Banco Bilbao Vizcaya Argentaria, S.a. · BME:BBVA
Banco Bilbao Vizcaya Argentaria — Q2 2024 Earnings Presentation
64 slides from Banco Bilbao Vizcaya Argentaria's earnings presentation, Jul 31, 2024
Slide 1: 2Q24 Earnings
BBVA 2Q24 Earnings July 31, 2024
Slide 2: Disclaimer
2Q24 Earnings 2 Disclaimer This document is only provided for information purposes and is not intended to provide financial advice and, therefore, does not constitute, nor should it be interpreted as, an offer to sell, exchange or acquire, or an invitation for offers to acquire securities issued by a
Slide 3: BBVA once again reports a remarkable quarter
2Q24 Earnings 3 BBVA once again reports a remarkable quarter NET ATTRIBUTABLE PROFIT TBV + DIVIDENDS (CURRENT €M) (€ / SHARE2) +38% +20% +27.0% +2.4% 9.17 9.39 7.84 0.553 0.553 8.62 8.84 2Q23 1Q24 2Q24 2Q23 1Q24 2Q24 EPS (€)1 0.33 0.36 0.47 TBV / share Dividends / share (2) Total number of shares co
Slide 4: Solid capital position and outstanding profitability metrics
2Q24 Earnings 4 Solid capital position and outstanding profitability metrics CET1 RATIO PROFITABILITY METRICS (%) (%) ROTE -7bps 20.0 12.82% 12.75% Target Range 11.5%-12.0% SREP Requirement ROE 19.1 9.11% Mar-24 Jun-24 6M23 2023 6M24
Slide 5: Highly consistent improvement of profitability over years
2Q24 Earnings 5 Highly consistent improvement of profitability over years NET ATTRIBUTABLE PROFIT ROTE (CURRENT €M) (%) 20.0 4,994 17.7 3,878 17.0 2,957 14.7 European 13.1 13.3 Peers (1) 1,911 11.2 12.9 Spanish 12.4 Peers (2) 9.8 9.5 7.9 9.3 3M 6M 6M21 6M22 6M23 6M24 2021 2022 2023 2024 (1) European
Slide 6: 2Q24 key messages
2Q24 Earnings 6 2Q24 key messages CORE REVENUES (NII+FEES) TOTAL LOAN GROWTH1 OUTSTANDING CORE REVENUES +23.4% +17.6% +10.7% +6.3% 1 AND SOLID ACTIVITY GROWTH CONSTANT CURRENT CONSTANT CURRENT vs. 6M23 vs. JUN 2023 EFFICIENCY RATIO LEADING AND IMPROVING 2 EFFICIENCY WITH POSITIVE JAWS 39.3% 6M24 -36
Slide 7: 2Q24 Profit & Loss
2Q24 Earnings 7 2Q24 Profit & Loss BBVA GROUP (€M) Change Change 2Q24/2Q23 2Q24/1Q24 2Q24 % constant % % constant % Net Interest Income 6,481 17 12 1 0 Net Fees and Commissions 1,955 35 33 4 4 Net Trading Income 1,114 247 233 47 44 Other Income & Expenses -324 26 -15 -66 -66 Gross Income 9,227 31 28
Slide 8: 6M24 Profit & Loss
2Q24 Earnings 8 6M24 Profit & Loss BBVA GROUP (€M) Change 6M24/6M23 6M24 % constant % Net Interest Income 12,993 20 14 Net Fees and Commissions 3,842 35 32 Net Trading Income 1,886 183 144 Other Income & Expenses -1,276 36 35 Gross Income 17,446 31 23 Operating Expenses -6,859 20 16 Operating Income
Slide 9: Excellent revenue growth following a remarkable trend
2Q24 Earnings 9 Excellent revenue growth following a remarkable trend NET INTEREST INCOME NET FEES AND COMMISSIONS (CONSTANT €M) (CONSTANT €M) +17% +35% +1.0% +4.4% Strong NII growth Outstanding fee driven by activity income evolution and customer levered on spreads payments and asset management bus
Slide 10: Sound gross income performance across the board
