886    768,788

Interest Expense (5)
    Interest on current account                                      --          --     (1,830)                   --    (10,647)
    Interest on saving deposits                                 (21,562)    (24,428)   (14,789)    (9,782)   (16,250)    (9,230)
    Interest on certificates of deposits                        (50,271)    (47,968)   (53,223)  (216,050)  (303,596)  (372,238)
    Other                                                        (2,149)     (2,018)      (472)  (170,269)  (209,014)  (153,342)
                                                               --------    --------  ---------  ---------  ---------  ---------
    Total interest expense                                      (73,982)    (74,414)   (70,314)  (396,101)  (528,860)  (545,457)
Net interest income before adjustments                          213,562     208,910    215,650    303,930    401,026    223,331
                                                               --------    --------  ---------  ---------  ---------  ---------
Adjustments to Interest
    Gain (losses) on foreign exchange (6)                            --          --         --     45,792     52,060     63,881
                                                               --------    --------  ---------  ---------  ---------  ---------
    Total adjustments to interest                                    --          --         --     45,792     52,060     63,881
    Net interest income after adjustments                       213,562     208,910    215,650    349,722    453,086    287,212
                                                               --------    --------  ---------  ---------  ---------  ---------
Other Financial Expenses
    Contribution to Guarantee of Deposits Fund                   (6,381)     (3,030)    (3,171)   (12,033)    (7,894)    (9,755)
    Taxes on financial income                                   (19,620)    (20,210)   (19,762)        --         --         --
                                                               --------    --------  ---------  ---------  ---------  ---------
    Total other financial expenses                              (26,001)    (23,240)   (22,933)   (12,033)    (7,894)    (9,755)
Net financial income before provision                           187,561     185,670    192,717    337,689    445,192    277,457
                                                               --------    --------  ---------  ---------  ---------  ---------
Provision for loan losses                                       (89,533)    (98,229)  (105,034)   (22,900)   (49,100)  (159,114)
Net financial income after provision                             98,028      87,441     87,683    314,789    396,092    118,343
                                                               ========    ========  =========  =========  =========  =========
</TABLE>
_________________

(1)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa and Santander Fondos.
(2)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A. Includes the result of operations and
     average balance sheets of Banco Tornquist through the time of its merger
     with and into Banco Rio.
(3)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A.
(4)  Includes all items shown in "Financial Income" on the Bank's Statement of
     Income except "Foreign exchange gains and premiums on the sales of foreign
     currency," which is included under "Gain on foreign exchange" herein.
(5)  The remaining items shown in "Financial expense" on the Bank's Statement of
     Income have been reclassified and are set forth under other headings
     herein.
(6)  Reflects the gains (losses) realized by the Bank on its net
     dollar-denominated monetary asset position as the Argentine currency
     depreciates (appreciates), and net premiums on sold and purchased foreign
     currency.

         Fiscal Year 2001 Compared to Fiscal Year 2000

         Interest Income

         Interest income for the fiscal year ended December 31, 2001 was
Ps.1,054.8 million, a decrease of 13.06% from Ps1,213.2 million for the previous
fiscal year. Average total interest-earning assets decreased 4.99% from Ps.10.1
billion for the fiscal year ended December 31, 2000 to Ps.9.6 billion for the
fiscal year ended December 31, 2001.

                                       93

<PAGE>

         The average nominal yield earned on these assets decreased 102 basis
points to 10.99% in the fiscal year ended December 31, 2001 when compared to
12.01% in the prior fiscal year. The decrease in interest income was driven by
the sharp decline in Government Securities yields from 11.85% for the fiscal
year 2000 to 1.07% for the fiscal year 2001. This deep drop was due to
significant sells of Government Securities carried under "investment accounts"
(held to maturity). As the year went on and macroeconomic indicators
deteriorated, the Bank's strategy gave priority to maintaining ample liquidity
and decreasing exposure to the government sector, as the main measures aimed at
protecting shareholders' and depositors' equity and interests. The first
consequence of this strategy was diminishing income, but it was to prove timely
when government securities fell steadily in the last months of the year. The
deteriorated income from Government Securities were partially offset by the
increase of 109 basis points on the average nominal yield earned by the loans
and financial leases to 14.67% for the fiscal year 2001 from 13.58% for the
prior year. The average volume of loans and financial leases grew 2.44% from Ps.
6.5 millon for the fiscal year ended December 31, 2000 to Ps.6.7 million for the
fiscal year ended December 31, 2001. It should be noted that, pursuant to the
government-debt restructuring made in November 2001, a portion of the
government-sector risks priorly booked as government-security holdings were
changed to be booked under loans. This change in manner of disclosure is the
cause for the entire increase in the loan portfolio. In the private sector, in
contrast, there were reductions in all segments but especially in small and
medium-sized companies. Given the conditions during the year and the perceived
increasing risk, the Bank adopted a policy of prudence and imposed more
stringent admittance conditions.

         Interest Expense

         Interest expense for the fiscal year ended December 31, 2001 increased
2.07% to Ps.615.8 million from Ps.603.3 million for the previous fiscal year.
The increase in interest expense is totally explained for the increase of 141
basis points in the cost of time deposits, the mainly component of the Bank's
sources of funds.

         Dollar-denominated average interest-bearing liabilities, which stood at
83.90% in fiscal year 2000 and 86.25% in fiscal year 2001, constituted a
relatively constant portion of average interest-bearing liabilities over the
period. In fiscal years 2000 and 2001, interest paid on dollar-denominated time
deposits represented a substantial portion of interest paid on
dollar-denominated liabilities: 57.40% and 68.24%, respectively.

         The most significant drops occurred in savings accounts - mainly those
denominated in pesos - partially offset by interest-bearing demand deposits,
which the Bank began, during the fiscal year 2001, to procure from the corporate
market and which reflected the liquidity of mutual funds. Market share of
deposits in the Argentine financial system reached 8.70% at December 31, 2001,
according to the Central Bank, increasing 60 basis points in relation to the
prior fiscal year.

         Gains on Foreign Exchange

         The Bank recorded gains on foreign exchange of Ps.63.9 million for
fiscal year 2001 as compared to gains of Ps.52.1 million for fiscal year 2000.
Included in these amounts are net premiums on forward exchange sales and
purchases.

         Net Interest Income After Adjustments

         Net interest income after adjustments was Ps.502.9 million for fiscal
year 2001, a 24.04% decrease from net interest income after adjustments of
Ps.662.0 million for fiscal year 2000. The decrease in net interest income after
adjustments in fiscal year 2001 reflected a 36.61% decrease in the
dollar-denominated portion of such net interest income from Ps.453.1 million in
fiscal year 2000 to Ps.287.2 million in fiscal year 2001, and a 3.23% increase
in the peso-denominated portion of such net interest income from Ps.208.9
million in fiscal year 2000 to Ps.215.6 million in fiscal year 2001. This
decrease was because of decreases in average volume and in net interest margin
from 6.04% for fiscal year 2000 to 4.57% for fiscal year 2001.

                                       94

<PAGE>

         Other Financial Expenses

         Other financial expenses, consisting of taxes on financial income and
contributions to the Guarantee of Deposits Fund that was implemented in April
1995, were Ps.31.1 million for fiscal year 2000 and Ps.32.7 million for fiscal
year 2001. This increase was due to the increase in the average of deposits
covered by the guarantee.

         Provision for Loan Losses

         Banco Rio recorded Ps.264.1 million in loan loss provisions for the
fiscal year ended December 31, 2001, representing a 79.29% increase over the
Ps.147.3 million registered for the prior fiscal year. This increase reflects
the quality deterioration of the Bank's loan portfolio, consequence of the deep
recession and the political and institutional crisis.

         Charge offs amounted to Ps.268.7 million in the fiscal year ended
December 31, 2001 compared to Ps.231.7 million in the fiscal year ended December
31, 2000.

         Banco Rio's non-performing loan portfolio fell from Ps.224.9 million at
December 31, 2000 to Ps.166.2 million at December 31, 2001. The ratio of
non-performing loans to total loans decreased to 2.41% at December 31, 2001
compared to 3.4% at December 31, 2000.

         As a result of increased provisions for loan losses and charge-offs of
non-performing loans, Banco Rio's allowances for loan losses as a percentage of
non-performing loans reached 135.51% at December 31, 2001 compared to 105.28% at
December 31, 2000. This increased ratio was established advanced the actual
uncertainty to collect loans.

         Fiscal Year 2000 Compared to Fiscal Year 1999

         Interest Income

         Interest income for the fiscal year ended December 31, 2000 was
Ps.1,213.2 million, an increase of 22.80% from Ps.987.6 million for the previous
fiscal year. Average total interest-earning assets increased 14.80% from Ps.8.8
billion for the fiscal year ended December 31, 1999 to Ps.10.1 billion for the
fiscal year ended December 31, 2000.

         The average nominal yield earned on these assets increased 78 basis
points to 12.01% in the fiscal year ended December 31, 2000 when compared to
11.23% in the prior fiscal year. The increase in interest income principally
reflected the 13.10% increase in interest on loans and financial leases, which
grew from Ps.780.3 million for the fiscal year ended December 31, 1999 to
Ps.882.9 million for the fiscal year ended December 31, 2000. This increase is
due mainly to the 8.30% increase in Banco Rio's average loans and financial
leases from Ps.6.0 billion for the fiscal year ended December 31, 1999 to Ps.6.5
billion for the fiscal year ended December 31, 2000 and a 62 basis point
increase in the average yield earned on the loan portfolio to 13.58% for the
fiscal year ended December 31, 2000 from 12.96% for the prior fiscal year. The
portfolio of government securities was the component with the highest growth
among interest earning assets of the Bank. The average volume of the portfolio
of government securities for the fiscal year ended December 31, 2000 amounted to
$1.9 billion, a 57.50% increase from last year. The portfolio of government
securities primarily contains dollar denominated securities registered in
investment accounts. This growth was fueled by the attractive yield rates
offered and the excess of liquidity that the Bank had for most of fiscal year
2000, due in part to lower demand for loans. The average yield rate was 11.85%,
which represented a 202 basis points gain from last year.

         The growth in Banco Rio's loan portfolio was driven mainly by public
sector loans, which increased 7.70% from Ps.1.3 billion on average for the
fiscal year ended December 31, 1999 to Ps.1.4 billion on average for the fiscal
year ended December 31, 2000. Most of such public sector loans were loans to
provinces, which are secured by the co-participation tax payments received by
the provinces from the central government. The average volume of retail loans,
primarily mortgages, personal loans and credit card financing, grew 9.80% in the
fiscal year ended December 31, 2000 as compared to the previous fiscal year.
Also, the middle market average loans grew 10.20%. This growth

                                       95

<PAGE>

was partly offset by a reduction in large corporate loans, which fell 9.00% in
the fiscal year ended December 31, 2000 compared to the previous fiscal year,
reflecting a low demand in light of the general slowdown in the economy. Banco
Rio's market share of loans in the Argentine financial system grew from 6.75% as
of December 1998 to 7.03% as of December 1999, reaching 8.10% in December 2000.

         Interest Expense

         Interest expense for the fiscal year ended December 31, 2000 increased
28.30% to Ps.603.3 million from Ps.470.1 million for the previous fiscal year.
The increase in interest expense reflected a 16.10% increase in Banco Rio's
average total interest-bearing liabilities, from Ps.(7.41) billion for the
fiscal year ended December 31, 1999 to Ps.(8.61) billion for the fiscal year
ended December 31, 2000, and a 67 basis point increase in the average nominal
rate paid on these liabilities from 6.34% to 7.01%.

         Dollar-denominated average interest-bearing liabilities, which stood at
79.90% in fiscal year 1999 and 83.90% in fiscal year 2000, constituted a
relatively constant portion of average interest-bearing liabilities over the
period. In fiscal years 1999 and 2000, interest paid on dollar-denominated time
deposits represented a substantial portion of interest paid on
dollar-denominated liabilities: 54.50% and 57.40%, respectively.

         Growth in time deposits continued being the most dynamic factor in the
growth of total interest-bearing liabilities, increasing 23.00% from Ps.3.9
billion on average for the fiscal year ended December 31, 1999 to Ps.4.8 billion
on average for the fiscal year ended December 31, 2000. Interest expense on time
deposits increased 32.00% to Ps.(351.6) million for the fiscal year ended
December 31, 2000 compared to Ps.(266.3) million in the prior fiscal year.
Market share of deposits in the Argentine financial system reached 8.10% at
December 31, 2000, according to the Central Bank, increasing 82 basis points in
relation to the prior fiscal year.

         Gains on Foreign Exchange

         The Bank recorded gains on foreign exchange of Ps.52.1 million for
fiscal year 2000 as compared to gains of Ps.45.8 million for fiscal year 1999.
Included in these amounts are net premiums on forward exchange sales and
purchases.

         Net Interest Income After Adjustments

         Net interest income after adjustments was Ps.662.0 million for fiscal
year 2000, a 17.50% increase from net interest income after adjustments of
Ps.563.3 million for fiscal year 1999. The increase in net interest income after
adjustments in fiscal year 1999 reflected a 29.60% increase in the
dollar-denominated portion of such net interest income from Ps.349.7 million in
fiscal year 1999 to Ps.453.1 million in fiscal year 2000, and a 2.20% decrease
in the peso-denominated portion of such net interest income from Ps.213.6
million in fiscal year 1999 to Ps.208.9 million in fiscal year 2000. This
increase was because of increases in average volume and in net interest margin
from 5.88% for fiscal year 1999 to 6.04% for fiscal year 2000.

         Other Financial Expenses

         Other financial expenses, consisting of taxes on financial income and
contributions to the Guarantee of Deposits Fund that was implemented in April
1995, were Ps.38.0 million for fiscal year 1999 and Ps.31.1 million for fiscal
year 2000. This decrease was due to the reduction in the rate established for
the fiscal year 2000 for contributions to the Guarantee of Deposits Fund

         Provision for Loan Losses

         Banco Rio recorded Ps.147.3 million in loan loss provisions for the
fiscal year ended December 31, 2000, representing a 31.00% increase over the
Ps.112.4 million registered for the prior fiscal year. This increase was due to
the growth in Banco Rio's loan portfolio and the incorporation of Banco
Tornquist's loan portfolio during this fiscal year that needed more provisions
for loan losses.

                                       96

<PAGE>

         Charge offs amounted to Ps.231.7 million in the fiscal year ended
December 31, 2000 compared to Ps.115.9 million in the fiscal year ended December
31, 1999. This increase is due to Banco Rio's policy change implemented in March
1999 to accelerate the date on which loans are written off from 360 days after
they become non-performing to 180 days after that date and to the clean-up
process for the past-due loan portfolio acquired from Banco Tornquist.

         Banco Rio's non-performing loan portfolio grew from Ps.154.9 million at
December 31, 1999 to Ps.224.9 million at December 31, 2000. The ratio of
non-performing loans to total loans increased to 3.39% at December 31, 2000
compared to 2.49% at December 31, 1999.

         As a result of increased provisions for loan losses and charge-offs of
non-performing loans, Banco Rio's allowances for loan losses as a percentage of
non-performing loans reached 105.28% at December 31, 2000 compared to 108.53% at
December 31, 1999. Banco Rio believes that its allowances for loan losses are
adequate to cover any known losses and any losses that can reasonably be
expected from its loan portfolio. For a discussion of Banco Rio's methods of
establishing the allowance for loan losses, see "Item 4. Information on the
Company--Selected Statistical Information of the Bank--Loan Portfolio--Allowance
for Loan Losses."

         Service Charge Income, Net

         The components of service charge income, net are reflected in the
following table:

                           SERVICE CHARGE INCOME, NET

<TABLE>
<CAPTION>
                                                                           For the fiscal year ended December 31,
                                                                    -------------------------------------------------
                                                                      1999 (1)          2000 (2)            2001 (3)
                                                                    -----------       ----------          -----------
<S>                                                                 <C>              <C>                <C>
Service charge income:
   Service Charges on Deposits Accounts ..........................     97,676            112,722            125,252
   Credit Card Operations ........................................     57,803             68,891             53,420
   Collections and Fund Management ...............................     14,788             37,641             43,644
   Capital Markets and Securities Activities .....................     35,670             49,101             63,441
   Fees Related to Foreign Trade .................................      9,108              9,633             10,109
   Credit Related Fees ...........................................     33,337             46,640             46,396
   Safety Deposit Box Rentals ....................................      3,354              4,064              2,160
   Insurance .....................................................     25,582             35,179             36,668
   Other .........................................................      2,148              3,569              9,518
                                                                    ---------          ---------          ---------
   Total .........................................................    279,466            367,440            390,608
                                                                    ---------          ---------          ---------
Service charge expense (4):
   Commissions ...................................................    (35,055)           (41,580)           (47,835)
   Taxes on service charge income ................................    (12,109)           (15,098)           (16,415)
                                                                    ---------          ---------          ---------
   Total .........................................................    (47,164)           (56,678)           (64,250)
                                                                    ---------          ---------          ---------

Service charge income, net: ......................................    232,302            310,762            326,358
                                                                    =========          =========          =========
</TABLE>

___________________
(1) Consolidated to include the financial statements of Riobank, Santander Bolsa
    and Santander Fondos.
(2) Consolidated to include the financial statements of Riobank, Santander
    Bolsa, Santander Fondos and Gire S.A. Includes the result of operations and
    average balance sheets of Banco Tornquist through the time of its merger
    with and into Banco Rio.
(3) Consolidated to include the financial statements of Riobank, Santander
    Bolsa, Santander Fondos and Gire S.A.
(4) Most of the expenses related to "Service charge income" are included in
    "Operating expenses" in the Statement of Income in the Consolidated
    Financial Statements and are not reflected in these figures.

                                       97

<PAGE>

     Fiscal Year 2001 Compared to Fiscal Year 2000

     Service charge income totaled $390.6 million in the fiscal year ended
December 31, 2001, a 6.31% increase over the previous year. The main positive
changes occurred in fees related to the maintenance and operation of deposit
accounts (+11.12%); collection for third parties and asset management (+15.95%)
and income from securities transactions (+29.21%). In the first case, the
improvement stems from the higher number of accounts and customers. Collection
for third parties and asset management commissions and fees rose thanks to the
maturing of new products and alternatives offered to customers, especially
through non-traditional channels. Lastly, commissions for securities-related
services include the positive impact of the commissions obtained on the
government-debt swap of Noverber 2001.

     Revenues from credit-card services declined by 22.46%. To a large extent,
this is attributable to the recessionary environment and competition issues that
affected prices.

     Service charge expense increased by 13.36% from Ps.56.7 million for fiscal
year 2000 to Ps.64.2 million for fiscal year 2001. Service charge expense
includes commissions paid to third parties in connection with certain of Banco
Rio's fee-generating services, such as collection fees paid to other banks, as
well as Argentine taxes imposed on service charge income.

     Fiscal Year 2000 Compared to Fiscal Year 1999

     Service charge income totaled $367.4 million in the fiscal year ended
December 31, 2000, a 31.50% increase over the previous year. The Bank has become
the major shareholder of Gire S.A through its merger with Banco Tornquist and,
therefore, this year it has consolidated Gire S.A.'s financial statements.
Excluding the commissions earned by Gire S.A., the service charge income would
have been $345.4 million, a 23.60% increase from the previous year.

     All the principal components experienced positive variations and
highlighted the increase in business activity. Among them, the increase in the
number of clients and accounts created a 15.40% increase in commissions on
deposit accounts and a 19.20% growth in fees related to credit cards. The fees
related to the sale of insurance policies also grew 37.50% due to new types of
coverage and cross selling with other products such as mortgage loans and car
loans.

     Service charge expense increased by 20.20% from Ps.47.2 million for fiscal
year 1999 to Ps.56.7 million for fiscal year 2000 impelled by the growth in
third parties costs related to the increase in transactions.

     Operating Expenses

     The components of the Bank's operating expenses are reflected in the
following table:

                               OPERATING EXPENSES

<TABLE>
<CAPTION>
                                                                    For the fiscal year ended December 31,
                                                             ----------------------------------------------------
                                                                1999 (1)           2000 (2)           2001 (3)
                                                             --------------     --------------     --------------
<S>                                                          <C>                <C>                 <C>
Salaries and Payroll Taxes                                      (210,589)          (231,004)          (246,192)
Outside consultant and services                                  (32,801)           (43,253)           (42,028)
Rent                                                             (19,591)           (21,469)           (22,423)
Advertising and Publicity                                        (14,495)           (20,155)           (20,514)
Taxes (other than income tax)                                    (11,004)           (10,845)           (14,900)
Management Fee                                                   (17,047)           (28,069)                --
Security Services                                                (11,830)           (13,291)           (11,806)
Stationery and Supplies                                           (5,973)            (5,842)            (5,333)
Electric Power and Communications                                (25,293)           (18,213)           (17,633)
</TABLE>

                                       98

<PAGE>

<TABLE>
<S>                                                  <C>               <C>                <C>
Depreciation of Bank Premises and Equipment             (29,009)           (32,781)           (36,010)
Amortization of Organization and development            (37,266)           (36,040)           (33,745)
Other                                                   (68,252)           (82,136)           (76,785)
                                                     ----------         ----------         ----------
Total                                                  (483,150)          (543,098)          (527,369)
                                                     ==========         ==========         ==========
</TABLE>

______________
(1)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa and Santander Fondos.
(2)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A. Includes the result of operations and
     average balance sheets of Banco Tornquist through the time of its merger
     with and into Banco Rio.
(3)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A.

         Fiscal Year 2001 Compared to Fiscal Year 2000

         For fiscal year 2001, operating expenses were $527.4 million, a 2.90%
decrease compared to fiscal year 2000.

         Among the items over which the Bank can exert control by direct action,
only salaries and social security taxes showed increases. This is because in
2001 there were higher severance pay charges, resulting from the process of
efficiency enhancement and adaptation to a recessionary market. The behavior of
all other items highlights the achievement of the sustained rationalization and
productivity-enhancement programs. No charges accrued under the management
agreement with the SCH Group because the fiscal year brought no profit.

         Fiscal Year 2000 Compared to Fiscal Year 1999

         For fiscal year 2000, operating expenses were $543.1 million, a 12.40%
increase compared to fiscal year 1999. As explained in the net service charge
income section, it should be noted that the consolidation of Gire S.A. added
$16.8 million of total expenses. Banco Tornquist's expenses amounting to $16.4
million further added to the increase in total expenses. Excluding these items,
the increase of total expenses from the previous year was 5.50%. The main
variation from the previous fiscal year is a 53.70% increase in fees paid for
the ten-year Management Agreement (as such term is defined in "Item 5: Major
Shareholders and Related Party Transactions--Related Party
Transactions--Management Agreement") (10.00% of the Bank's income before income
tax) with BSCH Group that was due by the larger income obtained in fiscal year
1999. During the fiscal year 2000, the Bank continued in the implementation of
plans and programs to reduce expenses and increase productivity and efficiency.
The increase in costs directly related to the level of business activity
(security, supplies, communications, rent, advertising, etc.) grew less than the
general expansion of business for the Bank. As a consequence, the Bank
registered an improvement in its efficiency ratio (cost to income), which
decreased from 63.80% to 57.70% for fiscal years 1999 and 2000, respectively.

         Other Income, Net

         The components of other income, net are reflected in the following
table:

                                OTHER INCOME, NET

<TABLE>
<CAPTION>
                                                                Fiscal year ended December 31,
                                                       -----------------------------------------------
                                                        1999 (1)          2000 (2)           2001 (3)
                                                       ---------          ---------          ---------
                                                                    (In thousands of pesos)
<S>                                                    <C>               <C>                 <C>
Income from Investments in Other Companies                 6,847              2,470                  -
Allowances Restored to Income                              1,939              7,268                  1
Expenses Recovered                                         3,009              3,083              2,785
Loans Recovered                                           11,247             28,229             44,030
Other                                                     15,291             17,351             11,241
                                                       ---------          ---------          ---------
TOTAL                                                     38,333             58,401             58,057
                                                       ---------          ---------          ---------
</TABLE>

                                       99

<PAGE>

<TABLE>
<S>                                                  <C>             <C>                 <C>
Loss from Investments in Other Companies                      -               -             (7,522)
Provision for Losses on Other Receivables
        and Other Allowances                            (12,486)        (19,872)           (23,886)
Other (4)                                               (27,016)        (27,424)           (29,645)
                                                      ---------       ---------          ---------
TOTAL                                                   (39,502)        (47,296)           (61,053)
                                                      ---------       ---------          ---------
                                                      ---------       ---------          ---------
                                                         (1,169)         11,105             (2,996)
                                                      =========       =========          =========
</TABLE>

___________
(1)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa and Santander Fondos.
(2)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A. Includes the result of operations and
     average balance sheets of Banco Tornquist through the time of its merger
     with and into Banco Rio.
(3)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A.
(4)  Most of the expenses related to "Service charge income" are included in
     "Operating expenses" in the Statement of Income in the Consolidated
     Financial Statements and are not reflected in these figures.

         Fiscal Year 2001 Compared to Fiscal Year 2000

         Other income for the fiscal year 2001 were of Ps.58.1 million and
represents a level approximately similar to the registered in the prior year.
Loans recovered were Ps. 44.0 million representing 75.84% of the Other Income
total. Other expenses increased 29.09% from Ps.(47.3) million to Ps.(61.1)
million, mainly due to the loss from investment in other companies. During the
fiscal year 2001, Prestamos de Consumo S.A., a company that offered financial
services to the low-income segment was liquidated because didn't offer the
prospective results.

         Fiscal Year 2000 Compared to Fiscal Year 1999

         Other income registered a net increase from Ps.(1.2) million for the
fiscal year ended December 31, 1999 to Ps.11.1 million for the fiscal year ended
December 31, 2000. Total other income increased 52.30% from Ps.38.3 million for
fiscal year 1999 to Ps.58.4 million for fiscal year 2000. The principal factor
that was responsible for this variation was an increase in the loans recovered,
showing the improvements in the collection process during the fiscal year 2000.

         Total other expenses increased 19.70% from Ps.(39.5) million for the
fiscal year ended December 31, 1999 compared to Ps.(47.3) million for the fiscal
year ended December 31, 2000. The main component was the 59.20% increase in
provisions for losses on other receivables and other allowances, from Ps.(12.5)
million for the fiscal year 1999 to Ps.(19.9) million for the fiscal year 2000.

         Income Tax

         Income taxes were Ps.41.6 million in fiscal year 1999, Ps.54.7 million
in fiscal year 2000 and Ps.12.2 million in fiscal year 2001, representing,
25.90% and 20.90%, of net income before income taxes for fiscal years 1999 and
2000. The whole income tax for the year 2001 corresponding to the earnings of
consolidated companies with the Bank, since the Bank didn't yield taxes due to
their lack of positive results As a percentage of net income before income
taxes, income taxes decreased in fiscal year 2000 because of the difference
between the Bank's recorded net income before income tax and taxable income
arising from differences in the treatment of certain past-due loans and in the
valuation of government securities carried in "investment accounts", that
differs from the mark-to-market valuation used by tax law.

         The statutory income tax rate was raised to 33.00% for all financial
periods ending on or after September 1, 1996. Before this date and since April
13, 1992, the statutory income tax rate was 30.00%. For fiscal years 1999, 2000
and 2001, the statutory income tax rate was raised from 33.00% to 35.00%.

                                       100

<PAGE>

Analysis of the Bank's Financial Position

         Asset and Liability Management

         The Bank's policy on asset and liability management is to minimize the
mismatching of maturities, to maximize its net financial income and the return
on assets and equity, and to protect its liquid net worth, taking into account
liquidity and foreign exchange risks.

         The Assets and Liabilities Committee (Comite de Activos y Pasivos or
"ALCO"), which includes the principal managers of the corporate banking,
commercial banking, and planning departments, in coordination with the financial
department, is responsible for the design of the Bank's funding policy and for
weekly funding decisions. The Market Risk Committee (Comite de Riesgos de
Mercado or "CRM"), comprised of the principal managers of the financial, risk,
planning and corporate banking departments, is responsible for the supervision
of the Bank's positioning, measurement of related risks and compliance with
fixed limits on interest rate risk and liquidity risk. These Committees meet at
least weekly and receive reports on the economic environment, financial markets
and the peso and dollar funding and assets of the Bank and make decisions within
guidelines established from time to time by the Bank's Management Committee
(some members of which are also members of the ALCO and CRM committees).

         Interest Rates

         Interest rate risk reflects the possibility that the Bank's interest
margin may diminish as a consequence of the impact that interest rate
fluctuations can have on the value of assets and liabilities held at fixed
rates, depending on terms to maturity or to rate revision. The Bank has the
right to re-price most of its interest-earning peso-denominated assets at least
every 30 days. Approximately 13.40% of peso-denominated loans (net of
allowances) at December 31, 2001 consisted of overdrafts. Credit card balances
represented approximately 51.54% of peso-denominated loans (net of allowances)
at December 31, 2001. The interest rate on credit card balances may be reset
monthly. The interest rate on a substantial majority of peso-denominated
mortgage loans, which represented approximately 25.83% of peso-denominated loans
(net of allowances) at December 31, 2001, is fixed. However, some mortgage loans
contain a provision allowing the Bank to adjust the rate of interest under
certain conditions.

         The Bank generally prices its dollar-denominated loans based upon rates
paid on dollar-denominated deposits in the domestic market, rates paid on credit
lines from correspondent banks and securities issued in the international market
and the market conditions prevailing at the time credit is extended to a
customer. Dollar-denominated mortgage loans generally have a fixed rate of
interest, but contain a provision allowing the Bank to adjust the rate of
interest if the London Interbank Offered Rate (LIBOR) or the U.S. Prime Rate
increases by more than a specified amount from levels prevailing at the time the
loan is extended. Since March 1994, substantially all loans to corporations with
maturities of more than one year have earned interest at the higher of a fixed
rate or a floating rate equal to LIBOR (at the time the loan is granted) plus a
spread. The interest rate payable is determined on each interest payment date.

         B.    Liquidity and Capital Resources

Funding

         The Bank has three principal funding sources: customer deposits
(consisting of current accounts, savings accounts and time deposits generated by
the Bank's branch network), credit lines from banks and international
organizations, and medium- and long-term funds obtained through issuances of
securities in the international capital markets. The Bank also uses its liquid
net worth as a source of funding. Below is a breakdown of the funding of the
Bank at December 31, 2000 and 2001:

                                      101

<PAGE>

                                     FUNDING

                                                   At December 31,
                                            -----------------------------
                                              2000 (1)         2001 (2)
                                            -----------      ------------
Deposits (3)                                  7,065,614         6,370,375
Credit Lines (3) (4)                          1,069,884           676,400
Corporate Bonds (3)                             984,131         1,035,446
Liquid Net Worth (5)                            908,554           628,555
                                            -----------      ------------

Total Funding                                10,028,183         8,710,776
                                            ===========      ============

_________________________
(1)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A. Includes the liabilities of Banco
     Tornquist through the time of its merger with and into Banco Rio.
(2)  Consolidated to include the financial statements of Riobank, Santander
     Bolsa, Santander Fondos and Gire S.A.
(3)  Includes accrued interest and exchange differences payable.
(4)  Includes credit lines and other borrowings from the Central Bank, other
     banks and international organizations.
(5)  Stockholders' equity less bank premises and equipment, other assets,
     intangible assets and that portion of investments in other companies
     consisting of investments in banks and unlisted companies.


         While customer deposits have been the most important part of the Bank's
funding sources, accounting for 73.13% of total funding (including liquid net
worth) at December 31, 2001, they have also been the most volatile source of
funding. The Bank's deposit base, like those of all other banks in Argentina,
has been significantly affected by the various economic plans and regulations
implemented by the Argentine Government over the years, as well as by general
economic conditions. Since the enactment of the law No. 23,928 (the
"Convertibility Law"), the Bank's deposit base has increased substantially, with
the exception that, early in 1995, the deposit base shrank as a result of the
Mexican peso crisis. The Asian crisis in October 1997 and the Russian default in
August 1998 had no material effect over the Bank's level of deposits. See "Item
4. Information on the Company--Argentine Banking System." Based on Central Bank
estimates, as of December 31, 2001 the Bank's market share, in terms of
deposits, increased to 8.70% from 8.10% as of December 31, 2000.

         The following chart shows the breakdown of deposits by currency at
December 31, 2000 and 2001:

                                DEPOSIT BREAKDOWN

                                                       At December 31,
                                                 ---------------------------
                                                   2000 (1)     2001 (2) (3)
                                                 -----------   -------------
                                                   (in thousands of pesos)
Peso-denominated (3)
   Checking and Other Demand deposits                373,003       549,836
   Saving deposits                                   802,064       478,415
   Time deposits                                     625,504       247,697
   Other                                              34,166        37,278
                                                  ----------    ----------
   Total                                           1,834,737     1,313,226
                                                  ==========    ==========

Dollar-denominated (3)
   Checking and Other Demand deposits                127,407       654,194
   Saving deposits                                   662,343     1,565,876
   Time deposits                                   4,391,583     2,643,619
   Other                                              49,544       193,460
                                                  ----------    ----------
   Total                                           5,230,877     5,057,149
                                                  ==========    ==========

Total deposits                                     7,065,614     6,370,375

                                      102

<PAGE>

_____________________
     (1) Consolidated to include the financial statements of Riobank, Santander
         Bolsa, Santander Fondos and Gire S.A. Includes the liabilities of Banco
         Tornquist through the time of its merger with and into Banco Rio.
     (2) Consolidated to include the financial statements of Riobank, Santander
         Bolsa, Santander Fondos and Gire S.A.
     (3) The accrued interest and exchange differences payable are included in
         each line.

         At December 31, 2001, 79.39% of the Bank's total deposits were dollar
denominated. Dollar-denominated deposits became an important source of funds for
the Argentine financial system after August 1, 1989, when the Central Bank
authorized banks to accept demand and time deposits in foreign currency, subject
to certain cash reserve requirements. Such deposits were made even more secure
with the enactment of the Convertibility Law, which modified the Argentine civil
code to provide that debts contracted in a foreign currency could not be
discharged with pesos, thereby requiring banks to use dollars to repay maturing
dollar-denominated deposits. Until November 1, 1995, the Central Bank imposed
cash reserve requirements with respect to certain types of deposit accounts.
Effective November 1, 1995, cash reserve requirements were abolished and
replaced with minimum liquidity requirements. See "Item 4. Information on the
Company--Argentine Banking System and Regulation--Argentine Banking
Regulation--Liquidity and Solvency Requirements--Minimum Liquidity
Requirements."

         The Bank's total peso-denominated deposits decreased from Ps.1,874.8
million at December 31, 1999 to Ps.1,834.7 million at December 31, 2000 and to
Ps.1313.2 at December 31, 2001. At December 31, 2001, the Bank's
peso-denominated deposit accounts consisted of approximately 347,900 checking
accounts, 594,900 savings accounts and 7,000 time deposits. Checking accounts,
which represented 41.87% of total peso-denominated deposits at that date, had an
average balance of approximately Ps.396.6 million. The Bank pays interest on
approximately 10% of these checking accounts. . Savings accounts represented
36.43% of total peso-denominated deposits and had an average balance of
approximately Ps.540.0 million for the fiscal year. During the year 2001, the
average interest rate paid on peso-denominated savings accounts was 0.23% per
month. Time deposits represented 18.84% of total peso-denominated deposits at
December 31, 2001. During the fiscal year, the average interest rate paid on
peso-denominated time deposits was 0.86% per month. The average term for
peso-denominated time deposits is 50 days.

         Total dollar-denominated deposits increased from Ps.4,372.8 million at
December 31, 1999, to Ps.5,230.9 million at December 31, 2000 and decreased to
Ps.5,057.1 at December 31, 2001. At that date, the Bank's dollar-denominated
deposit accounts in Argentina consisted of approximately 318,000 sight deposit
accounts, 441,000 savings accounts and 71,540 time deposits. Time deposits
represented the largest portion of dollar-denominated deposits (52.27%), and the
average balances of such deposits increased 2.16% from Ps. 4,237.3 million in
fiscal year 2000 to Ps.4,329.0 million in fiscal year 2001. The average term for
these time deposits at December 31, 2001 was 60 days. During the fiscal year
2001, the average interest rate paid on these time deposits was 0.72% per month.
Savings accounts represented 30.96% of total dollar-denominated deposits and had
an annual average balance of approximately Ps.538.3 million. The average
interest rate paid on dollar-denominated savings deposits was 0.13% per month.
Checking and other demand deposits represented 12.94% of total
dollar-denominated deposits at December 31, 2001. Checking and other demand
deposits had an annual average balance of approximately Ps.427.7 million.

         The Bank also funds itself with credit lines from banks and
international agencies. At December 31, 2001, these credit lines amounted to
Ps.673.6 million, a decrease of 37.04% from the Ps.1,169.9 million in credit
lines at December 31, 2000. The Bank maintains these interbank credit lines,
which represent a longer term source of funds, in an effort to maintain a
balance between the maturity of its assets and liabilities. These credit lines
are used in connection with import and export financing activities. Also
included in lines of credit is Ps.0.6 million in Central Bank re-discounts used
to finance specific export transactions. The Central Bank stopped providing new
financing of this type following the implementation of the Convertibility Plan.

         The Bank has also been able to fund itself in the international
financial markets through the issuance of euro-denominated certificates of
deposit, corporate debt securities (obligaciones negociables) and medium-term
notes. Long-term, dollar-denominated funds raised in the international capital
markets are an important part of the Bank's funding, with Ps.1,037.9 million of
such funds outstanding at December 31, 2001. In December 1993, the Bank issued
U.S.$250.0 million of ten-year negotiable obligations. Further, as of December
31, 2001, the Bank had issued and outstanding U.S.$350.0 million under a global
program and U.S.$1.0 billion, and U.S.$435.0 million

                                      103

<PAGE>

under a global program of U.S.$500 million. These sources of funding have
enabled the Bank to obtain longer term financing in dollars.

Liquidity

         The purpose of liquidity management is to ensure that the Bank has
available funds to meet its present and future financial obligations and to
capitalize on business opportunities as they arise. The Bank requires liquid
funds in order to honor withdrawals of deposits, to make repayments at maturity
of other liabilities, to extend loans or other forms of credit to customers and
to meet its own working capital needs. Because the Bank has significant
operations in both pesos and dollars, it manages its liquidity position in each
currency independently. The Bank's objective is to match its assets and
liabilities with respect to currency and maturity. The Assets and Liabilities
Committee monitors the Bank's liquidity position on at least a weekly basis.

         The Bank's liquidity management policy is to invest a substantial
portion of its net worth (together with other funds) in both peso- and
dollar-denominated liquid instruments, such as publicly traded government bonds
and short-term, high-quality loans. The Bank has historically managed its
liquidity position conservatively, allowing it to weather the Argentine
economy's various economic crises in the past. The economic recession and the
current crisis of confidence over the Argentine financial system have materially
and adversaly affected our liquidity. To maintain appropriate conditions of
liquidity the Bank has taken diverse measures. Among them, we have successfully
renegotiated all corporate bonds that have matured in the course of the year
2002. Also, we are negotiating with the Bank's foreign creditors (Corresponsal
Banks), in order to restructure the terms of the Bank's outstanding liabilities
with these creditors. Lastly, we reinforce the collection efforts and we have
suspended practically all new originations of loans.

         Repricing Opportunities for Selected Balance Sheet Categories

         The following table provides a breakdown of the remaining maturity of
the Bank's assets and liabilities at December 31, 2001 in an effort to
demonstrate the sensitivity of assets and liabilities to interest rate changes.
For any given period, the pricing structure is matched when an equal amount of
assets and liabilities mature. Any excess of assets or liabilities results in a
gap. A negative gap denotes liability sensitivity and normally means that an
increase in interest rates would have a negative effect on net interest income
while a decline in interest rates would have a positive effect. Conversely, a
positive gap denotes asset sensitivity and normally means that an increase in
interest rates would have a positive effect on net interest income while a
decline in interest rates would have a negative effect. These relationships are
as of one particular date only, and significant swings can occur daily as a
result of both market forces and management decisions. See "--Analysis of the
Bank's Financial Position--Asset and Liability Management."

                                       104

<PAGE>

                    REMAINING MATURITY - AT DECEMBER 31, 2001
                             (in thousands of pesos)

<TABLE>
<CAPTION>
                                  Overnight     Over        Over       Over        Total      Over 1
                                     to      31 days to    3 to 6     6 to 12      within     year to      Over
                                   31 days    3 months     months     months      one year    5 years     5 years     Total
                                  ---------  ----------  ----------  ---------  ----------   ---------   ---------  ---------
<S>                               <C>        <C>         <C>         <C>        <C>          <C>         <C>        <C>
PESO DENOMINATED
Assets
Loans (1)                           208,446      26,404      21,465    59,535      315,850      91,869      30,093    437,812
Governmnet and Private Securities         2      14,100           7     1,524       15,633         963          36     16,632
Cash and due from banks             308,227           -           -         -      308,227           -           -    308,227
Investments in other companies            -           -           -         -            -           -      48,862     48,862
Bank premises and equipment               -           -           -         -            -           -     321,716    321,716
Other assets                        295,146     127,558      43,169    19,635      485,508      40,633      24,417    550,558
                                  ---------  ----------  ----------  ---------  ----------   ---------   ---------  ---------
                                    811,821     168,062      64,641    80,694    1,125,218     133,465     425,124  1,683,807
                                  =========  ==========  ==========  =========  ==========   =========   =========  =========

Sources of Funds

Demand and saving deposits (2)    1,028,251           -           -         -    1,028,251           -           -  1,028,251


Time deposits (2)                   100,855      16,882     120,389    46,849      284,975           -           -    284,975
Other liabilities                   315,497      81,904       9,493     8,109      415,003       7,870       4,889    427,762
Stockholders' equity                      -           -           -         -            -           -     (57,181)   (57,181)
                                  ---------  ----------  ----------  ---------  ----------   ---------   ---------  ---------
                                  1,444,603      98,786     129,882    54,958    1,728,229    7,870.00     (52,292) 1,683,807
                                  =========  ==========  ==========  =========  ==========   =========   =========  =========
                                  ---------  ----------  ----------  ---------  ----------   ---------   ---------  ---------
Liquidity Gap                      (632,782)     69,276     (65,241)    25,736    (603,011)    125,595     477,416          -
                                  =========  ==========  ==========  =========  ==========   =========   =========  =========

FOREIGN CURRENCY
DENOMINATED
Assets
Loans  (1)                        2,022,029     301,724     222,752   406,918    2,953,423   2,303,533     964,637  6,221,593
Government and Private Securities        40       6,199     192,667     1,115      200,021     237,283       1,934    439,238
Cash and due from banks             986,234           -           -         -      986,234           -           -    986,234
Investments in other companies            -           -           -         -            -           -       1,502      1,502
Bank premises and equipment               -           -           -         -            -           -         688        688
Other assets                        296,995      51,150      13,961    47,224      409,330     197,146       3,753    610,229
                                  ---------  ----------  ----------  ---------  ----------   ---------   ---------  ---------
                                  3,305,298     359,073     429,380   455,257    4,549,008   2,737,962     972,514  8,259,484
                                  =========  ==========  ==========  =========  ==========   =========   =========  =========
Sources of Funds
Demand and saving deposits (2)    2,220,070           -           -         -    2,220,070           -           -  2,220,070
Time deposits (2)                 1,603,979     363,713     551,430   311,315    2,830,437       6,539      103.00  2,837,079
Other liabilities                   413,044     214,309     136,538   108,255      872,146     163,246   12,848.00  1,048,240

Corporate bonds                           -     298,004  333,576.00   250,896      882,476      51,024     101,946  1,035,446
Stockholders' equity                      -           -           -         -            -           -   1,118,649  1,118,649
                                  ---------  ----------  ----------  ---------  ----------   ---------   ---------  ---------
                                  4,237,093     876,026   1,021,544   670,466    6,805,129     220,809   1,233,546  8,259,484
                                  =========  ==========  ==========  =========  ==========   =========   =========  =========
                                  ---------  ----------  ----------  ---------  ----------   ---------   ---------  ---------
Liquidity Gap                      (931,795)   (516,953)   (592,164)  (215,209) (2,256,121)  2,517,153    (261,032)         -
                                  =========  ==========  ==========  =========  ==========   =========   =========  =========
</TABLE>

                                       105

<PAGE>

     C. Research and Development, Patents and Licenses, Etc.

     Not applicable.

     D. Trend Information

     In Argentina, since December 2001, economic activity has been virtually
paralyzed. The recent economic and financial measures (See: Risk factors) have
deepened the crisis and further adversely affected economic activity, consumer
spending, investment and unemployment levels.

     As a result of the current economic crisis, the Bank activity was seriously
affected. We suspended practically all new origination of loans, we have big
difficulties to get new deposits and the sales of new products and services have
decreased. Also, we believe that the asset quality of our loan portfolio will
deteriorate. To face these adverse effects we are focusing in the development of
new transactional services for companies and individuals, supported in the state
of the art technological framework that we have built in the previous years.

     Due to the significant uncertainties relating to the implementation of the
current economic and financial policies and governmental, legal and other
initiatives, we cannot reasonably quantify the impact of the current Argentine
crisis on our total assets and liabilities, shareholders' equity and net income.
Although uncertain, such impact has most likely been and may continue to be
material and adverse.

     As a consequence of the significant and recurring changes in financial
regulations implemented during 2002, the filing dates prescribed by the
information regime to wich financial institutions are subject experienced
succesive postponements. To the presentation date of this report, the Argentine
Central Bank has not informed the final date by which to submit the accounting
information corresponding to the first quarter of 2002.

Item 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES

     A. Directors and Senior Management

Board of Directors

     The administration of Banco Rio is conducted through the Board of
Directors, which is composed of a minimum of six and a maximum of 15 directors
elected for one-year terms by the stockholders at their annual general meeting.
The Board of Directors is comprised of six members and six alternate members.

Duties and Liabilities of Directors

     Under Argentine law, directors have the obligation to perform their duties
with the loyalty and the diligence of a prudent business person. Directors are
jointly and severally liable to Banco Rio, the shareholders and third parties
for the improper performance of their duties, for violating the law, the by-laws
of the Bank (the "By-Laws") or applicable regulations, if any, and for any
damage caused by fraud, abuse of authority or gross negligence. Under Argentine
law, specific duties may be assigned to a director by the by-laws or by a
resolution of a shareholders' meeting. In such cases, a director's liability
will be determined with reference to the performance of such duties, provided
that certain recording requirements are met. Under Argentine law, directors are
prohibited from engaging in activities in competition with Banco Rio without
express shareholders' authorization. Certain transactions between directors and
Banco Rio are subject to ratification procedures established by Argentine law;
these procedures do not apply in connection with transactions between affiliates
of directors and Banco Rio or between shareholders and Banco Rio. A director
must inform the Board of Directors of any conflicting interest he may have in a
proposed transaction and must abstain from voting thereon.

     A director will not be liable if, notwithstanding his presence at the
meeting at which a resolution was adopted or his knowledge of such resolution, a
written record exists of his opposition thereto and he reports his opposition to
the Supervisory Committee before any complaint against him is brought to the
Board of Directors, the Supervisory Committee, a shareholder's meeting, the
competent governmental agency or the courts. Except in the

                                      106

<PAGE>

event of mandatory liquidation or bankruptcy of Banco Rio, shareholders'
approval of a director's performance terminates any liability of a director
vis-a-vis Banco Rio, provided that shareholders representing at least 5% of
Banco Rio's capital stock do not object and provided further that such liability
does not result from a violation of the law or the By-Laws.

         Causes of action against directors may be initiated by Banco Rio upon a
majority vote of shareholders. If a cause of action has not been initiated
within three months of a shareholders' resolution approving its initiation, any
shareholder may start the action on behalf and for the account of Banco Rio.