2Q24 Earnings 10 Sound gross income performance across the board SPAIN MEXICO (CURRENT €M) (CURRENT €M) +29% +14% +14.0% -0.6% 2Q23 3Q23 4Q23 1Q24 2Q24 2Q23 3Q23 4Q23 1Q24 2Q24 TURKEY SOUTH AMERICA (CURRENT €M) (CURRENT €M) +16% +47% +19.8% +10.8% 2Q23 3Q23 4Q23 1Q24 2Q24 2Q23 3Q23 4Q23 1Q24 2Q24
Slide 11: Strong performance in Spain and Mexico supported by activity growth
2Q24 Earnings 11 Strong performance in Spain and Mexico will continue to be supported by activity growth TOTAL LOAN GROWTH (YOY, CONSTANT €) TOTAL LOAN GROWTH KEY SEGMENTS (YOY, CURRENT €) (YOY JUN’24, CURRENT €) SPAIN BBVA GROUP +8.3% +5.5% Consumer + Mid-sized Jun’23 Sep’23 Dec’23 Mar’24 Jun’24 Cr
Slide 12: Positive jaws and further improving industry-leading efficiency
2Q24 Earnings 12 Positive jaws and further improving industry-leading efficiency POSITIVE JAWS EFFICIENCY RATIO (6M24 YOY, CONSTANT €) (COST-TO-INCOME, % CONSTANT €) FOOTPRINT -362 bps INFLATION1 +30.5% 21.3% 12M AVERAGE +19.5% 39.3 Gross Operating 6M23 6M24 Income Expenses (1) Weighted by operating
Slide 13: Asset quality within expectations, in a context of strong activity growth
2Q24 Earnings 13 Asset quality within expectations, in a context of strong activity growth FINANCIAL ASSETS IMPAIRMENTS NPL (CONSTANT €M) (€BN) 2Q23 3Q23 4Q23 1Q24 2Q24 Jun-23 Sep-23 Dec-23 Mar-24 Jun-24 COST OF RISK NPL & COVERAGE RATIOS (%, YTD) (%) COVERAGE NPL 6M23 9M23 12M23 3M24 6M24 Jun-23 Se
Slide 14: Sound capital position above our target
2Q24 Earnings 14 Sound capital position above our target CET1 RATIO (%, BPS) Very preliminary estimate for +73 bps -39 bps Basel IV impact -40 bps reduces from 12.82% -1 bps 12.75% below -40 bps to below -15 bps -23bps market impact Target Range 11.5%-12.0% SREP Requirement 9.11% Dividend RWAs Mar -
Slide 15: Excellent customer acquisition driven by digital
2Q24 Earnings 15 Excellent customer acquisition driven by digital NEW CUSTOMERS1 (BBVA GROUP, MILLION; % ACQUISITION THROUGH DIGITAL CHANNELS) DIGITAL 67% TOTAL DIGITAL 20% 6M19 6M20 6M21 6M22 6M23 6M24 (1) Gross customer acquisition through own channels for retail segment. Excludes the US business
Slide 16: Advancing in sustainable business
2Q24 Earnings 16 Advancing in sustainable business SUSTAINABLE BUSINESS (€ BN, ACCUMULATED DATA SINCE 2018) €46 Bn BY SEGMENT channeled in 6M24 (€ BN) New target (2022) YoY 300 €Bn growth €252 Bn 46 +37% Channeled since 2018 Revised target 5.3 Retail +12% (2021) 200 €Bn 34 4.8 15.8 Enterprises +57%
Slide 17: Positive impact on society through our activity
2Q24 Earnings 17 Positive impact on society through our activity BBVA GROUP LOAN GROWTH1 +10.7(YOY, CONSTANT €) % +6.3% (YOY, CURRENT €) INCLUSIVE GROWTH FINANCING 75,000 340,000 70,000 11 €Bn MOBILIZED IN 6M24 FAMILIES BOUGHT SMEs AND LARGER THEIR HOME2 SELF - EMPLOYED CORPORATES BOOSTED THEIR INVE
Slide 18: We will clearly outperform our ambitious 2021-2024 goals