         The following table shows the actual composition of the Board of
Directors: /(1)/

<TABLE>
<CAPTION>
                                                                             Year of           Expiration of
Name                                     Position                            Appointment       Term
----------------------------------- --------------------------------------- ----------------- ------------------
<S>                                      <C>                                 <C>               <C>
Jose Luis Enrique Cristofani             Director (Chief Executive Officer)       5-29-2002    One year
Claudio Alberto Cesario                  Director                                 5-29-2002    One year
Angel Oscar Agallano                     Director                                 5-29-2002    One year
Marcelo Alejandro Castro                 Director                                 5-29-2002    One year
Gabriel Omar Alonso                      Director                                 5-29-2002    One year
Julio Jose Gomez                         Director                                 5-29-2002    One year
Luis Miguel Garcia Morales               Alternate Director                       5-29-2002    One year
Fernando Omar de Illana                  Alternate Director                       5-29-2002    One year
Jaime Chocano Aguirre                    Alternate Director                       5-29-2002    One year
Carlos Osvaldo Schmidt                   Alternate Director                       5-29-2002    One year
Mario Eduardo Vazquez                    Alternate Director                       5-29-2002    One year
Jose Ramon Rodrigo Zarza                 Alternate Director                       5-29-2002    One year
</TABLE>

___________________
/(1)/ For the year 2001, on April 27, 2001, the Shareholders' Meeting of Banco
      Rio appointed the new Board of Directors and Supervisory Committee
      composed of Directors: Jose Luis Enrique Cristofani, Angel Oscar Agallano,
      Mario Eduardo Vazquez, Jose Maria Mathys, Carlos Osvaldo Schmidt and Julio
      Jose Gomez. Alternate Directors: Claudio Alberto Cesario, Fernando Omar De
      Illana, Jaime Chocano, Marcelo Alejandro Castro, Gabriel Omar Alonso, Jose
      Ramon Rodrigo Zarza and Luis Miguel Garcia Morales. Ms. Ana Patricia
      Botin-Sanz de Sautuola y O'Shea refused the appointment.

         Jose Luis Enrique Cristofani

         Mr. Cristofani has been the Executive Vice Chairman of the Board of
Directors since the shareholders' meeting held on August 22, 1997. He became the
Chief Executive Officer of Banco Rio in September 1997. He obtained his degree
in accounting and business administration from the University of Buenos Aires.
He began work at J.P. Morgan & Co. Incorporated Buenos Aires ("J.P. Morgan
Buenos Aires") in the Corporate Finance unit, and, in 1984, was transferred to
Madrid to be Unit Head of Corporate Finance and, in 1988, became Head of
Equities. In 1992, he returned to J.P. Morgan Buenos Aires and was appointed a
member of the management committee. In 1992, he joined Banco Santander as a
Managing Director and Country Manager for Banco Santander and Santander
Investment, respectively.

         Claudio Alberto Cesario

         In 1982, Mr. Cesario graduated as a lawyer from the University of
Buenos Aires. Between 1984 and 1989 he was Vice Manager of the Legal Department
of Bank of America S.A. in Buenos Aires. Before he joined Banco Rio in June
1998, he was a partner at the law firm Allende & Brea. During the course of his
career, he has specialized in financial and banking subjects.

         Angel Oscar Agallano

         Mr. Agallano has been a member of the Board of Directors since the
shareholders' meeting held on June 26, 1998. Mr. Agallano became the Principal
Accounting Officer of Banco Rio in September 1997. He worked for ten years with
Bank of America and became the Operations Manager and Administration Manager of
Santander

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<PAGE>

Argentina in 1986 and 1997, respectively. Mr. Agallano is a member of the board
of directors of Santander Sociedad de Bolsa S.A.

         Marcelo Alejandro Castro

         Mr. Castro has been an Alternate Director since the shareholders'
meeting held on June 26, 1998 and Director since the shareholders' meeting held
on May 29, 2002. Mr. Castro became the Treasury Manager of Banco Rio in
September 1997, with responsibility for funding and fixed income distribution,
sales, trading and research. Mr. Castro joined Grupo Santander in 1986. He
became the Financial Officer of Santander Argentina in 1986 and a Managing
Director of Santander Investment Securities Inc. ("SIS") in 1997. He received
his degree in accounting from the Argentine Catholic University.

         Gabriel Omar Alonso

         Mr. Alonso has been an Alternate Director since the shareholders'
meeting held on June 26, 1998 and Director since the shareholders' meeting held
on May 29, 2002. Mr. Alonso is the Corporate Banking Manager of Banco Rio. He
received a degree in public accounting from the University of Buenos Aires and
completed post-graduate studies in business administration in the Instituto de
Altos Estudios Empresariales ("IAE") in 1988. From 1989 to 1994, he was Vice
President of J.P. Morgan Buenos Aires in charge of the Global Credit unit and
the Corporate Desk. In August 1994, Mr. Alonso joined Banco Rio as Government
and Public Entities Manager in charge of commercial relations with public
entities and banks.

         Julio Jose Gomez

         Mr. Gomez has been a member of the Board of Directors since the
shareholders' meeting held on April 28, 2000. Mr. Gomez was President of the
Banks Association of the Argentine Republic from 1993 to 1998, President of the
Central Bank of the Argentine Republic in 1981, General Manager, Vice-president
and President of Banco Shaw from 1959 to 1994 and Vice-president of Banco
Tornquist from 1995 to 2000.

         Luis Miguel Garcia Morales

         Mr. Garcia Morales received a degree in accounting from the University
of Buenos Aires. He spent nine years working for Banco Exprinter, where his
assignments included responsibilities on their "Sociedad de Bolsa," Corporate
and Middle Market Banking Group, and finally, Distribution Group. He joined
Banco Rio Argentina in 1995, to head the Factoring Group. In December 1997, he
became the head of the branch network of Banco Rio. During 1998, he was
appointed as head of consumer banking.

         Fernando Omar de Illana

         Mr. Illana has been an Alternate Director since April 30, 1999 and from
December 23, 1997 to April 30, 1999, he was a member of the Board of Directors.
He became the Private Banking and Asset Management Manager of Banco Rio in
September 1997. He joined Grupo Santander in 1992, starting his career with
Santander Argentina in the Treasury department. Before that, he worked for Bunge
& Born Group, first as Chief Financial Officer of Bunge Espana and then as
Financial Manager of Bunge & Born S.A. (holding company). Currently, he is a
General Manager of Origenes AFJP.

         Jaime Chocano Aguirre

         Mr. Chocano has been an Alternate Director since the shareholders'
meeting held on December 3, 1999. Mr. Chocano is a Peruvian banker and director
of other companies in Peru.

         Carlos Osvaldo Schmidt

         Mr. Schmidt has been a member of the Board of Directors since the
shareholders' meeting held on April 28, 1998. He graduated as a public
accountant from the University of Buenos Aires in 1971 and took specialized
courses

                                      108

<PAGE>

in financial management at Stanford University. Mr. Schmidt began his career in
1971 at Andersen Consulting, leaving the firm as a partner in 1992. He continued
his career at Banco Credito Argentino where he was responsible for Systems &
Operations until 1995, when he became General Manager. He left Banco Credito
Argentino in 1996 to join Ernst & Young Management Consulting Services as
director until 1997 when he joined Banco Rio.

         Mario Eduardo Vazquez

         Mr. Vazquez has been a member of the Board of Directors since the
shareholders' meeting held on August 22, 1997. He received a degree in
accounting and a masters in economics from the University of Buenos Aires. He
worked for Pistrelli, Diaz y Asociados, members of Arthur Andersen, and, in
1993, he retired as an active Partner. He is a member of the board of directors
of Central Puerto S.A., Corporacion Metropolitana de Finanzas S.A. and Heller
Sud S.A., among others. He acts as a syndic (statutory auditor) for Ceras
Johnson S.A., Mercedes Benz Argentina S.A., Repsol-YPF and others.

         Jose Ramon Rodrigo Zarza

         Mr. Zarza has been an Alternate Director since the shareholders'
meeting held on December 3, 1999. Mr. Zarza is a Spanish banker, and he acts as
a director of various other companies in Spain.

         Executive Officers

         Banco Rio has a Management Committee composed of Banco Rio's Chief
Executive Officer and substantially all of the executive officers of Banco Rio.
The Management Committee meets once a week, and attendance at each meeting
varies according to the matters being brought before the committee. The
Management Committee oversees the day-to-day operations of Banco Rio to ensure
that the overall strategic objectives of Banco Rio are being implemented.

         The following table shows the executive officers of Banco Rio at
present:

Name                          Position
----------------------------- ----------------------------------------------
Jose Luis Enrique Cristofani  Chief Executive Officer
Luis Miguel Garcia Morales    Consumer Banking Manager
Oscar Luis Correa             Corporate Communications Manager
Gabriel Omar Alonso           Corporate Banking Manager
Marcelo Alejandro Castro      Treasury Manager
Claudio Alberto Cesario       Legal Counsel Manager
Jose Carlos Avila Benito      Risk Manager
Lucia Esther Haedo            Human Resources Manager
Angel Oscar Agallano          Administration, Corporate Control and System
                              Manager
Jesus Lopez Gracia            Internal Audit Manager
Luis Alberto Aragon           Strategic Planning and e-Business Manager

         Oscar Luis Correa

         Mr. Correa is the Corporate Communications Manager of Banco Rio. He
holds a degree in business administration from the Argentine Catholic University
and, before joining Banco Rio, he was a Director of Media Services at A.C.
Nielsen Argentina and Senior Manager in international advertising agencies, such
as J. Walther Thompson and Ogilvy & Mather.

         Jose Carlos Avila Benito

         Mr. Avila is a Spanish banker. He was named Head of National Risk Area
in Banco Comercial Espanol, Madrid from 1980 to 1985. He was International Risk
Analyst in Banco Santander, Madrid from 1985 to 1990. He

                                      109

<PAGE>

was also Head of International Risk Area in Banco Santander Madrid from 1990 to
1997 and he performed as Banco Santander Puerto Rico's Executive Vice Chairman
from 1997 to 1998.

         Lucia Esther Haedo

         Ms. Haedo is Head of Human Resources in Banco Rio. She holds a degree
in Sciences, Communications and Psychology (labor orientation) from the
University of Buenos Aires. She got a post-graduate degree in Human Resources
Management from the IAE. In 1993, before joining Banco Rio, Ms. Haedo was named
Head of Human Resources of Origenes AFJP S.A.

         Jesus Lopez Gracia

         Mr. Jesus Lopez Gracia graduated in Economics in 1986 and in Law in
2001. Mr. Lopez Gracia began his professional career in 1988 in Banco Santander,
later Grupo Santander Central Hispano. Since 1991, his funcitons have included
being auditor and manager of various business units. Prior to joining Banco Rio,
from 1998 through May 2002, Mr. Lopez Gracia held the office of Audit Director
in Banco Santander Mexicano.

         Luis Alberto Aragon

         Mr. Aragon graduated as Industrial Engineer from the Argentine Catholic
University and earned an MBA from the Ecole des Ponts et Chausees in Paris. From
1988 through 1996, Mr. Aragon worked for BankBoston, in Buenos Aires. He joined
Banco Rio in 1996 where he worked in the international business area. In 1998,
Mr. Aragon was placed in charge of Investor Relations and in March 2000 added
the responsibilities of E-Business and Strategic Planning Manager.

         B. Compensation

         The Bank's compensation policy is to stipulate a fixed portion and a
variable portion. The variable compensation portion depends on the achievement
of strategic and commercial goals, which are set on a yearly basis. There are no
preferred stock option plans.

         Over 2001, total compensation to the top managers of Banco Rio de la
Plata S.A. amounted to Ps. 6,105,000.

         Total Directors' Fees paid over fiscal year 2001 amounted to Ps.
278,000. When top managers also hold the office of Banco Rio de la Plata S.A.
Director, they do not collect fees.

         Banco Rio de la Plata and its subsidiaries have in place a medium-term
program to recruit and retain the best staff available to hold positions of high
responsibility and enhance the results of the Bank's operations. As of December
31, 2001, the Bank carried a provision of U.S$5,163,000 to be applied to such
program. Payments thereunder are contingent on achieving goals related to (i)
profitability, efficiency and quality, and (ii) the position held.

                                      110

<PAGE>

         C. Board Practices

         Supervisory Committee

         The By-Laws provide for a Supervisory Committee consisting of three
members ("Syndics") and three alternate members ("Alternate Syndics"). In
accordance with the By-Laws, Syndics and Alternate Syndics are elected by a
majority vote of the holders of Common Stock. Each member of the Supervisory
Committee is elected at the annual ordinary shareholders' meeting and serves for
a one-year renewable term. Pursuant to the Argentine Companies Law, as amended,
only lawyers and accountants admitted to practice in Argentina or civil
partnerships composed of such persons may serve as Syndics of an Argentine
sociedad anonima.

         The primary responsibilities of the Supervisory Committee are to
monitor the management's compliance with Argentine Companies Law, the By-Laws,
its regulations, if any, and the shareholders' resolutions, and to perform other
functions such as: (i) to attend meetings of the board of directors and
shareholders, (ii) to call extraordinary shareholders' meetings when deemed
necessary and ordinary shareholders' meetings when not called by the Board of
Directors and (iii) to investigate written complaints of shareholders. In
performing these functions, the Supervisory Committee does not control the
operations of the Bank or assess the merits of the decisions made by the
Directors.

         The following table shows the composition of the Supervisory Committee
of Banco Rio designated at the shareholders' meeting held on May 29, 2002:/(1)/

                                                Year of        Expiration of
Name                          Position        Appointment          Term
--------------------------    -----------     -------------    --------------
Alberto Bande                 Syndic           5-29-2002         One year
Claudio Gustavo Giaimo        Syndic           5-29-2002         One year
Carlos Oscar Rey              Syndic           5-29-2002         One year
Alberto Adolfo Allemand       Alternate        5-29-2002         One year
Omar Raul Rolotti             Alternate        5-29-2002         One year
Ruben Roberto Ruival          Alternate        5-29-2002         One year

_____________________
(1)  On April 27, 2001, the shareholders' meeting of Banco Rio appointed the
     Supervisory Commitee composed by Syndics: Carlos Alberto Gindre, Ernesto
     Juan Cassani and Oscar Miguel Castro. Alternate Syndics: Ernesto Mario San
     Gil, Andrea Nora Rey and Mario Alberto Bittar.

D.       Employees

         As of December 31, 2001, the Bank had 4,770 employees. The following
table shows the distribution of the human resources by main units:

General Manager Unit                                                  5
Corporate and Investment Banking                                     57
Commercial Banking                                                  450
Branch Network                                                    2,889
Private Banking and Asset Management                                 96
Systems and Operations                                              648
Risk Management                                                     214
Treasury                                                             46
Administration and Corporate Control                                153
Internal Audit                                                       54
Corporate Communications                                              7
Strategic Planning and e-Business                                    26
Human Resources                                                      37
Legal Affairs                                                        33

                                      111

<PAGE>

Other staff                                                      55
                                                         ----------
Total employees                                               4,770

         Only 212 (4%) of the Bank's employees are represented by the national
bank union in which membership is optional. The union negotiates a collective
agreement to establish minimum wages and general labor conditions for all of its
members. In recent years, the Bank has not experienced any conflict with the
union and considers relations with its employees to be good.

         Training and development of personnel have always played an important
role in the Bank's human resources policy. The Bank has focused particularly on
the development and training of its management personnel in order to increase
the quality of its operations. In fiscal year 2001, multiple programs have been
continued for the training of employees, carrying out a decentralization and
regionalization process. In this way, a large part of the need for training is
covered in local meetings that foster opportunities to introduce and integrate
colleagues located in the same geographical area. As to position coverage, the
use of the search and internal resource selection system was taken to its
maximum possibility of promotion and development for our team, and all demands
were covered with internal resources. The future project for trainees and
interns was consolidated as well, which is especially interesting and highly
demanded by young university students. The project, based on a successful
interaction with universities, allows students to access a different training
and labor experience that will give them the possibility - in the case of
trainees - of a subsequent incorporation as junior professionals.

         E. Share ownership

         No officer or director of Banco Rio owns any Common Stock issued by
Banco Rio or options granted to acquire Banco Rio shares.

Item 7.  MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS

         A. Major Shareholders

         The following tables set forth certain information concerning the
beneficial ownership of the capital stock of Banco Rio by each person known to
Banco Rio to own more than 5.00% of the outstanding capital stock of Banco Rio
as of June 24, 2002, following the exercise in January 2002 of the options to
purchase additional shares held by Merrill Lynch International:

<TABLE>
<CAPTION>
                                   Class A Shares    Class B Shares
        Shareholder                 (5 votes per       (1 vote per                      %           %
                                       share)            share)          Total       Capital      Votes
                                   --------------    --------------   -----------    --------    -------
<S>                                <C>               <C>                 <C>         <C>          <C>
Administracion de Bancos
Latinoamericanos Santander S.L.     105,180,556       109,474,024     214,654,580      61.91%     69.26%
Banco Santander Central Hispano               -        88,830,009      88,830,009      25.62%      9.68%
BRS Investments S.A.                 36,730,452         2,539,000      39,269,452      11.33%     20.30%
Others                                  754,406         3,233,218       3,987,624       1.15%      0.76%
                                    -----------       -----------     -----------     ------     ------
Total                               142,665,414       204,076,251     346,741,665     100.00%    100.00%
                                    ===========       ===========     ===========     ======     ======
</TABLE>

         The SCH Bank holds, directly and indirectly through other subsidiaries
of the SCH Group, the 98.86% of the capital and the 99.24% of the votes.

Grupo Santander

         The Controlling Shareholder is a wholly owned subsidiary of Banco
Santander Central Hispano. Grupo Santander Central Hispano is engaged
principally in financial operations in Spain and other countries worldwide and
provides a comprehensive range of banking, financial and related services to
corporate and individual clients in 40 countries. Banco Santander was
established in 1857 and headquartered in Spain, with consolidated assets of
Euros 358.1 billion at December 31, 2001. At December 31, 2001, Grupo Santander
had stockholders' equity of Euros 19.1 billion.

                                      112

<PAGE>

         Banco Santander Central Hispano is the largest company in Grupo
Santander. The capital stock of Banco Santander is listed on the Madrid, London,
Tokyo, Frankfurt, Zurich and Geneva stock exchanges and, in the form of American
Depositary Shares, on the NYSE under the symbol "STD."

         On April 17, 1999, Banco Santander S.A. of Spain merged with Banco
Central Hispanoamericano S.A. BCH in a transaction in which the surviving
corporate entity upon consummation of the merger was Banco Santander Central
Hispano S.A. The term "Banco Santander" in this Annual Report means Banco
Santander S.A. of Spain if it refers to the period of time prior to the merger
with BCH, and Banco Santander Central Hispano S.A. if it refers to the period of
time thereafter.

         Investment banking activities are conducted principally through
Santander Investment, which was organized to hold the various Grupo Santander
companies involved in investment and merchant banking activities, including
Santander Investment Securities, Inc. in New York. In addition, Santander
Investment engages in corporate finance, securities underwriting, structured
finance, securities trading and brokerage services, mergers and acquisitions
advisory services, and project finance.

         Grupo Santander Central Hispano centralizes certain services, such as
auditing, accounting and risk management, which are managed on a Grupo Santander
Central Hispano-wide basis. SCH's management monitors credit and market risk
exposures and establishes limits accordingly for all of SCH Group. Except as set
forth above, Santander Investment manages its own activities, as well as those
of its subsidiaries, separately from the rest of Grupo Santander.

         Pursuant to the Management Agreement (as defined herein), Banco
Santander will provide management and advisory services to Banco Rio until June
30, 2007. See "--Related Party Transactions--Management Agreement." Banco
Santander Central Hispano's legal domicile in Argentina is Rivadavia 611, 11th
floor, Buenos Aires, Argentina.

BRS Investments

         BRS Investments was a holding company wholly owned by the Perez Companc
Family. On July 25, 1998, Sudacia transferred all of its 36,730,452 Class A
Shares and its 2,539,000 Class B Shares of Banco Rio to BRS Investments. BRS
Investments is a successor in interest to the rights and obligations of Sudacia
under the Registration Rights Agreement and the Shareholders Agreement (as
defined below) and the option granted to Banco Santander. On December 18, 2000
the Perez Companc Family transferred to Merrill Lynch International, London, all
the shares of BRS Investment. Since January 22, 2002, BRS Investments is a
wholly owned subsidiary of SCH Group.

Merrill Lynch International

         Merrill Lynch International, London ("MLI") is a wholly owned
subsidiary of Merrill Lynch & Co., Inc., a holding company that, through its
subsidiaries and affiliates, provides investment, financing, advisory, insurance
and related products and services on a global basis. On December 18, 2000, MLI
purchased 24,999,998 Class B Shares of Banco Rio from Foundation Perez Companc.
MLI is a successor in interest to the rights and obligations of Foundation Perez
Companc under the option granted to Banco Santander. On January 18, 2002, MLI
transferred all its shares of Banco Rio to Administracion de Bancos
Latinoamericanos Santander S.L., who is a wholly owned subsidiary of SCH Group.

Shareholders Agreement

         The Controlling Shareholder and BRS Investments (as successor to
Sudacia) were party to a shareholders agreement (the "Shareholders Agreement")
entered into for purposes of governing certain matters relating to their
participation in Banco Rio. The Shareholders Agreement, together with the
Acquisition Agreements, provides that, so long as BRS Investments and/or the
Perez Companc Family (or any of their respective successors, controlling or
controlled entities, or entities under common control) own at least 10.00% of
the outstanding Common Stock, (i) the Controlling Shareholder will vote its
Common Stock to elect a number of nominees of BRS Investments to Banco

                                      113

<PAGE>

Rio's Board of Directors equal to BRS Investments' proportionate voting power,
but not less than two directors, (ii) the Controlling Shareholder will vote to
elect one nominee of BRS Investments to the Supervisory Committee, and (iii) the
Controlling Shareholder will vote in favor of an annual cash dividend of at
least 30.00% of Banco Rio's net income for the applicable fiscal year or the
maximum amount legally permitted, if lower than 30.00%.

         When the Perez Companc Family sold all their shares of BRS Investment
to MLI, the Shareholders Agreement was terminated.

Registration Rights Agreement

         Each of BRS Investments (as successor to Sudacia) and Foundation Perez
Companc is a party to a registration rights agreement (the "Registration Rights
Agreement") with Banco Rio and Banco Santander pursuant to which BRS Investments
and Foundation Perez Companc have certain registration rights. For as long as
either BRS Investments or Foundation Perez Companc owns shares of Common Stock,
each will have the right to request, on up to five separate occasions, that
Banco Rio register all or a portion of such shares under the Securities Act of
1933, as amended, for public offering in the United States. In addition, each of
BRS Investments and the Foundation Perez Companc has the right to participate in
any primary or other secondary offering of Common Stock. Under the Registration
Rights Agreement, each of BRS Investments and Foundation Perez Companc will pay
its proportionate share of underwriting fees and commissions and, in the case of
a secondary offering, the other expenses of the offering. When the Perez Companc
Family sold its shares of BRS Investments and the Foundation sold its shares of
Banco Rio, the Registration Rights Agreement was terminated.

Options

         Sudacia and the Foundation had granted options to the Controlling
Shareholder that were exercisable within three years of May 26, 1997 and May 27,
1997, respectively, to purchase up to an additional 30 million Class A Shares
from Sudacia and 15 million Class B Shares from the Foundation. On September 30,
1998, these options were canceled and new options were granted to Banco
Santander to purchase all, but not less than all, of the Class A Shares and
Class B Shares owned by each of BRS Investments (successor in interest to
Sudacia) and the Foundation between June 4, 2001 and June 8, 2001. BRS
Investments and the Foundation also have the option to sell all their Class A
and Class B shares between June 11, 2001 and June 15, 2001. On December 18, 2000
these options were amended and MLI replaced and assumed respectively the Perez
Companc Family and Foundation Perez Companc's rights and obligations under the
options agreement. Morover, the execution date of the options was postponed
until January 15, 2002, when the options were executed.

         B. Related Party Transactions

Management Agreement

         Banco Rio entered into a management agreement (the "Management
Agreement") with Banco Santander on August 22, 1997. Pursuant to the Management
Agreement, Banco Santander has agreed to provide management and advisory
services to Banco Rio until June 30, 2007 and, in exchange, Banco Rio has agreed
to pay to Banco Santander an all-inclusive annual fee equal to 10.00% of the
Bank's annual net income before income tax. Neither Banco Santander nor any
entity controlling, controlled by or under common control with it will charge
Banco Rio any fee or price, in addition to the 10.00% annual fee, for any
product or service typically rendered under a broad definition of management and
advisory services even if such product or service is not specifically listed in
the Management Agreement.

         Under the Management Agreement, Banco Santander has agreed to provide
the following services, among others, to Banco Rio:

         .    to assist and advise in, and supervise, the implementation of
              changes in policies and procedures in the areas of administration,
              operations and systems analysis and credit evaluation,
              decision-making processes and any other areas related to the
              banking and financial business;

                                      114

<PAGE>

         .    recommend and apply marketing strategies for products offered or
              sold and/or to be offered or sold by Banco Rio, as well as for
              services rendered or to be rendered by Banco Rio, and with respect
              to all Banco Rio's current or future markets;

         .    to make recommendations related to the development of new products
              and financial and/or banking services, as well as in connection
              with the development of new markets;

         .    to present and deliver to Banco Rio product and/or service
              developments aiming to achieve the strategic objectives of Banco
              Rio, as well as the design of the technological support and
              administrative services to effect them;

         .    to present and propose new clients to Banco Rio, and to advise
              Banco Rio in its relationship with them;

         .    to recommend, develop and apply internal audit policies and
              procedures in accordance with modern banking practices;

         .    to recommend, develop and apply organization plans for the
              operations, administration, systems and human resources areas of
              Banco Rio;

         .    to recommend, develop and apply policies in the area of human
              resources, including policies and procedures related to
              performance evaluation and salaries and benefits administration;

         .    to establish systems and procedures for the adequate documentation
              of transactions entered into by Banco Rio;

         .    to recommend and apply policies on procedures and controls of
              foreign exchange transactions performed by Banco Rio;

         .    to recommend and apply improvements in the use of Banco Rio real
              estate resources and security systems;

         .    to recommend and apply a centralized system for the approval and
              control of expenses;

         .    to recommend and apply improvements in the budgeting and planning
              systems; and

         .    to provide training in its offices in Spain, or in any other place
              chosen by Banco Santander for that purpose, to Banco Rio's
              employees in the areas of foreign exchange, banking transactions
              and credit administration, among others.

         Banco Santander will perform the aforementioned services at the request
and under the supervision of the Board of Directors of Banco Rio and under an
annual plan submitted for approval to the Board of Directors during the first
month of each fiscal year. In addition, Banco Santander must submit to the Board
of Directors, within 60 days of the end of each fiscal year, a report detailing
the management products and services provided by it during such fiscal year. The
Management Agreement may be terminated by Banco Santander upon 30 days' notice
and by Banco Rio in the event of a material breach or if Banco Santander loses
its direct or indirect control of Banco Rio.

Financial and Related Services

         The granting of credit to related persons of the Bank is subject to the
regulations of the Central Bank. Such regulations set limits on the amount of
credit that may be extended to related persons based on, among other things, a
percentage of the Bank's net worth. See "Item 4. Information on the
Company--Argentine Banking System and Regulation--Liquidity and Solvency
Requirements--Concentration of Risk," the Bank's extensions of credit to
companies belonging to the Santander Group and its directors and officers at
December 31, 2001 amounted to Ps.216.5 million, representing approximately 3.25%
of loans (net of allowances) granted by the Bank.

                                      115

<PAGE>

         C. Interests of Experts and Counsel

         Not applicable.

Item 8.  FINANCIAL INFORMATION

         A. Consolidated Statements and Other Financial Information

         See "Item 18. Financial Statements."

Legal Proceedings

         The Bank is involved in normal collection proceedings initiated by the
Bank and other legal proceedings in the ordinary course of business. The Bank is
not involved in any litigation or other legal proceedings that, if determined
adversely to the Bank, would individually or in the aggregate have a material
adverse effect on the Bank or its operations, except for the legal claims filed
by depositors against deposits reprogramming and de-dollarization provided for
by the Argentine Government with about 7,800 filings. As a result of such
actions, courts have issued resolutions (many of which have not been met because
the Banks filed the applicable appeals) obliging the Bank to provide amounts
from such deposits totaling Ps.112 million and USD 108.7 million. Such amounts
are related to the actions for which courts have ruled in favor either totally,
partially or precautionary (most cases); increase in the number of actions with
favorable rulings is possible with the subsequent impact it would entail. In
addition, the Bank does not rule out the possibility of new suits being filed.
Notwithstanding the fact that on February 1, 2002, the Argentine Supreme Court
ruled that certain measures adopted by the Government to prevent fund
withdrawals were unconstitutional, the Government continued to issue regulations
aimed at decreasing the depletion of money from banks. For this measure to be
effective they need to be ratified by the Argentine Supreme Court. This has not
happened yet and it is impossible to determine whether it will do so.

Dividend Policy

         Historically, Banco Rio has paid dividends on its Common Stock (all its
ordinary Class A and Class B shares) depending on its results and strategic
plans. Pursuant to the Shareholders Agreement, the Controlling Shareholder had
agreed, for as long as Sudacia and/or the Perez Companc Family (or any of their
respective successors, controlling or controlled entities or entities under
common control) continued to own at least 10.00% of the Common Stock, to vote
its shares of Common Stock at the ordinary shareholders' meetings of Banco Rio
to cause Banco Rio to declare and pay, to the extent it was legally possible, an
annual cash dividend of at least 30.00% of the net income for the applicable
fiscal year, or the maximum amount permitted under applicable law if such amount
was lower than the above percentage. When the Perez Companc Family sold all
their shares of BRS Investment to MLI on December 18, 2000, the Shareholders'
Agreement was terminated, for dividend purposes, effective after Banco Rio's
fiscal year ended December 31, 2000. Under Argentine law, declaration and
payment of annual dividends, to the extent funds are legally available
therefore, is determined by the holders of Common Stock, generally but not
necessarily on the recommendation of the Board of Directors. Any modification of
Banco Rio's dividend policy will depend on various factors, including the level
of Banco Rio's retained earnings, results of operations, cash flow requirements
(including projected capital expenditures) and other factors considered relevant
by the holders of Common Stock.

         Dividends may be lawfully declared and paid only out of Banco Rio's
retained earnings stated in its annual financial statements according to
Argentine Banking GAAP and approved by a shareholders' meeting as described
below. Under the FIL, financial institutions, such as Banco Rio, are only
permitted to pay dividends in respect of net earnings arising from yearly
financial statements approved by their shareholders.

         The Board of Directors submits the financial statements of Banco Rio
for the preceding fiscal year, together with reports thereon by the Supervisory
Committee, at the annual ordinary shareholders' meeting for approval. Within
four months of the end of each fiscal year, an ordinary shareholders' meeting
must be held to approve the financial statements and determine the allocation of
Banco Rio's net income for such year. According to the FIL and Central Bank
regulations, Banco Rio is required to allocate 20.00% of its net yearly income
(as adjusted to

                                      116

<PAGE>

reflect changes in prior years' results) to a legal reserve. At December 31,
2000, Banco Rio's legal reserve totaled approximately Ps.293.6 million, and its
unappropriated retained earnings were Ps.271.5 million. At a shareholders'
meeting held on April 27, 2001, the shareholders of Banco Rio approved: (i) the
annual financial statements of Banco Rio at December 31, 2000, (ii) decided to
allocate Ps.41.5 million to legal the reserve and Ps.103.8 million to retained
earnings and to distribute Ps.62.3 million as a cash dividend in respect of such
fiscal year net income and (iii) authorized the Board of Directors to distribute
a cash dividend against retained earnings. The legal reserve is not available
for distribution to shareholders. Under Argentine law and the By-Laws, after the
allocation to the legal reserve has been made, an amount will be segregated to
pay the accrued fees of the members of the Board of Directors and of the
Supervisory Committee and, if any preferred stock were outstanding, an amount
would be segregated to pay any dividends thereon. The remainder of net earnings
for the year, as well as retained earnings from prior years, may be distributed
as dividends on common stock or retained as a voluntary reserve, contingency
reserve or other account, or any combination thereof, all as determined by the
shareholders' meeting. In accordance with the resolution passed by the
Shareholders' meeting held on April 27, 2001, the Bank paid dividends amounting
to Ps.167.7 on June 28, 2001 against retained earnings. The Board of Directors'
meeting held on November 16, 2001 approved the distribution of the irrevocable
contribution of Ps. 38 million received on July 31, 1996, resulting from the
merger of Banco Santander S.A. with and into Banco Rio that was consummated on
October 29, 1998 and, at such time, became retroactively effective as of January
1, 1998 under Argentine GAAP. All shareholders share the restitution according
to their holdings.

         At a Shareholders' meeting held on May 29, 2002, the Shareholders of
Banco Rio: (i) approved the annual financial statements of Banco Rio at December
31, 2001, and decided to allocate the amount of Ps. 10.2 million corresponding
to a total losses of the fiscal year in the retained earnings account; (ii)
accordingly to legal restrictions decided do not distribute cash dividend in
respect of such fiscal year; and (iii) ratified the Board of Directors' decision
adopted on November 16, 2001, in respect of the distribution of the irrevocable
contribution of Ps. 30 million received on July 31, 1996. All shareholders share
the restitution according to pro-rata basis.

         Under applicable CNV regulations, unless otherwise provided in the
By-Laws, cash dividends must be paid to shareholders within 30 days of the
shareholders' meeting approving the dividend. In the case of stock dividends,
shares are required to be delivered within three months of the Bank's receiving
notice of the authorization of the CNV for the public offering of the shares
arising from such dividend. In accordance with the current exchange controls
regulations, transfers of funds abroad to effect payment of dividends require
the prior authorization of the Argentine Central Bank.

         B. Significant Changes

         None.

Item 9.  OFFER AND LISTING DETAILS

         A. Offer and Listing Details

         The principal non-United States market for the Company's Class B Shares
is on the Buenos Aires Stock Exchange. In the United States, the Class B Stock
were traded in the form of ADSs, from October 9, 1997 to December 14, 2001,
which were evidenced by ADRs issued by The Bank of New York, as Depositary (the
"Depositary"), each were represented for two Class B Shares. The ADSs were
listed on the NYSE under the symbol "BRS." The Shareholders' meeting of the Bank
of April 27, 2001, agreed, to delist from the New York Stock Exchange the ADRs
because of the low number of holders and volume traded. On November 1, 2001, the
Bank announced that its ADRs would be delisted from the New York Stock Exchange.
On December 14, 2001, the Bank's ADRs were suspended and delisted from the New
York Stock Exchange, as instructed by the Securities and Exchange Commission.

         Prior to October 9, 1997, there was no public market for the Common
Stock, including the Class B Shares or ADSs, in Argentina, the United States or
elsewhere.

                                      117

<PAGE>

         The table below sets forth, for the periods indicated, the high and low
sales prices for the Class B Shares and the ADRs, as reported on the Buenos
Aires Stock Exchange and the New York Stock Exchange, respectively.

<TABLE>
<CAPTION>
                                                    Price per                Price per
                                                   Common Share                 ADR
                                             -----------------------   -----------------------
                                                High         Low         High          Low
                                             ---------     ---------   ---------     ---------
                                                    (in pesos)           (in U.S. dollars)
<S>                                          <C>           <C>         <C>           <C>
Full Year
1997                                           Ps.8.30     Ps.5.10        16-5/8        10-1/2
1998                                              7.11        2.60        14-3/8        5-5/16
1999                                              7.00        3.95       13-9/16         7-7/8
2000                                              7.50        3.60       15-3/16             7
2001/(1)/                                         2.75        1.70
Quarterly
2001
First Quarter                                     7.50        4.30            15         8.125
Second Quarter                                    6.50        4.15          13.9             9
Third Quarter                                     4.10        3.20             9          6.08
Fourth Quarter/(1)/                               2.75        1.70          5.92          3.95
2002
First Quarter                                     2.10        1.75             -             -
Second Quarter (Through May 13, 2002)             1.60        1.45             -             -
Monthly
November 2001                                     1.90        1.70             -             -
December 2001                                        -           -             -             -
January 2002                                      2.10        1.75             -             -
February 2002                                     1.90        1.90             -             -
March 2002                                           -           -             -             -
April 2002                                        1.60        1.60             -             -
May 2002                                          1.50        1.45             -             -
</TABLE>

__________________________
(1)  On November 1, 2001, the Bank announced that its ADRs would be delisted
     from the New York Stock Exchange. On December 14, 2001,the Bank's ADRs were
     suspended and delisted from the New York Stock Exchange, as instructed by
     the Securities and Exchange Commission.


Volume information:


                           Common Share                  ADR's
                           ------------                  -----
                          (Buenos Aires)               (New York)

January 2001                  424,725                   452,200
February 2001                 193,738                   433,400
March 2001                    265,517                   203,900
April 2001                      4,946                    28,100
May 2001                       30,562                     9,100
June 2001                      51,316                    45,300
July 2001                       5,773                    21,600
August 2001                    13,000                    18,000
September 2001                 51,518                    39,700
October 2001                  106,050                    57,800
November 2001                 113,998                         -
December 2001                       -                         -

                                      118

<PAGE>

January 2002              15,332                 -
February 2002              6,788                 -
March 2002                     -                 -
April 2002                 4,100                 -
May 2002                  16,386                 -

         Because Banco Rio has a reporting obligation with respect to its 8.75%
Class IV Negotiable Obligations (the "Negotiable Obligations") under Section
15(d) of the Securities Exchange Act of 1934, as amended, this item is
inapplicable with respect to the Negotiable Obligations.

         B. Plan of Distribution

         Not applicable.

         C. Markets

Argentine Securities Markets

         There are 13 exchanges in Argentina, seven of which have affiliated
stock markets and are authorized to quote publicly offered securities: Buenos
Aires, Rosario, Cordoba, La Plata, Mendoza, Santa Fe and La Rioja. The oldest
and largest of these exchanges is the Buenos Aires Stock Exchange, founded in
1854 and on which approximately 97% of all equity trades are executed. Total
trading volume in the equity securities of Argentine companies as of December
31, 2001 was approximately US$34.87 billion, which was concentrated in the
shares of a small number of companies. As of December 31, 2001, the market
capitalization of shares of the 113 companies (excluding mutual funds) listed on
the Buenos Aires Stock Exchange was approximately US$192.5 billion, from
US$165.8 billion on December 31, 2000. Trading in securities listed on an
exchange is conducted through the brokers of the Mercado de Valores ("stock
market") affiliated with such exchange.

         Securities may also be listed and traded through over-the-counter
market brokers who must be linked to an electronic reporting system. The
activities of such brokers are controlled and regulated by the Mercado Abierto
Electronico S.A. (the "MAE" or the "OTC Market"), an electronic over-the-counter
market reporting system that functions independently from the Mercado de Valores
de Buenos Aires S.A. (the "Buenos Aires Stock Market") and the Buenos Aires
Stock Exchange. Pursuant to an agreement between the Buenos Aires Stock Exchange
and certain members of the MAE, trading in equity and equity related securities
is conducted exclusively on the Buenos Aires Stock Exchange and trading in
Argentine Government and corporate debt securities, which are not covered by the
agreement, may be conducted on either or both the Buenos Aires Stock Exchange
and the MAE. The agreement does not extend to other Argentine exchanges.

         The CNV has passed a set of resolutions establishing a system of
self-regulatory entities, under which each exchange and the MAE are responsible
for developing and implementing regulations establishing conditions for listing
securities, admitting brokers, conducting trades and controlling the
truthfulness of any information which is required to be reported in connection
therewith, subject to the approval and oversight of the CNV.

The Buenos Aires Stock Market

         The Buenos Aires Stock Market, which is affiliated with the Buenos
Aires Stock Exchange, is the largest stock market in Argentina. The Buenos Aires
Stock Market is a corporation whose 125 shareholder members are the only
individuals and entities authorized to trade in the securities listed on the
Buenos Aires Stock Exchange. Trading on the Buenos Aires Stock Exchange is
conducted by continuous open outcry, or the traditional auction system, from
2:00 p.m. to 6:00 p.m. each business day of the year. Trading on the Buenos
Aires Stock Exchange is also conducted through SINAC. SINAC is an electronic
trading system that operates debt securities and equity securities from 11:00
a.m. to 6:00 p.m. each business day of the year. In order to control price
volatility in the Buenos Aires Stock Exchange, the Buenos Aires Stock Market
operates a system which suspends dealing in shares of a particular issuer for 30
minutes when changes in the price of such issuer's shares rise or fall more than
10% of the preceding day's closing share price. If the price of such issuer's
shares increases or falls an additional 5% in the same day, for a

                                      119

<PAGE>

total of 15% above or below the preceding day's closing share price, the Buenos
Aires Stock Exchange suspends trading in such shares for the remainder of the
day. Trading for such shares resumes the next trading day.

         Investors in the Argentine securities market are mostly individuals and
companies. Institutional investors, which represent an important share of
trading activity, consist of a limited number of mutual funds. The Argentine
Congress passed amendments to the social security laws which took effect July 1,
1994. These amendments have partially privatized the Argentine Government social
security system and are expected to increase substantially the assets of
Argentine institutional pension funds and also to increase the volume of trading
on the Buenos Aires Stock Exchange.

         Certain information regarding the Argentine securities market is set
forth in the table below:

<TABLE>
<CAPTION>
                                                1997        1998        1999         2000        2001
                                              -------     -------     --------     --------    --------
<S>                                           <C>         <C>         <C>          <C>         <C>
Market capitalization (in billions)(a) .....  US$55.6     US$45.2     US$ 83.9     US$165.8    US$192.5
Volume (in billions)(b)(c) .................  US$20.0     US$ 8.9     US$201.1     US$90.42    US$34.87
Number of listed companies(a) ..............      132         129          114          121         113
</TABLE>

________________
Notes:

a)  End of period figures for shares traded on the Buenos Aires Stock Exchange.
b)  For the year ended December 31.
c)  Including trading of equity and corporate debt securities on both the Buenos
    Aires Stock Exchange and the MAE.

Source: CNV and Instituto Argentino de Mercado de Capitales.

         Market Regulation

         The CNV oversees the regulation of the Argentine securities markets and
is responsible for authorizing public offerings of private securities and
supervising intermediaries, public companies and mutual funds. AFJPs and
insurance companies are regulated by separate government agencies while
financial institutions are regulated mainly by the Central Bank. The Argentine
securities markets are governed generally by Law No. 17,811, as amended, which
created the CNV and regulates stock exchanges, stockbrokers, market operations
and the public offerings of securities; and by Decree 677/01, which regulates
transparency in the tender offer.

         In compliance with the provisions of Law No.20,643, most debt and
equity securities traded on the exchanges and on the Argentine OTC Market must,
unless otherwise instructed by the shareholders, be deposited by the
shareholders through over-the-counter dealers in Caja de Valores S.A. ("Caja de
Valores"), which is a corporation owned by the Buenos Aires Stock Exchange, the
Buenos Aires Stock Market and certain provincial exchanges. Caja de Valores acts
as a clearing house for securities trading, provides central depository
facilities for securities and acts as a transfer and paying agent in connection
therewith. It also handles settlement of securities transactions carried out by
the Buenos Aires Stock Exchange and operates the computerized exchange
information system.

         There is a relatively low level of regulation of the market for
Argentine securities and investors' activities, and enforcement of existing
regulatory provisions has been extremely limited. Furthermore, there may be less
publicly available information about Argentine companies than is regularly
published by or about companies in the United States and certain other
countries. However, the CNV has taken steps to strengthen disclosure and
regulatory standards for the Argentine securities markets, including the
issuance of regulations prohibiting insider trading and requiring insiders to
report their ownership of securities with associated penalties for
non-compliance.

         In order to offer securities to the public in Argentina, an issuer must
meet certain requirements of the CNV regarding assets, operating history,
management and other matters, and only securities for which an application for a
public offering has been approved by the CNV may be listed on the Buenos Aires
Stock Exchange. This approval does not imply any kind of certification or
assurance related to the merits or the quality of the securities or the

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solvency of the issuer. Issuers of listed securities are required to file
unaudited quarterly financial statements and audited annual financial statements
as well as various other periodic reports with the CNV and the Buenos Aires
Stock Exchange.

         The Executive Power enacted Decree No. 677/01 which sets forth new
rules on transparency for public offerings and introduces several material
changes to Argentine corporate and securities laws and regulations.

         The main features of the new rules on transparency are as follows: the
shareholders of publicly held companies shall appoint independent public
accountants in accordance with the guidelines to be enacted by the CNV; the
companies shall establish an Auditing Committee composed of at least 3
directors, the majority of which shall be independent from the Company and its
controlling shareholders, in accordance with the criteria to be established by
the CNV; the creation of a mandatory tender offers regime applicable to any
intent of acquiring the control of a public company; the regulation of exchange
offers; the imposition to public companies of the obligation to subject any
corporate conflicts to arbitration procedures; and establishing that the burden
of proof is reversed in the case of lawsuits based on transactions or agreements
entered into with related parties, between others.

         D.  Selling Shareholders

         Not applicable.

         E.  Dilution

         Not applicable.

         F.  Expenses of the Issue

         Not applicable.

Item 10. ADDITIONAL INFORMATION

         A.  Share Capital

         Not applicable.

         B.  Memorandum and Articles of Association

Register

         Banco Rio was incorporated as Sociedad Anonima on June 20, 1908. The
aggregate Common Stock of Ps.346,741,665 consists of 142,665,414 Class A Shares
and 204,076,251 Class B Shares. The By-Laws were registered in the Registro
Publico de Comercio (General Board of Corporations) on May 14, 1968 under number
1,215, page 64, book 66, volume A of Corporations.

         Objects and Purposes

         Article 3 of the By-Laws of the Bank states that its purpose is to
carry out banking transactions, either for its own account, or on account of, or
in association with, third parties, subject to the applicable laws and
regulations. For the achievement of such purpose, the Bank has full legal
capacity to assume rights and perform all acts that are not prohibited by the
law or by the By-Laws.

         Voting Rights

         Class A Shares generally entitle the holder thereof to five votes and
Class B Shares entitle the holder thereof to one vote at any meeting of the
shareholders of Banco Rio. In the case of a vote on (i) a fundamental change in
Banco Rio's corporate purpose, (ii) a change of Banco Rio's domicile to be
outside of Argentina, (iii)

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dissolution prior to the expiration of Banco Rio's corporate existence, (iv)
merger or spin-off in which Banco Rio is not the surviving corporation, and (v)
a total or partial recapitalization following a mandatory reduction of capital,
holders of Class A Shares will be entitled to one vote. Pursuant to Argentine
regulations, once Banco Rio has been authorized to make a public offering of any
or all of its capital stock, it generally will not be allowed to issue multiple
voting shares.

         The Depositary shall endeavor insofar as practicable to vote or cause
to be voted the amount of Class B Shares represented by the ADSs in accordance
with the written instructions of the holders thereof. If no instructions are
received, the Depositary will deem holders of ADRs to have instructed it not to
vote such Class B Shares.

         Conflict of Interest

         Under Argentine law, if a shareholder votes on a business transaction
in which the shareholder's interest conflicts with that of Banco Rio's, such
shareholder will be liable for damages, but only if the transaction would not
have been approved without such shareholder's vote.

         In addition, Argentine law provides that, if a member of Banco Rio's
Board of Directors has an interest in a business transaction which conflicts
with Banco Rio's interest, such director must inform the Board of Directors and
the Supervisory Committee thereof and refrain from participating in the relevant
discussion. If such director acts in contravention of such law, he or she will
be liable for damages arising therefrom.

         Cumulative Voting

         Under Argentine law, any shareholder is entitled to require application
of cumulative voting procedures for the election of up to one-third of the
directors to be elected by the shareholders at any shareholders' meeting. If at
least one shareholder gives notice to Banco Rio of its decision to exercise
cumulative voting rights not later than three business days prior to the date of
a meeting, all shareholders are entitled but not required to exercise such
rights. The aggregate number of votes corresponding to the shares of a
shareholder exercising cumulative voting rights is multiplied by the number of
vacancies to be filled in such election, and each such shareholder may allocate
such number of votes among a number of candidates not to exceed one-third of the
number of vacancies to be filled. Shareholders not exercising cumulative voting
rights are entitled to cast the number of votes corresponding to their shares
for a candidate for each vacancy to be filled. The candidates receiving the
largest number of votes among all votes cast will be deemed elected to the
number of vacancies to be filled, with no more than one-third of the vacancies
being filled as a result of cumulative voting. No candidate may be elected to a
vacancy by either cumulative or non-cumulative voting without receiving votes
equivalent to a majority of the non-cumulative votes cast with respect to such
vacancy. In the case of a tie between two or more candidates, Argentine law
provides for a tie-breaking procedure.

         Dividends

         The declaration, amount and payment of dividends on the Common Stock
are determined by majority vote of the holders of Common Stock and are based
generally but not necessarily on the annual recommendation of the Board of
Directors.

         Capital Increases and Reductions

         The capital stock of Banco Rio may be increased without limitation by
resolution of an ordinary shareholders' meeting. Capital increases do not
require an amendment of the By-Laws, but must be notified to the CNV and the
Central Bank, published in the Official Gazette of the Republic of Argentina
(the "Official Gazette") and registered with the Public Registry of Commerce.
Capital reductions may be voluntary or mandatory. Voluntary reductions of
capital must be approved by an extraordinary shareholders' meeting and, unless
such reduction is made out of net or retained earnings or available reserves,
may take place only after notice thereof is published and creditors are given an
opportunity to obtain payment or collateralization of their claims, or, in the
absence of such payment or collateralization, a judicial order for attachment.
Reductions of capital are mandatory when losses have exceeded reserves and more
than 50.00% of Banco Rio's adjusted shareholders' contributions.

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         Preemptive and Accretion Rights

         Pursuant to the By-Laws and the Argentine Companies Law, in the event
of a capital increase and the issuance of shares of Common Stock, each existing
holder of shares of Common Stock has a preemptive right to subscribe for
additional shares of Common Stock in proportion to the number of shares owned.
Holders of ADSs may be restricted in their ability to exercise preemptive rights
if a registration statement under the Securities Act relating thereto has not
been filed or is not effective or an exemption is not available. Preemptive
rights are exercisable following the last publication of notice of shareholders'
opportunity to exercise preemptive rights in the Official Gazette and an
Argentine newspaper of wide circulation for a period of 30 days, provided that
such period may be reduced to no less than 10 days if so approved by an
extraordinary shareholders' meeting.

         Shareholders who have exercised their preemptive rights and indicated
their intention to exercise additional preemptive rights are entitled to
additional preemptive rights ("accretion rights"), on a pro rata basis, with
respect to any unsubscribed shares, in accordance with the terms of the
Argentine Companies Law. Class B Shares not subscribed by the shareholders by
virtue of their exercise of preemptive or accretion rights may be offered to
third parties.

         Appraisal Rights

         Whenever the shareholders of Banco Rio approve (i) a merger or spin-off
in which Banco Rio is not the surviving corporation, unless the acquiror's
shares are authorized to be publicly offered or listed on any stock exchange,
(ii) a change in the corporate structure of Banco Rio, (iii) a fundamental
change in Banco Rio's corporate purpose, (iv) a change of Banco Rio's domicile
to be outside Argentina, (v) a voluntary withdrawal from a public offering, (vi)
a delisting or a mandatory cancellation of the public offering authorization or
(vii) a total or partial recapitalization following a mandatory reduction of
capital, any shareholder that voted against such action or did not attend the
relevant meeting may exercise the right to have its shares cancelled in exchange
for the book value of its shares, determined on the basis of the Bank's latest
balance sheet prepared in accordance with Argentine laws and regulations,
provided that such shareholder exercises its appraisal rights within the periods
set forth below. There is, however, doubt as to whether holders of ADSs will be
able to exercise appraisal rights with respect to Class B Shares represented by
ADSs. Appraisal rights must be exercised within five days following the
adjournment of the meeting at which the resolution was adopted, in the event
that the dissenting shareholder voted against such resolution, or within 15 days
following such adjournment if the dissenting shareholder did not attend such
meeting and can prove that he was a shareholder on the date of such meeting. In
the case of merger or spin-off involving an entity authorized to make a public
offering of its shares, appraisal rights may not be exercised if the shares to
be received as a result of such transaction are listed. Appraisal rights are
extinguished if the resolution giving rise to such rights is overturned at
another shareholders' meeting held within 75 days of the meeting at which the
resolution was adopted.

         Payment on the appraisal rights must be made within one year of the
date of the shareholders' meeting at which the resolution was adopted, except
where the resolution was to delist Banco Rio's capital stock, in which case the
payment period is reduced to 60 days from the date of the related resolution.

         Liquidation Rights

         In the event of the liquidation, dissolution or winding-up of Banco
Rio, the assets of Banco Rio are (i) to be applied to satisfy its liabilities
and (ii) to be proportionally distributed among holders of preferred stock in
accordance with the terms of the preferred stock, if any. If any surplus
remains, the holders of common stock are entitled to receive and share
proportionally in all net assets available for distribution to shareholders,
subject to the order of preference established by the By-Laws.

         Redemption and Repurchase

         Banco Rio's shares are subject to redemption in connection with a
reduction in capital by majority vote of shareholders at an extraordinary
shareholders' meeting. Any shares so redeemed must be canceled by Banco Rio.
Banco Rio may repurchase fully paid shares of its common stock with retained
earnings or available reserves, upon

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a determination of the Board of Directors that such repurchase is necessary in
order to avoid severe damage to Banco Rio, which determination must be explained
to the immediately succeeding ordinary meeting of shareholders. Banco Rio may
also repurchase shares of its capital stock held by a bank acquired by or merged
with Banco Rio. In either case, Banco Rio is required to resell the shares
purchased within one year (which term may be extended by a resolution adopted at
a meeting of shareholders) and must give shareholders a preemptive right to
purchase such shares. Any shares repurchased by Banco Rio will not be considered
in the determination of a quorum or a majority.

         Preferred Stock

         The By-Laws provide that preferred stock may be issued when authorized
by the shareholders at an ordinary shareholders' meeting and in accordance with
applicable regulations. Such preferred stock may have a fixed cumulative
dividend, with or without additional participation in the profits of Banco Rio
as resolved by the shareholders' meetings authorizing the issuance. Banco Rio
currently has no outstanding preferred stock.

Meetings of Shareholders

         Shareholders' meetings may be ordinary meetings or extraordinary
meetings. Banco Rio is required to convene and hold an ordinary meeting of
shareholders within four months of the close of each fiscal year to consider the
matters specified in the first two paragraphs of Article 234 of the Argentine
Companies Law: approval of the Bank's financial statements, allocation of net
income for such fiscal year, approval of the reports of the Board of Directors
and the Supervisory Committee and election and remuneration of directors and
members of the Supervisory Committee. Other matters that may be considered at an
ordinary meeting convened and held at any time include the responsibility of
directors and members of the Supervisory Committee, capital increases, the
issuance of certain corporate bonds, a sale of, or the establishment of a
security interest on, the assets and whether to sign management agreements.
Extraordinary shareholders' meetings may be called at any time to consider
matters beyond the authority of an ordinary meeting, including amendment of the
By-Laws, issuance of debentures or bonds in general, early dissolution, merger,
spin-off, reduction of common stock, redemption of shares, transformation from
one type of entity to another and limitation of shareholders' preemptive rights.
A shareholders' meeting is limited in its actions to the items set forth in the
meeting's agenda unless all shares of the outstanding common stock are present
at the meeting and resolutions are adopted by a unanimous vote of such
shareholders.

         Shareholders' meetings may be called by the Board of Directors whenever
required by law or whenever the Board of Directors deems it necessary. Also, the
Board of Directors is required to call shareholders' meetings upon the request
of shareholders representing an aggregate of at least five percent of the
outstanding Common Stock. The members of the Supervisory Committee are
authorized to call extraordinary shareholders' meetings at their discretion and
ordinary shareholders' meetings when not called by the Board of Directors. If
the Board of Directors or the Supervisory Committee fail to call a meeting
following such a request, a meeting may be ordered by the CNV or by the courts.
In order to attend a meeting, a shareholder must deposit with Banco Rio a
certificate of book-entry shares registered in its name issued by Caja de
Valores at least three business days prior to the date on which the meeting is
to be held. If so entitled to attend a meeting, a shareholder may be represented
by proxy. Proxies may not be granted to directors, members of the Supervisory
Committee or officers or employees of Banco Rio.

         Notices of Meetings

         Notice of shareholders' meetings must be published for five days in the
Official Gazette, in an Argentine newspaper of wide circulation and in the
publications of Argentine exchange or securities markets in which Banco Rio's
shares are traded, at least 20 but not more than 45 days prior to the date on
which the meeting is to be held. Such notice must include information regarding
the type of meeting to be held, the date, time and place of such meeting and the
agenda. If a quorum is not available at such meeting, notice for a meeting on
second call, which must be held within 30 days of the date for which the first
meeting was called, must be published for three days, at least eight days before
the date of the second meeting. The Board of Directors will determine
appropriate publications of notice outside Argentina in accordance with the
requirements of the jurisdictions in and the exchanges on which Banco Rio's
shares are traded. The first and second call notices for ordinary shareholders'
meetings may be disseminated simultaneously, in which case, in the absence of a
quorum at the first call meeting, if the second call meeting will be held on the
same day, it should commence at least one hour later.

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         Quorum Requirements

         The quorum for ordinary meetings of shareholders on first call is a
majority of the shares entitled to vote, and action may be taken by the
affirmative vote of an absolute majority of the votes present that are entitled
to be exercised on such action. If a quorum is not available, a second meeting
may be called at which the shares present, regardless of number, shall
constitute a quorum and action may be taken by the holders of an absolute
majority of the votes present, regardless of the number of such votes.

         The quorum for extraordinary shareholders' meetings on first call is
60.00% of the shares entitled to vote, and if such quorum is not available, a
second meeting may be called at which the shares present, regardless of number,
shall constitute a quorum. Action may be taken at extraordinary shareholders'
meetings by the affirmative vote of an absolute majority of votes present that
are entitled to be exercised on such action, except that the approval of a
majority of shares entitled to vote without application of multiple votes, if
any, is required in both first and second call meetings for (i) the transfer of
Banco Rio's domicile outside Argentina, (ii) a fundamental change of the
corporate purpose set forth in the By-Laws, (iii) the dissolution of Banco Rio
prior to 2107, (iv) the total or partial repayment of capital, (v) the merger or
spin-off of Banco Rio, if Banco Rio is not the surviving entity or (vi) a change
in Banco Rio's corporate structure.

Limitations on Foreign Investment in Argentina

         Under the Argentine FIL, the purchase of stock by an individual or
legal entity domiciled abroad or by a local company of foreign capital (as
defined in the FIL) constitutes a foreign investment subject to the FIL. Foreign
investments are generally unrestricted. However, foreign investments in certain
industries are restricted to a certain percentage. No approval is necessary to
purchase Class B shares. The FIL does not limit the right of non-resident or
foreign owners to hold or vote Class B shares and there are no restrictions in
the By-Laws limiting the rights of non-residents or non-Argentines to hold or
vote the Class B shares.

Change of Control

         There are no provisions in the By-Laws which may have the effect of
delaying, deferring or preventing a change of control of the Bank and that would
only operate with respect to a merger, acquisition or corporate restructuring
involving Banco Rio or any of its subsidiaries.

         C.  Material Contracts

         From January 1, 2002 up to the date of this annual report there were
not material contracts entered into by the Bank or its subsidiaries, other than
contracts entered into the ordinary course of business.

         D.  Exchange Controls

         There have been no foreign currency exchange controls in Argentina from
December 1989 to December 3, 2001 while it was effective the Convertibility Law.

         However, since December 3 2001, the majority of transfers of funds
abroad to effect payment of indebtedness require the prior authorization of the
Argentine Central Bank. On February 8, 2002, the Argentine Central Bank issued
Communication "A" 3471 which specified that until June 13, 2002, transfers from
Argentina to other countries for the payments of principal on certain
indebtedness and the distribution of dividends, require the approval of the
Argentine Central Bank. On March 25, 2002, the Argentine Central Bank issued
Communication "A" 3537 that established the requirement of such approval for
payments of interest for a specified period of time which pursuant to
Communication "A" 3584 issued on April 29, 2002, will remain in effect until
August 12, 2002.

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         E.  Taxation

Argentine Taxes

         General

         The following discussion is a general summary of certain Argentine tax
matters that may be relevant to the acquisition, ownership and disposition of
ADSs, Class B Shares or the Negotiable Obligations and is for general
information only.

         The summary describes the principal tax consequences of the
acquisition, ownership and disposition of ADSs, Class B Shares or the Negotiable
Obligations, but it does not purport to be a comprehensive description of all of
the tax considerations that may be relevant to a decision to acquire ADSs, Class
B Shares or the Negotiable Obligations. For purposes of the following summary
regarding Argentine tax law, the purchase, sale or disposition of ADSs is
treated as a purchase, sale or disposition of Class B Shares.

         The summary is based upon tax laws of Argentina, regulations
thereunder, and administrative and judicial interpretations thereof, as in
effect on the date of this Annual Report subject to change with possibly
retroactive effect. In addition, the summary is based in part on representations
of The Bank of New York, depositary for the ADSs, and assumes that each
obligation provided for in or otherwise contemplated by the deposit agreement
for the ADSs or any related document will be performed in accordance with its
terms.

Taxation of Dividends on Class B Shares or ADSs

         Dividends in cash, property or capital stock of Banco Rio paid or
distributed to holders of Class B Shares or ADSs are currently not subject to
Argentine withholding or income tax, only if dividends do not overcome the
taxable income or accumulated accountant incomes at the end of the fiscal year.

Income and Withholding Taxes for Negotiable Obligations

         Except as described below, interest payments on the Negotiable
Obligations (including original issue discount, if any) will be exempt from
Argentine income tax, provided the Negotiable Obligations are issued in
accordance with Argentine Law No. 23,576, as amended (the "Negotiable
Obligations Law"), and qualify for tax exempt treatment under Article 36 and 36
bis of such law. Under this Article, interest on Negotiable Obligations will be
exempt if the following conditions (the Article 36 and 36 bis Conditions) are
satisfied:

                  (i)   the Negotiable Obligations must be placed through a
         public offering authorized by the CNV;

                  (ii)  the proceeds of the placement must be used by Banco Rio
         for (a) working capital, (b) investments in tangible assets located in
         Argentina, (c) refinancing of debts, (d) contributions to the capital
         of a controlled or related corporation, provided the latter uses the
         proceeds of such contribution for the purposes specified in this
         section (ii), or (e) making loans for any of the purposes described in
         this section (ii); and

                  (iii) Banco Rio must provide evidence to the CNV in the time
         and manner prescribed by regulations that the proceeds of the placement
         have been used for the purposes described in section (ii) above.

         If Banco Rio does not comply with the Article 36 and 36 bis Conditions,
Article 38 of the Negotiable Obligations Law provides that Banco Rio shall be
responsible for the payment of any withholding taxes on interest received by the
holders of Negotiable Obligations. In such event, such holders shall receive the
amount of interest provided in the relevant Negotiable Obligation as though no
withholding tax had been required.

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         Presidential Decree No. 1,076 of June 30, 1992, ratified by Argentine
Law No. 24,307 of December 30, 1993 ("Decree No. 1,076"), eliminated the
exemption described above with respect to certain Argentine entities. As a
result of Decree No. 1,076, interest paid to holders that are subject to the tax
adjustment for inflation rules is subject to withholding as prescribed by
Argentine tax regulations.

         Payment of interest on the notes whose beneficiaries are local
companies (excluding financial entities subject to Law No. 21,526, as amended,
such as the Bank), shall be subject to a 35.00% withholding tax, and such
withholding shall be considered, for the holders of the notes, a payment on
account of Argentine Income Tax. If the issuer is a financial entity subject to
Law No. 21,526, the withholding tax will not be applied. If the holders of the
notes are foreign beneficiaries or individuals resident in Argentina, the
payment of interest on the notes shall not be subject to the income tax
withholding.

Taxation of Capital Gains

         Capital gains derived from the sale, exchange or other disposition of
ADSs or Class B Shares by individuals resident and non-resident in Argentina,
estates located in Argentina and abroad, and foreign entities not having a
permanent establishment in Argentina are not subject to withholding or income
tax.

         Capital gains derived by Argentine taxpayers that are encompassed by
Title VI of the Income Tax Law (in general, legal entities and certain
individuals compelled to adjust financial statements for inflation) from the
sale, exchange or other disposition of ADSs or Class B Shares will be subject to
income tax.

         Resident and nonresident individuals and foreign entities not having a
permanent establishment in Argentina are not subject to taxation on capital
gains derived from the sale or other disposition of Negotiable Obligations if
the Article 36 Conditions have been satisfied. As a result of Decree No. 1,076,
those taxpayers subject to the tax adjustment for inflation rules of the
Argentine income tax law are subject to taxes on capital gains on the sale or
other disposition of Negotiable Obligations as prescribed by Argentine tax
regulations.

Value Added Tax

         Neither the sale, exchange or other disposition of ADSs or Class B
Shares nor the payment of dividends thereunder is subject to Argentine value
added tax (the "Value Added Tax").

         All transactions and financial operations related to the issuance,
placement, purchase, transfer, payment of principal of and/or interest on or
redemption of Negotiable Obligations are exempt from Value Added Tax if the
Article 36 Conditions are satisfied.

Tax on Personal Property

         In accordance with Law No. 23,966, as amended, and Decree Nos. 127/96
and 812/96 (the "Decrees") and Resolutions No. 4172/96 and 4203/96 of the Tax
Bureau, individuals and estates domiciled or located in Argentina or abroad (in
such latter case only with respect to assets located in Argentina, including the
Class B Shares, the ADSs and the Negotiable Obligations) are subject to a tax on
personal assets (the "Personal Assets Tax") on assets held at December 31 of
each year at a rate of 0.50% if the taxable assets amount to Ps.200,000 and
0.75% on assets over the amount described, with a non-taxable amount, in the
case of individuals and estates domiciled or located in Argentina, of
Ps.102,300. The Personal Assets Tax is based on the year-end value of the
property which, in the case of listed securities, is the market value of the
securities or, in the case of unlisted securities, its acquisition cost plus
accrued and unpaid interest on such date. Although Class B Shares and ADSs that
are held by individuals and estates domiciled or located outside of Argentina
technically would be subject to the Personal Assets Tax, the current legislation
contemplates no method or procedure for the collection of the Personal Assets
Tax in respect of the Class B Shares or ADSs that are held by such individuals
or estates.

         Corporations, partnerships, establishments, trusts and other legal
entities ("Legal Entities") domiciled or located in Argentina are not subject to
the Personal Assets Tax.

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         Class B Shares or ADSs

         Legal Entities domiciled outside of Argentina ("Foreign Legal
Entities") will not be subject to the Personal Assets Tax unless, under a
presumption established by Law No. 23,966 and Decree No. 127/96, the Foreign
Legal Entity is deemed to be an individual or estate domiciled in Argentina for
purposes of the Personal Assets Tax. In accordance with the Decrees, such
presumption will apply to any Foreign Legal Entity the capital stock of which is
represented by securities not considered to be registered securities under the
laws of its country of incorporation (i) the activities or corporate purposes of
which are to invest outside its place of incorporation and/or (ii) that is
expressly prohibited from carrying out certain transactions and/or investments
in such jurisdiction either pursuant to its by-laws or applicable law (an
"Offshore Taxable Entity").

         Pursuant to Decree No. 812/96, the Personal Assets Tax will not apply
to Offshore Taxable Entities with respect to their holdings of securities, such
as the Class B Shares or ADSs, to the extent such securities (i) have been
authorized for public offering by the CNV and (ii) are tradable on national or
foreign exchanges or over the counter markets. The scope of the requirement set
forth under (ii) above has not yet been subject to interpretation by the
Argentine courts or tax authorities. The ADSs have been approved for listing on
the New York Stock Exchange under the symbol "BRS." The CNV has approved the
public offerings of the Class B Shares in Argentina, and the Class B Shares have
been approved for listing on the Buenos Aires Stock Exchange.

         Decree No. 4203/96 of the Direccion General Impositiva (the "Argentine
Tax Authority" or "DGI"), issued on August 1, 1996, requires the issuers of
securities authorized for public offering by the CNV, such as the Class B
Shares, to provide upon request of the DGI a copy of the certificate or
resolution of the CNV authorizing the public offering of such securities
together with evidence of the effectiveness of such certificate or resolution at
December 31 of the year in which the tax liability would have otherwise accrued.

         If at any time (i) Banco Rio fails to provide the evidence described
above to the DGI, or (ii) the Class B Shares or ADSs fail to meet the
requirements for exemption from the Personal Assets Tax with respect to Legal
Entities, or (iii) Decree No. 812/96 is derogated, or otherwise superseded, then
Class B Shares or ADSs directly owned ("titularidad directa") at December 31 of
each year by an Offshore Taxable Entity will be subject to the Personal Assets
Tax at a rate of 1.00% of their market value at year end. In such case, direct
owners ("titulares directos") of Class B Shares or ADSs will be required to
certify to Banco Rio that they are not Offshore Taxable Entities in the time and
manner currently set forth under Decree No. 4172/96 of the DGI. In the absence
of appropriate certification, Banco Rio will be required to pay the Personal
Assets Tax on behalf of the direct owner ("titular directo") of the affected
Class B Shares or ADSs and, in such case, Banco Rio will be entitled to recover
the amounts so paid by any means, including by way of withholding or foreclosing
on the assets that gave rise to such payment.

         Negotiable Obligations

         The Decrees make clear that, although Negotiable Obligations held by
individuals or undivided estates domiciled outside Argentina technically would
be subject to personal property tax, such tax will not be collected with respect
to Negotiable Obligations that are held by such individuals or undivided
estates.

         Pursuant to the Decrees, Foreign Legal Entities that are deemed to be
direct owners of Negotiable Obligations that are not tradable in local or
foreign exchanges or markets ("Taxable Notes") will be subject to personal
property tax if they are presumed to be holding Taxable Notes on behalf of an
Argentine individual or estate. Such presumption, which does not allow any proof
to the contrary, applies to any Foreign Legal Entity that (a) is located in a
country in which a regime for registration of private securities is not applied
and (b) is an Offshore Taxable Entity. In any case, such presumption would not
apply to any Foreign Legal Entity that is (a) an insurance company, (b) an
open-end mutual fund, (c) a pension fund or (d) a bank or financial entity whose
headquarters are incorporated or domiciled in a country that has adopted the
banking supervisory standards established by the Basel Convention (an "Exempt
Offshore Entity").

         Notwithstanding the requirement indicated in (a) above, pursuant to
Resolution No. 4172/96 (the "Resolution") adopted on June 6, 1996 by the DGI, a
Foreign Legal Entity constitutes an Offshore Taxable Entity if its capital stock
is not evidenced by securities that qualify as "registered securities" under the
laws of its jurisdiction,

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even if equity securities in such company's jurisdiction are generally held in
registered form, such as in the United States. On the other hand, if the capital
stock of a Foreign Legal Entity is evidenced by securities that qualify as
registered securities under the laws of its jurisdiction of incorporation, such
Foreign Legal Entity would not be presumed to be holding securities on behalf of
an Argentine individual or estate even it would otherwise qualify as an Offshore
Taxable Entity.

         If under this presumption a Foreign Legal Entity that directly owns
Taxable Notes is deemed to be holding such Negotiable Obligations on behalf of
an Argentine individual or estate and, therefore, is subject to the personal
property tax, its eligible Taxable Notes will be taxed at the rate of 1.00% of
the acquisition cost plus accrued interest in such Taxable Notes and such tax
will be levied on any individual or Legal Entity that is domiciled in Argentina
and has joint ownership, possession, use, authority over disposition, custody,
management or guardianship of the securities as a substitute taxpayer for such
Foreign Legal Entity. Notwithstanding the above, the rules and regulations
promulgated under the personal property law established that the issuing
entities will be substitute taxpayers for such Foreign Legal Entities.

         Pursuant to Decree 812/96, the above-mentioned presumption is not
applicable to debt securities that have been authorized by the CNV to be offered
publicly and that are listed on an Argentine or foreign stock exchange.

         In those instances not referred to in the previous paragraph, the
presumption only applies to corporations or businesses domiciled or doing
business outside of Argentina whose principal activity or purpose is to make
investments outside of their country of organization and/or make investments
expressly required by law or by such entities' charter documents.

         Financial institutions that have issued debt securities approved for
public offer by the CNV must present a copy of the CNV resolution approving such
issuance and evidence of compliance with such resolution by December 31st of
each year. Failure to present such evidence will result in the issuing entity's
being liable for the personal property tax.

         Pursuant to the Decrees, the Bank will be required to obtain from each
Foreign Legal Entity holding Taxable Notes a certification as to whether such
entity is subject to the presumption described above. If the Bank fails to
obtain the required certification, the Bank would be held liable for the
personal property tax that would be imposed on that Foreign Legal Entity if it
were subject to the presumption described above. In such a case, the Bank would,
as a matter of Argentine law, be entitled to seek reimbursement from the direct
owner of the Negotiable Obligations of any such amounts paid (whether by
deduction from payment of principal or interest on the Negotiable Obligations or
otherwise).

         Foreign Legal Entities that are not Offshore Taxable Entities and that
hold Taxable Notes must submit to the Bank a copy of their by-laws or similar
document. In addition, Exempt Offshore Entities that constitute financial
institutions must provide the Bank a certification from the relevant central
bank or similar agency or, if not available, from a firm or individual duly
authorized to issue such certification, of the fact that such financial
institutions are subject to the Basle Convention supervisory standards. In the
case of Foreign Legal Entities that qualify as Offshore Taxable Entities, such
entities are required, in order to prove that they are not holding Taxable Notes
on behalf of an Argentine individual or estate and therefore not subject to the
personal property tax, to submit to the Bank a certification issued by any
relevant authority of the jurisdiction of such Foreign Legal Entities'
incorporation of the fact that the capital stock of such Foreign Legal Entities
is evidenced by equity securities that qualify as "registered securities" under
the laws of such jurisdiction. Such certification should be issued by a firm or
individual duly authorized to issue such certification.

         Tax on Interest Paid and the Financial Cost of Business Indebtedness

         A recent tax law, promulgated on December 30, 1998, created a new tax
of 15.00% on the amount of the interest paid on certain types of indebtedness
(the "New Tax"), including interest on Negotiable Obligations. The New Tax,
which is not a withholding tax, is a tax on the issuer (excluding financial
entities governed by Law No. 21,526, as amended, such as the Bank) and is
payable when interest on indebtedness or Negotiable Obligations is paid or
capitalized, and shall be deductible as a business expense by the issuer for
purposes of its own income tax. In the case of Negotiable Obligations that do
not pay interest and are issued at a discount, the New Tax is payable on

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<PAGE>

the amount of the discount from the face value of the notes when the proceeds
from the placement are delivered to the issuer.

Court Taxes for Negotiable Obligations

         In the event that it becomes necessary to institute enforcement
proceedings in relation to Negotiable Obligations in Argentina, a court tax
(currently at a rate of 3.00%) will be imposed on the amount of any claim
brought before the Argentine courts sitting in the City of Buenos Aires.

Other Argentine Taxes

         No Argentine stamp taxes shall be payable by holders of Negotiable
Obligations under Article 35 of the Negotiable Obligations Law. No Argentine
transfer taxes are applicable on the sale or transfer thereof. Article 38 of the
Negotiable Obligations Law provides that if the Bank does not comply with the
Article 36 Conditions, the Bank shall be responsible for the payment of any
resulting taxes that would otherwise be payable by the holders of Negotiable
Obligations.

         Argentina imposes neither an estate tax nor a gift tax on a decedent,
donor, legatee or donee. There are no Argentine stamp, issue, registration or
similar taxes or duties payable solely as a result of holding Class B Shares or
ADSs. The sale, exchange, disposition or transfer of Class B Shares or ADSs is
not subject to a transfer tax. No Argentine tax is imposed on the deposit or
withdrawal of Class B Shares in exchange for ADSs. Other than the taxes
discussed above, no other Argentine taxes are applicable to an investment in
Class B Shares or ADSs.

         This Memorandum describes the recent amendments to the Personal Assets
Tax Law ("PATL") introduced by Law 25,585 that will enter into force on May 24,
2002.

         The amendments change three main issues:

         1.  Elimination of the standard deduction and new tax rate

             1.  Previously, individuals resident in Argentina enjoyed a
standard deduction of A$102,300, and paid a 0.5% tax on the excess over
A$102,300 if the value of the assets subject to the PATL was lower than
A$302,300, or a 0.75% tax on the excess of $102,300 if the value exceeded
$302,300.

             2.  Under the PATL as amended, all shares and other types of equity
in business entities incorporated under Argentine law (corporations, LLCs, LLPs,
LPs, etc.) owned by individuals resident in Argentina are excluded from the
general tax basis and subject to a special 0.5% tax on their value, which is
equivalent to a withholding, because it does not allow for a standard deduction.
The existing rates and standard deduction remain in force for all other types of
assets.

         2.  Valuation

             3.  Previously:

         a)  Shares that were publicly traded were taxed on their fair market
value as of the last day of the relevant fiscal year.

         b)  Shares that were not publicly traded and other types of equity were
taxed at their cost of acquisition.

             4.  Under the PATL, as amended, shares and other types of equity
are valued on the basis of the percentage they represent in respect of the net
equity of the company, according to the balance sheet of the company at December
31st of the relevant fiscal year.

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<PAGE>

         3.  New taxpayers

         Previously, only individuals resident in Argentina and legal entities
incorporated abroad which issued non-registered shares and benefited from an
offshore regime were subject to the Personal Assets Tax on their holdings of
shares issued by Argentine companies or other types of equity in entities
incorporated in Argentina. It was uncertain whether individuals resident abroad
were subject to Personal Assets Tax on their shares or equity holdings in
Argentine business entities.

         Under the PATL, as amended, individuals resident in Argentina or
abroad, and all types of legal entities incorporated abroad owning shares or
other types of equity in business entities incorporated under Argentine law,
will be subject to a 0.50% Personal Assets Tax on their holdings. The
regulations may carve out some exception, as they have done in relation with the
previous law (eg., shares publicly traded in a stock exchange were exempted from
the tax), but it is uncertain whether they will do it in connection with the
PATL, as amended.

Practical Consequences of the Changes

         The changes to the PATL intend to increase tax revenues.

         The amendment to the PATL has aggravated the situation of non-resident
companies that hold stock or other types of equity in business entities
incorporated under Argentine law; previously, unless they were incorporated
under an offshore regime with non-registered shares, they were exempt from
Personal Assets Tax on their holdings of shares or other types of equity in all
Argentine legal entities. Under the PATL as amended, all non Argentine companies
will be subject to Personal Assets Tax on their holdings of stock or other types
of equity in business entities incorporated in Argentine law. Their tax
liability may be nil, however, if the Argentine entity has a negative net
equity, as explained below.

         The issuers of the shares or other types of equity subject to taxation
are liable for the payment of the tax as a substitute obligor. They may recover
such payments from the non-resident person and are authorized to foreclose on
the assets in their custody to recover said payments (eg., dividends).

         The individuals and entities that were already subject to Personal
Assets Tax before the enactment of this reform and own stock in non publicly
traded companies are probably better off; they shifted from an acquisition cost
tax basis to one based on the proportionate net equity represented by the
relevant shares or equity holdings. Unless the economy recovers, net equity is
likely to be lower than the acquisition cost in the current economic context of
Argentina. The law does not provide any rule for a negative net equity, but a
reasonable interpretation would allow that in such a case there would be no
taxable basis in relation to such shares or equity holdings.

Tax Treaties

         Argentina has entered into tax treaties with several countries. There
is currently no tax treaty or convention in effect between Argentina and the
United States.

         The above summary is not intended to constitute a complete analysis of
all tax consequences relating to the ownership of Class B shares, ADSs or
Negotiable Obligations. Holders and prospective purchasers of these securities
should consult their own tax advisors concerning the tax consequences in their
particular situation.

United States Federal Income Taxes

         General

         The following discussion describes the material United States federal
income tax considerations relevant to the acquisition, ownership and disposition
of Class B Shares or ADSs by U.S. holders (as defined below). This discussion is
based on the United States Internal Revenue Code of 1986, as amended (the
"Code"), Treasury regulations promulgated or proposed under the Code, published
rulings, and administrative and judicial interpretations of the Code and the
Treasury regulations, all as of the date hereof, and all of which are subject to

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change, possibly with retroactive effect. This summary is based in part on
representations of the depositary and assumes that each obligation provided for
in or otherwise contemplated by the deposit agreement for the ADSs or any
related document will be performed in accordance with its terms. This discussion
is addressed only to U.S. holders and does not address any United States federal
income tax considerations that might be relevant to persons other than U.S.
holders. Further, this discussion deals only with U.S. holders that hold Class B
Shares or ADSs as capital assets (generally property held for investment) within
the meaning of Section 1221 of the Code, and does not address the tax treatment
of holders that may be subject to special tax rules, such as banks, insurance
companies, tax-exempt organizations, dealers in securities or currencies,
traders in securities that elect mark-to-market treatment, persons that hold
Class B Shares or ADSs as part of a hedge, "straddle," "conversion transaction"
or other integrated investment, persons that have a "functional currency" other
than the U.S. dollar and U.S. holders that own or are treated as owning 10% or
more of the voting power of the Bank's shares.

         The foregoing discussion does not discuss all aspects of United States
federal income taxation that may be relevant to a particular investor in light
of its particular circumstances and income tax situation. U.S. holders should
consult their own tax advisors as to the specific tax consequences of the
acquisition, ownership and disposition of Banco Rio's Class B Shares or ADSs,
including the application and effect of state, local, foreign and other tax laws
and the possible effects of changes in federal or other tax laws.

         In general, for United States federal income tax purposes, if you hold
ADSs, you will be treated as the beneficial owner of the Bank's Class B shares
represented by those ADSs. For purposes of this discussion, you are a U.S.
holder if you are a beneficial owner of the Bank's Class B shares or ADSs and
you are, for United States federal income tax purposes, (i) an individual who is
a citizen or resident of the United States, (ii) a corporation (or other entity
taxable as a corporation) created or organized in or under the laws of the
United States or of any state or the District of Columbia thereof, (iii) an
estate the income of which is subject to United States federal income taxation
regardless of source, or (iv) a trust if both a court within the United States
has primary supervision over the administration of the trust and one or more
United States persons have the authority to control all substantial decisions of
the trust. If a partnership or other entity taxable as a partnership holds Class
B shares or ADSs, the tax treatment of a partner generally will depend on the
status of the partner and the activities of the partnership. If you are a
partner of a partnership holding Class B shares or ADSs, you should consult your
tax advisors.

         Taxation of Banco Rio's Class B Shares or ADSs

         Distributions

         In general, distributions that the Bank makes on its Class B Shares
or ADSs will be treated as a dividend to you to the extent of the Bank's
current or accumulated earnings and profits as determined under United States
federal income tax principles. Such dividends generally will be subject to
United States federal income taxation as ordinary income and will not be
eligible for the dividends received deduction. To the extent, if any, that
the amount of a distribution on the Bank's Class B Shares or ADSs exceeds its
current and accumulated earnings and profits, such distributions first will
reduce your adjusted tax basis in Banco Rio's Class B Shares or ADSs to the
extent of that adjusted tax basis, and, to the extent in excess of such tax
basis, will be treated as capital gain.

         The amount of dividend income taxable to you will include the amount of
Argentine taxes, if any, that Banco Rio withholds (see "Taxation--Argentine
Taxes"). Thus, in the event such withholding taxes are imposed, you will be
required to report income in an amount greater than the cash you receive in
respect of payments on Class B Shares or ADSs. However, you may, subject to
various limitations, be eligible to claim the Argentine income tax withheld in
connection with any distribution on Class B Shares or ADSs as a credit or
deduction for purposes of computing your United States federal income tax
liability. Dividends the Bank pays on its Class B Shares or ADSs generally will
be treated as foreign source income and generally will constitute "passive"
income (or in the case of certain U.S. holders "financial services" income) for
foreign tax credit purposes. The rules relating to foreign tax credits and the
timing thereof are extremely complex and you should consult with your own tax
advisors with regard to the availability of a foreign tax credit and the
application of the foreign tax credit limitations to your particular situation.
In addition, the IRS has announced that it is studying the eligibility of U.S.
holders of depository shares for foreign tax credits. Accordingly, investors
should be aware that the discussion above regarding the creditability of
Argentine withholding tax on dividends could be affected by future action
that may be taken by the IRS.

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         If a dividend is paid in pesos, the amount you must include in gross
income will be the U.S. dollar value of the pesos distributed, as determined on
the date of receipt by you, or by a nominee, custodian or other agent who
receives the payment on your behalf, regardless of whether the payment is in
fact converted into U.S. dollars at that time. You will have a tax basis in such
pesos for United States federal income tax purposes equal to the U.S. dollar
value on the date of receipt. Any subsequent gain or loss in respect of such
pesos arising from exchange rate fluctuations will be ordinary income or loss
and will be treated as income or loss from United States sources for foreign tax
credit purposes.

         You should be aware that you likely will not be able to claim a foreign
tax credit for any Argentine personal property tax (as described in "Taxation--
Argentine Taxes"), but you may be able to deduct such tax in computing your
United States federal income tax liability, subject to applicable limitations.

         Sale or Other Taxable Disposition

         Deposits and withdrawals of the Bank's Class B shares by U.S. holders
in exchange for the Bank's ADSs will not result in the realization of gain or
loss for United States federal income tax purposes.

         Upon a sale or other taxable disposition of a Class B Share or an ADS,
you generally will recognize capital gain or loss equal to the difference
between the amount realized on such disposition (which, in the event of a
redemption, will include any amount withheld by Banco Rio in respect of
Argentine taxes imposed on such redemption) and your adjusted tax basis in the
Class B Share or ADS. Your adjusted tax basis in a Class B Share or an ADS
generally will equal your cost of the Class B Share or ADS. Any gain that you
recognize generally will be treated as United States source income for foreign
tax credit purposes. Consequently, if a withholding tax is imposed on such gain,
you will not be able to use any corresponding tax credit unless you have other
foreign source income of the appropriate type in respect of which the credit may
be used. Your net capital gains may be taxed at reduced rates if you are an
individual and your holding period for the Bank's Class B Shares or ADSs is more
than one year. The deduction of capital losses is subject to limitations under
the Code.

         Backup Withholding

         The information reporting requirements of the Code generally will apply
to distributions to you. Subject to certain exceptions, "backup withholding"
(currently at a rate of 30%) may apply to payments of dividends on Banco Rio's
Class B Shares or ADSs and to payments of the proceeds of a sale or exchange of
Class B Shares or ADSs that are made to a non-corporate U.S. holder if such
holder fails to provide a correct taxpayer identification number, to certify
that such holder is not subject to backup withholding, or otherwise comply with
applicable requirements of the backup withholding rules. The backup withholding
tax is not an additional tax and may be credited against a U.S. holder's U.S.
federal income tax liability, provided that correct information is provided to
the Internal Revenue Service. U.S. holders should consult their own tax advisors
regarding their qualification for exemption from backup withholding and the
procedure for obtaining such exemption, if applicable.

         Passive Foreign Investment Company

         Special United States federal income tax rules apply to United States
persons owning shares of a "passive foreign investment company" (a "PFIC"). A
foreign corporation generally will be classified as a PFIC for United States
federal income tax purposes in any taxable year in which, after applying
relevant look-through rules for certain subsidiaries, either (i) at least 75% of
its gross income for the taxable year is "passive income" or (ii) on average at
least 50% of the gross value of its assets is attributable to assets that
produce "passive income" or are held for the production of passive income. For
this purpose, active banking income of an active foreign bank generally is not
considered to be passive income for purposes of the PFIC rules. Based upon (i)
IRS Notice 89-81, (ii) certain proposed Treasury Regulations which are not yet
in effect (the "Proposed Regulations") and (iii) the Bank's regulatory status
under local laws, its banking activities performed in the ordinary course of
business (including lending, accepting deposits and providing charge and credit
card services for customers) and the amount of income received from such
activities, the Bank does not believe that it is currently a PFIC. However,
because PFIC status is a factual determination that is made annually after the
end of each taxable year and because there are uncertainties in the application
of the relevant rules, there can be no assurances that the Bank will not be
considered to be a PFIC for

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any particular year.

         If the Bank was a PFIC for any taxable year in which you held Class B
Shares or ADSs, and unless you made one of certain available elections available
to you, you would be subject to special rules with respect to (i) any gain
realized on the sale or other disposition of the Class B Shares or ADSs and (ii)
any "excess distribution" made by Banco Rio to you (generally, any distributions
to you in respect of the Class B Shares or ADSs during a single taxable year
that, when added together, are more than 125% of the average annual
distributions received by you in respect of the Class B Shares or ADSs during
the three preceding taxable years or, if shorter, your holding period for the
Class B Shares or ADSs). Under these rules, (i) the gain or excess distribution
would be allocated ratably over your holding period for the Class B Shares or
ADSs, (ii) the amount allocated to the taxable year in which the gain or excess
distribution was realized would be taxable as ordinary income, (iii) the amount
allocated to each prior taxable year, with certain exceptions, would be subject
to tax at the highest rate in effect for that year and (iv) the interest charge
generally applicable to underpayments of tax would be imposed in respect of the
tax attributable to each such prior taxable year.

         You should consult with your own tax advisor regarding the application
of the PFIC rules to the Bank's Class B Shares or ADSs and the availability and
advisability of making an election to avoid the adverse tax consequences of the
PFIC rules should the Bank be considered a PFIC for any taxable year.

         F.  Dividends and Paying Agents

         Not applicable

         G.  Statement of Experts

         Not applicable

         H.  Documents on Display

         We file reports and other information with the Securities and Exchange
Commission. You may read and copy any document that Banco Rio file at the
Commission's Public Reference Room at 540 Fifth Street, N.W., Washington D.C.
20549. You may obtain information on the operation of the Public Reference Room
by calling the SEC at 1-800-SEC-0330. You may also inspect Banco Rio's filngs at
the SEC's regional offices 500 West Madison Street, Suite 1400, Chicago,
Illinois 60661 and 233 Broadway, New York, New York 10279. In addition, material
that the Bank files with the SEC may also be inspected at the offices of the New
York Stock Exchange, 20 Broad Street, New York, NY 10005.

         I.  Subsidiary Information

         Not applicable

Item 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Introduction

         The effectiveness with which Banco Rio is able to manage the balance
between risk and reward is a significant factor in the Bank's ability to
generate long-term, stable earnings growth. Toward that end, the Bank's senior
management places great emphasis on risk management.

         The Bank's relationship with Santander Central Hispano has allowed the
Bank to take advantage of SCH's banking policies, procedures and standards,
especially with respect to risk management. Such policies and expertise have
been successfully used by SCH in the Spanish and other banking markets, and
management believes that such policies and expertise will have a beneficial
effect upon the Bank's operations.

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Market Risks

     Market risk is the risk of losses due to unexpected changes in interest
rates, foreign exchange rates and other rates or prices. Banco Rio is exposed to
market risk mainly as a result of the following activities:

     .    Trading financial instruments, which exposes the Bank to interest rate
          and equity market value risk;

     .    Engaging in banking activities, which subjects the Bank to interest
          rate risk, since a change in interest rates affects gross interest
          income, gross interest expense and customer behavior.

     The Assets and Liabilities Committee (the "ALCO"), following guidelines set
by SCH's Global Risk Department, is responsible for establishing the Bank's
policies, procedures and limits with respect to market risks and monitors the
overall performance in light of the risks assumed. The ALCO constantly monitors
whether these policies are fulfilled. The Bank's Market Risk Department and the
Finance Division carry out the day-to-day risk management of the trading and
non-trading activities of the Bank.

Trading Activities

     The Bank's trading portfolio is composed of local and foreign-currency
fixed-income instruments, consisting primarily of government bonds. The Finance
Division manages trading activities following the guidelines set by the ALCO and
SCH's Global Risk Department. The Market Risk Department's activities consist of
(i) applying VaR techniques (as discussed below) to measure interest rate and
equity market value risk; (ii) marking to market the Bank's trading portfolio
and measuring daily profit and loss from trading activities; (iii) comparing
actual trading VaR and other limits against the established limits; (iv)
establishing control procedures for losses in excess of such limits; and (v)
providing information about trading activities to the ALCO, other members of
senior management, the Finance Division and SCH's Global Risk Department.

Non-Trading Activities

     The Bank's non-trading portfolio includes all positions that are not
considered to be trading instruments denominated in pesos or other currencies.
The Finance Division manages the risk management of non-trading positions under
guidelines approved by the ALCO and SCH's Global Risk Department. In carrying
out its market risk management functions, the Finance Division manages interest
rate risk that arises from any mismatches with respect to rates, maturities,
repricing periods, notional amounts or other mismatches between the Bank's
interest earning assets and its interest bearing liabilities.

     The Market Risk Department: (i) applies scenario simulations (as discussed
below) to measure the interest rate risk of the local currency non-trading
portfolio and the potential loss of the Bank's non-trading activities; (ii)
provides the ALCO, the Finance Division and SCH's Global Risk Department with
risk/return reports; and (iii) consolidates all market positions (trading and
non-trading) to measure the Bank's total risk profile.

Foreign Currency Positions

     The Bank's foreign currency position includes all of the Bank's assets and
liabilities in foreign currency, including derivatives that hedge certain
foreign currency mismatches. The Finance Division manages the Bank's net foreign
currency position following the guidelines approved by the ALCO and SCH's Global
Risk Department. In carrying out its market risk management, the Finance
Division manages the foreign exchange rate risk arising from mismatches between
investments and the funding thereof that arise from differences in amounts and
currencies. The Market Risk Department uses a VaR model to monitor and measure
the exchange rate risk of the Bank's net foreign currency position, which
includes trading and non-trading activities. The Market Risk Department uses
scenario simulations, to measure the interest rate risk of the Bank's net
foreign currency position.

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Statistical Tools for Measuring and Managing Risk

     The Bank uses a variety of mathematical and statistical models, including
value at risk ("VaR") models, historical simulations, volume limits and scenario
simulations to measure, monitor, report and manage market risk.

VaR Model

     As calculated by the Bank, VaR is an estimate of the expected maximum loss
in the market value of a given portfolio over a one-day horizon at a one-tailed
99.00% confidence interval. It is the maximum one-day loss that the Bank would
expect to suffer on a given portfolio 99.00% of the time, subject to certain
assumptions and limitations discussed below. Conversely, it is the figure that
the Bank would expect to exceed only 1.00% of the time, or approximately one-day
in 100. VaR provides a single estimate of market risk that is comparable from
one market risk to the other.

     The Bank uses VaR estimates to alert senior management whenever the
statistically expected losses in its trading portfolio and net foreign currency
position exceed prudent levels. Limits on VaR are used to control exposure on
the trading portfolios mainly comprised of government bonds. The net foreign
currency position includes all assets and liabilities in foreign currency
(principally U.S. dollars) including forward contracts used to hedge positions.
A daily VaR is calculated for the trading portfolio and the net foreign currency
position. The daily VaRs are monitored and limited by three different methods:
"VaR Stop," "Loss Trigger" and "Stop Loss."

     VaR Stop: VaR Stop constitutes a mixture of risk and performance based on
two fundamental parameters:

     the daily VaR and the monthly results from trading and the net foreign
currency position.