2Q24 Earnings 18 We will clearly outperform our ambitious 2021-2024 goals COST-TO-INCOME ROTE1 TBV + DIVIDENDS (%) (%, ANNUALIZED) (€/SHARE, %) CAGR 2021-6M24 2021-24 CAGR 6M 6M 6M NEW TARGET CUSTOMERS2 SUSTAINABLE BUSINESS (MILLION CUMULATIVE) (€ BILLION, CUMULATIVE SINCE 2018) GOAL Current target
Slide 19: Business Areas
2Q24 Earnings 19 Business SPAIN Areas MEXICO TURKEY SOUTH AMERICA
Slide 20: Spain
2Q24 Earnings 20 Spain PROFIT & LOSS (€M) ACTIVITY (JUN-24) Δ (%) Δ (%) €Bn €Bn YoY YoY 2Q24 vs. 2Q23 vs. 1Q24 6M24 vs. 6M23 +2.4% +3.5% Net Interest Income 1,612 18.5 0.8 3,211 26.2 Net Fees and Commissions 579 3.8 2.2 1,144 4.7 Net Trading Income 152 55.4 -25.8 358 64.3 Mortgages +1.3% Other Incom
Slide 21: Mexico
2Q24 Earnings 21 Mexico PROFIT & LOSS (CONSTANT €M) ACTIVITY (JUN-24) (CONSTANT €) €Bn YoY €Bn YoY Δ Constant (%) Δ Current (%) Δ Constant (%) +14.6% +12.6% 2Q24 vs. 2Q23 vs. 1Q24 6M24 vs. 6M23 vs. 6M23 Mortgages +9.1% Net Interest Income 2,980 7.0 -0.3 5,968 13.4 6.8 Net Fees and Commissions 629 13
Slide 22: Turkey
2Q24 Earnings 22 Turkey PROFIT & LOSS (CURRENT €M) ACTIVITY (JUN-24) Δ Current (%) Δ Current (%) (CONSTANT €; BANK ONLY) €Bn YoY1 €Bn FC -8.5% 2Q24 vs 2Q23 vs 1Q24 6M24 vs. 6M23 Time YoY1 -48.6% Net Interest Income 327 -7.5 18.0 605 -38.3 Net Fees and Commissions 482 n.s. 13.9 905 217.2 FC Net Tradi
Slide 23: South America
2Q24 Earnings 23 South America NET ATTRIBUTABLE PROFIT (CURRENT €M) ACTIVITY (JUN-24) (CONSTANT €) €Bn YoY €Bn YoY +24.5% Δ Current (%) Δ Current (%) +12.2% 2Q24 vs. 2Q23 vs. 1Q24 6M24 vs. 6M23 Colombia +13.3% Colombia 37 -31.6 86.9 57 -39.7 Colombia +2.7% Peru 68 28.3 59.7 110 1.2 Argentina 69 45.2
Slide 24: Takeaways
2Q24 Earnings 24 Takeaways BBVA once again Excellent core revenues reports a evolution on the back of At the top of the European remarkable quarter activity growth Banking Sector TBV + ROTE DIVIDENDS (YoY) Significant progress in On track to clearly the execution of our strategy focused on exceed our
Slide 25: Update on the Offer to Banco Sabadell Shareholders
2Q24 Earnings 25 Update on the Offer to Banco Sabadell Shareholders
Slide 26: Compelling offer for a powerful combination
2Q24 Earnings 26 Compelling offer for a powerful combination The combination will create a stronger and more profitable franchise, with 1 additional lending capacity to support families and businesses in Spain estimated at 5 Bn€ annually The transaction shows a clear strategic appetite for gaining sc
Slide 27: Financial impacts of takeover
2Q24 Earnings 27 Financial impacts of takeover SYNERGIES BREAKDOWN EPS ACCRETION FOR BBVA SHAREHOLDERS (PHASED-IN OVER 3 YEARS) (BASED ON MARKET 2026e NET INCOME ESTIMATES1) €850m +3.5 % €450m €300m €100m EPS ACCRETION FOR SABADELL SHAREHOLDERS (BASED ON MARKET 2026e NET INCOME ESTIMATES1,2) ADMINIS
Slide 28: Process is progressing according to plan
2Q24 Earnings 28 Process is progressing according to plan Take over bid Merger Max. 70 days Offer Application for BBVA Competition SEC filing ECB CNMV Take-up Spanish announcement regulatory extraordinary authorities submission approval approval period Ministry of approvals (1) shareholders approvals
Slide 29: Annex