          VaR Stop = Initial VaR Stop limit - (20.00% * Monthly loss)

     The 20.00% is calculated based on the assumption that the daily results are
independent events and that the daily result is a proxy of the monthly result
divided by the square root of 25, considering that there are, on average, 25
business days in a month. VaR Stop permits the Bank not only to impose a daily
VaR limit but a limit on the accumulated losses that the Bank may incur in a
given time period. The monthly loss or gain is the accumulated result from the
marking to market of the Bank's trading portfolio during the month.

         The following is an example of how VaR Stop is utilized:

<TABLE>
<CAPTION>
                                             Monthly          Year-to-Date         VaR Stop              %
        Day              Daily VaR           Results            Results             Limit           Utilization
--------------------- --------------- -------------------- ------------------  ----------------  -----------------
<S>                   <C>             <C>                  <C>                 <C>               <C>
     January 31             100                 20                  20               150                67%
     February 1             120                  1                  21               150                80%
         2                  110                (30)                (10)              144 (1)            76%
         3                  130               (110)                (90)              128 (2)           102%
         4                  100                (10)                 10               148                68%
         5                  120                (10)                 10               148                81%
         6                  120                 -                   10               150                80%
    February 28             110                (40)                (30)              142                77%
      March 1               900                (30)                (20)              140                63%
         2                  100                (50)                (70)              140                71%
</TABLE>

___________________
(1)      Equal to 150-(20.00%*(30))
(2)      Equal to 150-(20.00%*(110))

         When the initial VaR limit is surpassed, as is the case of February 3,
in the example above, the Market Risk Department will report this event to the
Chief Executive Officer, the Finance Division and the ALCO. These results

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are sent on a daily basis to SCH's Global Risk Department and the Finance
Division. The ALCO reviews the current status of the VaR Stop limits on a weekly
basis.

     Loss Trigger: A loss trigger is activated when the accumulated losses in
the period, both realized and unrealized, exceed the Loss Trigger limit. The VaR
Stop is applicable to limit monthly losses; the Loss Trigger is a control over
the month-to-date and the year-to-date results produced by the trading
portfolio.

     The following is an example of how the Loss Trigger is utilized:

     Loss Trigger vs. Monthly Results

<TABLE>
<CAPTION>
                                Monthly              Year-to-Date           Loss Trigger                %
          Day                   Results                Results                 Limit               Utilization
--------------------- --------------------------- ------------------- ------------------------ --------------------
<S>                   <C>                         <C>                 <C>                      <C>
        January                   20                     20                     50                     -
       February                  (10)                    10                     50                    20%
         March                   (30)                   (20)                    50                    60%
         April                   (50)                   (70)                    50                   100%
</TABLE>

         Loss Trigger vs. Year-to-Date Results

<TABLE>
<CAPTION>
                                Monthly              Year-to-Date           Loss Trigger                %
          Day                   Results                Results                 Limit               Utilization
--------------------- --------------------------- ------------------- ------------------------ --------------------
<S>                   <C>                         <C>                 <C>                      <C>
        January                   20                     20                     50                     -
       February                  (10)                    10                     50                     -
         March                   (30)                   (20)                    50                    40%
         April                   (50)                   (70)                    50                   140%
</TABLE>

     Once the Loss Trigger limit is surpassed, an action plan must be
established. This plan will be executed if the Stop Loss level is reached. The
Market Risk Department will design the control and follow-up procedures for the
Loss Trigger in coordination with SCH's Global Risk Department.

     Stop Loss: This is defined as the maximum loss permitted. Once this level
is reached, the action plan established at the Loss Trigger stage must be
executed and, if necessary, the position must be closed and/or eliminated. The
methodology for calculating the Stop Loss is identical to the Loss Trigger. The
Stop Loss is activated when the accumulated losses in a period surpass an
established amount. While the Loss Trigger is a measure for communicating an
excessively risky scenario and for defining the action plan, the Stop Loss
results in the elimination of the position and a limited total loss.

     The Loss Trigger and the Stop Loss are calculated as percentages of the
amount budgeted of the expected gains from the Bank's trading portfolio and its
net foreign currency position.

     Our main objective in holding derivatives for purposes other than trading
is the management of interest rate and foreign exchange risk arising out of
non-trading assets and liabilities.

     The Asset and Liability Committee of the Bank and SCH's Global Risk
Department monitor regularly the derivatives operations and their financial
impact in the overall asset and liability structure.

     Daily mark to market and stress testing is done to know the exposure when
the Bank has open positions. VaR and equations are used to measure these risks
within global policies and limits.

Quantitative Disclosures

     For the Bank's trading portfolio, the average, high and low amounts of the
VaR with the corresponding cash position between January 1, 2001 and December
31, 2001 were the following:

                                      137

<PAGE>

         Trading Portfolio          Daily VaR in Ps.         Cash Position
     --------------------------  ----------------------   --------------------
                 High                 14,365,777            674,208,901
                 Low                     381,251             27,996,061
               Average                 3,602,701            208,009,423

Assumptions and Limitations

         The Bank's VaR model assumes that changes in the market risk factors
have a normal distribution and that the parameters of this joint distribution
(in particular, the standard deviation of risk factor changes and the
correlation between them) have been estimated accurately. The model assumes that
the correlation and changes in market rates/prices included in the Bank's
historical databases are independent and identically distributed random
variables, and provide a good estimate of correlation and rate/price changes in
the future. The Bank typically uses the most recent one year to two years of
market data depending on circumstances. However, reliable historical risk factor
data may not be readily available for certain instruments in the Bank's
portfolio.

         The Bank's VaR methodology should be interpreted in light of the
limitations of the Bank's models, which include:

         .    Changes in market rates and prices may not be independent and
              identically distributed random variables or have a normal
              distribution. In particular, the normal distribution assumption
              may result in underestimating the probability of extreme market
              moves. However, the Bank believes that the use of historical
              simulation techniques should limit such potential underestimating.

         .    Historical data used by the Bank in its VaR model may not provide
              the best estimate of the joint distribution of risk factor changes
              in the future, and any modifications in the data may be
              inadequate. In particular, the use of periods between six months
              and two years of historical data may fail to capture the risk of
              possible extreme adverse market movements.

         .    At present, the Bank computes VaR at the close of business and
              trading positions may change substantially during the course of
              the trading day.

Volume Limits

         Fixed Income: Equivalent-Volume. This system is considered to be an
additional limit to the size of the Bank's trading portfolio. This measure seeks
to homogenize the different instruments in the Bank's fixed income trading
portfolio and convert the portfolio into a single instrument of known duration.
The Bank limits the size of this equivalent-volume portfolio. The equivalent
instrument is assumed to have a duration of one year. The equivalent volume is
calculated by the Market Risk Department and limits are set by the ALCO as to
size of the equivalent-volume portfolio.

         Net Foreign Currency Position: Maximum Net Position. The Bank also sets
an absolute limit on the size of the Bank's net foreign currency position. As of
December 31, 2001, this was equal to US$702.3 million. This limit is a useful
measure in limiting the Bank's exposure to foreign exchange and interest rate
risk, especially in periods of lower volatility and low daily VaR levels. The
limit to the size of the net foreign currency position is determined by the
SCH's Global Risk Department and is calculated and monitored by the Market Risk
Department.

Scenario Simulations and Stress Testing

         Because of the limitations in VaR methodology, in addition to
historical simulation, the Bank uses stress testing on its non-trading portfolio
to analyze the impact of extreme movements in interest rates and to adopt
policies and procedures in an effort to protect its capital and results of
operation against such contingencies. The potential loss in the market value of
the Bank's non-trading portfolio resulting from a 100 basis point shift in the
yield curve cannot be greater than 12.00% of total equity. At the same time, the
variation in net financial income caused by the 100 basis point shift cannot be
greater than 2.50% of the total net financial income budgeted for the year.

                                      138

<PAGE>

Scenario Simulation (Net Financial Income)

         To determine the percentage of the Bank's budgeted net financial income
for the year that is at risk of being lost with a sudden 100 basis point
movement in the entire yield curve, the Bank utilizes the following equation:

                             N

         Sensitivity =       The sum of     GAPi x /\ r x (365-ti)
                                            -------------------------
                             i=1                    365

         n:     Number of intervals in which sensitivity is measured.
         ti:    Average maturity (or duration) for each interval being measured.
         rr:    Change in interest rate.  A 100-basis point increase (decrease)
                in the yield curve is used.
         GAP:   Difference between assets and liabilities that are sensitive to
                interest rates for each period.

Scenario Simulation (Market Value of Equity)

         To determine the percentage of the Bank's capital and reserves that is
at risk of being lost with a sudden 100 basis point movement in the entire yield
curve, the Bank utilizes the following equation:

                             N

         Sensitivity =    the sum of         GAPi x /\ r x (Dmi)
                             i=1

         n:     Number of intervals in which sensitivity is measured.
         Dmi:   Modified duration for interval.
         rr:    Change in interest rate.  A 100-basis point increase (decrease)
                in the yield curve is used.
         GAP:   Difference between assets and liabilities that are sensitive to
                interest rates for each period.

Quantitative Disclosures

         The foregoing limits (12.00% of total equity and 2.50% of total net
financial income) were established in December of 2001. The following table
indicates that the Bank is currently within the limits.

<TABLE>
<CAPTION>

                                         December 31, 2000                       December 31, 2001
                                 ---------------------------------   -----------------------------------------
                                   Financial        Capital and           Financial           Capital and
     100 Basis Point Shift           Income          Reserves              Income              Reserves
-----------------------------    --------------  -----------------   -------------------   -------------------
<S>                                   <C>              <C>                       <C>             <C>
             Limit                    2.5%             2.25%                     2.5%            12.0%
             Actual                  1.79%            (1.52%)                   1.13%           (6.26%)
</TABLE>

         Those measures include a non-trading portfolio of public bonds held for
investment of U.S.$179.5 million as of December 31, 2001.

Assumptions and Limitations

         The most important assumption is the usage of a 100 basis point shift
in the yield curve. The Bank uses a 100 basis point shift because a sudden shift
of this magnitude is considered realistic, but not an everyday occurrence given
historical movements in the yield curve, and significant in terms of the
possible effects a shift of this size could have on the Bank's performance.
SCH's Global Risk Department has also set comparable limits by country in order
to compare, monitor and consolidate market risk by country in a realistic and
orderly manner.

         The Bank's scenario simulation methodology should be interpreted in
light of the limitations of the Bank's models, which include the following:

                                      139

<PAGE>

         .    The scenario simulation assumes that the volumes remain on the
              balance sheet and that they are always renewed at maturity,
              omitting the fact that credit risk considerations and pre-payment
              may affect the maturity of certain positions.

         .    This model assumes an equal shift throughout the entire yield
              curve and does not take into consideration different movements for
              different maturities.

         .    The model does not take into consideration the sensitivity of
              volumes to these shifts in interest rates.

         .    The limits to the loss of the budgeted financial income are
              calculated over an expected financial income for the year that may
              not be obtained, signifying that the actual percentage of
              financial income at risk could be higher than expected.

         As a result of historical data, the Bank assumes that 50% of its sight
deposits mature or change interest rates at the same time and in the same amount
that the longest assets do.

Item 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES

         Not applicable

                                    PART II

Item 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES

         None.

Item 14. MATERIAL MODIFICATIONS TO THE RIGHT OF SECURITYHOLDERS AND USE OF
         PROCEEDS

         None.

Item 15. [RESERVED]

Item 16. [RESERVED]

                                    PART III

Item 17. FINANCIAL INFORMATION

         We have responded to Item 18 in lieu of responding to this item.

Item 18. FINANCIAL INFORMATION

         Reference is made to pages F-1 to F-78 of this Annual Report.

Item 19. EXHIBITS

         Exhibit 10:       Letter to Securities and Exchange Commission
                           regarding representations made by Pistrelli Diaz y
                           Asociados, member of Andersen.

                                      140

<PAGE>

                   BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

<TABLE>
<CAPTION>
                                                                                                    Page
                                                                                                   ------
<S>                                                                                                <C>
Report of Independent Public Accountants                                                             F-3

Consolidated Balance Sheets as of December 31, 2001 and 2000.                                        F-7

Consolidated Statements of Income for the fiscal years
ended December 31, 2001, 2000 and 1999.                                                              F-10

Consolidated Statements of Changes in Stockholders' Equity for the fiscal years
ended December 31, 2001, 2000 and 1999.                                                              F-11

Consolidated Statements of Cash Flows for the fiscal years
ended December 31, 2001, 2000 and 1999.                                                              F-12

Notes to Consolidated Financial Statements as of December 31, 2001, 2000 and 1999.                   F-13
</TABLE>

                                      F-1

<PAGE>

BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

Consolidated Financial Statements
as of December 31, 2001, 2000 and 1999

                                      F-2

<PAGE>

REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To the Directors of
BANCO RIO DE LA PLATA S.A.
Bartolome Mitre 480
Buenos Aires

         We have audited the accompanying consolidated balance sheets of BANCO
RIO DE LA PLATA S.A. (a bank organized under Argentine Legislation) and
subsidiaries as of December 31, 2001 and 2000, and the related consolidated
statements of income, changes in stockholders' equity and cash flows for the
fiscal years ended December 31, 2001, 2000 and 1999. These consolidated
financial statements are the responsibility of the Bank's Board of Directors.
Our responsibility is to express an opinion on these financial statements based
on our audits.

         We conducted our audits in accordance with the United States of America
(U.S.) generally accepted auditing standards and with the "Minimum standards for
independent audits" of the Central Bank of the Argentine Republic (BCRA). Those
standards require that we plan and perform the audit to obtain reasonable
assurance about whether the consolidated financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made by the Bank's management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.

         As mentioned in note 4 to the accompanying consolidated financial
statements, such financial statements have been prepared in accordance with
accounting rules prescribed by the BCRA applicable to consolidated financial
statements, which differ in certain respects from, and constitute a
comprehensive basis of accounting other than Argentine generally accepted
accounting principles applicable to business enterprises in general. Accounting
rules prescribed by the BCRA applicable to consolidated financial statements do
not conform with accounting principles generally accepted in the United States
of America. Note 30 presents reconciliations of consolidated stockholders'
equity as of December 31, 2001 and 2000, and to consolidated net income for the
fiscal years ended December 31, 2001, 2000 and 1999, under Central Bank
accounting rules to the corresponding amounts that would be reported in
accordance with United States of America generally accepted accounting
principles except, as allowed pursuant to item 18 of Form 20-F of the Securities
and Exchange Commission, for the ommission of adjustments to account for the
impact of inflation in accordance with generally accepted accounting principles
in the United States of America.

                                      F-3

<PAGE>

                                      -2-

         As mentioned in note 4 to the accompanying consolidated financial
statements, some of the required disclosures of the BCRA have not been presented
herein since they are not material to the accompanying consolidated financial
statements. In addition, certain presentations and disclosures have been
included in the accompanying consolidated financial statements to comply with
the United States Securities and Exchange Commission's regulations for foreign
registrants.

         As explained in detail in note 1 to the accompanying consolidated
financial statements, during the last few months profound changes were
introduced into the Argentine economic framework and the Convertibility Law,
which pegged the Argentine peso at par with the US dollar and had been in effect
since 1991, was amended; such changes included the devaluation of the Argentine
peso in relation to the US dollar and the mandatory conversion of assets and
liabilities denominated in foreign currency into pesos - the effects of which
are to be recognized in the following fiscal year, in accordance with BCRA
accounting standards - as well as severe restrictions on withdrawal of funds
from the financial system and on fund transfers abroad. The future development
of the economic crisis may require further measures from the Argentine Federal
Government. The accompanying financial statements should be read taking into
account the issues mentioned above. As mentioned in note 9, the Bank and its
subsidiaries hold securities issued by the Argentine federal government and
governments of Argentine provinces and carry receivables from credit assistance
to customers in the non-financial public and private sector amounted to 435,590,
2,080,866 and 5,460,818 thousands of pesos, respectively. In view of the
situation described above, it is not possible to determine the future effects
that the prolongation of the economic crisis that Argentina is undergoing could
have on the recoverability of the accounting value of such holding securities
and financing.

         In our opinion, the accompanying consolidated financial statements
present fairly, in all material respects, the financial position of BANCO RIO DE
LA PLATA S.A. and subsidiaries as of December 31, 2001 and 2000, and the results
of their operations and cash flows for the fiscal years ended December 31, 2001,
2000 and 1999, in conformity with rules prescribed by the BCRA applicable to
consolidated financial statements.

         The accompanying consolidated financial statements as of December 31,
2001 have been prepared assuming that the Bank wil continue as a going concern.
As mentioned in note 1. to the accompanying consolidated financial statements,
the measures adopted by the Argentine Federal Government significantly affected
the liquidity, solvency and profitability of the financial system as a whole,
which made it necessary for the Argentine government and the BCRA to adopt the
further regulations to moderate the abovementioned effects and foster the
restructuring of the financial system; such additional regulations are currently
being issued and implemented, and it is uncertain if whether the restructuring
of the financial system as a whole and the Bank's own plans and actions will
allow it to continue its operations and meet the solvency and liquidity ratios
required by the BCRA. This situation and the financial outcome of the
uncertainties related to the recoverability of the assets

                                      F-4

<PAGE>

                                      -3-

mentioned in the fifth paragraph of this report could continue to affect the
financial position and equity of the Bank and its subsidiaries, and give rise to
a substantial doubt the Bank's ability to continue as a going concern. The
consolidated financial statements as of December 31, 2001 do not include any
adjustment that might result the outcome of these uncertainties.

Buenos Aires,
    April 26, 2002, except for Note 31
    which is as of June 3, 2002.

                                                   PISTRELLI, DIAZ Y ASOCIADOS


                                                    /s/ Ernesto J. Cassani
                                                   ---------------------------


                                                       ERNESTO J. CASSANI
                                                             Partner

                                      F-5

<PAGE>

                                                                        ANDERSEN

Buenos Aires, June 26, 2002

Attn: BANCO RIO DE LA PLATA S.A.

                                Ref.: Consent of Independent Public Accountants
                                ---

As independent public accountants, we hereby consent to the inclusion of our
report dated April 26, 2002, except for Note 31 which is as of June 3, 2002
appearing on this Form 20-F relating to the consolidated balance sheets of Banco
Rio de La Plata S.A. and subsidiaries as of December 31, 2001 and 2000 and the
related consolidated statements of income, changes in stockholders' equity and
cash flows for the fiscal years ended December 31, 2001, 2000 and 1999 and to
incorporation by reference of such report in the Prospectus constituting part of
the Registration Statement on Form 20-F.

                                        PISTRELLIM DIAZ Y ASOCIADOS



                                                 /s/ Ernesto J. Cassani
                                        ----------------------------------------
                                                 ERNESTO J. CASSANI
                                                      Partner

                                      F-6

<PAGE>

                   BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES
                   -------------------------------------------
          CONSOLIDATED BALANCE SHEETS AS OF DECEMBER 31, 2001 AND 2000
          ------------------------------------------------------------
                         (Stated in thousands of pesos)

<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------------------------
                                           ASSETS                                         2001         2000 (1) (2)
--------------------------------------------------------------------------------------------------------------------

--------------------------------------------------------------------------------------------------------------------
<S>                                                                                    <C>              <C>
 A.    CASH AND DUE FROM BANKS                                                         1,294,461        1,091,557
--------------------------------------------------------------------------------------------------------------------
       - Cash                                                                            250,933          278,519
       - Banks and correspondents                                                      1,043,528          813,038

--------------------------------------------------------------------------------------------------------------------
 B.    GOVERNMENT AND PRIVATE SECURITIES                                                 455,870        1,952,599
--------------------------------------------------------------------------------------------------------------------
       - Holdings in investment accounts                                                 179,208        1,672,710
       - Holdings for trading                                                              4,454          188,670
       - Unlisted government securities                                                  251,928           24,971
       - Investments in listed private securities                                         20,280           66,248

--------------------------------------------------------------------------------------------------------------------
 C.    LOANS                                                                           6,659,405        6,374,985
--------------------------------------------------------------------------------------------------------------------
       - To the nonfinancial public sector                                             2,080,557        1,632,790
       - To the financial sector                                                         136,419           84,698
       - To the private nonfinancial sector and foreign residents:                     4,667,622        4,894,307
              - Overdraft                                                              1,326,798        1,697,697
              - Promissory notes                                                         776,503        1,010,976
              - Real estate mortgage                                                   1,166,087        1,148,042
              - Collateral loans                                                         145,125          190,668
              - Consumer                                                                 204,392          244,712
              - Credit Cards                                                             303,470          299,458
              - Other                                                                    679,806          291,330
              - Accrued interest and price differences receivable                         84,246           82,797
              - Unapplied collections                                                       (497)         (14,351)
              - Unearned discount                                                        (18,308)         (57,022)
         Less: Allowances                                                               (225,193)        (236,810)

--------------------------------------------------------------------------------------------------------------------
 D.    OTHER RECEIVABLES FROM FINANCIAL TRANSACTIONS                                     889,092        4,347,058
--------------------------------------------------------------------------------------------------------------------
       - Central Bank of the Argentine Republic                                          117,521        1,107,475
       - Receivables on spot and forward transactions                                    367,446        1,737,663
       - Securities and foreign exchange receivable on spot and forward purchases        125,929        1,343,608
       - Premiums on options purchased                                                     1,027            1,648
       - Unlisted corporate bonds                                                        195,577           53,153
       - Other not included in Debtor Rating Standards                                    64,378           54,862
       - Other included in Debtor Rating Standards                                        21,350           47,270
       - Accrued interest receivable included in Debtor Rating Standards                   1,113            4,963
         Less: Allowances                                                                 (5,249)          (3,584)

--------------------------------------------------------------------------------------------------------------------
 E.    ASSETS COVERED BY FINANCING LEASES                                                 64,253           61,137
--------------------------------------------------------------------------------------------------------------------
       - Assets covered by financing leases                                               67,521           65,903
         Less: Allowances                                                                 (3,268)          (4,766)

--------------------------------------------------------------------------------------------------------------------
 F.    INVESTMENTS IN OTHER COMPANIES                                                     50,364           14,558
--------------------------------------------------------------------------------------------------------------------
       - Banking                                                                           4,191              998
       - Others                                                                           46,626           14,010
         Less: Allowances                                                                   (453)            (450)

--------------------------------------------------------------------------------------------------------------------
 G.    OTHER RECEIVABLES                                                                 146,668           72,340
--------------------------------------------------------------------------------------------------------------------
       - From sale of assets                                                                 ---                4
       - Other                                                                           151,424           78,857
       - Other accrued interest receivable                                                   431               73
         Less: Allowances                                                                 (5,187)          (6,594)

--------------------------------------------------------------------------------------------------------------------
 H.    BANK PREMISES AND EQUIPMENT                                                       322,404          347,831
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------
 I.    OTHER ASSETS                                                                       24,417           22,039
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------
 J.    INTANGIBLE ASSETS                                                                  35,728           46,666
--------------------------------------------------------------------------------------------------------------------
       - Goodwill                                                                            433              625
       - Organizations and development expenses                                           35,295           46,041
--------------------------------------------------------------------------------------------------------------------
 K.    SUSPENSE ITEMS                                                                        629            7,243
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------

                                        TOTAL ASSETS                                   9,943,291       14,338,013

--------------------------------------------------------------------------------------------------------------------
</TABLE>

                                      F-7

<PAGE>
                                                                             -2-

                   BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES
                   -------------------------------------------
          CONSOLIDATED BALANCE SHEETS AS OF DECEMBER 31, 2001 AND 2000
          ------------------------------------------------------------
                         (Stated in thousands of pesos)

<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------------------------
                                   LIABILITIES                                              2001         2000 (1) (2)
---------------------------------------------------------------------------------------------------------------------
<S>                                                                                       <C>              <C>

---------------------------------------------------------------------------------------------------------------------
 L.  DEPOSITS                                                                             6,370,375        7,065,614
---------------------------------------------------------------------------------------------------------------------
      - Nonfinancial public sector                                                            8,193            3,570
      - Financial sector                                                                      5,335            1,653
      - Private nonfinancial sector and foreign residents:                                6,356,847        7,060,391
           - Checking accounts                                                            1,189,437          495,323
           - Savings accounts                                                             2,043,601        1,461,582
           - Certificates of deposits                                                     2,386,163        4,892,798
           - Investments accounts                                                           464,589           74,505
           - Other                                                                          226,178           83,538
           - Accrued interest and price differences payable                                  46,879           52,645

---------------------------------------------------------------------------------------------------------------------
 M.  OTHER LIABILITIES FROM FINANCIAL TRANSACTIONS                                        2,312,466        5,698,007
---------------------------------------------------------------------------------------------------------------------
     - Central Bank of the Argentine Republic - Others                                          632            1,672
     - Banks and international organizations                                                557,046          809,043
     - Unsubordinated Corporate Bonds                                                     1,031,285          979,532
     - Amounts payable on spot and forward purchases                                        140,859        1,269,216
     - Securities and foreign currency payable on spot and forward sales                    340,754        2,269,091
     - Premiums on options sold                                                                  15              ---
     - Financing from local financial institutions                                           46,540          206,300
     - Other                                                                                177,824          144,063
     - Accrued interest and price differences payable                                        17,511           19,090

---------------------------------------------------------------------------------------------------------------------
 N.  OTHER LIABILITIES                                                                      141,768          195,447
---------------------------------------------------------------------------------------------------------------------
     - Dividends payable                                                                      1,574            1,114
     - Other                                                                                140,194          194,333

---------------------------------------------------------------------------------------------------------------------
 O.  CONTINGENT LIABILITIES                                                                  47,498           27,959
---------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------
 P.  SUSPENSE ITEMS                                                                           4,827            6,888
---------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------

                                TOTAL LIABILITIES                                         8,876,934       12,993,915

---------------------------------------------------------------------------------------------------------------------


---------------------------------------------------------------------------------------------------------------------
 Q.  MINORITY INTEREST IN SUBSIDIARIES                                                        4,889            4,450
---------------------------------------------------------------------------------------------------------------------


---------------------------------------------------------------------------------------------------------------------
     STOCKHOLDERS' EQUITY                                                                 1,061,468        1,339,648
---------------------------------------------------------------------------------------------------------------------


---------------------------------------------------------------------------------------------------------------------

        TOTAL LIABILITIES, MINORITY INTEREST IN SUBSIDIARIES AND STOCKHOLDERS' EQUITY     9,943,291       14,338,013

---------------------------------------------------------------------------------------------------------------------
</TABLE>

                                      F-8

<PAGE>

                                                                             -3-

                   BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES
                   -------------------------------------------
          CONSOLIDATED BALANCE SHEETS AS OF DECEMBER 31, 2001 AND 2000
          ------------------------------------------------------------
                         (Stated in thousands of pesos)

<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------------------------------------------
                             MEMORANDUM ACCOUNTS                                                     2001            2000 (1)(2)
-------------------------------------------------------------------------------------------------------------------------------
<S>                                                                                        <C>                       <C>
-------------------------------------------------------------------------------------------------------------------------------
      DEBIT BALANCES                                                                               15,669,721        19,705,660
-------------------------------------------------------------------------------------------------------------------------------

                                                                                           ------------------------------------
      CONTINGENCIES                                                                                 4,382,639         4,362,738
                                                                                           ------------------------------------
      - Credit lines taken (unused portion)                                                                --           350,000
      - Guarantees received                                                                         3,488,518         3,301,997
      - Other not included in Debtor Rating Standards                                                 300,000                --
      - Contra to contingency account debit balances                                                  594,121           710,741

                                                                                           ------------------------------------
      CONTROL ACCOUNTS                                                                             10,877,255        15,310,880
                                                                                           ------------------------------------
      - Loans classified as irrecoverable                                                             567,654           423,996
      - Other                                                                                      10,170,667        14,559,525
      - Contra to control account debit balances                                                      138,934           327,359

                                                                                           ------------------------------------
      DERIVATIVE ACCOUNTS                                                                             378,739             7,794
                                                                                           ------------------------------------
      - "Notional" value of call options purchased                                                        363                --
      - "Notional" value of put options purchased                                                      43,682                --
      - Other                                                                                         223,175                --
      - Contra to derivative account debit balances                                                   111,519             7,794

                                                                                           ------------------------------------
      FIDUCIARY ACCOUNTS                                                                               31,088            24,248
                                                                                           ------------------------------------
      - Trust funds                                                                                    31,088            24,248

-------------------------------------------------------------------------------------------------------------------------------
      CREDIT BALANCES                                                                              15,669,721        19,705,660
-------------------------------------------------------------------------------------------------------------------------------

                                                                                           ------------------------------------
      CONTINGENCIES                                                                                 4,382,639         4,362,738
                                                                                           ------------------------------------
      - Agreed-upon credits (unused balances) included in Debtor Rating Standards                     376,661           432,038
      - Other guarantees given included in Debtor Rating Standards                                    105,076           137,367
      - Other included in Debtor Rating Standards                                                     112,384           141,336
      - Contra to contingency account credit balances                                               3,788,518         3,651,997

                                                                                           ------------------------------------
      CONTROL ACCOUNTS                                                                             10,877,255        15,310,880
                                                                                           ------------------------------------
      - Cheks to be credited                                                                          223,099           261,732
      - Other                                                                                           2,522             2,417
      - Contra to control account credit balances                                                  10,651,634        15,046,731

                                                                                           ------------------------------------
      DERIVATIVE ACCOUNTS                                                                             378,739             7,794
                                                                                           ------------------------------------
      - "Notional" value of call options sold                                                          11,519             7,794
      - "Notional" value of put options sold                                                          100,000                --
      - Contra to derivative account credit balances                                                  267,220                --

                                                                                           ------------------------------------
      FIDUCIARY ACCOUNTS                                                                               31,088            24,248
                                                                                           ------------------------------------
      - Contra to fiduciary account credit balances                                                    31,088            24,248

-------------------------------------------------------------------------------------------------------------------------------
</TABLE>

(1) See incorporation procedure of former Banco Tornquist S.A. balance sheet
    account balances in note 3.4. to the consolidated financial statements of
    Banco Rio de la Plata S.A. and subsidiaries.

(2) See note 3.1.



         Notes 1 to 31 to the consolidated financial statements, are an
                       integral part of these statements.

                                      F-9

<PAGE>

                                                                             -4-

                   BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES
                   -------------------------------------------
                        CONSOLIDATED STATEMENTS OF INCOME
                        ---------------------------------
           FOR THE FISCAL YEARS ENDED DECEMBER 31, 2001, 2000 AND 1999
           -----------------------------------------------------------
                         (Stated in thousands of pesos)

<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------------------------
                        CONSOLIDATED STATEMENT OF INCOME                             12/31/2001   12/31/2000 (1) (2)  12/31/1999 (2)
----------------------------------------------------------------------------------------------------------------------------------
<S>                                                                                     <C>             <C>             <C>
----------------------------------------------------------------------------------------------------------------------------------
 A.       FINANCIAL INCOME                                                              1,146,062       1,281,967       1,045,766
----------------------------------------------------------------------------------------------------------------------------------
          - Interest on cash and due from banks                                            27,520          41,400          27,918
          - Interest on loans to the financial sector                                      19,935          13,381          13,419
          - Overdraft interest                                                            276,372         264,221         295,990
          - Interest on promissory notes                                                  351,568         298,510         180,636
          - Interest on real estate mortgage loans                                        144,681         129,457         102,517
          - Interest on collateral loans                                                   24,161          20,885          16,654
          - Credit card interest                                                           57,997          67,510          56,308
          - Interest on other loans                                                        77,550          80,009         112,585
          - Interest on other receivables from financial transactions                       6,363          12,258           2,096
          - Net gain on government and private securities                                  24,359         228,931         139,430
          - Net gain on guaranteed loans - Decree No. 1387/01                              20,031             ---             ---
          - Other                                                                         115,525         125,405          98,213

----------------------------------------------------------------------------------------------------------------------------------
 B.       FINANCIAL EXPENSE                                                              (675,888)       (651,105)       (520,516)
----------------------------------------------------------------------------------------------------------------------------------
          - Interest in checking accounts                                                 (12,477)           (657)            ---
          - Interest on savings deposits                                                  (23,981)        (39,972)        (31,312)
          - Interest on certificates of deposit                                          (403,640)       (343,855)       (245,284)
          - Interest on financial sector's financing                                       (4,474)         (2,185)         (1,291)
          - Interest on other liabilities from financial transactions                    (139,412)       (182,116)       (159,599)
          - Other interest                                                                (21,954)         (5,892)        (11,878)
          - Net expense from options                                                         (625)         (1,808)         (7,824)
          - Other                                                                         (69,325)        (74,620)        (63,328)

----------------------------------------------------------------------------------------------------------------------------------
          GROSS MARGIN ON FINANCIAL TRANSACTIONS                                          470,174         630,862         525,250
----------------------------------------------------------------------------------------------------------------------------------

----------------------------------------------------------------------------------------------------------------------------------
 C.       PROVISION FOR LOAN LOSSES AND OTHER RECEIVABLES
          FROM FINANCIAL TRANSACTIONS                                                    (264,148)       (147,329)       (112,433)
----------------------------------------------------------------------------------------------------------------------------------

----------------------------------------------------------------------------------------------------------------------------------
 D.       SERVICE CHARGE INCOME                                                           390,608         367,440         279,466
----------------------------------------------------------------------------------------------------------------------------------
          - Related to assets                                                              39,110          76,211          33,908
          - Related to liabilities                                                        116,222          89,083          76,681
          - Other commissions                                                              67,577          26,265          19,981
          - Other                                                                         167,699         175,881         148,896

----------------------------------------------------------------------------------------------------------------------------------
 E.       SERVICE CHARGE EXPENSE                                                          (64,250)        (56,678)        (47,164)
----------------------------------------------------------------------------------------------------------------------------------
          - Commissions                                                                   (42,154)        (39,290)        (33,664)
          - Other                                                                         (22,096)        (17,388)        (13,500)

----------------------------------------------------------------------------------------------------------------------------------
 F.       OPERATING EXPENSES                                                             (527,369)       (543,098)       (483,150)
----------------------------------------------------------------------------------------------------------------------------------
          - Personnel expenses                                                           (289,577)       (273,874)       (252,151)
          - Directors' and statutory auditors' fees                                          (442)           (551)           (280)
          - Other fees                                                                    (21,361)        (50,653)        (33,401)
          - Advertising and publicity                                                     (19,530)        (20,155)        (14,495)
          - Taxes                                                                         (14,910)        (10,845)        (11,004)
          - Other operating expense                                                      (142,741)       (149,047)       (133,900)
          - Other                                                                         (38,808)        (37,973)        (37,919)

----------------------------------------------------------------------------------------------------------------------------------
          NET GAIN ON FINANCIAL TRANSACTIONS                                                5,015         251,197         161,969
----------------------------------------------------------------------------------------------------------------------------------

----------------------------------------------------------------------------------------------------------------------------------
 G.       MINORITY INTEREST'S SHARE IN SUBSIDIARY'S INCOME                                 (1,832)         (1,523)            (18)
----------------------------------------------------------------------------------------------------------------------------------

----------------------------------------------------------------------------------------------------------------------------------
 H.       OTHER INCOME                                                                     58,057          58,401          38,333
----------------------------------------------------------------------------------------------------------------------------------
          - Income from long-term investments in other companies                              ---           2,470           6,715
          - Punitive interest                                                               2,917           3,224           2,804
          - Receivables recovered and allowances restored to income                        44,031          35,497          14,701
          - Other                                                                          11,109          17,210          14,113

----------------------------------------------------------------------------------------------------------------------------------
 I.       OTHER EXPENSE                                                                   (59,221)        (45,773)        (39,484)
----------------------------------------------------------------------------------------------------------------------------------
          - Loss from long-term investments in other companies                             (7,522)            ---             ---
          - Punitive interest and charges payable to the BCRA                                 (85)           (320)           (116)
          - Allowance for doubtful accounts and other allowances                          (23,886)        (19,872)        (12,486)
          - Other                                                                         (27,728)        (25,581)        (26,882)

----------------------------------------------------------------------------------------------------------------------------------
          NET INCOME BEFORE INCOME TAX                                                      2,019         262,302         160,800
----------------------------------------------------------------------------------------------------------------------------------

----------------------------------------------------------------------------------------------------------------------------------
 J.       INCOME TAX                                                                      (12,227)        (54,709)        (41,632)
----------------------------------------------------------------------------------------------------------------------------------

                     NET (LOSS) / INCOME FOR THE FISCAL YEAR                              (10,208)        207,593         119,168
                    NET (LOSS) / INCOME PER COMMON SHARE (*)                                (0.03)           0.61            0.36

----------------------------------------------------------------------------------------------------------------------------------
</TABLE>

(1)  See incorporation procedure of former Banco Tornquist S.A. gain (losses) as
     of December 31, 2000 in note 3.4. to the consolidated financial statements
     of Banco Rio de la Plata S.A. and subsidiaries.

(2)  See note 3.1.

(*)  Earnings per share as of December 31, 2001, 2000 and 1999, were calculated
     on the basis of 346,741,665, 341,004,670 and 335,267,675 average
     outstanding shares. The Specials Stockholders' Meetings of April 28, 2000,
     approved the increase of the capital stock to 346,741,665, represented by
     11,473,990, class "B" shares.

 Notes 1 to 31 to the consolidated financial statements, are an integral part of
                                these statements.

                                      F-10

<PAGE>

                 BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES
           CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
          FOR THE FISCAL YEARS ENDED DECEMBER 31, 2001, 2000 AND 1999
                        (Stated in thousands of pesos)

<TABLE>
<CAPTION>

-------------------------------------------------------------------------------------------------------------------------------
                                                                                              NONCAPITALIZED CONTRIBUTIONS
                                                                                           -----------------------------------
                                  MOVEMENTS                                      CAPITAL      SHARE ISSUE      IRREVOCABLE

                                                                                  STOCK        PREMIUMS       CONTRIBUTIONS
-------------------------------------------------------------------------------------------------------------------------------
<S>                                                                              <C>                  <C>              <C>
Balance as of December 31, 1998                                                    335,268            54,161           38,000

-------------------------------------------------------------------------------------------------------------------------------

Unrealized valuation difference on government securities available for sale

Distribution of unappropriated earnings approved by Stockholders' Meeting of
April 30, 1999:

     - Legal reserve
     - Cash dividends

Net income for the fiscal year

-------------------------------------------------------------------------------------------------------------------------------
Balance as of December 31, 1999                                                    335,268            54,161           38,000
-------------------------------------------------------------------------------------------------------------------------------

Distribution of unappropriated earnings approved by Stockholders' Meeting of
April 28, 2000:

     - Legal reserve
     - Cash dividends

Resolutions of the April 28, 2000 Stockholders' Meeting:

     - Capital increase upon merger with Banco Tornquist S.A. (1)                   11,474
     - Accounting for merger premium                                                                 125,726
     - Incorporation of irrevocable contributions for future capital subscriptions upon the merger
        with Banco Tornquist S.A.                                                                                      55,000
     - Incorporation of adjustments to equity, legal reserve, other reserves and unappropriated
       earnings upon the merger with Banco Tornquist S.A.

Reimbursement of irrevocable contributions approved by the Board of Directors at its
meeting of October 4, 2000                                                                                            (55,000)

Net income for the fiscal year

-------------------------------------------------------------------------------------------------------------------------------
Balance as of December 31, 2000                                                    346,742           179,887           38,000
-------------------------------------------------------------------------------------------------------------------------------

Distribution of unappropriated earnings approved by Stockholders' Meeting of
April 27, 2001:

     - Legal reserve
     - Cash dividends

Distribution of unappropriated earnings approved by the Board of Directors as of
June 19, 2001, pursuant to the authorization of the Regular General
Shareholders' Meeting held on April 27,2001

     - Cash dividends

Reimbursement of irrevocable contributions approved by the Board of Directors at its
meeting of November 16, 2001                                                                                          (38,000)

Net loss for the fiscal year

-------------------------------------------------------------------------------------------------------------------------------
Balance as of December 31, 2001                                                    346,742           179,887        --
-------------------------------------------------------------------------------------------------------------------------------

<CAPTION>
-----------------------------------------------------------------------------------------------------------------------------------
                                                                             ADJUSTMENTS TO          EARNINGS          UNREALIZED

                                  MOVEMENTS                                   STOCKHOLDERS'          RESERVED          VALUATION
                                                                                              ------------------------
                                                                                 EQUITY          LEGAL       OTHER     DIFFERENCE
-----------------------------------------------------------------------------------------------------------------------------------
<S>                                                                                    <C>        <C>          <C>           <C>
Balance as of December 31, 1998                                                        68,976     234,596      79,215        3,385

-----------------------------------------------------------------------------------------------------------------------------------

Unrealized valuation difference on government securities available for sale                                                 (3,385)

Distribution of unappropriated earnings approved by Stockholders' Meeting of
April 30, 1999:

     - Legal reserve                                                                               20,212
     - Cash dividends

Net income for the fiscal year

-----------------------------------------------------------------------------------------------------------------------------------
Balance as of December 31, 1999                                                        68,976     254,808      79,215      --
-----------------------------------------------------------------------------------------------------------------------------------

Distribution of unappropriated earnings approved by Stockholders' Meeting of
April 28, 2000:

     - Legal reserve                                                                               23,834
     - Cash dividends

Resolutions of the April 28, 2000 Stockholders' Meeting:

     - Capital increase upon merger with Banco Tornquist S.A. (1)
     - Accounting for merger premium
     - Incorporation of irrevocable contributions for future capital
        subscriptions upon the merger with Banco Tornquist S.A.
     - Incorporation of adjustments to equity, legal reserve,
        other reserves and unappropriated earnings upon the merger
        with Banco Tornquist S.A.                                                      55,074      14,911       6,705

Reimbursement of irrevocable contributions approved by
the Board of Directors at its meeting of October 4, 2000

Net income for the fiscal year

-----------------------------------------------------------------------------------------------------------------------------------
Balance as of December 31, 2000                                                       124,050     293,553      85,920      --
-----------------------------------------------------------------------------------------------------------------------------------

Distribution of unappropriated earnings approved by Stockholders' Meeting of
April 27, 2001:

     - Legal reserve                                                                               41,519
     - Cash dividends

Distribution of unappropriated earnings approved by the Board of Directors
as of June 19, 2001, pursuant to the authorization of the Regular General
Shareholders' Meeting held on April 27,2001

     - Cash dividends

Reimbursement of irrevocable contributions approved by the Board of Directors
at its meeting of November 16, 2001

Net loss for the fiscal year

-----------------------------------------------------------------------------------------------------------------------------------
Balance as of December 31, 2001                                                       124,050     335,072      85,920      --
-----------------------------------------------------------------------------------------------------------------------------------

<CAPTION>
---------------------------------------------------------------------------------------------------------------


                                  MOVEMENTS                                       UNAPPROPRIATED      TOTAL

                                                                                     EARNINGS
---------------------------------------------------------------------------------------------------------------
<S>                                                                                        <C>       <C>
Balance as of December 31, 1998                                                            306,488   1,120,089

---------------------------------------------------------------------------------------------------------------

Unrealized valuation difference on government securities available for sale    )                        (3,385)

Distribution of unappropriated earnings approved by Stockholders' Meeting of
April 30, 1999:

     - Legal reserve                                                                       (20,212)
     - Cash dividends                                                                      (30,318)    (30,318)

Net income for the fiscal year                                                             119,168     119,168

---------------------------------------------------------------------------------------------------------------
Balance as of December 31, 1999                                                            375,126   1,205,554
---------------------------------------------------------------------------------------------------------------

Distribution of unappropriated earnings approved by Stockholders' Meeting of
April 28, 2000:

     - Legal reserve                                                                       (23,834)
     - Cash dividends                                                                      (35,750)    (35,750)

Resolutions of the April 28, 2000 Stockholders' Meeting:

     - Capital increase upon merger with Banco Tornquist S.A. (1)                                       11,474
     - Accounting for merger premium                                                                   125,726
     - Incorporation of irrevocable contributions for future capital
        subscriptions upon the merger with Banco Tornquist S.A.                                         55,000
     - Incorporation of adjustments to equity, legal reserve,
        other reserves and unappropriated earnings upon the merger
        with Banco Tornquist S.A.                                                         (251,639)   (174,949)

Reimbursement of irrevocable contributions approved by
the Board of Directors at its meeting of October 4, 2000                                               (55,000)

Net income for the fiscal year                                                             207,593     207,593

---------------------------------------------------------------------------------------------------------------
Balance as of December 31, 2000                                                            271,496   1,339,648
---------------------------------------------------------------------------------------------------------------

Distribution of unappropriated earnings approved by Stockholders' Meeting of
April 27, 2001:

     - Legal reserve                                                                       (41,519)          0
     - Cash dividends                                                                      (62,278)    (62,278)

Distribution of unappropriated earnings approved by the Board of Directors
as of June 19, 2001, pursuant to the authorization of the Regular General
Shareholders' Meeting held on April 27,2001

     - Cash dividends                                                                     (167,694)   (167,694)

Reimbursement of irrevocable contributions approved by the Board of Directors
at its meeting of November 16, 2001                                                                    (38,000)

Net loss for the fiscal year                                                               (10,208)    (10,208)

---------------------------------------------------------------------------------------------------------------
Balance as of December 31, 2001                                                            (10,203)  1,061,468
---------------------------------------------------------------------------------------------------------------
</TABLE>

(1) Shares exchanged with Banco Tornquist S.A. Stockholders.


Notes 1 to 31 to the Consolidated Financial Statements, are an integral part of
                               these statements.

                                      F-11

<PAGE>

                    BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES
                       CONSOLIDATED STATEMENTS OF CASH FLOWS
            FOR THE FISCAL YEARS ENDED DECEMBER 31, 2001, 2000 AND 1999
                          (Stated in thousands of pesos)

<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------------------
                                                                           12/31/2001     12/31/2000 (1) (2) 12/31/1999 (2)
                                                                        ------------------------------------------------------
<S>                                                                     <C>               <C>                <C>

Cash provided by operating activities
-------------------------------------

     - Financial income collected                                               1,117,307         1,023,715           880,106
     - Service charge income collected                                            390,504           367,477           279,518
     - Other income collected                                                      66,550            36,278            48,457

     Less:
     - Financial expenses paid                                                   (710,737)         (638,926)         (519,458)
     - Operating expenses paid                                                   (504,650)         (473,621)         (430,011)
     - Other expenses paid                                                        (59,756)          (58,158)          (46,833)

------------------------------------------------------------------------------------------------------------------------------
Net cash provided by operating activities                                         299,218           256,765           211,779
-----------------------------------------
------------------------------------------------------------------------------------------------------------------------------

     Less:

Cash (provided by) used in investing activities:
------------------------------------------------

    - (Decrease) / Increase in government and private securities               (1,520,103)          238,236           261,775
    - Increase in loans                                                           533,372           477,676           118,478
    - (Decrease) / Increase in other receivables from financial
        transactions                                                           (3,432,992)        1,221,489          (289,008)
    - Increase in other assets                                                    156,350            79,898            59,167

------------------------------------------------------------------------------------------------------------------------------
Net cash (provided by) used in investing activities                            (4,263,373)        2,017,299           150,412
---------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------

Plus:

Cash (used in) provided by financing activities:
------------------------------------------------

     - (Decrease) / Increase in deposits                                         (689,759)          806,456           921,199
     - (Decrease) / Increase in other liabilities from financial
         transactions                                                          (3,361,063)        1,095,206          (496,832)
     - Decrease in other liabilities                                              (41,353)          (11,502)          (34,358)
     - Cash dividends paid                                                       (229,512)          (48,674)          (19,536)
     - Merger with Banco Tornquist S.A.                                        ---                   17,251        ---
     - Reimbursement of irrevocable contributions                                 (38,000)          (55,000)       ---

------------------------------------------------------------------------------------------------------------------------------
Net cash (used in) provided by financing activities                            (4,359,687)        1,803,737           370,473
---------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------

------------------------------------------------------------------------------------------------------------------------------
Increase in cash and cash equivalents                                             202,904            43,203           431,840
-------------------------------------
------------------------------------------------------------------------------------------------------------------------------


------------------------------------------------------------------------------------------------------------------------------
Reconciliation of cash and due from banks
-----------------------------------------

------------------------------------------------------------------------------------------------------------------------------

Cash and due from banks at the beginning of fiscal year                         1,091,557         1,048,354           616,514
Increase in cash and cash and equivalents                                         202,904            43,203           431,840
------------------------------------------------------------------------------------------------------------------------------
Cash and due from banks at the end of fiscal year                               1,294,461         1,091,557         1,048,354
-------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
</TABLE>

(1) As of December 31, 2000 includes 29 upon the merger of Banco Tornquist S.A.
    See incorporation procedure of former Banco Tornquist S.A.'s account
    balances and gain (losses) in note 3.4. to the consolidated financial
    statements of Banco Rio de la Plata S.A. and subsidiaries.