2Q24 Earnings 29 Annex 01 Net Attributable Profit CET1 Sensitivity to market 07 evolution impacts 02 Gross Income breakdown 08 CET1 evolution YtD & RWAs by business area 03 P&L Accounts by business unit 09 Book Value of the main subsidiaries 04 Customer spread by country TBV per share & dividends 10
Slide 30: Net Attributable Profit evolution
2Q24 Earnings 30 Net Attributable Profit evolution
Slide 31: Business Areas Contribution to Group's NAP 2Q24 yoy growth
2Q24 Earnings 31 Business Areas Contribution to Group's NAP 2Q24 yoy growth NET ATTRIBUTABLE PROFIT (BUSINESS AREAS CONTRIBUTION TO 2Q24 YOY GROWTH; CURRENT €M) +38% 2Q23 Spain Mexico Turkey South Rest of Corporate 2Q24 America Business Center NAP 2Q24 (€M) 1,066 1,417 207 197 115 -207 NAP growth (Y
Slide 32: Business Areas Contribution to Group's NAP 6M24 yoy growth
2Q24 Earnings 32 Business Areas Contribution to Group's NAP 6M24 yoy growth NET ATTRIBUTABLE PROFIT (BUSINESS AREAS CONTRIBUTION TO 6M24 YOY GROWTH; CURRENT €M) +29% 6M23 Spain Mexico Turkey South Rest of Corporate 6M24 America Business Center NAP 6M24 (€M) 1,790 2,858 351 317 235 -557 NAP growth (Y
Slide 33: Gross Income breakdown
2Q24 Earnings 33 Gross Income breakdown
Slide 34: Gross Income breakdown
2Q24 Earnings 34 Gross Income breakdown 6M24 (€M, %) Rest of business 678 €M Spain South America 4% 4,626€M 2,639 €M 15% 26% Turkey 11% 1,892 €M 44% Mexico 7,910 €M Note: Figures exclude Corporate Center.
Slide 35: P&L Accounts by business unit
2Q24 Earnings 35 P&L Accounts by business unit Rest of Business Corporate Center Turkey (hyperinflation adjustment) Argentina (hyperinflation adjustment) Colombia Peru
Slide 36: Rest of Business - Profit & Loss
2Q24 Earnings 36 Rest of Business - Profit & Loss PROFIT & LOSS (€M) Δ (%) Δ (%) 2Q24 vs 2Q23 vs 1Q24 6M24 vs 6M23 Net Interest Income 178 21.3 12.9 335 28.9 Net Fees and Commissions 71 11.2 5.9 138 4.1 Net Trading Income 93 -3.8 -16.7 204 17.7 Other Income & Expenses 2 n.s. 125.3 2 n.s. Gross Income
Slide 37: Corporate Center - Profit & Loss
2Q24 Earnings 37 Corporate Center - Profit & Loss PROFIT & LOSS (€M) Δ (%) Δ (%) 2Q24 vs 2Q23 vs 1Q24 6M24 vs 6M23 Net Interest Income -125 56.1 65.3 -201 43.1 Net Fees and Commissions -20 -22.7 n.s. -24 -19.9 Net Trading Income 205 n.s. n.s. -65 -89.1 Other Income & Expenses -16 n.s. n.s. -10 n.s. G
Slide 38: Turkey - hyperinflation adjustment
2Q24 Earnings 38 Turkey - hyperinflation adjustment PROFIT & LOSS (€M) 6M24 Hyperinflation 6M24 (reported) (1) adjustment (2) Ex.Hyperinflation Net Interest Income 605 20 585 Net Fees and Commissions 905 34 871 Net Trading Income 601 25 576 Other Income & Expenses -219 -993 774 Gross Income 1,892 -914
Slide 39: Argentina - hyperinflation adjustment
2Q24 Earnings 39 Argentina - hyperinflation adjustment PROFIT & LOSS (€M) 6M24 Hyperinflation 6M24 (reported) (1) adjustment (2) Ex.Hyperinflation Net Interest Income 1,666 199 1,467 Net Fees and Commissions 127 14 113 Net Trading Income 207 63 145 Other Income & Expenses -1,206 -1,037 -169 Gross Incom