(2) See note 3.1.





Notes 1 to 31 to the consolidated financial statements, are an intergal part of
                               these statements.

                                      F-12

<PAGE>

                   BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 and 1999

                         (Stated in thousands of pesos)

1.   MACROECONOMIC SITUATION OF THE FINANCIAL SYSTEM AND THE BANK

     1.1. EFFECTS OF THE DEVALUATION OF THE ARGENTINE PESO AND OTHER CHANGES TO
          ECONOMIC LEGISLATION AND REGULATIONS

          The economic and financial situation in Argentina deteriorated
          unrelentingly over the last few months; since June 30, 2001, this was
          basically reflected in an increase in sovereign risk, diminishing
          reserves, continuing fiscal imbalance, lower deposits in the financial
          system overall, deeply recessionary conditions with significant drops
          in both consumption and investment, decreased actual cash flows,
          difficulties to settle short-term debt and a deteriorating chain of
          payments.

          On November 1, 2001, the Argentine Government announced a new economic
          plan, the main measures of which related to the comprehensive
          restructuring of public debt at lower interest rates, launching a plan
          to revive the economy, and other fiscal measures, while the
          convertibility law (whereby the Argentine peso was pegged at par with
          the US dollar) and the balanced-budget law were to remain in effect.

          Although the domestic phase of the national public-debt restructuring
          process pursuant to Decree No. 1387/01 was successful, a new crisis
          broke out on November 30, 2001, triggered by the loss of deposits out
          of the financial system, which led the Government to issue Decree No.
          1570/01, which set tight restrictions on the withdrawal of cash from
          banks and controls on the transfer of funds abroad while fostering an
          increased dollarization of the economy.

          Subsequent to year-end, the deterioration of the economic and
          financial situation affected the institutions, with several successive
          changes taking place at the highest levels of the Federal Executive,
          which culminated with National Congress electing a new President to
          complete the constitutional period until December 10, 2003. In the
          interim, the suspension of payments on public debt, domestic and
          foreign, was declared.

          On January 6, 2002, National Congress enacted Public Emergency and
          Foreign Exchange System Reform Law No. 25,561, which introduced deep
          changes to the economic framework effective until then and,
          particularly, amended the Convertibility Law (whereby the Argentine
          peso was pegged at par with the US dollar) which had been in effect
          since March 1991; Law No. 25,561 also empowered the Federal Executive
          to issue additional monetary, financial and foreign exchange measures
          aimed at overcoming the economic crisis in the medium term. The law
          included, among others, the following measures:

          a)  The switch into pesos of certain debts towards the financial
              sector originally denominated in US dollars and outstanding as of
              December 31, 2001, at the exchange rate of one Argentine peso
              (ARS) to each US dollar;

          b)  The switch into pesos of private contracts stipulated in US
              dollars or including indexation clauses, over a term of 180 days,
              at the exchange rate of one ARS 1 to each US dollar;

          c)  The switch into pesos at the exchange rate of one ARS 1 to each US
              dollar of public utility rates priorly stipulated in US dollars,
              to be subsequently renegotiated on a case-by-case basis;

                                      F-13

<PAGE>

                   BANCO RIO DELA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 and 1999

                         (Stated in thousands of pesos)

          d)  The implementation of a new system levying duties on the export of
              oil and gas;

          e)  Empowering the Federal Executive to establish compensatory
              measures to avoid imbalances in financial institutions that may
              result from the switch into pesos of certain receivables.

          Furthermore, Federal Executive Decree No. 71/02 and "Central Bank of
          the Argentine Republic" (BCRA) Communique "A" 3425 established an
          "officially-ruled" foreign exchange market, basically for exports and
          certain imports and financial transactions, and another "free"
          exchange market (floating rate) for all other transactions. The
          officially-ruled exchange rate was set at ARS 1.4 to each US dollar,
          while the exchange rate on the "free market" at close of business of
          January 11, 2002, (the first day the foreign exchange market reopened
          after being suspended since December 23, 2001), ranged from ARS 1.60
          to ARS 1.70 to each US dollar, selling price. Later, by Decree No.
          260/02 of February 8, 2002, the Federal Executive established a single
          and free market through which all foreign exchange transactions are to
          be channeled as from the date of issuance of such Decree. Foreign
          exchange transactions are to take place at freely agreed-upon rates,
          subject to certain requirements and to the regulations to be set by
          the BCRA. As of the date of issuance of these financial statements,
          the latest exchange rate was ARS 3.10 to each US dollar, which was
          that as of April 19, 2002, given that the BCRA - through Communique
          "A" 3571 - had suspended foreign exchange transactions.

          Subsequently, through Decrees No. 214/02 of February 3, 2002, and No.
          410/02 of March 1, 2002, the Federal Executive took, among others, the
          following measures:

          a)  The switch into pesos of all obligations, whatever their cause or
              origin, to deliver sums of money stipulated in US dollars or any
              other foreign currency outstanding of the date of enactment of Law
              No. 25,561, with the exceptions, mainly, of financing related to
              foreign trade granted by financial institutions, and the private
              and government sectors' obligations to deliver sums to which
              foreign law is applicable;

          b)  The switch into pesos of all deposits with all financial
              institutions stipulated in US dollars or other foreign currencies
              at an exchange rate of ARS 1.4 to each US dollar, or its
              equivalent in other currencies;

          c)  The switch into pesos of all debts towards financial institutions
              stipulated in US dollars or other foreign currencies, whatever the
              amount or nature, at the exchange rate of ARS 1 to each US dollar,
              or its equivalent in other currencies;

          d)  The conversion into pesos of obligations to deliver monies,
              stipulated in US dollars or other foreign currencies, unrelated to
              financial institutions and whatever their origin or nature, at the
              exchange rate of ARS 1 to each US dollar, or its equivalent in
              other currencies;

          e)  The adjustment of all receivables and payables referred to in
              points (b) through (d) by applying a "Coeficiente de
              Estabilizacion de Referencia" (CER -Benchmark Stabilization
              Coefficient) that is to be published by the BCRA and,
              additionally, the application of a minimum set interest rate for
              deposits and a maximum set interest rate for loans. The CER is
              applicable as from the publication of Decree No. 214/02.
              Obligations of any nature or origin arising after the enactment of
              such Law No. 25,561, shall not be allowed to contain and shall not
              be subject to adjustment clauses;

          f)  The issuance of a Bond to be borne by the Federal Treasury to
              compensate the imbalances in the financial system resulting from
              the exchange difference caused by the switch of deposits with and
              payables to the financial system mentioned in points (b) and (c)
              above.

                                      F-14

<PAGE>

                   BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 and 1999

                         (Stated in thousands of pesos)

     1.2. IMPACT OF THE NEW MEASURES ON THE BANK'S PARTICULAR SITUATION

          a)  Effects of the devaluation of the Argentine peso

              As indicated in note 4.a) The Bank's assets and liabilities
              denominated in foreign currency as of December 31, 2001, were
              valued at the exchange rate of ARS 1 to each US dollar, as
              required by Resolution MD No. 01/02 of the "Consejo Profesional de
              Ciencias Economicas de la Ciudad Autonoma de Buenos Aires"
              (CPCECABA - Professional Council in Economic Sciences of Buenos
              Aires Autonomus City), by BCRA Communiques "A" 3439 and "A" 3574,
              by "Comision Nacional de Valores" (CNV - Argentine National
              Securities Commission) Resolution No. 392 and "Inspeccion General
              de Justicia" (IGJ - Governmental Regulatory Agency of
              Corporations) Resolution No. 2/02.

              Under the provisions of Law No. 25,561, and Sections Nos. 2, 3 and
              6 of Decree No. 214/02 and the amending and complementary
              regulations mentioned above, a significant portion of such assets
              and liabilities denominated in foreign currency were switched into
              pesos. The BCRA will define a procedure to compensate the adverse
              effects on equity resulting from switching into pesos (at
              different exchange rates) the receivables and payables denominated
              in foreign currency and to cover the negative difference in the
              net position of assets and liabilities denominated in foreign
              currency resulting from their switch into pesos; the procedure
              shall meet the following criteria:

          a)  The balance sheet as of December 31, 2001, shall be taken as
              reference.

          b)  The shareholders' equity resulting from the balance indicated in
              (a) shall be adjusted by applying to the net foreign currency
              position the exchange rate of ARS 1.4 to each US dollar, or its
              equivalent in other currency.

          c)  The amount to be compensated shall be any positive difference
              between the shareholders' equity determined as provided in point
              (b) above and the shareholders' equity resulting from having
              switched into pesos, at different exchange rates, the Bank's
              assets and liabilities as recorded in its balance sheet as of
              December 31, 2001.

          d)  The compensation to the Bank, determined in pesos, shall be paid
              by delivering Argentine Federal Government Compensatory Bonds in
              Pesos. Up to the amount of the net negative position in foreign
              currency resulting from converting into pesos the assets and
              liabilities recorded in the balance sheet as of December 31, 2001,
              the Bank will be entitled to have Argentine Federal Government
              Compensatory Bonds in Pesos received in compensation or acquired
              from third parties be exchanged for Argentine Government
              Compensatory Bonds in US Dollars at a rate of ARS 1.4 to each US
              dollar, at nominal values for both kinds of bonds, under the
              conditions and through the mechanism set by the BCRA. The
              Argentine Federal Government Compensatory Bonds in Pesos will be
              tradable on exchanges and markets, will carry the issuance date of
              December 31, 2001, and will mature on February 3, 2007. Such bonds
              shall be amortized in pesos in sixteen equal and consecutive
              quarterly installments to be adjusted by the CER - the first of
              which falls due on March 3, 2003 - and shall pay interest at 3%
              per annum on adjusted outstanding balances, also to be paid
              quarterly and in pesos. Meanwhile, the Argentine Federal
              Government Compensatory bonds in US dollars will be tradable on
              exchanges and markets, will carry the issuance date of December
              31, 2001, and will mature on February 3, 2012. Such bonds shall be
              amortized in US dollars in eight equal and consecutive annual
              installments, the first of which falls due on February 3, 2005,
              and shall pay interest at 180-day LIBOR per annum on outstanding
              balances, payable semi-annually in US dollars.

                                      F-15

<PAGE>

                   BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 and 1999

                         (Stated in thousands of pesos)

              The consolidated net foreign currency position as of December 31,
              2001, amounts to 1,118,649, resulting from assets (net of loan
              loss reserves) amounting to 8,259,484 and liabilities amounting to
              7,140,835 (See note 17.).

              Although the purpose of the government Bonds are to offset the
              imbalance in the banking system resulting from the exchange
              difference stemming from the switch into Argentine pesos of the
              deposits with, and debts owed to, the banking system, the
              regulations from the BCRA, which will establish the methodology,
              calculation and the specific treatment for balances in foreign
              currency to be converted into pesos, have not yet been issued.
              Accordingly the Bank is unable to estimate the ultimate net impact
              the devaluation and conversion of assets and liabilities in
              foreign currency will have on the financial position of the Bank.
              Once the BCRA has defined the criteria regarding the valuation of
              assets and liabilities denominated in foreign currency, the Bank
              will present and file a Pro-forma Balance Sheet including the
              effects of applying such regulations. Also, as of the date of
              issuance of these consolidated financial statements, the Bank had
              not submitted to the BCRA the monthly accounting information for
              January, February and March 2002, availing itself of the due dates
              postponement provided by the latter institution.

          b)  Deposits. Reprogramming of balances. Replacement by Federal
              Government Securities.

              As mentioned in note 1.1, the Federal Executive, through Decree
              No. 1570/01, established severe restrictions on withdrawals of
              funds from banks. Subsequently, pursuant to Decree No. 71/02, the
              Ministry of Economy issued Resolution No. 6/02, dated January 9,
              2002, amended by Decree No. 214/02, which laid down a schedule of
              reprogrammed repayment due dates for deposits held by the
              financial system under the system instated by Decree No. 1570/01.
              The BCRA, through Communique "A" 3426 of January 10, 2002 and "A"
              3467 of February 8, 2002, set the dates for the abovementioned
              schedule of deposit repayments, as follows:

              -   Deposits denominated in pesos (fixed-term deposits):

<TABLE>
<CAPTION>
                                                         Number of
                    Amount (in thousands of pesos)      installments        Repayment schedule
                  ----------------------------------  ----------------  --------------------------
                  <S>                                 <C>               <C>
                  From ARS 0,4 and up to ARS 10               4            As from March 2002
                  From ARS 10 to ARS 30                      12            As from August 2002
                  Larger than ARS 30                         24            As from December 2002
</TABLE>

                  Reprogrammed deposits, originally stipulated in pesos, shall
                  accrue interest at a nominal annual rate of 7% on outstanding
                  balances, payable on a monthly basis as from February 2002.
                  Installments to amortize the principal of such deposits shall
                  be monthly and consecutive.

              -   Deposits denominated in foreign currency switched into pesos
                  at the exchange rate of ARS 1.4 to each US dollar (checking
                  account deposits in excess of US$ 10,000, savings account
                  deposits in excess of US$ 3,000 and fixed-term deposits):

<TABLE>
<CAPTION>
                                                         Number of
                    Amount (in thousands of pesos)      installments        Repayment schedule
                  ----------------------------------  ----------------  --------------------------
                  <S>                                 <C>               <C>
                  From ARS 1.2 and up to ARS 7               12            As from January 2003
                  From ARS 7 and up to ARS 14                12            As from March 2003
                  From ARS 14 and up to ARS 42               18            As from June 2003
                  More than ARS 42                           24            As from September 2003

</TABLE>

                                      F-16

<PAGE>
                   BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 and 1999

                         (Stated in thousands of pesos)

                   Reprogrammed deposits originally stipulated in foreign
                   currency shall accrue interest at a nominal annual rate of 2%
                   on outstanding balances, payable monthly as from February
                   2002. Installments to amortize the principal of such deposits
                   shall be monthly and consecutive.

               Subsequently, on March 12, 2002, the Federal Executive issued
               Decree No. 494/02 providing that owners of deposits originally
               made in pesos or made in foreign currency and that were switched
               into pesos under Decree No. 214/02 shall be entitled to swap the
               total or a portion of the amount of their deposits, without any
               cap, for Argentine Federal Government Bonds in Pesos - paying 3%
               and maturing in 2007 -, while the owners of deposits made in
               foreign currency and that were switched into pesos under Decree
               No. 214/02, shall be entitled to swap the total or a portion of
               the amount of their deposits, up to the lower of the amount of
               the reprogrammed deposit or US$ 30,000, for Argentine Federal
               Government Bonds in US dollars - paying 2% and maturing in 2012 -
               or Federal Government Compound - Interest Bonds in US Dollars
               paying LIBOR plus 1% and maturing in 2012.

               On the other hand, as a consequence of the measures adopted by
               the Federal Executive, a number of depositors filed before the
               courts petitions for precautionary measures, mainly
               constitutional rights protection actions, seeking to obtain the
               return of their deposits in cash and in the original currency,
               for amounts exceeding current regulations. In view of such
               circumstances, the banking industry organizations "Asociacion de
               Bancos Publicos y Privados de la Republica Argentina" (ABAPRA -
               Association of Governmental and Private Banks of Argentina) and
               "Asociacion de Bancos de la Argentina" (ABA - Argentine Banking
               Association) filed a petition against the precautionary measures
               before the Supreme Court of Justice of the Nation seeking that
               the Supreme Court consider the issue directly (Per Saltum
               procedure). As of the date of issuance of these consolidated
               financial statements, the Supreme Court had not yet issued any
               ruling on the issue. As a consequence of constitutional rights
               protection actions filed by depositors, by the date of issuance
               of these consolidated financial statements, the Bank had paid out
               59,399 (in thousands of ARS) and 66,839 (in thousands of US
               dollar).

               On April 25, 2002, National Congress enacted Law No. 25,587, on
               Public Emergency and Foreign Exchange System Reform, which sets
               forth that in court proceedings of any nature where defendants
               include financial institutions, and the matter of which regards
               financial loans, receivables, debts, obligations, deposits or
               reprogramming that could be considered affected by the provisions
               of Law No. 25,261 and its administrative order and supplementary
               measures, the precautionary measures provided by Section 230 of
               the Federal Civil and Commercial Procedure Code shall only be
               admissible when there were the danger that the maintenance or any
               alteration, as the case may be, of the status quo, whether under
               law or de facto, could interfere with the final judgment or
               render its execution impossible or ineffective.

               These statutory provisions, matters of public policy, shall be
               applicable to all cases in process and all precautionary measures
               pending execution, whatever the date of the court order.

          c)   Changes in the macroeconomic situation

               The negative effects for the financial system as a whole of the
               situations described above are related to the deep illiquidity,
               the impact of the devaluation of the peso, and the switching of
               obligations and deposits into pesos and their consequences on the
               recoverability of government and private sector loans, reduced
               profitability and the mismatch of terms and currencies.

                                      F-17

<PAGE>

                   BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 and 1999

                         (Stated in thousands of pesos)

      The Bank's Management is continually assessing the magnitude of the impact
      that economic measures could have on the Bank's equity and financial
      situation.

      These consolidated financial statements have been prepared assuming that
      the Bank will continue as a going concern, based on the understanding that
      the restructuring of the financial system as a whole, the restructuring of
      public debts and the implementation of the Bank's own action plans, will
      allow it to continue its operations and meet the liquidity and solvency
      ratios required by the BCRA and, accordingly, these consolidated financial
      statements do not include adjustments related to the recoverability of the
      asset amounts booked or the sufficiency of liabilities that may be
      necessary to resolve favorably the situations described above.

2.    THE BANK'S CORPORATE SITUATION

      As of April 26, 2002, Santander Central Hispano (SCH) Group owns, directly
      and through Administracion de Bancos Latinoamericanos Santander S.L. and
      other SCH Group companies, and also taking into account the exercise in
      January 2002 of call options - acquired in September 1998 - on shares
      owned by Merril Lynch International (holder of the rights and obligations
      of the Bank's former controlling shareholders), class "A" and "B" shares
      of Banco Rio de la Plata S.A., such shares represent 98.85% of capital
      stock equivalent to 99.23% of votes.

      As from 1997, the Bank lists its stock on the Buenos Aires Stock Exchange
      (BCBA) and on the New York Stock Exchange (NYSE) and, since 1999, on the
      Latin-American Euro Stock Exchange (Latibex) in Spain. The Shareholders'
      Meeting of Banco Rio de la Plata S.A. of April 27, 2001, agreed, among
      other things, to delist from the NYSE the "American Depository Receipts"
      (ADRs) which represent Bank shares because of the low number of holders
      and volume traded. On November 1, 2001, Banco Rio de la Plata S.A.
      announced that its ADRs would be delisted from the NYSE, but the request
      to deregister ADRs from the United States Securities and Exchange
      Commission (SEC) had not been filed yet. On December 14, 2001, the Bank's
      ADRs were suspended and delisted from the NYSE, as instructed by the SEC.

      As a consequence of the commitments made upon the execution of the Bank's
      stock transfer to the current controlling stockholders, a management
      agreement was entered into with SCH Group for a 10-year term with a 10%
      annual retribution of the Bank's net income of each year, before
      income tax.

      2.1.   Merger with Banco Santander S.A. of Argentina.

             On June 26, 1998, the Special Shareholders' Meetings of Banco Rio
             de la Plata S.A. (Banco Rio) and Banco Santander S.A. of Argentina
             (BSA) approved, among other things, the preliminary merger
             agreement executed by both institutions, the special
             merger-purposes financial statements of Banco Rio and BSA as of
             September 30, 1997, the rate at which shares would be exchanged and
             the merger of both institutions. In addition, the above mentioned
             Shareholders' Meetings also approved the increase of the capital
             stock of Banco Rio de la Plata S.A. to 335,268 (represented by
             35,267,675 class "B" book-entry shares, for a nominal value of $ 1
             each entitled to one vote per share), allocated the sum of 54,161
             as merger premium and the early dissolution, without liquidation,
             of BSA and the addition of all its assets to and assumption of all
             its liabilities by Banco Rio (as the surviving entity). The Banks
             executed the definitive merger agreement on July 31, 1998. The BCRA
             authorized the merger of both institutions on October 1, 1998.
             Consequently, on October 15, 1998, BSA merged into Banco Rio de la
             Plata S.A., effective as of January 1, 1998, transferring all BSA's
             current businesses as of such date following the procedure
             described in note 3.4 and the former discontinued all operations
             (See note 30.1).

                                      F-18

<PAGE>

                   BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 and 1999

                         (Stated in thousands of pesos)

      2.2.   Merger with Banco Tornquist S.A.

             On January 6, 2000, the controlling shareholders of Banco Rio de la
             Plata S.A. and Banco Tornquist S.A. (an entity in which SCH
             indirectly holds a 100% equity interest) executed an agreement for
             the merger of both entities, whereby all Banco Tornquist S.A.
             (absorbed entity) operations are to be merged into Banco Rio de la
             Plata S.A. (absorbing entity). Under the abovementioned agreement,
             Banco Rio de la Plata S.A. took over management of Banco Tornquist
             S.A. for the purpose of ensuring effective integration of
             operations, customer service continuity, and sharing the benefits
             of the former's broad range of services. Furthermore, on February
             16, 2000, Banco Rio de la Plata S.A. and Banco Tornquist S.A.
             executed a preliminary merger agreement; also, the Boards of
             Directors of both entities approved the special merger-purposes
             consolidated financial statements of Banco Rio de la Plata S.A. and
             Banco Tornquist S.A. as of December 31, 1999, and the share
             exchange rate.

             On April 28, 2000, the Shareholders' Meetings of Banco Rio de la
             Plata S.A. and Banco Tornquist S.A. approved, among other issues,
             the preliminary merger agreement that had been executed between the
             two Banks, the merger-purposes special consolidated financial
             statements of Banco Rio de la Plata S.A. and Banco Tornquist S.A.
             as of December 31, 1999, the share exchange ratio and the effective
             merger of both institutions. In addition, the abovementioned
             shareholders' meetings approved that the capital stock of Banco Rio
             de la Plata S.A. be increased to 346,742 (represented by 11,473,990
             Class B book-entry shares of a face value of $1 each and entitled
             to one vote per share), the dissolution without liquidation of
             Banco Tornquist S.A. and the transfer of its entire equity to Banco
             Rio de la Plata S.A. (the surviving entity).

             The BCRA, through Resolution No. 122 dated March 9, 2000,
             authorized Banco Tornquist S.A. to be merged with and into the Bank
             and allow the operating ratios used for regulatory purposes to
             be computed on a consolidated basis. Also, the merger was
             authorized by the BCBA on May 31, 2000, and by the CNV through
             Resolution No. 13,452 dated June 30, 2000.

             Accordingly, the merger of Banco Tornquist S.A. with and into Banco
             Rio de la Plata S.A. became final on June 30, 2000, and was given
             retroactive effect as from January 1, 2000. All Banco Tornquist
             S.A. business outstanding as of such date was transferred to the
             Bank following the procedure described in note 3.4 and the former
             discontinued all operations. The merger of Banco Tornquist S.A.
             with and into Banco Rio de la Plata S.A. and the former's
             subsequent dissolution was registered with the IGJ on July 13,
             2000.

3.    SIGNIFICANT ACCOUNTING POLICIES

      Banco Rio de la Plata S.A. is a private sector commercial bank in
      Argentina organized and existing under the laws of Argentina. It also has
      a foreign branch in Grand Cayman and other related companies. The
      principal business of the Bank is to engage directly and indirectly
      through its foreign branch and related companies, in a wide variety of
      commercial banking activities and related financial and non-financial
      services in Argentina and abroad, including investment banking and capital
      markets activities in pesos and U.S. dollars with both retail and
      wholesale customers.

      The consolidated financial statements include the accounts of the Bank in
      Argentina and its foreign branch (See note 3.2 below) and its directly or
      indirectly held subsidiaries. All significant intercompany transactions
      have been eliminated.

                                      F-19

<PAGE>

                   BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 and 1999

                         (Stated in thousands of pesos)

      As of December 31, 2001 and 2000, the Bank has consolidated its financial
      statements with Santander Riobank (Grand Cayman) and its subsidiaries,
      Santander Sociedad de Bolsa S.A., Santander Investment Gerente de Fondos
      Comunes de Inversion S.A. and Gire S.A.

      The Bank's (direct and indirect) equity interest in subsidiaries is as
      follows:
<TABLE>
<CAPTION>
                                                                        Shares                 Percentage over
                                                              -------------------------- ----------------------------
                              Company                                                        Total        Possible
                                                                  Type        Number        Capital        votes
      ------------------------------------------------------- ------------ ------------- ------------- --------------
      <S>                                                     <C>          <C>           <C>           <C>
      Santander Riobank (Grand Cayman)                           Common      9,360,000      100.00%       100.00%
      Santander Sociedad de Bolsa S.A.                           Common      4,900,000      100.00%       100.00%
      Santander Investment Gerente de F.C.I. S.A.                Common        113,740      100.00%       100.00%
      Gire S.A.                                                  Common         57,163       58.33%        58.33%
</TABLE>

      As of December 31, 1999, Banco Rio de la Plata S.A. has consolidated its
      financial statements with the financial statements of Santander Riobank
      (Grand Cayman) and its subsidiaries, Santander Sociedad de Bolsa S.A. and
      Santander Investment Gerente de Fondos Comunes de Inversion S.A. as of
      that date.

      3.1. Comparative Information

           The consolidated financial statements as of December 31, 2001 are
           presented comparatively with those of the December 31, 2000 and 1999
           fiscal years and have been restated to reflect the effect of changes
           in the purchasing power of the peso through August 31, 1995, as
           explained in note 3.3.

           The following are the changes in the inflation rate based on the
           general price index for the fiscal years ended:

           December 31, 2001          (5.30)%
           December 31, 2000           2.40%
           December 31, 1999           1.06%

           As a result of the merger between Banco Rio de la Plata S.A. and
           Banco Santander S.A. of Argentina mentioned in note 2.1., the
           consolidated financial statements for the years ended December 31,
           2001, 2000 and 1999, include the balance sheet and statement of
           income of the former BSA from the beginning of the year through the
           merger with Banco Rio de la Plata S.A. (See note 3.4).

           As a result of the merger between Banco Rio de la Plata S.A. and
           Banco Tornquist S.A. mentioned in note 2.1., the consolidated
           financial statements for the year ended December 31, 2001 and 2000,
           include the balance sheet and statement of income of the former Banco
           Tornquist S.A. from the beginning of the year through the merger with
           Banco Rio de la Plata S.A.

           By Communiques "A" 3147 as supplemented, and "A" 3345, the BCRA
           amended the accounting information quarterly/annual publishing rules
           and regulations and, specifically, the regulations in connection with
           the presentation and disclosure of the financial statements of
           financial institutions, which were in effect through September 30,
           2000 and 2001, respectively. These changes in disclosures methods do
           not imply any changes in shareholders' equity or income (loss) for
           each fiscal year. Consequently, the consolidated financial statements
           as of December 31, 1999 and 2000 have been reclassified by applying
           the regulations, for the sole purpose of comparing them with the
           consolidated financial statements of the year ended December 31,
           2001.

                                      F-20

<PAGE>

                   BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 and 1999

                         (Stated in thousands of pesos)

      3.2. Consolidation of the Bank's Foreign Branch and subsidiaries

           The consolidation procedure was as follows:

           a) The financial statements of the foreign branch, originally
              expressed in U.S. dollars (US$), have been adapted to generally
              accepted accounting principles in Argentina and the standards of
              the Central Bank. As the functional currency is considered to be
              the Argentine peso, the branch financial statements amounts were
              translated into pesos as described below:

              -  Assets and liabilities were translated into pesos as described
                 in note 4.a) below.

              -  The translation difference on Bank Premises and Equipment and
                 Other Assets was credited to "Adjustments to Stockholders'
                 Equity".

              -  Assigned capital was reflected at the peso amounts remitted by
                 Head Office and recorded in the Head Office books.

              -  Retained earnings were determined as the difference between
                 assets and liabilities plus capital stock, translated into
                 pesos as indicated above.

              -  Income statement accounts were converted into pesos as
                 described in note 4.a) below.

           b) Intercompany transactions between foreign branch and Head Office
              were eliminated from both the Balance Sheets and the Statements of
              Income.

           c) The subsidiaries' financial statements have been prepared in
              accordance with the same accounting methods as those applied by
              Banco Rio de la Plata S.A. to prepare its financial statements
              insofar as valuation of assets and liabilities, measurement of
              income and restatement procedures are concerned.

              Intercompany transactions between subsidiaries and between these
              and the Bank were eliminated from both the Balance Sheets and the
              Statements of Income.

      3.3. Restatement of the Head Office's and Local Branches' financial
           statements in equivalent purchasing power

           The consolidated financial statements have been prepared from the
           Bank's books of account in conformity with the accounting standards
           of the BCRA.

           The consolidated financial statements fully reflect the effect of
           changes in the purchasing power of the peso through August 31, 1995
           by the application of the method for restatement in constant pesos
           set forth in Technical Resolution No. 6 of the "Federacion Argentina
           de Consejos Profesionales de Ciencias Economicas" (FACPCE - Argentine
           Federation of Professional Council in Economic Sciences). As from
           September 1, 1995, in view of the economic stability conditions
           prevailing at the time and as required by General Resolution No. 272
           of the CNV and Communique "A" 2365 of the BCRA, the Bank suspended
           the application of the restatement-in-constant-pesos method and
           maintained the restatement recorded until such date.

                                      F-21

<PAGE>

                   BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 and 1999

                         (Stated in thousands of pesos)

           This criterion has been accepted by professional accounting standards
           as long as the variation in the internal producer price index,
           general level, applicable for such restatement does not exceed an
           annual 8% rate. The variation of such index for each of the years
           ended as from September 1, 1995, was below such percentage. However,
           the "Instituto Nacional de Estadistica y Censos" (INDEC - Argentine
           Institute of Statistics and Census) informed that such index had
           increased by 6.6%, 11% and 11.2%, respectively, for January, February
           and March 2002.

           Considering the existence of a new inflationary context and the
           conditions imposed by the new system created by the Law on Public
           Emergency and Exchange System Reform, which are described in detail
           in note 1, on March 6, 2002, the Directors of CPCECABA approved
           Resolution MD No. 03/02, which provides, among other things, the
           resumption in the application of the inflation adjustment for the
           interim periods or years ended as from March 31, 2002. Such
           Resolution further provides that the above mentioned adjustment may
           be applied in advance and establishes that the accounting
           measurements restated upon the change on the currency purchasing
           power loss (gain) until the interruption of the adjustments,
           including those measurements dating back to the stability period,
           shall be considered restated as of December 2001. The
           restatement-in-constant-pesos method shall be applied to the
           accounting cost values prior to the capitalization of the exchange
           differences mentioned in note 4.s), which shall be considered an
           advanced recognition of variations in the purchasing power loss
           (gain) of currency and will, therefore, be absorbed by the value in
           constant pesos of assets. The Bank must apply the provisions of
           Resolution MD No. 03/02 of the CPCECABA upon approval by the related
           controlling authorities.

      3.4. Procedure to incorporate Banco Santander S.A. of Argentina's and
           Banco Tornquist S.A.'s balances

           Similar methods to those applied by Banco Rio de la Plata S.A. to
           prepare the consolidated financial statements as of December 31, 1998
           and 2000, were used for the valuation of assets and liabilities and
           the calculation of income (loss) of the former Banco Santander S.A.
           of Argentina and the former Banco Tornquist S.A., respectively.

           The procedures to incorporate the former Banco Santander S.A. of
           Argentina's and the former Banco Tornquist S.A.'s accounts to the
           consolidated financial statements of Banco Rio de la Plata S.A. were
           as follows:

           a) Balance Sheet:

              -  Banco Santander S.A. of Argentina:

                 On April 30, 1998, Banco Rio de la Plata S.A. and Banco
                 Santander S.A. of Argentina executed an assets and liabilities
                 purchase agreement whereby Banco Santander S.A. of Argentina
                 transferred to Banco Rio de la Plata S.A. a portion of the
                 former's assets and liabilities as of that date at book value.

                 As from the merger date, the former Banco Santander S.A. of
                 Argentina's assets and liabilities in effect as of such date
                 were incorporated to those of Banco Rio de la Plata S.A. line
                 by line.

                 At the same time, premium on merger was recorded in the amount
                 of 54,161 as a result of the share exchange between the
                 shareholders from both banks as explained in note 2.1.

              -  Banco Tornquist S.A.:

                 The assets and liabilities remaining as of June 30, 2000, were
                 added on a line-by-line basis to those of Banco Rio de la Plata
                 S.A.; the assets of the former Banco Tornquist S.A. amounted to
                 about 980,000 and its liabilities to about 963,000.

                                      F-22

<PAGE>

                   BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 AND 1999

                         (Stated in thousands of pesos)


          At the same time, the premium on merger was set in the amount of
          125,726 as a result of the share exchange between the shareholders
          from both banks as explained in note 1 and was recorded under
          "Stockholders' Equity - Share issue premiums".

    b) Statement of Income:

       The income (loss) items of the former Banco Santander S.A. of Argentina
       and the former Banco Tornquist S.A. generated from the beginning of the
       years ended December 31, 1998 and 2000, respectively, through the merger
       date were allocated, line by line, to those of Banco Rio de la Plata
       S.A.

    c) Transactions between the former Banco Santander S.A. of Argentina and
       the former Banco Tornquist S.A. and Banco Rio de la Plata S.A.:

       The balance sheet accounts balances and the transactions between the
       banks through the merger dates were eliminated.

    d) Statement of cash flows:

       -  Cash provided by transactions:

          The income (loss) for the fiscal years ended December 31, 1998 and
          2000, include the cash receipts, disbursements and expenses of the
          former Banco Santander S.A. of Argentina and the former Banco
          Tornquist S.A., respectively, from the beginning of these years
          through the merger dates.

       -  Cash used for assets and/or provided by liabilities:

          The variations in the balance sheet accounts balances are affected by
          the incorporation of the assets and liabilities of the former Banco
          Santander S.A. of Argentina and the former Banco Tornquist S.A. as
          explained in a).


4.  MAIN VALUATION METHODS

    The accounting policies and financial statement presentation conform to the
    rules prescribed by the Central Bank. The Central Bank prescribes the
    reporting and disclosure practices of all banks in Argentina, wich practices
    differ from those applicable to business associations in general. These
    rules differ in certain respects from generally accepted accounting
    principles in Argentina. The rules of the Central Bank allowed for certain
    of the bank's investments in federal government securities to be carried at
    amortized cost plus interest accrued, basically, when such securities are
    held for at least one year; whereas Argentine generally accepted accounting
    principles applicable to business enterprises in general require, under
    those same conditions, such securities to be accounted for at market value.

    Until February 28, 1999, the Bank classified part of its government
    securities holdings and certain assets in government securities under
    repurchase agreements as "available for sale" in accordance with Communique
    "A" 2266 and supplementary ones of the BCRA, charging the difference between
    the higher cost and listed prices to the "Stockholders' Equity - Unrealized
    valuation difference" account. By Communique "A" 2793 dated October 27,
    1998, as supplemented, the BCRA had repealed the valuation system to be
    applied to federal government securities held as "available for sale" (that
    had been established by Communique "A" 2266 and supplementary ones of the
    BCRA), that was to become effective on March 1, 1999.

                                      F-23

<PAGE>

                   BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 AND 1999

                         (Stated in thousands of pesos)


     As disclosed in notes 4.b) and 4.g) below, as of December 31, 2001 and
     2000, the Bank classified part of its listed government securities
     portfolio and certain assets in government securities used by repurchase
     agreements as "holdings in investment account" in accordance with BCRA
     standards. Under generally accepted accounting principles in Argentina, the
     listed Argentine government securities mentioned in the preceding paragraph
     should have been valued at the listed price net of estimated selling
     expenses, crediting (charging) any differences in the listed price to
     current income (loss) of each year.

     As disclosed in note 4.c) below during the fiscal year ended, and as
     provided by Decree No. 1387/01, Banco Rio de la Plata S.A. and its
     subsidiary Santander Riobank (Grand Cayman) swapped Federal Government
     securities, bonds, and Treasury Notes (classified and valued as "Investment
     accounts" or "trading or financial transactions" under BCRA accounting
     standards) with the Federal Government on November 6, 2001.In accordance
     with Argentine professional accounting standards the abovementioned loans
     should be valued, until November 6, 2001, thus converting then into loans
     to the Government, considering the respective listed prices of the
     securities swapped, the listed price on such date becoming the cost of the
     transaction to which the interest accrued from then and until year-end
     should be added. Under Argentine professional accounting standards the
     effect of such holdings as of November 6, 2001, as disclosed in note
     30.6.c).

     In all other respects, BCRA standards are consistent with Argentine
     generally accepted accounting principles in Argentina. Certain of the
     required disclosures of the BCRA have not been presented herein since they
     are not material to the accompanying financial statements. In addition,
     certain presentations and disclosures have been included in the
     accompanying financial statements to comply with the United SEC's
     regulations for foreign registrants. The following is a summary of the main
     valuation methods used in the preparation of the consolidated financial
     statements:

     a)   Foreign currency assets and liabilities:

          As of December 31, 2001, assets and liabilities in foreign currency
          were converted at the ARS 1 = USD 1 rate effective as of the date of
          suspension of the exchange market on December 23, 2001 (See note 1),
          according to the provisions of BCRA Communiques "A" 3439 and "A" 3574,
          CPCECABA Resolution MD No. 02/02 and CNV Resolution No. 392/02.

          As of December 31, 2000, such assets and liabilities were converted at
          the Banco de la Nacion Argentina selling rate (ARS 1= USD 1 in
          accordance with the Convertibility Law) effective for each currency as
          of the closing of transactions of the last working day of the year.
          Any exchange differences have been credited/charged to income of each
          year.

     b)   Government and private securities:

          -    Listed government securities:

               .    Holdings in investment accounts: as of December 31, 2001
                    each security was valued at original cost, increased by a
                    compound interest formula on the basis of the internal rate
                    of return and the time elapsed since acquisition. For
                    holdings carried over from before the new method came into
                    effect, original cost was considered to be the book value of
                    such holdings as of May 31, 2001, plus the internal rate of
                    return as from such date, as required by Communique "A" 3278
                    as supplemented by the BCRA.

                    As of December 31, 2000, each security was valued at
                    acquisition cost increased by the interest rate of the
                    current coupon at year-end, with a limit of 120% of market
                    value as of such date, if applicable. On the other hand, the
                    BCRA, through Communique "A" 3303 dated July 20, 2001,
                    extended the transitory suspension of the abovementioned cap
                    equivalent to 120% of market value provided by Communique
                    "A" 3269 of May 9, 2001.

                                      F-24

<PAGE>

                   BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 AND 1999

                         (Stated in thousands of pesos)


                    Any differences between acquisition cost and the valuation
                    described in the preceding paragraphs have been
                    credited/charged to income of each year.

               .    Holdings for trading or financial transactions: they have
                    been valued at the listed price of each security at each
                    year-end. Any differences in listed price have been
                    credited/charged to income of each fiscal year.

          -    Unlisted government securities - In foreign currency: they have
               been valued at residual face value plus interest accrued at each
               year-end. These amounts were converted into Argentine pesos as
               described in note 4.a) above.

          -    Listed private securities:

               .    Debt securities: valued at their listed price in effect as
                    of each year-end, net of estimated selling expenses. The
                    differences in listed price were charged/credited to income
                    for each fiscal year.

               .    Equity securities: valued at their listed price in effect as
                    of each year-end, net of estimated selling expenses. The
                    differences in listed price were charged/credited to income
                    for each fiscal year.

     c)   Guaranteed loans - Decree No. 1387/01

          On November 1, 2001, by Decree No. 1387/01, the Federal Executive
          instructed the Ministry of Economy to offer, under voluntary
          conditions, the swap of the federal and provincial public debt for
          guaranteed loans granted by the Federal Government or the Fiduciary
          Fund for Provincial Development, intending to obtain a reduction of
          the interest on the bonds swapped and the extension of amortization
          periods.

          Decrees No. 1387/01 and 1646/01 established the basic characteristics
          of such guaranteed loans, which include: conversion at the nominal
          value plus interest on the obligation swapped (one-to-one), loan
          denominated in the same currency as the obligation swapped, 3-year
          term broader than the term of the obligation swapped, tax exemption
          both for the difference between the conversion value and the market or
          accounting value and guaranteed loans and interest, providing as
          security for all payments of principal and interest on guaranteed
          loans all resources from the bank account credit-debit tax and, in
          general, all resources of the Federal Government under the federal tax
          revenue sharing system. Additionally, Decree No. 471/02 provided,
          among other things, the conversion into Argentine pesos of all
          obligations of the Federal, Provincial and Municipal public sector
          denominated in foreign currency, which are only subject to Argentine
          law at the ARS 1.40 = USD 1 rate or equivalent in any other currency,
          and the adjustment according the CER and the interest rate applicable
          to each type of public bond and guaranteed loan, based on its average
          life and the currency in which it was originally issued. In such
          sense, the Bank and its subsidiary, Santander Riobank (Grand Cayman),
          swapped part of their federal government securities and/or loans of
          the Federal Public Sector effective as of November 6, 2001, for a
          nominal value of USD 1,084,480,968, receiving in consideration
          guaranteed loans in the amount of 1,105,865.

          As provided for by BCRA Communiques "A" 3366 and "A" 3385, the initial
          value of guaranteed loans coincided with the prior accounting value of
          federal government securities (classified and valued as "investment
          accounts" or "for trading or financial transactions", under BCRA
          accounting standards) and/or loans as of the date of the swap, giving
          rise to no income at all as a result of the recognition of the swap,
          since the positive difference derived from the swap values established
          by the Ministry of Economy and the accounting value of the instruments
          swapped was reflected in an asset regularization account. The balance
          of such account will be allocated monthly to income in proportion to
          the term of each guaranteed loan.

                                      F-25

<PAGE>

                   BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 AND 1999

                         (Stated in thousands of pesos)


          Consequently, as of December 31, 2001, such guaranteed loans have been
          valued at the swap values established by the Ministry of Economy as of
          November 6, 2001, plus the related interest accrued until the year-end
          and have been registered in the consolidated financial statements as
          "Loans to the non-financial public sector" in the amount of 1,005,868,
          net of discounts.

          Moreover, the Bank has presented before Banco de la Nacion Argentina,
          in its capacity as fiduciary agent of the Fiduciary Fund for
          Provincial Development, provincial government securities and loans
          granted to the Provincial Public Sector with a nominal value of USD
          586,365,448 to execute the swap established by Decree No. 1387/01
          which, to date, has not yet been documented. Such transaction has been
          recorded as "Loans to the non-financial public sector" in such amount
          plus the related interest accrued and pending as of December 31, 2001,
          under the provisions of Decree No. 1387/01.

     d)   Accrual of interest:

          Interest has been accrued by the straight-line method in the years in
          which it was generated, except interest on transactions maturing in
          more than 92 days, on which interest has been accrued according to a
          compound interest formula.

          Generally, the Bank suspends the accrual of interest when the related
          loan is past-due and the collection of principal and interest is in
          doubt. Accrued interest remains on the Bank's books of account and is
          considered a part of the loan balance when determining the allowance
          for loan losses. Interest is then recognized on a cash basis after
          reducing the balance of accrued interest, if applicable.

     e)   Loans and deposits in government securities:

          They have been valued at the market price prevailing for each security
          at each year-end, plus accrued interest. Price differences have been
          credited/charged to income of each year.

     f)   Allowance for doubtful accounts and for contingencies commitments:

          The Bank generally provides for estimated possible future loans losses
          and the related accrued interest through the establishment of an
          allowance for loan losses.

          In the past, Argentina has gone through an economic crisis which had
          an impact on the financial system as a whole. As mentioned in notes 1
          and 9, adverse changes in the current economic environment could
          negatively affect the financial position of the Bank's debtors.

          The allowance for loans losses has been calculated based on the Bank's
          estimated loan loss risk in the light of debtor compliance, the Bank's
          analysis of each debtor's loan repayment capacity and the
          guarantee/security supporting the respective transactions, under
          Communique "A" 2950 as supplemented of the BCRA.

          In cases where loans with specifically allocated provisions are
          settled, and the specific provision established in previous years is
          greater than needed, the reversal of the specific provision is shown
          in the "Allowances restored to income" account in the accompanying
          Consolidated Statements of Income.

          Certain loans are charged off directly to the provision for loan
          losses in the accompanying Consolidated Statements of Income.
          Generally, these are loans for which a specific provision had not been
          provided in the Allowance for loan losses.

          Recoveries on charged-off loans are recorded directly in income as
          "Loans recovered" in the accompanying Consolidated Statements of
          Income.

                                      F-26

<PAGE>

                   BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 AND 1999

                         (Stated in thousands of pesos)


     g)   Securities and foreign exchange receivable or deliverable on spot and
          forward transactions pending settlement:

          The Bank enters into forward contracts to purchase or sell currencies
          or securities at future dates. A receivable and payable is reflected
          at the time of the agreement which reflects the amounts of cash and
          currencies or securities to be exchanged at close of business on the
          last business day of each year. The difference between the receivable
          and payable on the original transaction date (premium) is deferred and
          amortized over the contract life.

          The Bank also purchases and sells foreign currencies on behalf of its
          customers who will settle on the following day. An asset or liability
          is reflected for the amounts due from or to the customer and a
          corresponding asset or liability is reflected for the currency to be
          exchanged.

          The Bank's receivables or payables representing the future receipt or
          delivery of currencies or securities are valued as follows:

          -    Foreign currency transactions: converted at the Banco de la
               Nacion Argentina's selling exchange rate for each currency at
               close of business on the last business day of each year.

          -    Government securities held in investment accounts: as of December
               31, 2000, such holdings have been valued at acquisition cost
               increased by the interest rate of the current coupon through
               December 31, 2000 with a limit of 120% of market value as of the
               same date, if applicable. Any differences between acquisition
               cost and the valuation described in the preceding paragraph have
               been credited/charged to income of each year.

          -    Government and private securities held for trading or financial
               transactions: as of December 31, 2000 they have been valued at
               the listed price of each security at each year-end. Price
               differences have been credited/charged to income of the year.

          -    Financial instruments related to repurchase agreements with the
               BCRA: as of December 31, 2000, they have been valued at
               acquisition cost plus interest accrued but not collected at
               fiscal year-end.

     h)   Amounts receivable and payable under spot and forward transactions
          pending settlement:

          Such amounts were valued at the price agreed upon for each transaction
          plus the respective premiums accrued at each year-end.

     i)   Corporate bonds purchased - unlisted:

          They have been valued at acquisition cost plus interest accrued but
          not collected at each fiscal year-end.

     j)   Certificates of participation in financial trust-unlisted:

          They have been valued at acquisition cost plus interest accrued but
          not collected at each year-end. These instruments are included in
          "Other receivables from financial transactions - Other not included in
          Debtor Rating Standards".

     k)   Assets covered by financing leases:

          Such assets were booked at the present value of unaccrued amounts (the
          periodic installments and the previously stipulated net book value)
          calculated according to the conditions agreed upon in the related
          agreements and applying the respective interest rates.

                                      F-27

<PAGE>

                   BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000, AND 1999

                         (Stated in thousands of pesos)

     l)   Investments in other companies:

          -    Interest in financial institutions, complementary and authorized
               activities:

               Affiliates - local: Origenes Vivienda y Consumo Compania
               Financiera S.A. (former Origenes Vivienda S.A.), was valued by
               the equity method.

               Affiliates - foreign: Bladex S.A. was valued at acquisition cost
               in foreign currency plus stock dividends received at nominal
               value converted into pesos as described in note 4.a) above.

               In other companies:

               -    Affiliates - local:

                    .    Banelco S.A., Visa Argentina S.A. and Interbanking
                         S.A., were valued by the equity method.

                    .    Rio Compania de Seguros S.A., Prestamos de Consumo S.A.
                         and Caminos de las Sierras S.A., were valued at their
                         acquisition cost; the limit on the proportional equity
                         value having been calculated based on the shareholders'
                         equity of the issuing companies according to the last
                         financial statements available.

                    .    Mercado de Valores de Buenos Aires S.A.: valued at
                         acquisition cost, restated as explained in note 3.3.

                    .    Other local affiliates: were valued at acquisition cost
                         while the Bank has recorded allowances for impairment
                         in value for the amounts by wich the recorded values of
                         equity interest in other unlisted affiliates companies
                         exceed their value as calculated by the equity method
                         on the basis of the latest available financial
                         statements.

               -    Affiliates - foreign: valued at acquisition cost.

          As from the effective date of Law No. 25,063, the dividends, in cash
          and in kind, received by the Bank for its investments in other
          companies in excess of their accumulated taxable income upon
          distribution thereof, will be subject to a 35% income tax withholding
          as sole and definite payment.

          The Bank has not charged income tax since it estimates that the
          dividends from earnings recorded by the equity method would not be
          subject to such tax.

     m)   Bank premises and equipment and other assets:

          They have been valued at acquisition cost plus increases from
          appraisal revaluations in prior years, restated as explained in note
          3.3., less related accumulated depreciation calculated in proportion
          to the months of estimated useful life of the items concerned. These
          amounts (the net book value) of bank premises and equipment and other
          assets taken as a whole does not exceed their recoverable value.

     n)   Intangible assets:

          They have been valued at acquisition cost restated as explained in
          note 3.3., less related accumulated amortization calculated in
          proportion to the months of estimated useful life of the items
          concerned.

     o)   Employee termination pay:

          The Bank expenses employee termination pay when disbursed.

                                      F-28

<PAGE>

                  BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000, AND 1999

                         (Stated in thousands of pesos)

     p)   Certificates of deposit at a variable interest rate - Communique "A"
          2482, as supplemented. Hedge options (See note 26.c):

          The variable interest rate and the hedge of these investments, which
          have been traded for terms exceeding 180 days, were accrued based on
          the variation in the price of financial assets or financial assets
          ratios, which are habitually listed on the domestic and international
          markets. The premiums paid on the execution of agreements involving
          financial instruments to hedge the income from certificates of deposit
          were accrued over their respective effective terms.

     q)   Options (See note 26.c)

          .    Call options sold:

               They have been valued at the listed prices of the underlying
               shares in effect at each year-end. Price differences have been
               charged/credited to income of each year.

          .    Call and put options purchased and put options sold:

               They have been valued at the strike price.

     r)   Stockholders' equity accounts:

          They have been restated as explained in note 3.3., except "Capital
          stock" which has been left at its original value. The adjustment
          required to restate it is included in the "Adjustments to
          Stockholders' Equity-Adjustment to Capital" account.

     s)   Income statement accounts:

          -    Accounts representing monetary transactions (financial income and
               expense, service charge income and expense, provision for loan
               losses, operating expenses, etc.) have been accrued monthly at
               historical amounts.

          -    Accounts reflecting the income effect of the sale, retirement or
               consumption of nonmonetary assets were computed based on the
               value of those assets, restated as described in note 3.3.

          -    Income on investments in subsidiaries has been computed on the
               basis of the income reported by such subsidiaries, restated as
               described in note 3.3.

     t)   Consolidated statement of Cash Flows:

          For purposes of reporting cash flows, Cash and cash equivalents
          include "Cash and Due from Banks".

5.   RESTRICTIONS ON ASSETS

     a)   As of December 31, 2001 and 2000, there are other liabilities owed to
          the "Banco de Inversion y Comercio Exterior" (Investment and Foreign
          Trade Bank) totaling 5,314 and 9,429, respectively, secured by
          promissory notes from the Bank's loan portfolio.

                                      F-29

<PAGE>

                  BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000, AND 1999

                         (Stated in thousands of pesos)

     b)   As of December 31, 2001 and 2000, a total of 1,515 in shares of
          "Mercado de Valores de Buenos Aires S.A." (Buenos Aires Stock
          Exchange) included in the "Investments in Other Companies" account has
          been given as collateral in favor of "La Buenos Aires Cia. de Seguros
          S.A." as required by article 7 of the Operating Regulations of the
          Buenos Aires Stock Exchange.

     c)   As of December 31, 2001, the "Government and private securities -
          Unlisted government securities" account included tax credit
          certificates in the amount of 57,371 which may be used to settle
          certain tax obligations as from the year beginning January 1, 2003,
          under Decree No. 979/01.

6.   INTEREST-BEARING DEPOSITS WITH OTHER BANKS

     a)   Included in "Cash and Due from Banks" are interest-bearing deposits
          totaling 82,008 and 756,862, as of December 31, 2001 and 2000,
          respectively.

     b)   Included in "Loans - Foreign residents" are overnight foreign bank
          interest-bearing deposits totaling 620,620 and 125,567, as of December
          31, 2001 and 2000, respectively.

7.   GOVERNMENT AND PRIVATE SECURITIES

     A breakdown of the government and private securities is as follows:

                                                           December 31,
                                                   -----------------------------
                 Name of security                     2001            2000
-----------------------------------------------    ------------- ---------------

GOVERNMENT SECURITIES

Holdings in investment accounts

External Bills in foreign currency                   179,208                -
Treasury Bonds                                             -          809,534
Variable Rate Government Bonds                             -          570,219
Global External Bonds                                      -          170,213
Floating Rate Bonds (FRB)                                  -           68,182
External Bills in local currency                           -           45,020
Other                                                      -            9,542
                                                     -------        ---------
  Subtotal holdings in investment accounts           179,208        1,672,710
                                                     -------        ---------

                                      F-30

<PAGE>

                  BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000, AND 1999

                         (Stated in thousands of pesos)

<TABLE>
<CAPTION>
                                                                            December 31,
                                                                       ----------------------
                      Name of security                                    2001       2000
---------------------------------------------------------------------- ----------  ----------
<S>                                                                        <C>         <C>
Holdings for trading or financial transactions

Central Bank of the Oriental Republic of Uruguay                           1,417       1,417
External Bonds                                                             1,093         545
Treasury Bonds                                                               539      32,686
Global External Bonds                                                        347      40,733
Dollar denominated, secured, floating rate Bonds (Discount Bonds)            259          20
Variable Rate Government Bonds                                               100       8,184
Pension Fund Debt Consolidation Bonds                                         96       8,498
Debt Consolidation Bonds                                                      29       9,852
External Bills                                                                17       3,122
Treasury Bills                                                                 -      72,188
Buenos Aires Province Consolidation Bonds                                      -       3,767
Bonds of the Argentine Republic in Euros                                       -       1,900
Other                                                                        557       5,758
                                                                       ---------   ---------
  Subtotal holdings for trading or financial transactions                  4,454     188,670
                                                                       ---------   ---------
TOTAL INVESTMENTS IN GOVERNMENT SECURITIES - LISTED                      183,662   1,861,380
                                                                       ---------   ---------

Government securities - Unlisted
Fixed - rate Government Bonds of the Argentine Republic 2002 - 9%        192,634           -
Tax credit certificate                                                    57,371           -
Treasury Bills to settle obligations of the Province of Buenos Aires       1,515      24,971
Other                                                                        408           -
                                                                       ---------   ---------
TOTAL OF GOVERNMENT SECURITIES - UNLISTED                                251,928      24,971
                                                                       ---------   ---------
TOTAL INVESTMENTS IN GOVERNMENT SECURITIES                               435,590   1,886,351
                                                                       =========   =========

INVESTMENTS IN LISTED PRIVATE SECURITIES

Other Debt Securities

Fideicomiso Financiero Pegasus Clase "B"                                   2,537           -
Origenes Vivienda S.A                                                      2,348       8,331
Banco Hipotecario Nacional S.A                                               798       2,222
Multicanal S.A                                                                85       2,581
Sideco Americana S.A                                                          64       1,354
Empresa Distribuidora de Electricidad de Mendoza S.A                           -      15,680
Distribuidora de Gas del Centro S.A                                            -       2,360
Other                                                                      1,977       6,485
                                                                       ---------   ---------
     Subtotal Other Debt Securities                                        7,809      39,013
                                                                       ---------   ---------
</TABLE>

                                      F-31

<PAGE>

                   BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000, AND 1999

                         (Stated in thousands of pesos)

<TABLE>
<CAPTION>
                                                                          December 31,
                                                                     ---------------------
                                   Name of security                     2001       2000
          ---------------------------------------------------------- ---------   ---------
<S>                                                                      <C>         <C>
          Equity Securities

          Superfondo Europa                                              5,410       7,909
          Fideicomiso Financiero La Nacion                               3,639           -
          Metrovias S.A                                                  1,111       1,753
          Superfondo Inmobiliario                                          790       1,196
          Quickfood S.A                                                    676       1,432
          Superfondo Ahorro US$                                              -       6,327
          Superfondo Ahorro $                                              270       5,391
          Other                                                            575       3,227
                                                                     ---------   ---------
               Subtotal Equity Securities                               12,471      27,235
                                                                     ---------   ---------
               TOTAL INVESTMENTS IN LISTED PRIVATE SECURITIES           20,280      66,248
                                                                     =========   =========
               TOTAL GOVERNMENT AND PRIVATE SECURITIES                 455,870   1,952,599
                                                                     =========   =========
</TABLE>

8.   LOANS

     Description of certain categories of loans on the accompanying Balance
     Sheets include:

          Non financial public sector: loans to public sector, excluding public
          financial entities.

     -    Financial sector: short-term loans to other banks and short-term loans
          from foreign branch to banks outside Argentina.

     -    Private non financial sector and foreign residents: loans given to the
          private sector (excluding financial entities) and residents abroad
          from Argentina.

     -    Overdraft: basically short-term loans to companies and overdraft lines
          of credit.

     -    With collateral security: loans secured by privileged guarantees.

     -    Credit cards: consists mainly of credit card loans.

     Under BCRA rules, the Bank must disclose the type of collateral pledged on
     loans to non-financial private sector and residents abroad. The
     classification of the loan portfolio in this regard is as follows:

                                      F-32

<PAGE>

                   BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000, AND 1999

                         (Stated in thousands of pesos)

<TABLE>
<CAPTION>
                                                                December 31,
                                                          ------------------------
                                                             2001         2000 (1)
                                                          ----------    ----------
<S>                                                        <C>           <C>
Non financial public sector                                2,080,557     1,632,790
                                                          ----------    ----------
Financial sector                                             136,419        84,698
                                                          ----------    ----------
Private non financial sector and foreign residents

     Commercial

     With Senior "A" guarantees and counter-guarantees        67,418       147,768

     With Senior "B" guarantees and counter-guarantees       164,702       390,599

     Without senior guarantees or counter-guarantees       2,355,496     2,337,220

     Consumer

      With Senior "A" guarantees and counter-guarantees        5,661         1,763

      With Senior "B" guarantees and counter-guarantees    1,203,688     1,155,187

      Without senior guarantees or counter-guarantees        870,657       861,770
                                                          ----------    ----------
                                                           4,667,622     4,894,307
                                                          ----------    ----------
Subtotal Loans                                             6,884,598     6,611,795
                                                          ----------    ----------
      Less:  Allowance for loan losses                      (225,193)     (236,810)
                                                          ----------    ----------
Total loans, net of allowances                             6,659,405     6,374,985
                                                          ==========    ==========
</TABLE>

     Commercial loan: encompasses all financing facilities, other than those not
     reaching an amount equivalent to Argentine Pesos (Ps.) 200 thousand with or
     without senior guarantees.

     Consumer loan: encompasses all financing facilities related to consumption
     (whether personal, professional or family consumption, loans for purchasing
     of consumer goods and financing credit cards) or housing loans (for buying,
     building or refurbishing) and financing (credits and guarantees) of a
     commercial nature up to an amount equivalent to Ps. 200 thousand with or
     without senior guarantees.

     "With Senior "A" guarantees and counter-guarantees" consist mainly of cash
     guarantees, gold guarantees, warrants over primary products and other forms
     of collateral of self-liquidation.

     "With Senior "B" guarantees and counter-guarantees" consist, in general, of
     real estate mortgages and other forms of collateral pledged to secure the
     loan amount. The entire principal amount of loan is included under the
     heading "preferred guarantees" regardless of the current market value of
     the collateral.

     "Without Senior guarantees or counter-guarantees" consist, in general, of
     unsecured third-party guarantees.

                                      F-33

<PAGE>

                   BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000, AND 1999

                         (Stated in thousands of pesos)


A classification of loans by status is as follows:

<TABLE>
<CAPTION>
                                                                            December 31,
                                                     ------------------------------------------------------------
                                                                  2001                         2000 (1)
                                                     -----------------------------   ----------------------------
                                                       Commercial       Consumer      Commercial      Consumer
                                                     --------------   ------------   ------------   -------------
<S>                                                  <C>              <C>            <C>            <C>
Normal                                                  4,665,942       1,916,859     4,454,906       1,811,730
Potential Risk/Inadequate compliance                       33,594         102,023        19,133         101,100
With Problems/Deficient compliance                         12,872          29,296        14,255          38,179
High risk of insolvency                                    82,239          29,327        86,824          24,778
Irrecoverable                                               1,018           2,501        16,586          42,945
Irrecoverable under Central Bank standards                  8,927               -         1,359               -
                                                        ---------       ---------     ---------       ---------
                                                        4,804,592       2,080,006     4,593,063       2,018,732

Less: Allowances                                         (183,124)        (42,069)     (165,005)        (71,805)
                                                        ---------       ---------     ---------       ---------
Total loans, net of allowances                          4,621,468       2,037,937     4,428,058       1,946,927
                                                        =========       =========     =========       =========
</TABLE>

A breakdown of total loans by geographic location of the borrowers is as
follows:

<TABLE>
<CAPTION>
                                                                               December 31,
                                                                       ---------------------------
                                                                          2001          2000 (1)
                                                                       -------------  ------------
<S>                                                                     <C>            <C>
Argentina                                                               6,095,160      6,301,176
United States of America                                                  661,270        183,513
Brazil                                                                          -         18,647
                                                                        ---------      ---------
                                                                        6,756,430      6,503,336

Accrued interest and price differences receivable                         128,168        108,459
Less: Allowances                                                         (225,193)      (236,810)
                                                                        ---------      ---------
Total loans, net of allowances                                          6,659,405      6,374,985
                                                                        =========      =========
</TABLE>

A breakdown of total loans by sector activity classified according to the
principal business of the borrowers is as follows:

                                      F-34

<PAGE>

                   BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000, AND 1999

                         (Stated in thousands of pesos)

<TABLE>
<CAPTION>
                                                                  December 31,
                                                         -----------------------------
                                                             2001            2000 (1)
                                                         -------------    ------------
<S>                                                      <C>                <C>
Services                                                  2,575,718          2,159,643
Finance                                                     701,048            430,171
Construction Industry                                       358,164            443,155
Other Manufacturing Industries                              240,211            395,402
Retail Merchants                                            381,561            341,559
Wholesale Merchants                                         189,052            357,131
Primary Production                                          250,333            275,195
Base Metal Industries                                        26,580             63,806
Consumer                                                  1,478,112          1,308,148
Foodstuffs                                                  114,731            179,736
Chemical Products                                            52,313             91,991
Petroleum and Coal Products                                 111,813             58,824
Electric, Gas, Water and Health Services                     32,037            132,605
Textiles                                                     32,731             43,406
Other                                                       340,194            331,023
                                                          ---------          ---------
                                                          6,884,598          6,611,795

Less:  Allowances                                          (225,193)          (236,810)
                                                          ---------          ---------
Total loans, net of allowances                            6,659,405          6,374,985
                                                          =========          =========
</TABLE>

During 2001 and 2000, the Bank had loans to certain companies related to
executive officers and directors of the Bank and its subsidiaries. Loans
outstanding to these companies as of December 31, 2001 and 2000 totaled 190,696
and 15,970, respectively. It is the Bank's policy that such loans are made in
the ordinary course of business at normal credit terms, including interest rate
and collateral requirements.

The detail of the above mentioned loans is as follows:

<TABLE>
<CAPTION>
                                                                                 December 31,
                                                                          -----------------------
                                                                             2001       2000 (1)
                                                                          ----------  -----------
<S>                                                                       <C>            <C>
Origenes Vivienda y Consumo Cia. Financiera S.A. (former Origenes
Vivienda S.A.)                                                              98,347       12,462
Caminos de las Sierras S.A.                                                 92,290            -
Rio Compania de Seguros S.A.                                                    59            -
Prestamos de Consumo S.A.                                                        -        3,508
                                                                          --------     --------
                                                                           190,696       15,970
                                                                          ========     ========
</TABLE>

(1)      See note 3.1.

                                      F-35

<PAGE>

                  BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 AND 1999

                         (Stated in thousands of pesos)

9.   CREDIT ASSISTANCE

     a)   Credit assistance to the non-financial public sector

          As a consequence of the enactment of the Law on Public Emergency and
          Exchange System Reform and the suspension in payment of the public
          debt, the fulfillment of such obligations is conditioned by the
          Federal Treasury's lack of resources and the continuance of the fiscal
          deficit of municipal, provincial and federal public accounts, which
          inevitably resulted in significant public indebtness. Consequently,
          the Ministry of Economy has been empowered to enter into negotiations
          and adopt any necessary measures to restructure the debt of the
          Federal Government.

          In this respect, on February 27, 2002, the Federal Government and the
          provinces signed the Agreement on Financial Relations and bases for a
          Federal Tax Revenue-Sharing system whereby, among other provisions,
          the Federal Government is entrusted by provincial governments with the
          duty to renegotiate provincial public debts, which may be restructured
          under the same terms and conditions as the federal public debt.

          On March 6, 2002, Decree No. 471/02 defined the treatment applicable
          pursuant to Law No. 25,561 and Decree No. 214/02 to the debt
          originally stipulated in US dollars or any other foreign currency by
          the municipal, provincial and federal public sector such obligations
          are subject to Argentine law.

          As of December 31, 2001, the Bank and its subsidiaries carries the
          following receivables from the public sector:

          - Municipal, provincial and federal public bonds in the amount of
            435,590. The detail of such portfolio is disclosed in note 7.

          - Credit assistance to the municipal, provincial and federal public
            sector for 2,080,866, whose origin may be classified as follows:
<TABLE>
<CAPTION>
                                                                                                Amount as of
                                           Item                                                  12-31-2001
          ------------------------------------------------------------------------          ------------------
          <S>                                                                               <C>
            .   Guaranteed loans - Decree No. 1387/01 - (net of discounts) (1)                   1,597,903
            .   Other loans to the federal public sector (Provincial Development
                Trust Fund)                                                                        388,889
            .   Loans to the provincial public sector and its decentralized
                entities: Province of Santa Fe                                                      28,500
                Housing Institute of the Province of Misiones                                        4,857
                Roadworks Administration of the Province of Chubut                                   1,780
            .   Loans to the municipal public sector and its decentralized
                entities:
                Municipality of Lujan de Cuyo - Province of Mendoza                                  1,129
                Municipality of Godoy Cruz - Province of Mendoza                                       167
            .   Loans to other entities of the public sector:
                Yacireta Binational Entity                                                          22,272
                National Institute for Retirees and Pensioners                                       5,500
                All other credit assistance to the public sector                                    29,869
                                                                                                 ---------
                Total (2)                                                                        2,080,866
                                                                                                 =========
</TABLE>

           (1)  Includes 586,367 in loans guaranteed to the provincial public
                sector presented for the debt swap established under Decree No.
                1387/01, (See note 4.c).
           (2)  Includes 309 in other guarantees given to the federal public
                sector recorded under "Memorandum accounts - credit balances-
                contingencies".

                                      F-36

<PAGE>

                  BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 AND 1999

                         (Stated in thousands of pesos)

          The BCRA rules related to minimum loan loss reserves do not require
          setting up any reserve for the credit assistance provided to this
          sector (See note 30.6.c)). To the date of issuance of these
          consolidated financial statements, it is not possible to determine the
          future effects that the continuance of the economic crisis may have on
          the recoverability of the book value of such financing.

     b)   Credit assistance to the non-financial private sector debtors

          The effects derived from the crisis Argentina is undergoing and the
          difficulties in the chain of payments have had a negative effect on
          financial assistance to borrowers in the Bank's consumer and business
          credit portfolios. This gave rise to an increasing impairment,
          compounded with a highly uncertain context that makes it difficult to
          establish objective criteria to agree on refinancing terms for such
          loans.

          Communique "A" 3418 of the BCRA of January 3, 2002, provided, for the
          purposes of classifying debtors in December 2001 and January 2002, to
          increase by 31 days the delinquency-in-payment term for rating levels
          1 (performing normally) and 2 (potential risk / deficient compliance)
          both for the commercial and consumer portfolios.

          Considering that the basic criteria for measuring the uncollectibility
          risk is the ability to pay the debt or any future obligation, focusing
          on the cash flow analysis, the current situation does not allow
          objective determination of such uncollectibility risk.

          Law No. 25,563 of February 14, 2002, declared a credit and production
          emergency until December 10, 2003, as a result of the Argentine
          crisis. Such legislation amends the Bankruptcy Law and related rules;
          the amendments are mainly intended to provide debtors the possibility
          of rescheduling their debts towards the financial system, and
          establishes a 180-day suspension for all court and out-of-court
          enforced collections and foreclosures, including on mortgages and
          pledges.

          As of December 31, 2001, the Bank and its subsidiaries carried the
          following receivables from the non-financial private sector:

                 .    Business portfolio financing          3,273,308
                 .    Consumer portfolio financing          2,410,106
                 .    Debt securities (1)                      11,114
                      (loan loss reserves)                   (233,710)
                                                            ---------
                      TOTAL (2)                             5,460,818
                                                            =========

          (1)  Relates to debt securities included in financial statements as
               "Private and Government Securities - Investment in listed private
               securities". As of December 31, 2001, the Bank had not recorded
               any allowance for impairment in value / uncollectibility of such
               securities.
          (2)  Includes: Loans to the private non financial sector and foreign
               residents (before allowances), Other receivables form financial
               transactions - Unlisted corporate bonds, Other included in Debtor
               Rating Standards and Accrued interest receivable included in
               debtor rating standards, Assets covered by financing leases
               (before allowances); Other receivables - from sale of assets,
               Memorandum accounts - Contingency accounts, Credit balances -
               agreed-upon credits (unused balances) included in Debtor Rating
               Standards, Other guarantees given included in Debtor Rating
               Standards and Other included in Debtor Rating Standards.

     The eventual recovery of financing granted depends on the future evolution
     of the Argentine economy and the effects derived from the abovementioned
     restructuring. To the date of issuance of these consolidated financial
     statements, it is not possible to determine the future effects that the
     continuance of the economic crisis may have on the recoverability of the
     book value of such financing.

                                      F-37

<PAGE>

                 BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                    AS OF DECEMBER 31, 2001, 2000 AND 1999

                        (Stated in thousands of pesos)


10.  ALLOWANCE FOR LOAN LOSSES AND RISK OF IMPAIRMENT IN VALUE OF LOANS

     The movements in the allowance for loan losses for the fiscal years ended
     December 31, 2001, 2000 and 1999 are as follows:

<TABLE>
<CAPTION>
                                                                          December 31,
                                                       ---------------------------------------------
                                                            2001             2000           1999
                                                       -------------    -------------   ------------
<S>                                                    <C>              <C>             <C>
     Net book value at beginning of fiscal year            236,810          168,112         173,300

     Increase in allowances (1)                        (*) 257,107      (*) 304,730     (*) 111,050

     Application of allowances (2)                        (268,724)        (231,673)       (115,905)

     Allowances restored to income (3)                           -           (4,359)           (333)
                                                          --------         --------        --------
     Balance at end of fiscal year                         225,193          236,810         168,112
                                                          ========         ========        ========
</TABLE>

     (1)  As of December 31, 2000 the increase in allowances includes 167,080
          and 214 in the year's beginning balances and the incollectibility
          charges, respectively, for the period 01/01/2000 through 06/30/2000
          related to the former Banco Tornquist S.A.

     (2)  As of December 31, 2000 applications includes 37,843 for the period
          01/01/2000 through 06/30/2000 related to the former Banco Tornquist
          S.A.

     (3)  As of December 31, 2000 allowances restored to income includes 2,669
          for the period 01/01/2000 through 06/30/2000 related to the former
          Banco Tornquist S.A.

     (*)  The differences in provisions, as set forth in this table and the
          Consolidated Statements of Income, represent direct charges to income.

     A portion of the Bank's loan portfolio is under court or other agreements
     to satisfy the debt on a different basis from the original loan terms. The
     Bank eliminates any differences between principal amount and accrued
     interest due under the original loan and the new loan amount through an
     increase in the allowance for loan losses. Loans under such agreements
     totals 70,947 and 153,554 as of December 31, 2001 and 2000, respectively.

11.  OTHER RECEIVABLES FROM FINANCIAL TRANSACTIONS

     Certain of the other receivables from financial transactions are enhanced
     by credit support from governmental agencies or other financial
     institutions. Therefore, other receivables from financial transactions as
     of December 31, 2001 and 2000 are classified as follows:

                                                               December 31,
                                                          ----------------------
                                                             2001        2000
                                                          ---------  -----------
     With senior guarantees or counter-guarantees                -    1,107,475
     Without senior guarantees or counter-guarantees       889,092    3,239,583
                                                          --------    ---------
                                                           889,092    4,347,058
                                                          ========    =========

                                      F-38

<PAGE>

                   BANCO RIO DELA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 and 1999

                         (Stated in thousands of pesos)

      The Bank and its subsidiaries enter into spot and forward transactions in
      government securities and foreign currencies. They recognize the cash and
      security or currency amount to be exchanged in the future as a receivable
      and payable at the initial transaction date. The assets and liabilities
      related to such transactions are as follows:

<TABLE>
<CAPTION>
                                                                                                 December 31,
                                                                                        -----------------------------
                                                                                             2001            2000
                                                                                        --------------- -------------
<S>                                                                                          <C>             <C>
      Spot and forward purchases of foreign currency pending settlement                      124,269         599,946
      Payables on spot and forward purchases of foreign currency pending settlement          129,570         622,955
      Forward purchases of securities under repurchase agreements                                  -         591,692
      Payables on forward purchases of securities under repurchase agreements                      -         506,299
      Receivables on spot and forward sales of foreign currency pending settlement           327,404       1,536,054
      Spot and forward sales of foreign currency pending settlement                          327,442       1,538,790
      Receivables on repurchase agreements of government securities and certificates
         of deposit                                                                                -         554,384
      Forward sales of government securities under repurchase agreements and
         certificates of deposit                                                                   -         553,896
      Spot sales of government and private securities pending settlement                          22         141,051
      Receivables on spot sales of government and private securities pending
         settlement                                                                           11,319         141,011
      Spot purchases of government and private securities pending settlement                       -         140,638
      Payables on spot purchases of government and private securities pending
         settlement                                                                           11,289         139,962
</TABLE>

      These instruments consist of foreign currency spot and forward purchase
      and sale contracts and spot and forward purchases and sales of securities,
      whose valuation method is disclosed in note 4.g).

      The fair value of these instruments held during the years ended December
      31, 2001 and 2000 was:

<TABLE>
<CAPTION>
                                            December 31, 2001                 December 31, 2000
                                    -------------------------------   ------------------------------
                                       Average          End-of-year      Average        End-of-year
                                      fair value        fair value      Fair value      fair value
                                    ---------------  --------------   -------------- ---------------
<S>                                      <C>              <C>           <C>              <C>
                ASSETS                   684,015          124,269       1,131,337        1,332,276

                LIABILITIES            1,327,285          327,464       2,258,316        2,233,737
</TABLE>

      Premiums on these instruments have been included in the Financial Income
      and Financial Expense captions of the Consolidated Statement of Income of
      each year.

12.   INVESTMENTS IN OTHER COMPANIES

      The following table provides information with respect to the main equity
      ownership of the Bank and its subsidiaries in other companies and other
      information about such companies as of the close of the fiscal year
      indicated for each such company:

                                      F-39

<PAGE>

                   BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 and 1999

                         (Stated in thousands of pesos)

<TABLE>
<CAPTION>

                                                 Book value
                                             --------------------                  Last Published
                                       %        December 31,                        Stockholders'      Fiscal
                                    Shares   --------------------      Principal        Equity        year-end/
                Company              Owned     2001      2000          Activity     (in thousands)   period-end
      ----------------------------- -------- --------------------   ------------- ---------------- --------------
<S>                                   <C>        <C>       <C>       <C>            <C>               <C>
      Bladex S.A.                     (1)        989       998         Banking       US$   699,204    12-31-00
      Banelco S.A.                   20.00%    3,674     3,412         Services      Ps.    18,369    09-30-01
      Visa Argentina S.A.             5.00%      645       924         Services      Ps.    15,534    05-31-01
      Interbanking S.A.              15.00%      753       753         Services      Ps.     5,640    12-31-00
      Mercado de Valores de                                           Securities
      Buenos Aires S.A.               0.94%    1,515     1,515          Market       Ps.   155,797    03-31-02
      Caminos de las Sierras S.A.    37.97%   37,753         -        Road works     Ps.   124,700    09-30-01
      Origenes Vivienda y Consumo
      Cia. Financiera S.A.
      (Former Origenes Vivienda
      S.A.) (2)                      12.50%    3,202     3,502         Services      Ps.    28,133    09-30-01
      Rio Cia. de Seguros S.A.       12.50%      818       818        Insurance      Ps.    10,351    09-30-01
      Prestamos de Consumo S.A.          -         -     1,832         Services      Ps.    14,661    12-31-00
      Other                           (3)      1,468     1,254           (3)                 (3)        (3)
                                              ------    ------
      Subtotal                                50,817    15,008

      Allowances                                (453)     (450)
                                              ------    ------
      Total                                   50,364    14,558
                                              ======    ======
</TABLE>

      (1)   The Bank and Santander Riobank (Grand Cayman) hold 47,386 Class "B"
            shares, no-par value, one vote per share and 7,812 preferred shares,
            par value US$10 per share, nonvoting.
      (2)   See note 2.2.
      (3)   Less than 5% held issuer's capital stock.

      As of December 31, 2001 and 2000, the balances of transactions with
      related companies are as follows:

                                         December 31,
                                      --------------------
                                          2001    2000
                                      ---------  ---------

      Loans                             190,696  15,970
      Deposits                            1,595   2,215


13.   BANK PREMISES AND EQUIPMENT, OTHER ASSETS AND INTANGIBLE ASSETS

      The main categories of Bank's and its subsidiaries' premises and
      equipment and other assets and intangible assets at the end of each year
      are as follows:

                                                             December 31,
                                                     ---------------------------
                       Bank premises and equipment        2001           2000
      ---------------------------------------------- -------------  ------------

      Land and buildings                                 351,816        351,474
      Furniture and fixtures                              41,339         40,459
      Machinery and equipment                            115,784        117,169
      Automobiles                                          1,459          1,521
      Other                                               11,616         10,920
      Accumulated depreciation                          (199,610)      (173,712)
                                                        --------       --------
                                                         322,404        347,831
                                                        ========       ========

                                      F-40

<PAGE>

                   BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 AND 1999

                         (Stated in thousands of pesos)

<TABLE>
<CAPTION>
                                                                                         December 31,
                                                                                  -------------------------
                                 Other Assets                                         2001         2000
    ----------------------------------------------------------------------------- ------------ ------------
    <S>                                                                           <C>          <C>
    Construction in progress                                                          2,100        2,764
    Advances against purchases of goods                                                 476           95
    Works of art                                                                        398          398
    Stationery and supplies                                                             380          333
    Assets rented out                                                                 4,052        4,053
    Other                                                                            17,710       14,973
    Accumulated depreciation                                                           (699)        (577)
                                                                                    -------      -------
                                                                                     24,417       22,039
                                                                                    =======      =======
                                   Intangible Assets
    -----------------------------------------------------------------------------

    Goodwill for the purchase of certain assets and liabilities of Banco Rio
    Tercero Cooperativo Limitado                                                        433          625

    Other Intangible assets (net of 99,981 and 77,362 of accumulated
    amortization as of December 31, 2001 and 2000, respectively):

    -  Administrative and systems reorganization done by third parties               31,861       32,464
    -  Improvements in third-party property and information systems
       investments made by third parties in local and foreign branches                3,434       13,577
                                                                                    -------      -------
                                                                                     35,728       46,666
                                                                                    =======      =======
</TABLE>

    As of December 31, 2001 and 2000, the amortization expense on goodwill was
    192 and 245, and amortization expense on other intangible assets was
    33,746 and 36,040, respectively.

14. OTHER LIABILITIES FROM FINANCIAL TRANSACTIONS - CENTRAL BANK

    The Bank obtained funds under various credit facilities from the Central
    Bank for specific purposes as follows:

<TABLE>
<CAPTION>
                                                                                         December 31,
                                                                                  -------------------------
                                                                                      2001         2000
                                                                                  ------------ ------------
    <S>                                                                           <C>          <C>
    Short-term borrowings
          Other Central Bank liabilities                                                422        1,357
          Export financing                                                              105          104
                                                                                    -------      -------
          Subtotal                                                                      527        1,461
                                                                                    -------      -------
    Long-term debt
          Export financing                                                              105          211
                                                                                    -------      -------
          Total                                                                         632        1,672
                                                                                    =======      =======
</TABLE>

                                      F-41

<PAGE>

                   BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 AND 1999

                         (Stated in thousands of pesos)


    Accrued interest on the above liabilities are 5 and 7 as of December 31,
    2001 and 2000, respectively, and are included in "Central Bank of the
    Argentine Republic - Others" under the caption "Other liabilities from
    financial transactions" in the accompanying balance sheets.


15. OTHER LIABILITIES FROM FINANCIAL TRANSACTIONS - BANKS AND INTERNATIONAL
    ORGANIZATIONS AND FINANCING FROM FINANCIAL INSTITUTIONS

<TABLE>
<CAPTION>
                                                                               December 31,
                                                                        -------------------------
                                                                            2001         2000
                                                                        ------------ ------------
<S>                                                                     <C>          <C>
    Short-term borrowings
          Funded lines of credit from foreign banks                         129,751      291,230
          Other loans from financial institutions                           120,855      265,022
          Export Financing                                                  267,678      434,539
          Accrued interest                                                   12,080       12,931
                                                                          ---------    ---------
          Subtotal                                                          530,364    1,003,722
                                                                          ---------    ---------
    Long-term debt
          Funded lines of credit from foreign banks                          48,978            -
          Export financing                                                   87,465       62,007
          Other loans from financial institutions                             7,692            -
          Accrued interest                                                    1,270        1,560
                                                                          ---------    ---------
          Subtotal                                                          145,405       63,567
                                                                          ---------    ---------
          Total                                                             675,768    1,067,289
                                                                          =========    =========
</TABLE>

    Accrued interest on the above liabilities are 13,350 and 14,491 as of
    December 31, 2001 and 2000, respectively, and are included in "Accrued
    interest and price differences payable" under the caption "Other liabilities
    from financial transactions" in the accompanying balance sheets.

    Long-term debt from financial institutions consists mainly of loans from
    foreign banks used to fund export activities in dollars with annual interest
    rates ranging from 6.05% to 11.82% as of December 31, 2001.

    Maturities of the above long-term debt are as follows as of December 31,
    2001:

                                2003               69,280
                                2004               76,125

    Short-term borrowings from financial institutions have maturities of
    generally less than one year and primarily consist of borrowings banks term
    foreign and interbank placements with annual interest rates ranging from
    2.75% to 12.90% in dollars as of December 31, 2001.

                                      F-42

<PAGE>

                  BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 AND 1999

                         (Stated in thousands of pesos)

16.      OTHER LIABILITIES FROM FINANCIAL TRANSACTIONS - UNSUBORDINATED
         CORPORATE BONDS

         a) Class IV Corporate Bonds

            As of December 31, 2001 and 2000, the Bank has outstanding issues of
            Corporate Bonds, authorized by the Regular General Stockholders
            Meeting of September 15, 1992, according to the following detail:

<TABLE>
<CAPTION>
                            Date             Face                          Interest
               Class       Issued            Value           Maturity        Rate          Authorized by CNV
             ----------  ---------  -------------------  --------------   ------------   -------------------------
<S>                       <C>        <C>                     <C>            <C>                 <C>
                 IV       12-15-93   US$ 250,000,000         10 years       8.75%               12-03-93
</TABLE>

            The principal amount and interest accrued, biannual payed, of these
            bonds as of December 31, 2001 and 2000, net of discounts, totaled
            250,896 and 250,876, respectively, and in line with the provisions
            of Communique "A" 1907 of the BCRA was used to fund consumer and
            mortgage loans and to grant loans to companies established in
            Argentina for investment in physical assets, working capital or
            restructuring of liabilities, loans to financial institutions and
            for the purchase of government securities. As of such dates, the
            principal amount of these bonds is recorded under "Other liabilities
            from financial transactions - Unsubordinated corporate bonds"

            On October 18, 1994, the Board of Directors determined the issuance
            conditions of the Second Series Class V Corporate Bonds in the
            amount of US$50 million. These corporate bonds have not as yet been
            issued.

         b) Global Corporate Bonds Program

            -   As of December 31, 2000, the Bank had the following outstanding
                Corporate Bonds: (a) three series of corporate bonds for US$200
                million, US$100 million and US$30.80 million issued in June,
                August and December 2000, respectively, under the Global Bond
                Program for up to US$1 billion, (b) two series of corporate
                bonds for a total principal amount of US$137.5 million, each
                other, issued in June and October 2000, respectively, and two
                series of corporate bonds for a total of US$67.5 million, each
                other, issued in November 2000, under the Global Bond Program
                for a total amount of US$500 million.

                The principal amount and interest accrued of these corporate
                bonds as of December 31, 2000, net of discounts, amounted to
                733,255 and was used, pursuant to Communique "A" 1907 of the
                BCRA to finance consumer and mortgage loans and to grant loans
                to companies established in Argentina for investment in physical
                assets, working capital or restructuring of liabilities, loans
                to financial institutions and for the purchase of government
                securities.

            -   As of December 31, 2001, the Bank has outstanding certain
                classes of its Corporate Bonds Global Issuance Programs (Term
                Securities Programs) the maximum outstanding amounts of which
                are US$ 1 billion and US$ 500 million. All such programs were
                authorized by the respective Shareholders' Meetings and the CNV.
                The nominal amount effectively issued and outstanding is US$785
                million; which breaks down as follows:

                                      F-43

<PAGE>

                  BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 AND 1999

                         (Stated in thousands of pesos)
<TABLE>
<CAPTION>
                Amount                               CNV's                       Date            Face       Interest  Maturity
            Global Program   Series              Authorization                  Issued           Value        Rate     Date
          ------------------ -------- ------------------------------------- ----------------  -----------  --------  ---------
<S>                           <C>       <C>                                   <C>            <C>              <C>
          US$  1,000,000,000   1/st/             N(Degrees)263                 06-21-00  US$  200,000,000      (1)    06-20-02
          US$  1,000,000,000   2/nd/             N(Degrees)263                 08-25-00  US$  100,000,000      (2)    08-25-10
          US$  1,000,000,000   7/th/             N(Degrees)263                 08-31-01  US$   50,000,000      (3)    08-31-05
          US$    500,000,000  37/th/    N(Degrees)107, 139, 194, 257 and 81    06-21-01  US$  150,000,000      (4)    03-07-02
          US$    500,000,000  38/th/    N(Degrees)107, 139, 194, 257 and 81    08-24-01  US$   67,500,000      (5)    05-21-02
          US$    500,000,000  39/th/    N(Degrees)107, 139, 194, 257 and 81    08-27-01  US$   67,500,000      (5)    05-24-02
          US$    500,000,000  40/th/    N(Degrees)107, 139, 194, 257 and 81    09-19-01  US$  150,000,000      (6)    03-07-02
</TABLE>

         (1)  Accrues interest at the 90-day LIBOR plus 1.65% per annum.
         (2)  Accrues interest at the 180-day LIBOR plus 2% per annum.
         (3)  Accrues interest at the 180-day LIBOR plus 2.5% per annum.
         (4)  A Class issued at a discount rate of 3.70% per annum.
         (5)  A Class issued at a discount rate of 3.46% per annum.
         (6)  A Class issued at a discount rate of 2.96% per annum.


         The principal and interest accrued of these liabilities as of December
         31, 2001, net of discounts, totals 784,550, and was used to fund
         consumer and mortgage loans and to grant loans to companies established
         in Argentina for investment in physical assets, working capital or
         restructuring of liabilities, loans to financial institutions and for
         the purchase of government securities, in accordance with BCRA
         regulations effective at the time of issuance of such series of
         corporate bonds. The principal amount of these liabilities is recorded
         under "Other liabilities from financial transactions - Unsubordinated
         corporate bonds".

         Accrued interest on the corporate bonds is 4,161 as of December 31,
         2001, and is included in "Accrued interest and price differences
         payable" under caption "Other liabilities from financial transactions"
         in the accompanying balance sheet.

         The maturities of the above liabilities (principal amounts and interest
         accrued) as of December 31, 2001 and each of the following years are as
         follows:

                         2002                      635,521
                         2003                      249,925
                         2005                       50,000
                         2010                      100,000
                                                ----------
                                                 1,035,446
                                                ==========

      c) Authorization of new issues of Corporate Bonds

         On June 26, 1998, the Bank's Special Shareholders' Meeting approved,
         in compliance with the resolutions of the Regular Shareholders'
         Meeting held on December 13, 1996, that overall maximum amount for the
         issuance of corporate bonds be increased from US$ 500 million to US$ 1
         billion which may be used for any of the following: (a) increase the
         amount of the Short-Term Securities Program from US$ 500 million to a
         maximum of US$ 900 million and (b) increase the amount of Medium-Term
         Securities Program to US$ 2 billion.

         The Regular General Shareholders' Meeting held on December 3, 1999,
         approved, among other things, the creation of a Medium-Term Global
         Program for the issuance and placement of unsecured corporate bonds
         not convertible into shares, for a maximum face value outstanding at
         any time of up to US$ 500 million; this program would not be offered
         publicly.

                                      F-44

<PAGE>

                   BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 AND 1999

                         (Stated in thousands of pesos)

             In addition, the Regular and Special General Shareholders' Meeting
             held on April 27, 2001, approved that the duration of the
             Short-term Corporate Bonds Global Program for a maximum face value
             outstanding at any time of up to US$ 500 million be extended for a
             further five years counted as from the approval of the CNV, which
             was granted on June 21, 2001, by Certificate No. 281.

             After December 31, 2001, i.e. subsequent to fiscal year-end, the
             Bank issued the fortieth, forty-second, and forty-third series of
             Corporate Bonds for a total amount of US$ 270 million, within the
             Short-term Corporate Bonds Global Issuance Program for an amount of
             US$ 500 million. Such issuance was approved by the Board of
             Directors it its meeting of March 6, 2002, in exercise of the
             powers delegated by the Special Shareholders' Meeting held on June
             26, 1998. The principal obtained from these bonds, net of discounts
             was US$ 266.6 million. In addition, on April 11, 2002, the Bank
             issued the eighth series of Corporate Bonds for a total amount of
             ARS 26 million within the Short- and Medium-Term Corporate Bonds
             Global Issuance Program for a total amount of US$ 1 billion. Such
             issuance had been approved by the Board of Directors in its meeting
             of April 8, 2002, in exercise of the powers delegated by the
             Regular Shareholders' Meeting of December 3, 1999. The principal
             obtained from these bonds, net of discounts was ARS 24.1 million.

             The proceeds in principal of these placements was applied to grant
             consumer and mortgage loans and financing to companies located in
             Argentina for investment in property, plant and equipment, addition
             to working-capital, or debt refinancing, interbank loans and the
             acquisition of government securities, in accordance with BCRA
             regulations effective upon the issuance of these securities.

         Due to deteriorating liquidity position of the financial markets the
         Bank anticipates that it may not able to obtain the financing it needs
         during calendar 2002 to repay its foreign debt pursuant to its original
         terms. In addition, the Bank must obtain the Argentine Central Bank's
         approval to convert pesos into dollars and transfer funds abroad in
         order to make principal and interest payments on such debt

17.      BALANCES IN FOREIGN CURRENCY

         The balances of assets, liabilities and memorandum accounts denominated
         in currencies other than Argentine pesos are as follows:

<TABLE>
<CAPTION>
                                                                               December 31,
                                                                   --------------------------------
      Assets                                                             2001              2000
                                                                   ----------------- --------------
<S>                                                                      <C>               <C>
            Cash and due from banks                                      986,234           878,045
            Government and private securities                            439,238         1,880,717
            Loans                                                      6,221,593         5,084,570
            Other receivables from financial transactions                497,947         2,691,150
            Assets covered by financing leases                            64,253            61,137
            Investments in other companies                                 1,502             1,502
            Other receivables                                             47,746            13,470
            Bank premises and equipment and other assets                     688               798
            Suspense items                                                   283             1,999
                                                                   -------------     -------------
                                                                       8,259,484        10,613,388
                                                                   -------------     -------------
</TABLE>

                                      F-45

<PAGE>

                   BANCO RIO DE LA PLATA S.A AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                      AS OF DECEMBER 31, 2001, 2000, 1999

                         (Stated in thousands of pesos)

<TABLE>
<CAPTION>
                                                                              December 31,
                                                                    --------------------------------
      Liabilities                                                         2001              2000
                                                                    ----------------  --------------
      <S>                                                              <C>                <C>
            Deposits                                                   5,057,149          5,230,877
            Other liabilities from financial transactions              2,048,830          4,950,078
            Other liabilities                                             32,793              6,850
            Suspense items                                                 2,063              4,385
                                                                    ------------      -------------
                                                                       7,140,835         10,192,190
                                                                    ------------      -------------
      Consolidated net foreign currency position                       1,118,649            421,198
                                                                    ============      =============

      Memorandum accounts

         Debit Balances (Except contra accounts debit balances)
            Contingencies                                              3,733,317          2,636,313
            Control accounts                                           3,448,692          4,959,243
            Derivative accounts                                          267,220                  -
            Fiduciary accounts                                            31,088             24,248

         Credit Balances (Except contra accounts credit balances)

            Contingencies                                                556,432            283,587
            Control accounts                                             827,419          1,204,131
            Derivative accounts                                          107,953                  -
</TABLE>

18.   TAXES

      a)  Income tax and tax on minimum presumed income

          The Bank and its subsidiaries determines the accounting charge for
          income tax by applying the current 35% tax rate to the estimated
          taxable income for the year, without taking into account the effect of
          temporary differences between book and taxable income. In addition,
          the Bank determines the tax on minimum presumed income by applying the
          rate of 1% on computable assets as of year-end. Law No. 25,063
          provides in respect of institutions governed by the Financial
          Institutions law, that such institutions should take, as the taxable
          base for the purpose of tax on minimum presumed income, 20% of their
          taxable assets, after deducting those assets defined as
          non-computable. This tax is supplementary to income tax. The Bank's
          tax obligation in each tax year shall be the higher of these two
          taxes. However, should minimum presumed income tax be higher than
          income tax in any given tax year, such excess may be considered as a
          prepayment on account of any excess of income tax over tax on minimum
          presumed income that may arise in any of the ten subsequent tax years.