Slide 40: Colombia - Profit & Loss
2Q24 Earnings 40 Colombia - Profit & Loss PROFIT & LOSS (€M CONSTANT) Δ (%) Δ (%) 2Q24 vs 2Q23 vs 1Q24 6M24 vs 6M23 Net Interest Income 259 27.6 7.1 501 22.4 Net Fees and Commissions 34 -3.3 21.3 62 -3.0 Net Trading Income 24 -22.1 -6.6 49 -30.1 Other Income & Expenses -4 5.9 77.6 -6 n.s. Gross Incom
Slide 41: Peru - Profit & Loss
2Q24 Earnings 41 Peru - Profit & Loss PROFIT & LOSS (€M CONSTANT) Δ (%) Δ (%) 2Q24 vs 2Q23 vs 1Q24 6M24 vs 6M23 Net Interest Income 357 12.3 0.7 711 13.8 Net Fees and Commissions 80 8.7 0.6 160 8.2 Net Trading Income 77 69.8 101.4 115 23.7 Other Income & Expenses -8 -14.0 -24.5 -18 -18.6 Gross Income
Slide 42: Customer Spread by country
2Q24 Earnings 42 Customer Spread by country
Slide 43: Customer spreads: quarterly evolution
2Q24 Earnings 43 Customer spreads: quarterly evolution AVERAGE 2Q23 3Q23 4Q23 1Q24 2Q24 2Q23 3Q23 4Q23 1Q24 2Q24 Spain 3.12% 3.33% 3.42% 3.44% 3.44% Turkey TL 0.81% 0.51% 0.38% -0.74% -0.02% Yield on Loans 3.64% 4.01% 4.28% 4.35% 4.30% Yield on Loans 16.50% 20.20% 28.49% 33.02% 36.86% Cost of Deposi
Slide 44: Customer spreads: YtD evolution
2Q24 Earnings 44 Customer spreads: YtD evolution AVERAGE 6M23 6M24 6M23 6M24 Spain 2.93% 3.44% Turkey TL 2.16% -0.30% Yield on Loans 3.38% 4.33% Yield on Loans 16.66% 35.04% Cost of Deposits -0.45% -0.89% Cost of Deposits -14.49% -35.34% 1 Mexico MXN 12.64% 12.44% Turkey FC 8.55% 9.22% Yield on Loan
Slide 45: Stages breakdown by business areas
2Q24 Earnings 45 Stages breakdown by business areas
Slide 46: Stages breakdown by business areas
2Q24 Earnings 46 Stages breakdown by business areas CREDIT RISK BUSINESS BREAKDOWN BY AREA (JUN-24, € M) Gross Accumulated Gross Accumulated Gross Accumulated BBVA GROUP Exposure impairments SPAIN Exposure impairments MEXICO Exposure impairments Stage 1 414,956 2,162 Stage 1 176,354 466 Stage 1 87,2
Slide 47: ALCO Portfolio, NII Sensitivity and LCRs & NSFRs
2Q24 Earnings 47 ALCO Portfolio, NII Sensitivity and LCRs & NSFRs
Slide 48: ALCO Portfolio
2Q24 Earnings 48 ALCO Portfolio ALCO PORTFOLIO BREAKDOWN BY REGION (€ BN) Amort Cost Fair Value (HTC) (HTC&S) (duration Jun-24 (€BN) (€BN) incl. hedges) South America 0.2 6.2 1.2 years Turkey 7.1 2.6 4.1 years Mexico 5.4 11.4 2.8 years Euro 35.0 11.3 2.6 years (1) Spain 29.2 4.8 Italy 2.9 4.1 Rest 2
Slide 49: NII sensitivity to interest rates movements
2Q24 Earnings 49 NII sensitivity to interest rates movements ESTIMATED IMPACT ON NII IN THE NEXT 12 MONTHS TO PARALLEL INTEREST RATE MOVEMENTS (TO +100 BPS INTEREST RATES INCREASE, %) +4% +2.3% EURO BALANCE MEXICO SHEET Note: NII sensitivities to parallel interest rates movements as of May-24, using
Slide 50: Liquidity and funding ratios
2Q24 Earnings 50 Liquidity and funding ratios BBVA GROUP AND SUBSIDIARIES LCR & NSFR (JUN-24) LCR NSFR Loan To Total Group 179% / 148%1 129% Deposits BBVA, S.A. 178% 121% 89% Mexico 154% 133% 104% 2 Turkey 162% 161% 80% S. America 94%3 All countries >100% >100% (1) Using a more restrictive criterion