          In the year ended December 31, 2001, the Bank estimated an income tax
          net operating loss of about 110,700. The above net operating loss
          represents a contingent asset of about 39,000, calculated at the
          effective tax rate. In addition, the Bank determined a charge of
          18,500 on account of tax on minimum presumed income, which was
          capitalized under the "Miscellaneous receivables" account. The net
          operating loss determined may be used to offset future taxable income
          through 2006. In every year that net operating loss are offset, the
          tax benefit (the effect of the effective rate on the net operating
          loss used) will be realized to the extent that income tax (net of the
          offsetting) equals or exceeds tax on minimum presumed income, but will
          be reduced by any excess of the latter over the former.

                                      F-46

<PAGE>

                   BANCO RIO DE LA PLATA S.A AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                      AS OF DECEMBER 31, 2001, 2000, 1999

                         (Stated in thousands of pesos)

          On the other hand, as of December 31,2001, an income tax charge 12,227
          was determined by Banco Rio de la Plata S.A.'s subsidiaries and
          charged to the income of the year under the caption "Income tax".

          As of December 31, 2000, the Bank determined an income tax charge of
          44,850, which exceeded tax on minimum presumed income and was charged
          to income for the year under "Income tax".

          As of December 31, 2001, and 2000, the tax on minimum presumed income
          credit balance was 34,947 and 24,930, respectively.


    b)    Contribution to the Instituto de Servicios Sociales Bancarios (Banking
          Health Services Institute - ISSB)

          The contribution to the ISSB provided in Section 17, point (f) of Law
          No. 19,322 - originally 2% on interest and commissions charged by
          banks - was reduced to 1% as from July 1, 1996 through July 1, 1997;
          as from the latter date, the above mentioned contribution was repealed
          (Decrees No. 263, dated March 20, 1996 and No. 915, dated August 7,
          1996). In addition, by Decree No. 336/98 of March 26, 1998, the
          Federal Executive confirmed the total elimination of the Bank
          Employees' Social Security Institute and the establishment of a new
          institution (Argentine Bank Employees' Health Plan - OSBA), which is
          not a successor entity of such Institution.

          During 1997 and 1998, the Argentine Bank Association and the Argentine
          Bank Employees' Health Plan (OSBA) have made different filings with
          the court to declare the above mentioned decrees unconstitutional and
          restore the Bank's obligation to make contributions.

          Although, the Bank and Banco Santander S.A. of Argentina requested an
          injunction. In this regard, the federal courts of original
          jurisdiction Nos. 4 and 6, through judgements Nos. 5918 and 208 of
          December 15, 1998, sustained the actions started and declared the
          validity of Decree No. 336/98 and thus, the OSBA is not a successor
          entity of the Bank Employees' Social Security Institute and that the
          OSBA cannot make any claim from Banco Rio de la Plata S.A. as from
          July 1, 1997, for the payment of the contribution established in point
          (f) of Section No. 17 of Law No. 19,322.

          According to the Bank's management and legal counsel, there are
          grounds to consider that the above mentioned contribution has been
          eliminated and, therefore, all the requirements derived from the
          Decrees mentioned above have been met. Consequently, no accrual has
          been set up to cover the possible contributions that could be claimed.


19.   STOCKHOLDERS' EQUITY AND RESTRICTIONS ON EARNINGS DISTRIBUTIONS


      As of December 31, 2001, capital stock totaling 346,742, fully registered
      with the Public Register of Commerce and authorized for Public Offer, was
      made up as follows:

<TABLE>
<CAPTION>
                                             Votes per         Face          Issued and
             Class             Number          Share           value         Outstanding       Paid-in
      ------------------ ---------------- --------------- --------------- ----------------- -----------
      <S>                   <C>                 <C>            <C>            <C>             <C>
      Common "A"            142,750,099         5              1.00           142,750         142,750
      Common "B"            203,991,566         1              1.00           203,992         203,992
                            -----------                        ----           -------         -------
                            346,741,665                                       346,742         346,742
                            ===========                                       =======         =======
</TABLE>

                                      F-47

<PAGE>

                  BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                      AS OF DECEMBER 31, 2001, 2000 AND 1999

                         (Stated in thousands of pesos)

     The Adjustments to Stockholders' Equity account in the Statements of
     Changes in Stockholders' Equity represents:

     -    the balance of the 1981 appraisal revaluation of fixed assets,
     -    the adjustment required to restate the "Capital Stock" and the
          "Adjustments to Stockholders' Equity" accounts as explained in note
          3.3.,
     -    the incorporation of adjustments to stockholders' equity upon the
          merger with Banco Tornquist S.A., in accordance with resolution April
          28, 2000, Stockholders' Meeting.

     The composition of Adjustments to Stockholders' Equity is as follows:

<TABLE>
<CAPTION>
                                                                                 December 31,
                                                                          --------------------------
                                                                             2001           2000
                                                                         -------------   -----------
      <S>                                                                   <C>            <C>
      Net worth Adjustment Fund-Appraisal revaluation reserve                44,705         44,705

      Adjustment to capital                                                  79,345         79,345
                                                                            -------        -------
                                                                            124,050        124,050
                                                                            =======        =======
</TABLE>

     This balance together with the total legal reserve and earnings
     reserved-other of 335,072 and 85,920, respectively, are not available for
     payment of dividends.

20.  MINIMUM CAPITAL REQUIREMENTS

     Under Central Bank regulations, the Bank is required to have a minimum
     computable net worth equal to the amount resulting from the sum of a
     percentage of the risk value of assets. The required minimum capital
     requirements and the Bank's computable net worth calculated under Central
     Bank regulations as reported by the Bank are as follows:

<TABLE>
<CAPTION>
                                                                 Regulated Computable         Excess over the
                                             Minimum           Net worth under Central        Minimum Capital
                                        Capital Required            Bank standards               Required
                                      ---------------------  ---------------------------   ---------------------
      <S>                                <C>                    <C>                            <C>
      December 31, 2001                      859,169                  1,001,101                  141,932
      December 31, 2000                      939,388                  1,281,449                  342,061
</TABLE>

     As a consequence of recent events mentioned in note 1, to date it is
     impossible to provide any assurance as to the permanence of current
     legislation, rules and regulations or to foresee the requirements that the
     regulatory body could possibly impose in the event of the Bank failing to
     comply with the new regulatory frameworks.

                                      F-48

<PAGE>

                  BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                      AS OF DECEMBER 31, 2001, 2000 AND 1999

                         (Stated in thousands of pesos)

21.  COMPLIANCE WITH THE REQUIREMENTS TO ACT AS AGENT IN THE OVER-THE-COUNTER
     MARKET


     As required under Resolution 368/01 of the CNV, the Bank's equity as of
     December 31, 2001 and 2000, exceeds the minimum stockholders' equity
     required under this resolution to act as agent in the over-the-counter
     market.

     As a consequence of recent events mentioned in note 1, to date it is
     impossible to provide any assurance as to the permanence of current
     legislation, rules and regulations or to foresee the requirements that the
     regulatory body could possibly impose in the event of the Bank failing to
     comply with the new regulatory frameworks.

22.  BANK DEPOSIT GUARANTEE INSURANCE SYSTEM AND BANK LIQUIDITY FUND

     a)   Bank Deposit Guarantee Insurance System

          Law N(degree) 24,485, published on April 18, 1995, and Decree N(0)
          540/95, of the same date provided for the creation of a Bank Deposit
          Guarantee Insurance System, characterized as being limited, mandatory,
          and for value. This system was designed to provide further coverage
          for risks inherent in bank deposits, as a subsidiary and complementary
          protection to that afforded by the system of bank deposit privileges
          and protection created by the Financial Institutions Law.

          This law provided for the creation of a company named "Seguros de
          Depositos Sociedad Anonima" (SEDESA, Deposit Insurance, Corporation)
          for the exclusive purpose of managing the Deposits Guarantee Fund. As
          required by the amendments made by Decree 1292/96, the shareholders of
          the newly created company are the BCRA (with a minimum of one share)
          and the trustees appointed in the trust agreement made by financial
          institutions in such individual proportions as determined by the BCRA
          in terms of their respective contributions to the Deposits Guarantee
          Fund.

          The current guarantee of deposit system does not include deposits made
          by other financial institutions (this includes certificates of deposit
          acquired in the secondary market), deposits made by individuals
          related to the bank either directly or indirectly, certificates of
          deposit in securities, acceptances or guarantees and, lastly, deposits
          made after July 1, 1995 and through September 17, 1998 at a rate two
          or more percentage points per annum above that offered by the Banco de
          la Nacion Argentina for equivalent terms and, since the latter date,
          at a rate two or more percentage points per annum above the rolling
          average for the last five days of deposit rates for an equivalent term
          as found by the survey conducted by the BCRA. Communique "A" 2399 of
          the BCRA of December 15, 1995 extended the stated grounds for
          exclusion from the system to include negotiable certificates of
          deposits acquired by endorsement and deposits obtained through systems
          offering other incentives in addition to agreed-upon interest rates.

          The above trust was created in August, 1995. As of December 31, 2001,
          the Bank has a 10.1132% interest in it.

          Communique "A" 2337 of the BCRA, issued on May 19, 1995, notified
          financial institutions that the rules relating to the application of
          the guarantee system had been approved and put into effect as from
          April 18, 1995.

                                      F-49

<PAGE>

                  BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                      AS OF DECEMBER 31, 2001, 2000 AND 1999

                         (Stated in thousands of pesos)

          The Federal Executive, by Decree No 1127/98 dated September 24, 1998,
          increased the reimbursement guaranty provided by Decree 540/95 to the
          amount of 30, regardless of the term for which the deposit is made.
          Deposit for amounts exceeding 30 are also covered by the guaranty
          system but only up to such amount. The BCRA may decide to change the
          amount covered by the guaranty system at any time and proveded it
          shall be applied to all system participants, on the basis of the
          developments in the Argentine financial system consolidation process
          and any other indicators the BCRA may consider appropriate.

          On January 21, 2000, the BCRA issued Communique "A" 3064 that set the
          normal contribution to the deposit guarantee insurance system at
          0.015% effective as from the contributions due for January 2000,
          subject to the banks executing with SEDESA agreements for loans
          earmarked for the Deposit Guarantee Fund in the conditions provided in
          such Communique. Subsequently, through Communique "A" 3153 of August
          24, 2000, the BCRA abrogated, as from the contributions related to
          September 2000, the requirement to execute loan agreements with
          SEDESA. However, previous loan agreements will remain in effect under
          originally agreed-upon terms and conditions until their respective
          repayments. On November 9, 2001, through Communique "A" 3358, the BCRA
          decided to set the regular contribution to the deposits guaranty fund
          at 0.03%, effective for contributions due in December 2001.

          As of December 31, 2001 and 2000, the Bank has granted loans to SEDESA
          amounting to 7,715, which are booked under the account "Other
          receivables from financial transactions - Other receivables not
          included in Debtor Rating Standards".

   b)     Bank Liquidity Fund

          On December 26, 2001, Decree No. 32/01 provided for the creation of
          the Bank Liquidity Fund in order to inject liquidity into the banking
          system, according to the scope established therein. Such Fund will be
          managed by SEDESA, which will act as trustee.

          Financial institutions authorized to operate in Argentina shall
          contribute to such fund through subscribing class "A" Participation
          Certificates for an amount equivalent to 5% of the average daily
          balances of deposits made by the non-financial private sector in each
          bank as of November 2001, as determined by the BCRA. Such contribution
          may be increased by up to 50%.

          On March 15, 2002, through Communique "A" 3513, the BCRA decided to
          set the regular contribution to the Bank Liquidity Fund at 3.5%. To
          date, the Bank has contributed 242,148. In addition, such Communique
          established that financial institutions may deduct to contribution to
          the fund from the minimum cash requirement.

23.  EMPLOYEE BENEFIT PLANS

     The Bank is obligated to pay employer contributions to the National Pension
     Plan System determined on the basis of the total monthly payroll. On the
     other hand, the Bank does not maintain pension plans, other postretirement
     benefit plans or stock based compensation plans for its personnel.

     These expenses totaled 18,595, 11,764 and 13,150, for the fiscal years
     ended December 31, 2001, 2000 and 1999, respectively, and are included in
     the "Operating Expenses - Personnel Expenses" account in the Consolidated
     Statement of Income.

                                      F-50

<PAGE>

                   BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 AND 1999

                         (Stated in thousands of pesos)

24.  CONSOLIDATED STATEMENTS OF INCOME AND BALANCE SHEETS

     The presentation of financial statements according to the Central Bank
     rules differs significantly from the format required by the United States
     Securities and Exchange Commission under Regulation S-X (Article 9). The
     following financial statements have been restated through August 31, 1995
     by applying conversion factors derived from the price index, as explained
     in note 3.3., and are presented in accordance with general accepted
     accounting principles of the Central Bank of the Argentine Republic. The
     Consolidated Statement of Income presented below discloses the categories
     required by Article 9:

<TABLE>
<CAPTION>
                                                                                  December 31,
                                                                     ---------------------------------------
                                                                          2001          2000         1999
                                                                     ------------  ------------  -----------
<S>                                                                     <C>           <C>           <C>
      CONSOLIDATED STATEMENT OF INCOME

      Interest income:

      Interest and fees on loans                                          988,037      928,607     792,919
      Dividends on investment securities                                       64          198          71
      Interest on interest-bearing deposits with other banks               27,520       42,112      28,380
      Interest on other receivables from financial transactions            15,591       21,462      72,264
      Interest on securities and foreign exchange purchased under
         resale agreements                                                 13,130       47,304      35,620
      Government securities and other trading gains, net                   16,030      220,179     113,337
      Foreign exchange gains, net                                          91,580       69,209      18,462
      Other interest income                                                16,360       14,081       7,617
                                                                       ----------   ----------  ----------
            Total interest income                                       1,168,312    1,343,152   1,068,670
                                                                       ----------   ----------  ----------
      Interest expense:

      Interest on deposits                                                461,972      389,982     287,752
      Interest on short-term borrowings                                    97,990      121,194      99,964
      Interest on long-term debt                                           82,606      105,358      86,942
      Other interest expense                                               20,595       24,746      30,144
                                                                       ----------   ----------  ----------
            Total interest expense                                        663,163      641,280     504,802
                                                                       ----------   ----------  ----------
            Net interest income                                           505,149      701,872     563,868
                                                                       ----------   ----------  ----------
      Provision for loan losses, net of allowances restored to
         income                                                           264,148      140,295     110,494
                                                                       ----------   ----------  ----------
      Net interest income after provision for loan losses                 241,001      561,577     453,374
                                                                       ----------   ----------  ----------
      Non-interest income:

      Service charges on deposit accounts                                 125,252      112,722      97,676
      Credit card service charges and fees                                 53,420       68,891      57,803
      Commissions for administration of pension funds                         791        1,179       1,456
      Other commissions                                                   183,540      119,160      97,126
      Foreign currency exchange trading income                              7,817        6,443       6,766
      Income from equity in other companies                                     -        2,310       6,646
      Other                                                                51,599       43,669      26,436
                                                                       ----------   ----------  ----------
            Total non-interest income                                     422,419      354,374     293,909
                                                                       ----------   ----------  ----------
</TABLE>

                                      F-51

<PAGE>

                  BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 AND 1999

                         (Stated in thousands of pesos)

<TABLE>
<CAPTION>
                                                                                  December 31,
                                                                    --------------------------------------
                                                                        2001         2000         1999
                                                                    ------------  -----------  -----------
      <S>                                                               <C>          <C>          <C>
      Non-interest expense:

      Commissions                                                        43,789       37,880       32,445
      Salaries and payroll taxes                                        234,863      219,973      202,655
      Outside consultants and services                                   65,188       67,875       57,916
      Depreciation of bank premises and equipment                        36,010       32,781       29,009
      Personnel services                                                 11,329       11,031        7,934
      Rent                                                               22,424       21,469       19,591
      Stationery and supplies                                             5,315        5,842        5,973
      Electric power and communications                                  16,039       18,213       25,293
      Advertising and publicity                                          19,531       20,155       14,495
      Taxes                                                              31,316       25,943       24,504
      Contribution to Guarantee of Deposits Fund                         12,926       10,924       18,414
      Management fee                                                          -       28,069       17,047
      Insurance                                                           1,371        1,318          767
      Security services                                                  11,806       13,291       11,830
      Maintenance, conservation and repair expenses                      12,887       13,163        5,547
      Amortization of organization and development expenses              33,745       36,040       37,266
      Loss on transactions with bank premises and equipment and
         other assets, net                                                9,710        4,421        4,373
      Loss from equity in other companies                                 7,572            -            -
      Provision for losses on other receivables and other
         allowances                                                      23,886       19,872       12,486
      Other                                                              59,862       63,866       58,920
                                                                      ---------    ---------    ---------
            Total non-interest expense                                  659,569      652,126      586,465
                                                                      ---------    ---------    ---------

      Minority interests income from subsidiaries                        (1,832)      (1,523)         (18)
                                                                      ---------    ---------    ---------
      Income before income tax                                            2,019      262,302      160,800
      Income tax                                                        (12,227)     (54,709)     (41,632)
                                                                      ---------    ---------    ---------
        Net income                                                      (10,208)     207,593      119,168
                                                                      =========    =========    =========
      Dividends per share (*)                                                 -         0.18         0.11
      Earnings per common share (**)                                      (0.03)        0.61         0.36
</TABLE>

     (*)  As of December 31, 2001 and 2000, dividends per share of common stock
          has been calculated on the basis of 346,741,665 outstanding shares.
          The Special Stockholders' Meeting of April 28, 2000, approved the
          increase of the capital stock to 346,741,665, represented by
          11,473,990 class "B" shares. As of December 31, 1999, dividends per
          share of common stock has been calculated on the basis of 335,267,675
          outstanding shares.

     (**) Earnings per share as of December 31, 2001, 2000 and 1999 has been
          calculated on the basis of 346,741,665, 341,004,670 and 335,267,675
          average outstanding shares.

                                      F-52

<PAGE>

                  BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 AND 1999

                         (Stated in thousands of pesos)

          Certain categories of income and expense maintained by the Bank have
          been presented in the Article 9 income statement in a manner which
          warrants further discussion as follows:

          -    Government securities and other trading gains, net: the Bank
               actively trades its government securities portfolio and does not
               distinguish in its accounting records between interest and
               realized and unrealized gains and losses on such securities. This
               caption is included as a component of Interest income.

          -    Foreign exchange gains, net: Foreign exchange gains, net
               primarily relate to the differences in exchange rates on the
               Bank's foreign currency denominated investments, loans and
               deposits. The foreign exchange gains, net are considered by
               management as an integral part of the generation of interest
               income and the incurrence of interest expense. The Bank does not
               maintain foreign exchange gains or losses in separate categories
               of interest-earning assets or interest-bearing liabilities and,
               therefore, since such gains or losses cannot be separately
               identified by type of activity, foreign exchange gains, net, is
               presented as a component of Interest income.

          -    Provision for loan losses, net of allowances restored to income
               includes direct charge-offs plus the provision charged to the
               allowance for loan losses and for risk of impairment in value,
               less allowances reversed.

          Central Bank rules also require certain classifications of assets and
          liabilities which are different from those required by Article 9. The
          following balance sheets shows the Bank's balance sheets as of
          December 31, 2001 and 2000, as if the Bank followed the balance sheet
          disclosure requirements under Article 9.

<TABLE>
<CAPTION>
                                                                                December 31,
                                                                      ------------------------------
      CONSOLIDATED BALANCE SHEET                                            2001         2000 (1)
                                                                      --------------  --------------
      <S>                                                                <C>            <C>
      Assets

      Cash and due from banks                                             1,212,453        334,695
      Interest-bearing deposits in other banks                              702,628        882,429
      Federal funds sold and repurchase agreements of
      governments securities and certificates of deposits                         -      1,146,076
      Trading account assets
      -        Government Securities                                        256,382        213,641
      -        Marketable Securities                                         22,257         68,228
      Other short-term investments                                          195,577         53,153
      Investment securities                                                 227,595      1,685,288
      Loans                                                               6,234,532      6,491,222
      Unearned discount                                                     (18,321)       (58,408)
      Accrued interest and price differences receivable                     112,020        114,551
      Allowances for loan losses                                           (225,193)      (236,810)
      Premises and equipment                                                346,821        369,870
      Due from customers on acceptance                                       93,719        112,233
      Checks drawn on the Bank and other banks                              294,627        379,100
      Collection items                                                      243,190        139,195
      Other assets                                                          423,068      1,135,342
                                                                       ------------    -----------
            Total assets                                                 10,121,355     12,829,805
                                                                       ============    ===========
</TABLE>

                                      F-53

<PAGE>

                    BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 AND 1999

                         (Stated in thousands of pesos)


<TABLE>
<CAPTION>
                                                                                        December 31,
                                                                               -------------------------
                                                                                   2001          2000(1)
                                                                               -------------------------
      <S>                                                                      <C>            <C>
      Liabilities and Stockholders' Equity
      Non-interest bearing deposits
        -Checking                                                               1,202,960        477,018
        -Other                                                                    226,179         83,710
      Interest-bearing deposits
        -Savings                                                                2,043,601      1,484,915
        -Certificates of deposit                                                2,850,756      4,967,326
      Accrued interest and price differences payable                               46,879         52,645
      Short-term borrowings                                                     1,153,915      1,421,896
      Accrued interest payable                                                     12,304         13,423
      Bank acceptances outstanding                                                 93,719        112,233
      Other liabilities                                                           293,935      1,708,514
      Long-term debt                                                              540,223        612,099
      Accrued interest payable                                                      5,212          5,674
      Commitments and contingent liabilities                                       47,498         27,959
      Liabilities on checks drawn on the Bank and other banks                     294,627        379,100
      Depositors of collection items                                              243,190        139,195
                                                                               ----------     ----------
              Total liabilities                                                 9,054,998     11,485,707

      Minority interest in subsidiaries                                             4,889          4,450

      Common stock                                                                346,742        346,742
      Other stockholders' equity                                                  714,726        992,906
                                                                               ----------     ----------
              Total stockholders' equity                                        1,061,468      1,339,648
                                                                               ----------     ----------
              Total liabilities, minority interest in subsidiaries and
              stockholders' equity                                             10,121,355     12,829,805
                                                                               ==========     ==========

          -Federal funds sold and repurchase agreements of
           government securities and certificates of deposits

           Forward purchases of government securities under
             repurchase agreements                                                      -        591,692
           Receivables on repurchase agreements of government
             securities and certificates of deposits                                    -        554,384
                                                                               ----------     ----------
                                                                                        -      1,146,076
                                                                               ==========     ==========

           Trading account assets

           .   Government securities

               Government securities - Listed                                       4,454        188,670
               Unlisted government securities                                     251,928         24,971
                                                                               ----------     ----------
                                                                                  256,382        213,641
                                                                               ==========     ==========
</TABLE>

                                      F-54

<PAGE>

                  BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 AND 1999

                         (Stated in thousands of pesos)


<TABLE>
<CAPTION>
                                                                                        December 31,
                                                                                --------------------------
                                                                                     2001          2000(1)
                                                                                -----------    -----------
      <S>     <C>                                                               <C>            <C>
      .       Marketable securities

              Shares                                                                1,900          6,003
              Corporate bonds                                                       7,810         39,013
              Mutual funds                                                         10,570         21,232
              Investments securities included in "Investments in other
                 companies" net of 453 and 450 of allowances as of
                 December 31, 2001 and 2000, respectively.                          1,977          1,980
                                                                                ---------      ---------
                                                                                   22,257         68,228
                                                                                =========      =========

      -   Investment securities

          "Investments in other companies - Banking"                                4,191            998
          Investment securities included in "Investments in other
              Companies"                                                           44,196         11,580
          Government securities - Holdings in investment
              Accounts                                                            179,208      1,672,710
                                                                                ---------      ---------
                                                                                  227,595      1,685,288
                                                                                =========      =========

      -   Loans

          Amount of principal, net of 620,620 and 125,567 as of
          December 31, 2001, and 2000, respectively, in interest
          bearing deposits in other banks                                       6,216,211      6,432,814
          Unearned discount                                                        18,321         58,408
                                                                                ---------      ---------
                                                                                6,234,532      6,491,222
                                                                                =========      =========

      -   Short-term borrowings

          Central Bank short-term borrowings                                          522          1,459
          Funded lines of credit from foreign banks and other loans
              from financial institutions included in "Banks and
              international organizations" (2)                                    518,091        990,791
          Unsubordinated Corporate Bonds                                          635,302        429,646
                                                                                ---------      ---------
                                                                                1,153,915      1,421,896
                                                                                =========      =========

      -   Long-term debt

          Central Bank long-term debt                                                 105            206
          Funded lines of credit from foreign banks included
              in "Banks and international organizations" (2)                      144,135         62,007
          Unsubordinated Corporate Bonds                                          395,983        549,886
                                                                                ---------      ---------
                                                                                  540,223        612,099
                                                                                =========      =========
</TABLE>

                                      F-55

<PAGE>

                  BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 AND 1999

                         (Stated in thousands of pesos)

    (1)  See note 3.1.

    (2)  As of December 31, 2001 and 2000, funded lines of credit from foreign
         banks and other loans from financial institutions includes financing
         granted by the SCH Group in the amount of 106,920 and 90,299,
         respectively.

25. OPERATIONS BY GEOGRAPHICAL SEGMENT

    The principal financial information classified by country of office where
    transactions originate, is shown below:

                                                    December 31,
                                      --------------------------------------
                                         2001         2000 (1)      1999 (1)
                                      ---------      ---------     ---------
    Total revenues
    Republic of Argentina             1,558,032      1,649,211     1,282,535
    Cayman Islands                       36,695         58,597        81,030

    Net income
    Republic of Argentina               (10,864)       198,592       101,788
    Cayman Islands                          656          9,001        17,380

    Total assets
    Republic of Argentina             9,144,930     13,934,526    11,636,512
    Cayman Islands                      798,361        417,838       604,872

    (1)  See note 3.1.


26. FINANCIAL INSTRUMENTS WITH OFF-BALANCE-SHEET RISK

    a)   In the normal course of business, the Bank enters into contractual
         agreements involving various types of off-balance-sheet financial
         instruments in order to meet the financing needs of clients, conduct
         trading activities, and manage its own exposures. These financial
         instruments generate commissions and fees. Credit risk represents the
         possibility that a loss may occur from the failure of another party to
         perform according to the terms of contract.

         A summary of the contractual or principal amounts of significant
         off-balance-sheet financial instruments, follows:

                                                                 December 31,
                                                            --------------------
                                                              2001        2000
                                                            --------------------

         Guarantees given                                   105,076      137,367
         Liabilities on foreign trade transactions           93,719      112,233
         Credit lines granted                               376,661      432,038
                                                            -------      -------
         Total                                              575,456      681,638
                                                            =======      =======

                                      F-56

<PAGE>

                  BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 AND 1999

                         (Stated in thousands of pesos)

         Guarantees are commitments issued by the Bank to guarantee the
         performance of its clients to third parties and are accounted in
         memorandum accounts. The guarantees outstanding at December 31, 2001
         and 2000, were written to support the financial performance of the
         Bank's clients. The credit risk arising from these commitments results
         from the potential need to satisfy, in whole or in part, the
         obligations of another party when certain specified future events
         occur. The possibility of credit risk in the Bank's operations is
         minimized by the fact that these guarantees are secured.

    b)   The Bank accounts for checks drawn on other banks, as well as other
         items in process of collection, such as notes, bills and miscellaneous
         items, in memorandum accounts until such time as the related item
         clears or is accepted. In the opinion of management, no risk of loss
         exists on these clearing transactions. The amounts of clearing items in
         process are as follows:

                                                                December 31,
                                                            -------------------
                                                              2001       2000
                                                            -------    --------

         Checks drawn on other banks pending clearing       294,627    379,100
         Collection items                                   243,190    139,195
                                                            -------    -------
             Total                                          537,817    518,295
                                                            =======    =======

    c)   Derivatives:

         Financial instruments

         The notional contractual amount of these instruments represents the
         volume of outstanding transactions and does not represent the potential
         gain or loss associated with the market or credit risk of such
         transactions. The market risk of derivatives arises from the potential
         changes in value due to fluctuations in market prices. The Bank
         generally reduces its exposure to market risk by entering into
         offsetting transactions. The credit risk of derivatives arises from the
         potential of a counterpart to default on its contractual obligations.
         The Bank attempts to limit its credit risk by dealing with creditworthy
         counterparties and obtaining collateral where appropriate.

         Options are purchased by the holder for a premium (up-front cash
         payment) that gives the right, but not the obligation to buy (call
         option) or sell (put option) an item at a specified price on or within
         a specified time. A detail of these instruments is as follows:

                                                            December 31,
                                                        ------------------
                                                            2001      2000
                                                        ------------------

         Call options purchased (**)                         363         -
         Put options purchased (**)                       43,682         -
         Call options sold (*)                            11,519     7,794
         Put options sold (**)                           100,000         -

         (*)  Valued at market price as of December 31, 2001 and 2000,
              respectively.
         (**) Valued at their strike price as of December 31, 2001.

         Premiums on these instruments have been included in current income in
         the Financial Income and Financial Expense captions of the
         Consolidated Statement of Income. The term of these instruments is
         less than twelve-months.

                                      F-57

<PAGE>

                   BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 AND 1999

                         (Stated in thousands of pesos)

         On the other hand, on March 21, 2001, the Bank executed an
         interest-rate swap agreement with Deutsche Bank AG New York Branch, to
         cover the variable yield accrued by the First Series of Corporate
         Bonds, for an amount of US$200 million, issued by the Bank under
         Corporate Bond Issuance Global Program for a total amount of US$1
         billion. In addition, on June 25, 2001, the Bank entered into two
         interest-rate swap agreements with the Standard Chartered Bank for a
         total amount of US$ 9,230,769 and US$ 13,943,917, so as to cover the
         variable rate payable on financing received from the Inter-American
         Investment Corporation; these swaps agreements expire on October 15,
         2006, and November 15, 2004, respectively. Accordingly, this
         transaction is recorded under the account "Memorandum accounts -
         Derivative accounts - Other" in the amount of 223,175.

         Variable - Rate certificates of deposits

         As of December 31, 2001 and 2000, the Bank became the obligor in
         connection with variable-rate certificates of deposit placed under the
         provisions of BCRA Communique "A" 2482 as supplemented and was assigned
         the respective hedging financial instrument agreements undertaken with
         the purpose of fully covering the impact on equity of the changes in
         the listed price of the financial assets on which such certificates are
         indexed. Most of such agreements were entered into with SCH Group
         member entities. The face value of such investments as of December 31,
         2001 and 2000, amounts to 10,998 and 37,365 respectively and they are
         recorded under the "Deposits - Private nonfinancial sector and foreign
         residents - Investment Accounts".

         The variable consideration to be paid for the funds procured under this
         type of transaction amounted to 52 and 2,020 at each year-end,
         respectively, and are recorded under "Deposits - Private nonfinancial
         sector and foreign residents - Accrued interest and price differences
         payable"; such amounts were fully covered by the revenues, in the same
         amount, from the above mentioned hedging instruments. As of December
         31, 2001 and 2000, the amount in such hedging instruments amounted to
         3,566 and 7,794, respectively and were recorded as detailed below:

         a)   As of December 31, 2001: for the account "Credit Memorandum
              Derivative Accounts - Notional Value of Call Options Sold" the
              balance was 3,566.

         b)   As of December 31, 2000: for the account "Credit Memorandum
              Derivative Accounts - Notional Value of Call Options Sold" the
              balance is 7,794.

         As of December 31, 2001 and 2000, the premiums paid for such
         instruments amount to 1,880 and 3,616, respectively; such premiums were
         accrued over the effective term of the above mentioned certificates. At
         each year-end, the unaccrued portion of such premiums is 1,027 and
         1,648 and is recorded under "Other receivables from financial
         transactions - Premiums on options purchased".

27.  FIDUCIARY ACTIVITIES

     Banco Rio de la Plata S.A. is the trustee for the trusts described below
     and in no case is the Bank liable with its own assets for the commitments
     undertaken in the performance of the trusts; such liabilities will only be
     serviced with and up to the sum of the trust corpus assets and the proceeds
     from such assets.

                                      F-58

<PAGE>

                   BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 AND 1999

                         (Stated in thousands of pesos)

    a)   Financial Trusts

<TABLE>
<CAPTION>
                               Amount Global                   Date       Underlying      Stockholders'    Fiscal Year/
           Description            Program         Series      Issued        Assets           Equity         Period End
         ----------------     ---------------     ------      ------    --------------    -------------    ------------
         <S>                  <C>                 <C>        <C>        <C>               <C>              <C>
         PEGASUS              US$ 300,000,000       B        07-17-97   Bontes 2002           20,804         12-31-01
                                                                        and Cash Flow
                                                                        Exchange

         INMOBILIARIO         US$ 200,000,000      1/st/     11-28-96   Real Estate              390         12-31-01
                                                                        Mortgage Loans

         EDIFICIO LA          US$  45,000,000      1/st/     08-10-00   Building under         8,592         12-31-01
         NACION                                                         construction
</TABLE>

    b)   Other Trusts


<TABLE>
<CAPTION>
                                                                           Amount of the
                                                                            Underlying
                    Description                  Underlying Assets            Assets           Kind of Trust
         ---------------------------        ---------------------------    -------------   --------------------
         <S>                                <C>                             <C>            <C>
         CP II                              Penitentiary Complex               102,230     Administration Trust

         CAMINOS DE LAS SIERRAS S.A.        Rights stemming from toll           92,290     Guaranty Trust
                                            collection

         BERSA                              Subordinate Debt Securities         18,046     Guaranty and
                                                                                           Safekeeping Trust

         CORREO ARGENTINO S.A.              Shares and rights                   99,000     Collection Rights
                                                                                           Assignment Trust

         SERVICIOS VIALES S.A.              Rights stemming from toll           30,000     Collection Rights
                                            collection                                     Assignment Trust

         CREDITO ACTUAL                     Rights, shares and                  14,000     Guaranty Trust
                                            guarantees
</TABLE>

28. DISCLOSURES ABOUT FAIR VALUE OF FINANCIAL INSTRUMENTS

    The following methods and assumptions were used to estimate the fair value
    of each class of financial instruments for which it is practicable to
    estimate that value, in accordance with Statement of Financial Accounting
    Standards N(0) 107.

    For purpose of estimating the value of loans, other receivables from
    financial transactions and assets covered by financing leases, the Bank has
    primarily relied upon its historical assessment of the credit quality of its
    customers without risk adjusting such estimation for the risk solely
    attributable to the economic disruption currently being experienced in
    Argentina. Argentina's economy is currently suffering from a disruption in
    traditional systems of payment due to a severe shortage of liquidity in the
    marketplace. The shortage of cash and resulting scarcity of working capital
    has contributed to a severe contraction of customary trade credit which in
    turn has brought many commercial activities to a standstill. The disruption
    of the payment system has had a particularly significant impact on
    Argentina's cash-based informal economy and those who depend on it. The
    scarcity of liquidity in the financial system is likely to adversely affect
    our normal cash collections and the overall asset quality of our loan
    portfolio.

                                      F-59

<PAGE>

                  BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 AND 1999

                         (Stated in thousands of pesos)


     .    Cash and due from banks, Government securities held for trading,
          Investments in listed private securities held for trading, Central
          Bank of the Argentine Republic (included in "Other receivables from
          financial transactions"), Other receivables from financial
          transactions - Other, Assets covered by financing leases and other
          assets.

          For these short-term instruments, the book value is a reasonable
          estimate of fair value.

     .    Government securities held in investment accounts and securities and
          foreign exchange receivables on spot and forward purchases (included
          in "Other receivables from financial transactions").

          For these instruments the fair value has been estimated using the
          market value of the securities as of December 31, 2001 and 2000,
          respectively.

     .    Loans

          Market value has been estimated by discounting future cash flows at
          the interest rate in effect as of December 31, 2001 and 2000,
          respectively for each loan category.

     .    Other receivables from financial transactions - Amounts receivables on
          spot and forward sales

          For these financial instruments, the present value was estimated
          considering the future liquidation value net of premiums unaccrued at
          each year-end.

     .    Long-term investments in other companies

          For these investments, which are primarily in unlisted investments,
          the fair market value has been estimated using the reported equity of
          the investee's latest financial statements multiplied by the Bank's
          ownership interest.

     .    Deposits - Checking, Saving and Other deposits

          The fair value has been estimated by considering the amount payable as
          of the date of the financial statements.

     .    Deposits - Certificates of deposits

          The fair value has been estimated by discounting future cash flows at
          the interest rates offered as of December 31, 2001 and 2000,
          respectively, for periods similar to the periods remaining through the
          maturity date.

          Under Communique "A" 3467 as amended by the BCRA, the return of
          deposits was rescheduled taking into account the currency, the type of
          account and the amount deposited. Such rescheduling was not considered
          in the fair value calculation, since all the conditions were not fully
          defined and it was still pending the depositors' option to maintain
          reprogrammed term deposits or subscribe government securities.

     .    Other liabilities from financial transactions - Central Bank of the
          Argentine Republic, Banks and international organizations and
          financing from local financial institutions, and Unsubordinated
          Corporate Bonds

          Fair value has been estimated by discounting future cash flows at the
          interest rate in effect as of December 31, 2001 and 2000,
          respectively, for each liability.

                                      F-60

<PAGE>

                  BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 AND 1999

                         (Stated in thousands of pesos)


     .    Other liabilities from financial transactions - Securities and foreign
          currency payables on spot and forward sales

          For theses instruments the fair value has been estimated using the
          market value of the securities as of December 31, 2001 and 2000,
          respectively.

     .    Other liabilities from financial transactions - Amounts payable on
          spot and forward purchases

          For these financial instruments, the present value was estimated
          considering the future liquidation value net of premiums unaccrued at
          each year-end.

     .    Other liabilities

          The book value is a reasonable estimate of fair value.

     .    Guarantees given

          The book value is a reasonable estimate of fair value.

     .    Call and Put Options purchased and Call and Put options sold

          For these instruments, the fair value has been estimated using the
          fair value of the options as of December 31, 2001 and 2000.

     The estimated fair values of the Bank's financial instruments are as
     follows:

<TABLE>
<CAPTION>
                                                                   December 31, 2001           December 31, 2000
                                                              ---------------------------------------------------------
                                                                Book          Fair            Book         Fair
                                                                Value         Value         Value (1)      Value

                                                              ---------------------------------------------------------
     <S>                                                      <C>           <C>            <C>          <C>
     Financial assets

     Cash and due from banks                                  1,294,461     1,294,461       1,091,557    1,091,557
     Government securities held for trading                       4,454         4,454         188,670      188,670
     Government securities held in investment accounts (2)      179,208       145,296       1,672,710    1,651,647
     Investments in listed private securities held for
         trading                                                 20,280        20,280          66,248       66,248
     Unlisted Government Securities (2)                         251,928       215,475          24,971       24,971
     Loans (2)                                                6,659,405     4,949,797       6,374,985    5,627,751
     Other receivables from financial transactions:
     -      Central Bank of the Argentine Republic              117,521       117,521       1,107,475    1,107,475
     -      Amounts receivables on spot and forward sales       367,446       354,156       1,737,663    1,701,821
     -      Securities and foreign exchange receivables on
            spot and forward purchases                          125,929       124,269       1,343,608    1,332,276
     -      Other                                               278,196       278,196         158,312      158,312
     Assets  covered by financing leases                         64,253        64,253          61,137       61,137
                                                             ------------- ------------- -------------  ------------
     Total Financial assets                                   9,363,081     7,568,158      13,827,336   13,011,865
                                                             ------------- ------------- -------------  ------------
     Other Assets

     Long-term investments in other companies                    50,364        50,364          14,558       14,558
     Other assets                                               529,846       529,846         496,119      496,119
                                                             ------------- ------------- -------------  ------------
     Total Other assets                                         580,210       580,210         510,677      510,677
                                                             ------------- ------------- -------------  ------------
</TABLE>

                                      F-61

<PAGE>

                  BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 AND 1999

                         (Stated in thousands of pesos)


<TABLE>
<CAPTION>
                                                                   December 31, 2001           December 31, 2000
                                                              -------------------------------------------------------
                                                                  Book          Fair           Book          Fair
                                                                  Value         Value       Value (1)        Value
                                                              ------------- ------------- -------------- ------------
      <S>                                                     <C>           <C>           <C>            <C>
      Financial liabilities

      Deposits
      .        Checking, savings and other deposits            3,474,478     3,474,478       2,048,468    2,048,527
      .        Certificates of deposits                        2,895,897     2,920,900       5,017,146    5,128,795
      Other liabilities from financial transactions:
      .        Central Bank of the Argentine Republic                632           639           1,672        1,662
      .        Banks and international organizations and
               financing from local financial institutions       675,768       682,269       1,067,289    1,069,454
      .        Unsubordinated Corporate Bonds                  1,035,446       979,513         984,131      901,988
      .        Amounts payable on spot and forward purchases     140,859       139,199       1,269,216    1,249,707
      .        Securities and foreign currency payables on
               spot and forward sales                            340,754       327,464       2,269,091    2,233,737
      .        Other                                             119,007       119,007         106,608      106,608
                                                              ------------- ------------- -------------- ------------
      Total Financial liabilities                              8,682,841     8,643,469      12,763,621   12,970,772
                                                              ------------- ------------- -------------- ------------

      Other liabilities                                          194,093       194,093         230,294      230,294
                                                              ------------- ------------- -------------- ------------
      Total Other liabilities                                    194,093       194,093         230,294      230,294
                                                              ------------- ------------- -------------- ------------
      Other financial instruments

      Guarantees given                                           105,076       105,076         137,367      137,367
      Call options purchased                                         363           363               -            -
      Put options purchased                                       43,682        37,753               -            -
      Call options sold                                           11,519        11,519           7,794        7,794
      Put options sold                                           100,000       100,000               -            -
</TABLE>

      (1)      See note 3.1.
      (2)      As of December 31, 2001, include the effect mentioned in note
               30.6.c).

29.   BUSINESS SEGMENT INFORMATION

      The Bank is mainly concentrated on financial sector, especially through
      its activities related to banking/financial, fund management and brokerage
      services. The following information shows total assets, financial income,
      financial expenses, provision for loan losses, service charge, net,
      operating expenses, other, net, loss on minority interest in subsidiaries,
      income tax and total net income, for each of the business segment
      identified by the company's management.

<TABLE>
<CAPTION>
                                                               December 31, 2001 (1)
                             -------------------------------------------------------------------------------------------------------
                                                                    Mutual Fund     Brokerage    Other
                                  Banking / Financial                Management      Services    Services
                             --------------------------------------  -------------  ---------- -----------
                              Banco Rio                              Santander       Santander
                             de la Plata    Santander                Investment      Sociedad
                                 S.A.        Riobank      Total     Gte. De F.C.I.   de Bolsa    Gire S.A.  Eliminations     Total
                             ------------  -----------  ----------  --------------  ---------- -----------  ------------ ---------
<S>                          <C>           <C>          <C>         <C>             <C>        <C>          <C>          <C>
Total assets                    9,393,989      757,736  10,151,725          35,585      12,291      21,832      (278,142) 9,943,291
                             ============  ===========  ==========  ==============  ========== ===========  ============  =========
Financial income                1,127,504       25,333   1,152,832          (1,724)     (1,387)        333        (3,997) 1,146,062
Financial expenses               (662,221)     (19,737)   (681,958)          2,080          (7)          -         3,997   (675,888)
Provision for loan losses        (263,878)        (270)   (264,148)              -           -           -             -   (264,148)
Service charge, net               265,980        4,761     270,741          27,509       1,422      26,686             -    326,358
Operating expenses               (497,324)      (5,204)   (502,528)         (1,829)     (2,896)    (20,254)          138   (527,369)
Other income/(expense),
   net                             19,731         (145)     19,586             285         (69)          -       (20,996)    (1,164)
Loss on minority interest
subsidiaries                            -            -          -                -           -           -        (1,832)    (1,832)
Income tax                              -         (191)       (191)         (9,668)          -      (2,368)            -    (12,227)
                             ------------  -----------  ----------  --------------  ---------- -----------  ------------  ---------
Total net income                  (10,208)       4,547      (5,661)         16,653      (2,937)      4,397       (22,660)   (10,208)
                             ============  ===========  ==========  ==============  ========== ===========  ============  =========
</TABLE>

                                      F-62

<PAGE>

                   BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                        AS OF DECEMBER 31, 2001, 2000 AND 1999

                         (Stated in thousands of pesos)

<TABLE>
<CAPTION>
                                                                December 31, 2000 (1) (3)
                               ------------------------------------------------------------------------------------------------
                                                                  Mutual Fund    Brokerage     Other
                                       Banking/Financial          Management     Services     Services
                               --------------------------------   -------------  ---------  -----------
                                Banco Rio                           Santander    Santander
                                  de la    Santander                Investment   Sociedad
                               Plata S.A.   Riobank    Total      Gte. De F.C.I. de Bolsa    Gire S.A.  Eliminations    Total
                               ---------- ---------- ---------    -------------- ---------  ----------- ------------  ----------
<S>                            <C>          <C>      <C>            <C>          <C>         <C>          <C>         <C>
Total assets                   14,250,999   627,855  14,878,854     34,200       18,231      23,189       (616,461)   14,338,013
                               ========== ========== ==========   ========       =======    =======     ==========    ==========
Financial income                1,249,294    50,615   1,299,909        611          522         389        (19,464)    1,281,967
Financial expenses               (638,921)  (29,962)   (668,883)       (66)      (1,620)          -         19,464      (651,105)
Provision for loan losses        (147,329)        -    (147,329)         -            -           -              -      (147,329)
Service charge, net               254,951     5,793     260,744     22,884        5,130      22,004              -       310,762
Operating expenses               (516,025)   (5,452)   (521,477)    (1,456)      (3,452)    (16,768)            55      (543,098)
Other income/(expense), net        50,473     3,021      53,494       (317)          42           -        (40,591)       12,628
Loss on minority interest in
subsidiaries                           -          -           -          -            -           -         (1,523)       (1,523)
Income tax                        (44,850)     (100)    (44,950)    (7,790)           -      (1,969)             -       (54,709)
                               ---------- ---------- ----------   --------       ------     -------     ----------    ----------
Total net income                  207,593    23,915     231,508     13,866          622       3,656        (42,059)      207,593
                               ========== ========== ==========   ========       ======     =======     ==========    ==========
</TABLE>


<TABLE>
<CAPTION>
                                                           December 31, 1999 (2) (3)
                                -----------------------------------------------------------------------------------
                                                                     Mutual Fund    Brokerage
                                  Banking/Financial                  Management     Services
                                ------------------------------------ -------------- ----------
                                  Banco Rio                            Santander    Santander
                                de la Plata   Santander                Investment   Sociedad
                                    S.A.      Riobank       Total    Gte. de F.C.I. De Bolsa Eliminations  Total
                                ------------ ----------   ---------- -------------- -------- ------------  --------
<S>                             <C>           <C>         <C>            <C>        <C>       <C>        <C>
Total assets                    12,013,740    575,465     12,589,205     17,808     16,886    (382,515)  12,241,384
                                ==========    =======     ==========     =======    ======    ========   ==========
Financial income                   999,926     46,341      1,046,267      1,217      1,816      (3,534)   1,045,766
Financial expenses                (499,079)   (24,868)      (523,947)      (103)         -       3,534     (520,516)
Provision for loan losses         (112,231)      (202)      (112,433)         -          -           -     (112,433)
Service charge, net                204,021      5,045        209,066     19,910      3,326           -      232,302
Operating expenses                (471,416)    (7,187)      (478,603)    (1,514)    (3,035)          2     (483,150)
Other income/(expense), net         32,165        302         32,467       (182)    (1,694)    (31,742)      (1,151)
Loss on minority interest in
subsidiaries                             -        (18)           (18)         -          -           -          (18)
Income tax                         (34,218)      (575)       (34,793)    (6,579)      (260)          -      (41,632)
                                ----------    -------     ----------     -------    ------    --------   ----------
Total net income                   119,168     18,838        138,006     12,749        153     (31,740)    119,168
                                ==========    =======     ==========     =======    ======    ========   ==========
</TABLE>

(1)   As of December 31, 2001 and 2000, the Bank's consolidated financial
      statements include the results of operations of Santander Riobank (Grand
      Cayman), Santander Investment Gerente de Fondos Comunes de Inversion S.A.,
      Santander Sociedad de Bolsa S.A. and Gire S.A.
(2)   As of December 31, 1999, the Bank's consolidated financial statements
      include the results of operations of Santander Riobank (Grand Cayman),
      Santander Investment Gerente de Fondos Comunes de Inversion S.A. and
      Santander Sociedad de Bolsa S.A.
(3)   See note 3.1.