Slide 51: CET1 Sensitivity to market impacts
2Q24 Earnings 51 CET1 Sensitivity to market impacts
Slide 52: CET1 Sensitivity to Market Impacts
2Q24 Earnings 52 CET1 Sensitivity to Market Impacts1 TO A 10% CURRENCY DEPRECIATION2 TO A 10% DECLINE IN TELEFONICA’S (JUN-24) SHARE PRICE (JUN-24) MXN -10bps TRY -6bps -2 bps USD +18bps TO +100 BPS MOVEMENT IN THE TO +100 BPS MOVEMENT IN THE MEXICAN SOVEREIGN BOND SPANISH SOVEREIGN BOND (JUN-24) (J
Slide 53: CET1 evolution YtD & RWAs by business area
2Q24 Earnings 53 CET1 evolution YtD & RWAs by business area
Slide 54: Capital YtD evolution
2Q24 Earnings 54 Capital YtD evolution CET1 FULLY-LOADED – BBVA GROUP YTD EVOLUTION (%, BPS) 1 1) Includes, among others, FX and mark to market of HTC&S portfolios, minority interests, and a positive impact in OCI equivalent to the Net Monetary Position value loss in hyperinflationary economies regis
Slide 55: Risk-weighted assets by business area
2Q24 Earnings 55 Risk-weighted assets by business area Fully-Loaded RWAs Δ (%) Breakdown by business area (€M) Jun-23 Mar-24 Jun-24 vs. Jun-23 vs. Mar-24 Spain 116,759 122,056 121,668 4.2% -0.3% Mexico 85,111 97,517 94,157 10.6% -3.4% Turkey 50,672 58,558 62,037 22.4% 5.9% South America 50,144 52,36
Slide 56: Book Value of the main subsidiaries
2Q24 Earnings 56 Book Value of the main subsidiaries
Slide 57: Book Value of the main subsidiaries
2Q24 Earnings 57 Book Value of the main subsidiaries1,2 € BN; JUN-24 Δ (%) QoQ Mexico 19.3 -7.2% Turkey 7.3 +7.9% Colombia 1.9 +6.8% Argentina 1.5 -5.7% Peru 1.4 +3.8% Chile 0.3 +1.1% Venezuela 0.1 +3.7% (1) Includes the initial investment + BBVA’s undistributed results + FX impact + other valuation
Slide 58: TBV per share & dividends evolution
2Q24 Earnings 58 TBV per share & dividends evolution
Slide 59: Shareholders' return: TBV per share & dividends evolution
2Q24 Earnings 59 Shareholders’ return: TBV per share & dividends evolution TBV PER SHARE & DIVIDENDS (€ PER SHARE(1)) TBV Dividends +20% (2) (2) (2) (2) (1) Total number of shares considered: 5,752m as of June-24; 5,751m as of March-24 post-SBB execution, 5,834m as of December-23, 5,835m as of Septe
Slide 60: MREL
2Q24 Earnings 60 MREL
Slide 61: Sound MREL position
2Q24 Earnings 61 Sound MREL position POSITION AS OF JUN-24 (% RWA1) MREL REQUIREMENT + CBR SUBORDINATION REQUIREMENT + CBR 28.42% 22.18% 26.41% CBR: 3.62% 3 17.12% 3 CBR: 3.62% MREL 22.79% Subordination 13.50% 2 2 M-MDA Buffer 201 bps (4.4€bn) Subordination Buffer 506 bps (11.0€bn) Note: Preliminary
Slide 62: Digital metrics
2Q24 Earnings 62 Digital metrics
Slide 63: Digital metrics mobile customers & digital sales
2Q24 Earnings 63 Digital metrics mobile customers & digital sales MOBILE CUSTOMERS DIGITAL SALES - UNITS (MILLION CUSTOMERS, %) % OF TOTAL SALES YTD, # OF TRANSACTIONS) +28% DIGITAL SALES - PRV2 % OF TOTAL SALES YTD, PRV) CUSTOMER PENETRATION RATE1 67.3% 70.8% 74.2% (1) Mobile over active customers.
Slide 64: BBVA
BBVA
Banco Bilbao Vizcaya Argentaria — Q2 2024 Earnings Presentation on 6ix