                                      F-63

<PAGE>

                   BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                        AS OF DECEMBER 31, 2001, 2000 AND 1999

                         (Stated in thousands of pesos)

30.   SUMMARY OF SIGNIFICANT DIFFERENCES BETWEEN THE STANDARDS OF THE CENTRAL
      BANK AND UNITED STATES GENERALLY ACCEPTED ACCOUNTING PRINCIPLES

      The following is a description of the significant differences between the
      rules of the Central Bank and those applicable in the United States under
      generally accepted accounting principles ("US GAAP"). References below to
      "SFAS" are to United States Statements of Financial Accounting Standards.

      30.1.    Merger with Banco Santander S.A. of Argentina

               On June 26, 1998, the Special Shareholders' Meetings of Banco Rio
               de la Plata S.A. (Banco Rio) and Banco Santander S.A. of
               Argentina (BSA) approved, among other things, the preliminary
               merger agreement executed by both institutions, the special
               merger-purposes financial statements of Banco Rio and BSA as of
               September 30, 1997, the rate at which shares would be exchanged
               and the merger of both institutions. In addition, the above
               mentioned Shareholders' Meetings also approved the increase of
               the capital stock of Banco Rio de la Plata S.A. to 335,268
               (represented by 35,267,675 class "B" book-entry shares, for a
               nominal value of $ 1 each entitled to one vote per share),
               allocated the sum of 54,161 as merger premium and the early
               dissolution, without liquidation, of BSA and the addition of all
               its assets to and assumption of all its liabilities by Banco Rio
               (as the surviving entity). The Banks executed the definitive
               merger agreement on July 31, 1998. The merger occurred in a
               two-step process consisting first of the acquisition by Santander
               Investment S.A. of Spain of a majority voting interest in Banco
               Rio and a later exchange of outstanding BSA shares for
               outstanding stock of Banco Rio, and the merger of the banking
               operations. The merger between BSA and Banco Rio was accomplished
               through the exchange of newly issued shares of Banco Rio and
               consequently, the surviving legal entity and capital structure of
               the combined banking group is that of Banco Rio. The Central Bank
               of the Argentine Republic authorized the merger of both
               institutions on October 1, 1998.

               Consequently, on October 15, 1998, Banco Santander S.A. of
               Argentina merged into Banco Rio de la Plata S.A., effective as of
               January 1, 1998, transferring all Banco Santander S.A. of
               Argentina's current businesses as of such date. In addition,
               Banco Santander S.A. of Argentina's operation was completely
               discontinued.

               Under generally accepted accounting principles (GAAP) in
               Argentina and Central Bank Regulations, this merger has been
               accounted for as a combining of interests of the two entities
               effective January 1, 1998 which has not resulted in the
               revaluation of the assets or liabilities of either BSA or Banco
               Rio. Under Argentine GAAP, there is no change of legal or
               reporting entity of the basic financial statements as those
               presented in accordance with Argentine GAAP. This accounting
               differs significantly from the accounting that would be applied
               if the transactions were accounted for in accordance with US
               GAAP.

               Under US GAAP, the merger of BSA and Banco Rio is accounted for
               as a purchase of Banco Rio with the revaluation of the assets and
               liabilities of Banco Rio in proportion to the ownership interest
               acquired by Santander Investment S.A. of Spain, effective as from
               the date of the actual transfer of Banco Rio shares from Banco
               Rio's prior controlling shareholders to Santander Investment S.A.
               of Spain on August 22, 1997. This resulted in an increase in net
               assets and liabilities of approximately 490,848 (as of December
               31, 1997, goodwill net of amortization was 484,901) as of August
               22, 1997, representing the partial revaluation of assets and
               liabilities of Banco Rio and recording of purchase intangibles
               (goodwill). Consequently, for US GAAP purposes, the merger
               between Banco Rio and BSA have been considered since August 22,
               1997.

                                      F-64

<PAGE>

                   BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                        AS OF DECEMBER 31, 2001, 2000 AND 1999

                         (Stated in thousands of pesos)

               As a consequence the events mentioned in note 1, under US GAAP
               -SFAS No. 121- requires that the Bank review long-lived assets
               and certain identifiable intangible to be held and used for
               impairment whenever events or changes in circumstances indicate
               that the carrying amount of an asset may not be recoverable.
               Consequently, as of December 31, 2001 the net income would be
               decrease of 416,935. On the other hand, the call options
               -acquired in September 1998- mentioned in note 2, had been
               exercise on January 2002. As a consequence of the recent events
               mentioned in note 1, the effect of such transaction has not been
               calculated by the Bank's management.

      30.2.    Merger with Banco Tornquist S.A.

               On January 6, 2000, the controlling shareholders of Banco Rio de
               la Plata S.A. and Banco Tornquist S.A. (an entity in which SCH
               indirectly holds a 100% equity interest) executed an agreement
               for the merger of both entities, whereby all Banco Tornquist S.A.
               (absorbed entity) operations are to be merged into Banco Rio de
               la Plata S.A. (absorbing entity). Such merger will be given
               retroactive legal effect as of January 1, 2000, once it has been
               approved by the appropriate oversight agencies. Under the
               abovementioned agreement, Banco Rio de la Plata S.A. took over
               management of Banco Tornquist S.A. for the purpose of ensuring
               effective integration of operations, customer service continuity,
               and sharing the benefits of the former's broad range of services.
               The respective Boards of Directors approved the agreement on
               January 6, 2000.

               On February 16, 2000, a preliminary merger agreement was executed
               between Banco Rio de la Plata S.A. (as absorbing entity) and
               Banco Tornquist S.A. (as absorbed entity). Also, the Boards of
               Directors of both entities approved the special merger-purposes
               consolidated financial statements of Banco Rio de la Plata S.A.
               and Banco Tornquist S.A. as of December 31, 1999, and the share
               exchange rate. Such exchange rate was based on the valuation of
               the economic contribution to Banco Rio de la Plata S.A. arising
               from the incorporation of Banco Tornquist S.A.'s business
               compared to Banco Rio de la Plata S.A. `s average market
               capitalization, on the Buenos Aires Stock Exchange, over the
               three months immediately preceding the agreement date.
               Consequently, the share exchange ratio was set at 1 share of
               Banco Rio de la Plata S.A. for every 11.9574794 shares of Banco
               Tornquist S.A. The above-mentioned exchange will result in Banco
               Rio de la Plata S.A. increasing its capital stock by 11,474;
               thus, after the merger, such capital stock will be 346,742.

               The Central Bank of the Argentine Republic approved the merger of
               Banco Rio de la Plata S.A. and Banco Tornquist S.A. on March 9,
               2000; such merger was approved by the respective General
               Shareholders' Meeting of Banco Rio de la Plata S.A. and Banco
               Tornquist S.A. held on April 28, 2000.

               Under generally accepted accounting principles ("GAAP") in
               Argentina, this merger was accounted for as a combining of
               interest which did not result in the revaluation of the assets or
               liabilities of either Banco Tornquist S.A. or the Banco Rio de la
               Plata S.A. This accounting is similar from the accounting that
               would be applied if the transactions were accounted for in
               accordance with US GAAP. However and bearing in mind that the
               merger of Banco Tornquist S.A. (Banco Central Hispanoamericano
               S.A.) with and into Banco Rio de la Plata S.A. (Banco Santander
               S.A. of Spain) was executed by both companies' controlling
               shareholders on April 17, 1999, such merger is considered a
               combination of interest becoming effective as from the time when
               both companies' controlling shareholders assumed common control
               thereof. As a consequence, under US GAAP the impact of the merger
               of Banco Rio de la Plata S.A. and Banco Tornquist S.A. on
               shareholders' equity and income (loss), was deemed effective as
               from April 17, 1999.

                                      F-65

<PAGE>

                   BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 AND 1999

                         (Stated in thousands of pesos)

      30.3.    Restatement of Financial Statements for General Price Level
               Changes

               Central Bank regulations required the restatement of assets and
               liabilities into constant Argentine Pesos. All nonmonetary assets
               and liabilities and Statement of Income amounts have been
               restated to reflect changes in the Argentine price index, from
               the date the assets were acquired or from the date the
               liabilities were incurred, to August 31, 1995 (See note 3.3.).

               In most circumstances, US GAAP does not allow for the restatement
               of financial statements for general price level changes. Under US
               GAAP, account balances and transactions are stated in the units
               of currency of the period when the transactions originated. This
               accounting model is commonly known as the historical cost basis
               of accounting.

               Rules prescribed by the Central Bank for reporting periods
               through August 31, 1995 called for the restatement of historical
               financial statements to adjust for the effects of inflation. As
               allowed pursuant to Item 18 of Form 20-F, no adjustments have
               been made in presenting the differences between Argentine and US
               GAAP to remove the inflationary adjustments as would be required
               to conform to US GAAP.

      30.4.    Income Taxes

               Central Bank regulations require income taxes to be recognized on
               the basis of amounts due in accordance with Argentine tax
               regulations. When income and expense recognition for income tax
               purposes does not occur in the same period as income and expense
               recognition for financial statement purposes, the resulting
               temporary differences are not considered in the computation of
               income tax expense for the period. For US GAAP purposes, the Bank
               accounts for income taxes under the liability method in
               accordance with SFAS No. 109, "Accounting for Income Taxes".

               Under this method, "Accounting for Income Taxes", income taxes
               are recognized according to the liability method whereby deferred
               tax assets and liabilities are established for temporary
               differences between the financial reporting basis and the tax
               basis of the Bank's assets and liabilities at enacted tax rates
               expected to be in effect when such amounts are realized. Deferred
               tax assets are recognized for all temporary items and an
               offsetting valuation reserve is only recorded if it is determined
               that it is probable that the asset will not be realized.

               Reconciliation of tax provision to statutory rate:

<TABLE>
<CAPTION>
                                                                                        December 31,
                                                                             -----------------------------------
                                                                               2001         2000        1999
                                                                             -----------------------------------
<S>                                                                            <C>         <C>        <C>
             Pre-tax income in accordance with Central Bank regulations        2,019       262,302    160,800
             Statutory tax rate                                                   35%           35%        35%
             Tax on net income at statutory rate                                 707        91,806     56,280
             Plus (Less) tax on permanent differences:

             -    Difference between items subject to tax and for
                  accounting purposes                                         65,459         4,381    (21,783)

             Temporary differences                                           (53,939)      (41,478)     7,135
                                                                             -------       -------     ------
             Statutory income tax according to Central Bank regulations       12,227        54,709     41,632
                                                                             =======       =======     ======
</TABLE>

                                      F-66

<PAGE>

                  BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 AND 1999

                         (Stated in thousands of pesos)


    The accumulated tax effect of significant temporary differences as of
    the end of each year is as follows - assets (liabilities):

<TABLE>
<CAPTION>
                                                                                       December 31,
                                                                   ----------------------------------------------------
                                                                     2001           2000                     1999
                                                                   ----------   ------------ --------------------------
                                                                     Banco          Banco       Banco        Banco
                                                                      Rio            Rio      Tornquist       Rio
                                                                   ----------   ------------ ------------  ------------
    <S>                                                            <C>          <C>          <C>           <C>
    Deferred tax assets before 1991                                   2,775          2,775        -            2,775
    Provision for loan losses                                       (36,953)        79,735      60,529        44,440
    Difference between book value and tax value of
      Investments in other companies                                (27,706)       (27,706)        730       (28,436)
    Difference between book value and tax value of bank
      Premises and equipment, other assets and intangible
      assets                                                         14,660        (12,667)         14       (20,841)
    Difference between book value and tax value of
      Government securities                                          10,734        (13,922)     (2,294)      (11,339)
    Deferred tax assets (liability)                                    -              -         15,820          -
    Other                                                            18,840          8,074      11,852         4,517
                                                                   --------       --------    --------     ---------
    Net deferred tax benefit/(provision)                            (17,650)        36,289      86,651        (8,884)

    Tax effect on change of rate                                      2,147          2,147        -            2,147
                                                                   --------       --------    --------     ---------
    Net deferred tax asset/(liability)                              (15,503)        38,436      86,651        (6,737)
                                                                   ========       ========    ========     =========
</TABLE>


30.5.   Commissions on Loans

        The Bank recognizes commissions (origination fees) on credit card loans
        and acceptances when collected. In accordance with US GAAP, under SFAS
        No. 91, loan origination fees and certain direct loan origination costs
        should be recognized over the life of the related loan as an adjustment
        of yield.

        The effects on the Article 9 Balance Sheets (See note 24) of adjustments
        required to state such amounts in accordance with US GAAP would be a
        decrease in loans by 76,648, 56,786, and 10,786, and a decrease in other
        assets by 1,004 and 795, 914 as of December 31, 2001, 2000 and 1999,
        respectively.


30.6.   Loan Loss Reserves

        The Bank's accounting for its allowance for loan losses differs in some
        respects from practices of US based banks. The most significant
        differences follow:

        a)  Interest Recognition - Nonaccrual Loans


            The Bank recognizes interest income on a cash basis for nonaccrual
            loans. US GAAP requires that if the collectibility of the principal
            of the nonaccrual loan is in doubt, cash payments should be applied
            to reduce principal to the extent necessary to remove such doubt.
            Management believes that the effect of this difference in interest
            recognition is not material to the Bank's Statements of Income
            because loans in such condition are covered by adequate allowances.

                                      F-67

<PAGE>

                  BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 AND 1999

                         (Stated in thousands of pesos)


        b)  Loan Charge-Offs and Recoveries

            The Bank records recoveries on previously charged off loans directly
            in income and records the amounts of charged off loans in excess of
            amounts specifically allocated as a direct charge to the
            Consolidated Statements of Income. The Bank does not partially
            charge off troubled loans until final disposition of the loan,
            rather, the allowance is maintained on a loan by loan basis for its
            estimated settlement value. The banking industry practice in the
            United States is to account for all charge off and recovery activity
            when all or part of the loan is considered uncollectible. The Bank's
            practice does not affect the accompanying statements of income as
            the Bank's reserve contemplates all losses inherent in those
            troubled loans.

        c)  Impaired loans - Non financial public sector

            As mentioned in note 1, during the fiscal year ended December 31,
            2001, and as a consequence of Decree No. 1387/01, the Bank and its
            subsidiary, Santander Riobank (Grand Cayman), swapped part of their
            federal government securities and/or loans of the Federal Public
            Sector effective as of November 6, 2001, for a nominal value of USD
            1,084,480,968, receiving in consideration guaranteed loans in the
            amount of 1,105,865.

            As provided for by BCRA Communiques "A" 3366 and "A" 3385, the
            initial value of guaranteed loans coincided with the prior
            accounting value of federal government securities (classified and
            valued as "investment accounts" or "for trading or financial
            transactions", under BCRA accounting standards) and/or loans as of
            the date of the swap, giving rise to no income at all as a result of
            the recognition of the swap (See note 4.c).

            The abovementioned debt swap is subject to the provisions of SFAS
            No. 115 "Accounting for certain investments in debt securities". In
            accordance to SFAS No. 115 a non-temporary impairment affects the
            swapped obligations and therefore requires that, in the event of
            such obligations having been classified as "held to maturity", a
            loss be recorded for the difference between the book value of the
            obligation so swapped and its quotation at the date of the swap, as
            such quotation is understood to be the best measure for recognizing
            the abovementioned impairment. Once this impairment is recognized in
            the accounting, the new accounting value of the obligations to be
            swapped will consitute the initial value of the new loans received.

            The effect required to state such amounts swapped in accordance with
            US GAAP would be a decrease of 255,948 and 216,843 in Stockholders'
            Equity and net income as of December 31, 2001, respectively.

            On the other hand, as a consequence of the enactment of the Law on
            Public Emergency and Exchange System Reform and the suspension in
            payment of the public debt, the fulfillment of such obligations is
            conditioned by the Federal Treasury's lack of resources and the
            continuance of the fiscal deficit of municipal, provincial and
            federal public accounts, which inevitably resulted in significant
            public indebtness. Consequently, the Ministry of Economy has been
            empowered to enter into negotiations and adopt any necessary
            measures to restructure the debt of the Federal Government.

            To this respect, on February 27, 2002, the Federal Government and
            the provinces signed the Agreement on Financial Relations and bases
            for a Federal Tax Revenue-Sharing system whereby, among other
            provisions, the Federal Government is entrusted by provincial
            governments with the duty to renegotiate provincial public debts,
            which may be restructured under the same terms and conditions as the
            federal public debt and government securities.

                                      F-68

<PAGE>

                  BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 AND 1999

                         (Stated in thousands of pesos)


            Moreover, the Bank has presented before Banco de la Nacion
            Argentina, in its capacity as fiduciary agent of the Fiduciary Fund
            for Provincial Development, provincial government securities and
            loans granted to the Provincial Public Sector with a nominal value
            of USD 586,365,448 to execute the swap established by Decree No.
            1387/01 which, to date, has not yet been documented. Such
            transaction has been recorded as "Loans to the non-financial public
            sector" in such amount plus the related interest accrued and pending
            as of December 31, 2001, under the provisions of Decree No. 1387/01.

            Considering the issues mentioned above, an impairment does affect
            such government securities and credit facilities to non financial
            public sector and a loss must therefore be recorded according to US
            GAAP for the difference between their accounting value and the
            expected value of future cash flows.

            The effect of adjustments required to state such amounts in
            accordance with US GAAP would be a decrease approximate of 770,365
            in Stockholders' Equity and net income as of December 31, 2001,
            respectively.

        d)  Impaired loans - Non financial private sector and residents abroad

            Under US GAAP, SFAS No. 114, "Accounting by Creditors for Impairment
            of a Loan" and SFAS No. 118 "Accounting by Creditors for Impairment
            of a Loan - Income Recognition and Disclosures", require a creditor
            to measure impairment of a loan based on the present value of
            expected future cash flows discounted at the loan's effective
            interest rate or at the loan's observable market price or the fair
            value of the collateral, if the loan is collateral dependent. This
            Statement is applicable to all loans (including those restructured
            in a troubled debt restructuring involving modification of terms)
            except large groups of smaller-balance homogeneous loans that are
            collectively evaluated for impairment. The Bank considers commercial
            loans over Ps. 200 thousand for individual impairment evaluations.
            Loans are considered impaired when, based on management's
            evaluation, a borrower will not be able to fulfill its obligation
            under the original terms of the loan. In the opinion of the Bank's
            management, the effect on the Bank's financial position or results
            of operations is not material.

            The following table discloses the amounts required by SFAS No. 114,
            as of December 31, 2001 and 2000:

                                                     2001           2000
                                                  -----------    -----------

             - Amounts of loans considered
               as impairment                        268,203        326,026
             - Reserves allocated to impaired
               loans booked under BCRA
               accounting standards                 178,858        190,168


            The Bank has primarily relied upon its historical assessment of the
            credit quality of its customers without risk adjusting such
            estimation for the risk solely attributable to the economic
            disruption currently being experienced in Argentina. Argentina's
            economy is currently suffering from a disruption in traditional
            systems of payment due to a severe shortage of liquidity in the
            marketplace. The shortage of cash and resulting scarcity of working
            capital has contributed to a severe contraction of customary trade
            credit which in turn has brought many commercial activities to a
            standstill. The disruption of the payment system has had a
            particularly significant impact on Argentina's cash-based informal
            economy and those who depend on it. The scarcity of liquidity in the
            financial system is likely to adversely affect our normal cash
            collections and the overall asset quality of our loan portfolio.

                                      F-69

<PAGE>

                  BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 AND 1999

                         (Stated in thousands of pesos)


30.7.   Government securities portfolio and forward purchases of government
        securities under repurchase agreements held in investment accounts

        As required by Central Bank Communique "A" 3278 and "A" 3039, and
        supplementary regulations, as of December 31, 2001 and 2000, the Bank
        holds securities in investment accounts that are valued as mentioned in
        notes 4.b) and 4.g) above.

        SFAS No. 115 "Accounting for Certain Investments in Debt and Equity
        Securities" requires that the institution retain securities through
        maturity to classify them as investment securities. Since the Bank could
        trade these securities at any time, under US GAAP, they should be
        classified as "Available for sale".

        The effect required to state such amounts in accordance with US GAAP
        would be an increase of 296 and a decrease of 39,105 and 34,308 in
        government securities and forward purchases of government securities
        under repurchase agreements and in Stockholders' Equity under
        "Unrealized loss on available for sale securities" as of December 31,
        2001, 2000 and 1999, respectively, and a decrease of 19,423 and an
        increase of 12,774 and 26,782 in net income as of December 31, 2001,
        2000 and 1999, respectively.

30.8.   Government securities portfolio held in "available for sale"

        As required by Central Bank Communique "A" 2266 and supplementary
        regulations, as from beginning of fiscal year ended December 31, 1999
        until February 28, 1999, the Bank held securities in "available for sale
        accounts" that are valued at the market price of each security at each
        year-end. Any difference between year-end market price and acquisition
        cost increased by accruing a compound internal rate of return over the
        period elapsed since the acquisition date were recorded in Stockholders'
        equity as an "Unrealized Valuation Difference". In order for these
        securities to classify as "available for sale", they are required to be
        kept in assets for at least three months.

        SFAS No. 115 "Accounting for Certain Investments in Debt and Equity
        Securities" addresses the accounting and reporting for securities
        classified as available for sale securities. Under such standard, these
        securities are accounted for at market value and any difference between
        year-end market price and acquisition cost is to be recorded under
        Stockholders' Equity as an "Unrealized gain/loss on available for sale
        securities".

        The effect of stating such amounts in accordance with US GAAP would be a
        decrease of 4,612 in net income as of December 31, 1999.

30.9.   Translation of Foreign Currency Statements

        As further described in note 3.2., the foreign branch and the subsidiary
        of the Bank, Santander Riobank (Grand Cayman), maintain their primary
        accounting records in US dollars instead of the Argentine Peso. Pursuant
        to US GAAP set forth in SFAS No. 52, remeasurement of foreign currency
        statements of the Bank's non Peso operations is required. For purposes
        of this remeasurement, an exchange rate as of the Balance Sheet date is
        used for assets and liabilities and a weighted average exchange rate for
        the period is used for revenue and expenses. Procedures followed by the
        Bank pursuant to the rules of the Central Bank as described in note
        3.2.a) (See note 30.17.) result in substantially the same reporting as
        required under US GAAP, because of the management estimates these
        differences have not material effect on the consolidated financial
        statements.

                                      F-70

<PAGE>

                  BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 AND 1999

                         (Stated in thousands of pesos)


30.10.  Items in Process of Collection and Due from customers on acceptances

        The Bank does not give accounting recognition to checks drawn on the
        Bank or other banks, or other items to be collected or accepted until
        such time as the related item clears or is accepted. Such items are
        recorded by the Bank in memorandum accounts. US banks, however, account
        for such items through Balance Sheet clearing accounts at the time the
        items are presented to the Bank.

        The Bank's assets and liabilities would be increased by approximately
        631,536 and 630,528 had US GAAP been applied as of December 31, 2001 and
        2000, respectively.

        The same effect would be displayed in the balance sheet disclosure
        requirements in accordance with Regulation S-X (See note 24).

30.11.  Forward Contracts in Securities and Foreign Currency

        The Bank accounts for purchase and sale forward contracts on a different
        basis from that required under US GAAP.

        For forward foreign exchange contracts and spot exchange transactions
        pending settlement, the Bank will recognize, at the time of the
        agreement, a receivable and payable which reflects the amount of cash
        and securities or currencies to be exchanged at the closing date. The
        receivable or payable representing the receipt or delivery of securities
        or currencies is stated at the quoted market value of such securities or
        currencies. In the United States, accounting for forward foreign
        exchange contracts and futures contracts is governed by SFAS No. 52,
        "Foreign Currency Translation" and SFAS No. 80, "Accounting for Futures
        Contracts", respectively. Under either standard, entities would not
        recognize a receivable or payable but would recognize the difference
        between the change in market price of the securities or currencies to be
        received if the transaction did not qualify as a hedge.

        The Bank's assets and liabilities would be decreased by approximately
        453,472 and 2,138,736 had US GAAP been applied as of December 31, 2001
        and 2000, respectively.

        The same effect would be displayed in the balance sheet disclosure
        requirements in accordance with Regulation S-X (See note 24).

30.12.  Appraisal Revaluation

        As described in note 4.m), an appraisal revaluation of bank premises and
        equipment was made in 1981 to eliminate relative price distortions
        generated by the high inflation then prevailing in Argentina. This
        revaluation was recorded in the Adjustments to Stockholders' equity
        account. When an asset which has been revalued is sold at a loss, the
        loss is recorded directly to Adjustments to Stockholders' equity to the
        extent of the original revaluation. Under US GAAP, the appraisal
        revaluation is considered to be a permanent addition to equity and,
        accordingly, any loss on the sale of an asset which was revalued should
        be reflected in net income.

        There has been no sale of revalued assets during the fiscal years ended
        December 31, 2001, 2000 and 1999. Consequently, the balance related to
        the previously mentioned revaluation included in the "Adjustments to
        Stockholders' Equity" account has not been modified.

                                      F-71

<PAGE>

                   BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 AND 1999

                         (Stated in thousands of pesos)

30.13.   Intangible assets

         The Bank amortizes administrative and systems reorganization done by
         third parties, and telephone exchange installation and reconfiguration
         (included in organization and development expenses) over their
         estimated useful life, up to a maximum of 60 months. US GAAP requires
         that administrative and systems reorganization done by third parties be
         charged off to income when incurred.

         The effect required to state such amounts in accordance with US GAAP
         would be a decrease of 31,861, 32,464 and 36,981 in Stockholders'
         Equity and an increase of 603, 4,517 and 3,155 in net income as of
         December 31, 2001, 2000 and 1999, respectively.

30.14.   Earnings per share

         In February 1997, the Financial Accounting Standards Board (FASB)
         issued Statement No. 128, "Earnings per share", which effective for
         interim financial information and annual financial statements with
         periods ending after December 15, 1997. SFAS No. 128 supersedes APB 15
         and its interpretations. It applies to companies with publicly traded
         common stock or potential common stock and establishes a new
         methodology for reporting earnings per share. It requires that
         entities with simple capital structures present basic per share
         amounts for income for continuing operations and net income on the
         face of the income statement. All other entities subject to SFAS No.
         128 must present basic and diluted per-share amounts for income from
         continuing operations and net income on the face of the income
         statement, regardless of the magnitude of their difference.

30.15.   Reporting on Comprehensive Income

         SFAS No. 130 "Reporting on Comprehensive Income" requires entities to
         report a measure of all changes in equity of an enterprise that result
         from transactions and other economic events of the period other than
         transactions with owners ("comprehensive income"). Comprehensive income
         is the total of net income and all other nonowner changes in equity.
         This statement, which is effective for fiscal years beginning after
         December 15, 1997, requires that comprehensive income be reported in a
         financial statement that is displayed with the same prominence as other
         financial statements with an aggregate amount of comprehensive income
         reported in that same financial statement.

         As of December 31, 2001, 2000 and 1999, the comprehensive income
         balance includes unrealized gains and losses on investments securities,
         and related tax effects. The following represents accumulated
         comprehensive income balances as of December 31, 2001, 2000 and 1999:

<TABLE>
<CAPTION>
                                                             Accumulated comprehensive income
                                                            ----------------------------------
                                                            Before          Tax          Net
                                                              Tax        (expense)      of tax
                                                            Amount      or benefit      amount
                                                            ------      ----------      ------
         <S>                                                <C>         <C>             <C>
         Balance as of December 31, 1998                     3,385        (1,185)        2,200

         Unrealized loss arising during period              (1,582)          554        (1,028)

         Less:  reclassification adjustment for loss
         realized in net income                             (3,655)        1,279        (2,376)
                                                            ------      --------       -------
         Balance as of December 31, 1999                    (1,852)          648        (1,204)
</TABLE>

                                      F-72

<PAGE>

                   BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 AND 1999

                         (Stated in thousands of pesos)

<TABLE>
<CAPTION>
                                                          Accumulated comprehensive income (Cont'd)
                                                          -----------------------------------------
                                                           Before            Tax             Net
                                                             Tax          (expense)         of tax
                                                           Amount        or benefit         amount
                                                          --------       ----------        --------

         <S>                                              <C>            <C>               <C>
         Balance as of December 31, 1999                    (1,852)            648          (1,204)

         Unrealized loss arising during period             (17,571)          6,150         (11,421)

         Less: reclassification adjustment for loss
         realized in net income                                  -               -               -
                                                          --------       ---------         -------
         Balance as of December 31, 2000                   (19,423)          6,798         (12,625)

         Unrealized gain arising during period                 296            (103)            193

         Plus: reclassification adjustment for loss
         realized in net income                             19,423          (6,798)         12,625
                                                          --------       ---------         -------
         Balance as of December 31, 2001                       296            (103)            193
                                                          ========       =========         =======

</TABLE>

30.16.   Accounting for Derivate Instruments and Hedging Activities

         In June 1998, the U.S. Financial Accounting Standards Board Standards
         Board issued SFAS No. 133 "Accounting for Derivative Instruments and
         Hedging Activities". This statement as subsequently amended by SFAS No.
         137 and 138 is required to be adopted for reporting under U.S.
         generally accepted accounting principles for all fiscal years beginning
         after June 15, 2000.

         SFAS No. 133 establishes accounting and reporting standards for
         derivative instruments, including certain derivative instruments
         embedded in other contracts (collectively referred to as derivatives)
         and for hedging activities. It requires that an entity recognize all
         derivatives as either assets of liabilities in the statement of
         financial position and measure those instruments at fair value. If
         certain conditions are met, a derivative may be specifically designated
         as (a) a hedge of the exposure to changes in the fair value of a
         recognized asset or liability or an unrecognized firm commitment, (b) a
         hedge of the exposure to variable cash flows of a forecasted
         transaction, or (c) a hedge of the foreign currency exposure of a net
         investment in a foreign operation, an unrecognized firm commitment, an
         available for sale security, or a foreign currency denominated
         forecasted transaction.

         Among other provisions, SFAS No. 133 requires that for a transaction to
         qualify for special hedge accounting treatment the transaction must
         meet specific test of high correlation and all hedge ineffectiveness is
         required to be reported currently in computation of net income. SFAS
         No. 133 further requires the identification of assets, liabilities or
         anticipated transactions being hedged and periodic revaluation of such
         hedged positions to reflect the changes in market value of risk being
         hedged. SFAS No. 133 further expands the definition of derivatives to
         include certain contacts or provisions commonly embedded in contracts
         or financial instruments and requires that such derivatives be reported
         at fair value.

         In note 26, it is explained, the derivatives instruments used by the
         Bank to cover their variable yield and the valuation method of these
         instruments were explained in notes 4.p) and 4.q). Such derivatives
         instruments has been valued at their fair value and the differences
         between these fair value have been credited/charged to income for the
         fiscal year ended as of December 31, 2001.

                                      F-73

<PAGE>

                   BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 AND 1999

                         (Stated in thousands of pesos)

30.17.   Foreign exchange difference

         Under Argentine generally accepted accounting principles the effects of
         the devaluation of Argentine peso described in note 1 on the valuation
         in Argentine pesos of assets and liabilities should be recognized in
         the fiscal year ending as of December 31, 2002 (See note 1). Under US
         GAAP, the exchange rate effective as of the date of reopened of the
         foreign exchange market (January 11, 2002 - See note 1.1.) should be
         used for the valuation in Argentine pesos of foreign currency assets
         and liabilities as of December 31, 2001.

         The effect required to state such assets and liabilities in accordance
         with US GAAP would be an increase of 12,954 in Stockholders' Equity and
         net income as of December 31, 2001, respectively.

         As mentioned in note 1, on January 6, 2002, the National Congress
         introduced deep changes to the economic framework. These changes
         included, together with the peso devaluation, that certain debts
         towards the financial sector originally denominated in US dollars and
         outstanding as of December 31, 2001, at the exchange rate of ARS 1 =
         US$ 1. Afterwards, the Federal Executive was authorized to adopt the
         measures to compensate any unbalances caused to the financial entities
         as a result of the abovementioned events.

         Subsequently, through Decrees No. 214/02 of February 3, 2002, and No.
         410/02 of March 1, 2002, the Federal Executive took, among others, the
         following measures:

         a)  The switch into pesos of all obligations, whatever their cause or
             origin, to deliver sums of money stipulated in US dollars or any
             other foreign currency outstanding of the date of enactment of Law
             No. 25,561, with the exceptions, mainly, of financing related to
             foreign trade granted by financial institutions, and the private
             and government sectors' obligations to deliver sums to which
             foreign law is applicable;

         b)  The switch into pesos of all deposits with all financial
             institutions stipulated in US dollars or other foreign currencies
             at an exchange rate of ARS 1.4 to each US dollar, or its equivalent
             in other currencies;

         c)  The switch into pesos of all debts towards financial institutions
             stipulated in US dollars or other foreign currencies, whatever the
             amount or nature, at the exchange rate of ARS 1 to each US dollar,
             or its equivalent in other currencies;

         The BCRA will define a procedure to compensate the adverse effects on
         equity resulting from switching into pesos (at different exchange
         rates) the receivables and payables denominated in foreign currency and
         to cover the negative difference in the net position of assets and
         liabilities denominated in foreign currency resulting from their switch
         into pesos.

         Although the propose of the government Bonds are to offset the
         imbalance in the banking system resulting from the exchange difference
         stemming from the switch into Argentine pesos of the deposits with, and
         debts owed to, the banking system, the regulations from the BCRA, which
         will establish the methodology, calculation and the specific treatment
         for balances in foreign currency to be converted into pesos, have not
         yet been issued. Accordingly the Bank is unable to estimate the
         ultimate net impact the devaluation and conversion of assets and
         liabilities in foreign currency will have on the financial position of
         the Bank.

30.18.   Reconciliation of Net Income and Stockholders' Equity

         The following is a summary of the significant adjustments to net income
         for the fiscal years ended December 31, 2001, 2000 and 1999 and to
         Stockholders' Equity as of these dates which would be required had US
         GAAP been applied instead of Central Bank regulations in the financial
         statements, except for the exclusion of any adjustment to remove the
         impact of inflation, as allowed under Item 18 of Form 20-F of SEC
         Regulation S-X.

                                      F-74

<PAGE>

                  BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 AND 1999

                         (Stated in thousands of pesos)


<TABLE>
<CAPTION>
                                                                                            December 31,
                                                                              ---------------------------------------
                                                                     Note          2001         2000         1999
                                                                   --------   -------------  -----------  -----------
      <S>                                                          <C>        <C>            <C>          <C>
      CONSOLIDATED NET INCOME AND
      COMPREHENSIVE INCOME

      Net income according to the Central Bank regulations:
      -   Banco Rio de la Plata S.A.                                  -           (10,208)     207,593      119,168
      -   Banco Tornquist S.A.                                        -              -            -        (190,374)

      Merger with Banco Santander S.A. of Argentina:
      -   Impairment and amortization of goodwill                    30.1        (416,935)     (24,542)     (24,542)

      Merger with Banco Tornquist S.A.:
      -   Loan fees                                                  30.5            -            -          (1,134)
      -   Credit card costs                                          30.5            -            -              11
      -   Government securities held in available for sale           30.8            -            -            (957)
      -   Other receivables                                           -              -            -             129
      -   Intangible assets                                         30.13            -            -           3,045
      -   Deferred tax assets                                        30.4            -            -          61,869

      Banco Rio's effects - Increase (decrease) due to (*):

      Loan origination fees and costs:
          Loan fees                                                  30.5         (14,149)     (29,365)        (296)
          Credit card fees                                           30.5          (6,152)     (22,888)           8
          Credit card costs                                          30.5             439        6,253        3,333
          Acceptances fees                                           30.5            (209)         119         (217)

      Government securities held in investment accounts
      (available for sale in accordance with US GAAP) and
      adjustment in government securities held in investment
      accounts (in accordance with Central Bank regulations) to
      exceed the limit of 120% of market value (See note 4.b) as
      of December 31, 2000)                                          30.7         (19,423)      12,774       26,782

      Government securities held in available-for-sale accounts      30.8            -            -          (3,655)

      Impaired loans to the non financial public sector
      as of the date of the swap                                     30.6.c)     (216,843)        -            -

      Approximate impaired to the non financial public sector        30.6.c)     (770,365)        -            -

      Intangible assets                                             30.13             603        4,517          110

      Foreign exchange difference                                   30.17          12,954         -            -

      Deferred tax liabilities                                       30.4         (53,939)     (41,478)        -
                                                                               -----------    ---------   ----------
      Approximate net income (loss) in accordance with US GAAP                 (1,494,227)     112,983       (6,720)
                                                                               -----------    ---------   ----------
      Other comprehensive income (loss), net of tax
      -   Unrealized gain (loss) on investment securities           30.15             193      (11,421)      (1,028)
                                                                               -----------    ---------   ----------
      Approximate comprehensive net income (loss)
      in accordance with US GAAP                                               (1,494,034)     101,562       (7,748)
                                                                               ===========    =========   ==========
      Approximate net income (loss) per share
      in accordance with US GAAP                                    30.14           (4.31)        0.33        (0.02)
                                                                               -----------    ---------   ----------
      Average number outstanding shares (in thousands)                            346,742      341,005      335,268
                                                                               ===========    =========   ==========
</TABLE>

                                      F-75

<PAGE>

                  BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 AND 1999

                         (Stated in thousands of pesos)


<TABLE>
<CAPTION>
                                                                                                   December 31,
                                                                                       -------------------------------------
                                                                              Note         2001        2000         1999
                                                                           ----------  ------------ ------------ -----------
          <S>                                                              <C>         <C>          <C>          <C>
          CONSOLIDATED STOCKHOLDERS' EQUITY

          Stockholders' Equity according to Central Bank regulations:
          -   Banco Rio de la Plata S.A.                                       -         1,061,468    1,339,648   1,205,554
          -   Banco Tornquist S.A.                                             -            -            -           17,251

          Merger with Banco Santander S.A. of Argentina:

          -   Goodwill in accordance with US GAAP, net of
              amortization                                                    30.1          -           416,935     441,477

          Merger with Banco Tornquist S.A.:

          -   Loan origination fees and costs                                  30.5         -            -           (4,726)
          -   Unrealized gain (loss) on available-for-sale securities          30.7         -            -           (1,852)
          -   Deferred tax asset                                               30.4         -            -           86,651

          Banco Rio's effects (*)

          -   Loan origination fees and costs                                  30.5        (77,652)     (57,581)     (6,974)
          -   Unrealized loss on available-for-sale securities and
              adjustment in government securities held in investment
              accounts (in accordance with Central Bank regulations)
              to exceed the limit of 120% of market value (See note
              4.b) as of December 31, 2000)                                    30.7            296      (39,105)    (32,456)
          -   Impaired loans to the non financial public sector
              as of the date of the swap                                       30.6.c)    (255,948)      -            -
              Approximate impaired loans to the non financial public           30.6.c)                                -
              sector                                                                      (770,365)      -
          -   Intangible assets                                               30.13        (31,861)     (32,464)    (36,981)
          -   Foreign exchange difference                                     30.17         12,954       -            -
          -   Deferred tax asset (liabilities)                                 30.4        (15,503)      45,173       -
                                                                                        -----------  -----------  ----------
          Approximate consolidated stockholders' equity
          in accordance with US GAAP                                                       (76,611)   1,672,606   1,667,944
                                                                                        ===========  ===========  ==========
</TABLE>

          (*) As of December 31, 2000, as a consequence of merger mentioned in
          note 2.1. "Merger with Banco Tornquist S.A." the adjustments to net
          income and stockholders' equity includes the Banco Rio's and the
          former Banco Tornquist S.A.'s effects.

31.   SUBSEQUENT EVENTS

      31.1.   Recent events on macreoceonomic situation

              After April 26, 2002, certain relevant events occurred, which
              include:

              -    Publication of Law No. 25,587, which establishes the
                   limitations to the precautionary measures that may be adopted
                   by courts in relation to the deposits subject to Law No.
                   25,561 as amended. Subject to certain exceptions, the law
                   provides that: (a) such precautionary measures may not entail
                   providing the deposited funds to the petitioner, and (b) the
                   effect of all motions brought against such measures shall be
                   suspensive; that is to say, they shall not be enforced until
                   they become final for lack of appeal or, as the case may be,
                   until such measures are not confirmed by the related
                   appellate court.

                                      F-76

<PAGE>

                  BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                       AS OF DECEMBER 31, 2001, 2000 AND 1999

                         (Stated in thousands of pesos)

         On June 1, 2002, the Federal Executive issued Decree No. 905/02, which
         provides as follows:

         a)         A new voluntary swap of rescheduled deposits for bonds
                    secured by the Argentine Treasury, subject to conditions
                    more advantageous than those provided by Decree No. 494/02
                    and 620/02.

         b)         In exchange for these securities which shall be delivered in
                    payment to depositors, financial entities will receive
                    prepayments from the BCRA, which shall be secured by the
                    public debt securities such entities hold or, otherwise, by
                    assigning their prime loan portfolio, including stock, so
                    that under the obligations assumed for the benefit of
                    depositors, the global indebtness of the public sector does
                    not rise.

         c)         In the case of failure to pay principal and interest by the
                    Federal Government for a term longer than 30 days as from
                    the related maturity of the bonds to be issued or the
                    secured loans, each financial institution shall be entitled
                    to settle in advance all or part of the prepayments received
                    for subscribing the bonds included in point (a) above. For
                    such purpose, all or the equivalent part of the assets
                    provided as security, as applicable, shall be used and
                    considered at their registration value (under BCRA rules) at
                    the time the prepayment was made, plus any accrued amount as
                    of the date of settlement, net of the amount effectively
                    paid off.

         d)         Should the Federal Government fail to meet the terms and
                    conditions upon total or partial amortization of the bonds
                    mentioned in point (a) above, such bonds or the unpaid
                    partial amortization coupons may be used for paying off
                    federal taxes.

         e)         The bonds mentioned in point (a) above shall be issued to
                    compensate financial institutions fully, definitively and
                    for a single time, for the negative equity effects as a
                    result of converting into Argentine pesos foreign currency
                    receivables and payables at different exchange rates, and
                    the amounts necessary to compensate such institutions for
                    the negative net position in foreign currency resulting from
                    such conversion into Argentine pesos.

         f)         For the sole purpose of calculating the compensation, the
                    loans secured by the Federal Government shall be included as
                    assets at the value, at which they had been booked by the
                    foreign branches and affiliates of local financial
                    institutions as of December 31, 2001.

         g)         For the rescheduled deposits that have not been subject to
                    the option contained in (a) above, the related system will
                    remain effective. Rescheduled deposits shall be negotiable
                    securities, and will be traded publicly and negotiable in
                    Argentine self-regulated markets. Additionally, rescheduled
                    deposits may be used to settle loans granted by the same
                    financial institution with which such funds are deposited
                    for a term equal or longer than the related rescheduled
                    deposit.

31.2.    Impact of these new measures on the Bank's particular situation

         On May 22, 2002, the Bank accepted the amendments to the terms and
         conditions of the secured loans imposed by Decree No. 1646/01,
         which consist basically in the converting into Argentine pesos of
         the secured loans originally denominated in US dollars, the new
         interest rates and the possible modification of the security based
         on the new agreement entered into by the Federal and the Provincial
         governments on February 27, 2002. Moreover, all other rights under
         the secured loan agreements remain effective, including the
         possibility of compensating unpaid principal and interest balances
         with the Bank's tax obligations deriving from tax amounts provided
         as security for such loans.

                                      F-77

<PAGE>

                   BANCO RIO DE LA PLATA S.A. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     AS OF DECEMBER 31, 2001, 2000 AND 1999

                         (Stated in thousands of pesos)

         As mentioned in note 16.c), after December 31, 2001, i.e.
         subsequent to fiscal year, the Bank issued the fortieth,
         forty-second, and forty-third series of Corporate Bonds for a total
         amount of US$ 270 million, within the Short-term Corporate Bonds
         Global Issuance Program for an amount of US$ 500 million. In
         addition, on April 11, 2002, the Bank issued the eighth series of
         Corporate Bonds for a total amount of ARS 26 million within the
         Short- and Medium-Term Corporate Bonds Global Issuance Program for
         a total amount of US$ 1 billion. As of the date of these
         consolidated financial statements, the Bank continues with their
         operations without generating the noncompliance of their corporate
         bonds. The Bank has renovated their corporate bonds. As mentioned
         in note 16, in accordance to deteriorating liquidity position of
         the financial markets the Bank anticipates that it may not able to
         obtain the financing it needs during calendar 2002 to repay its
         foreign debt pursuant to its original terms. In addition, the Bank
         must obtain the Argentine Central Bank's approval to convert pesos
         into dollars and transfer funds abroad in order to make principal
         and interest payments on such debt.

31.3.    Merger with Origenes Vivienda y Consumo Compania Financiera S.A.
         (former Origenes Vivienda S.A.) and sale of Santander Riobank (Grand
         Cayman)

         On January 3, 2002, controlling shareholders of Banco Rio de la
         Plata S.A. and Origenes Vivienda y Consumo Compania Financiera S.A.
         (former Origenes Vivienda S.A., company fully and indirectly
         controlled by SCH Group) signed an agreement to merge both
         companies, whereby all transactions of the absorbed company,
         Origenes Vivienda y Consumo Compania Financiera S.A., are assumed
         by the absorbing company, Banco Rio de la Plata S.A. Such merger
         will be retroactively effective for legal purposes as from January
         1, 2002, upon approval by the related oversight authorities.
         Management believes that the effect of this merger does not have a
         material impact on the Bank consolidated financial condition or
         results of operations.

         On the other hand, on January 4, 2002, an agreement was signed for
         the purchase of Santander Riobank (Grand Cayman)'s stock, whereby
         Banco Rio de la Plata S.A. sells Santander Overseas Bank Inc. its
         100% equity interest on Santander Riobank (Grand Cayman). The gain
         (loss) resulting from selling off Santander Riobank (Grand Cayman)
         was immaterial.

These new events, in addition to other special actions currently implemented by
the Bank, are part of a plan to enable the Bank to continue operating and to
comply with BCRA liquidity and cash requirements.

                                      F-78

<PAGE>

                                   SIGNATURES

         Pursuant to requirements of Section 12 of the Securities Exchange Act
of 1934, the Registrant certifies that it meets all of the requirements for
filing Form 20-F and has duly caused this Annual Report to be signed on its
behalf by the undersigned, thereunto duly authorized.


                                  BANCO RIO DE LA PLATA S.A.



                                  By:       /s/ Angel O. Agallano
                                       ---------------------------
                                         Name:  Angel O. Agallano
                                         Title: Principal Accounting Officer



                                  By:       /s/ Jose Luis Enrique Cristofani
                                       ----------------------------------------
                                         Name:  Jose Luis Enrique Cristofani
                                         Title: General Manager

Date: June 30, 2002

<PAGE>

                                  EXHIBIT INDEX

   EXHIBIT NO.        EXHIBIT DESCRIPTION
   -----------        -------------------

       99             Letter to Securities and Exchange Commission regarding
                      representations made by Pistrelli Diaz y Asociados, member
                      of Andersen.