Banco Bilbao Vizcaya Argentaria, S.a. · BME:BBVA
Banco Bilbao Vizcaya Argentaria — Debt Investor Presentation (August 2024)
54 slides from Banco Bilbao Vizcaya Argentaria's debt investor presentation, Aug 1, 2024
Slide 1: 2Q24 Fixed Income Presentation
2Q24 Fixed Income Presentation
Slide 2: Disclaimer
2Q24 Fixed Income 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
Slide 3: BBVA Investment Case
BBVA O01 BBVA Investment Case
Slide 4: About BBVA
2Q24 Fixed Income 4 About BBVA BBVA’s GLOBAL PRESENCE FINANCIAL HIGHLIGHTS JUNE 2024 JUNE 2024 Net attributable profit 6M24 CET 1 FL 4,994 M€ 12.75% Total assets Deposits from customers Loans and advances to customers (gross) 759.534 M€ 430,984 M€ Countries Branches Employees Active Customers 405,021
Slide 5: Leading franchises in attractive markets
2Q24 Fixed Income 5 1) Leading franchises in attractive markets STRONG POSITION BBVA Pre-Provision Profit 1 1 2 Loan Market Share (%) Ranking Market Share (%) Spain 13.8% #3 22.1% Mexico 24.6% #1 42.4% Turkey 18.9% #2 40.8% Peru 21.4% #2 24.0% Colombia 11.5% #4 8.4% (1) Latest available information.
Slide 6: Well diversified business model
2Q24 Fixed Income 6 2) Well diversified business model DIVERSIFICATION UNDER A PROFITABLE BUSINESS MIX DECENTRALIZED MODEL TOTAL ASSETS1 LOANS AND ADVANCES TO CUSTOMERS (JUN-24) (PERFORMING LOANS UNDER MANAGEMENT EX-REPOS) 8% Rest of Business JUN-24 9% South America 21% CIB 1 24% Mortgages 45% 9% Tur
Slide 7: Proven track record of solid financial returns
2Q24 Fixed Income 7 3) Proving track record of solid financial returns STRONG PRE-PROVISION PROFIT AND OUTPERFORMING ON BEST-IN-CLASS EFFICIENCY PROFITABILITY PRE-PROVISION PROFIT/RWA EFFICIENCY RATIO ROTE BBVA: 2020-6M24 ANNUALIZED, % BBVA: 2020-6M24, % BBVA: 2020-6M24, % PEERS: 2020-3M24, % PEERS:
Slide 8: Capturing value from digitization
2Q24 Fixed Income 8 4) Capturing value from digitization NEW CUSTOMERS1 (BBVA GROUP, MILLION; % ACQUISITION THROUGH DIGITAL CHANNELS) DIGITAL 67% TOTAL DIGITAL 21% 1Q19 1Q20 1Q21 1Q22 1Q23 1Q24 (1) Gross customer acquisition through own channels for retail segment. Excludes the US business sold to P
Slide 9: Solid fundamentals
2Q24 Fixed Income 9 5) Solid fundamentals SOUND ASSET QUALITY METRICS STRONG CAPITAL COMFORTABLE LIQUIDITY NPL Ratio CET 1 FULLY-LOADED (%) (%) NSFR Group Coverage Ratio 12.75% 129% (%) Target range 11.5-12.0% Cost of Risk YtD(%) CET1 Requirement LCR Group 9.11%1 179%2 Jun-23 Sep-23 Dec-23 Mar-24 Ju
Slide 10: Strong ESG Credentials
2Q24 Fixed Income 10 6) Strong ESG Credentials SUSTAINABLE BUSINESS SOCIAL GOVERNANCE Sustainable Business Channeling Positive impact on society Directors Sustainable Loan growth1 +10.7 % Business 300 €Bn 2018-2025 (JUN-24, YOY, CONSTANT €) % Female 47% Goal: 40% Directors at least goal 75,000 340,0
Slide 11: Advancing in sustainable business
2Q24 Fixed Income 11 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 +
Slide 12: We will clearly outperform our ambitious 2021-2024 goals
2Q24 Fixed Income 12 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 tar
Slide 13: 2Q24 Results
BBVA O02 2Q24 Results
Slide 14: 2Q24 key messages
2Q24 Fixed Income 14 2Q24 key messages NET ATTRIBUTABLE PROFIT (CURRENT €M) CORE REVENUES (NII+FEES) TOTAL LOAN OUTSTANDING CORE GROWTH1 +38% 1 REVENUES AND SOLID +23.4% +17.6% +10.7% vs. ACTIVITY GROWTH (YOY, CONSTANT) (YOY, CURRENT) JUN 2023 vs. 6M23 +27.0% LEADING AND EFFICIENCY RATIO 2 IMPROVING
Slide 15: Excellent revenue growth following a remarkable trend
2Q24 Fixed Income 15 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 managemen
Slide 16: Positive jaws and further improving industry-leading efficiency
2Q24 Fixed Income 16 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 operat
Slide 17: Asset quality within expectations, in a context of strong activity growth
2Q24 Fixed Income 17 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-2
Slide 18: Business Areas
Business SPAIN Areas MEXICO TURKEY SOUTH AMERICA
Slide 19: Strong performance in Spain and Mexico supported by activity growth
2Q24 Fixed Income 19 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’2
Slide 20: Spain
2Q24 Fixed Income 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 I
Slide 21: Mexico
2Q24 Fixed Income 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 62
Slide 22: Turkey
2Q24 Fixed Income 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 T
Slide 23: South America
2Q24 Fixed Income 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
Slide 24: Capital & Liquidity
BBVA O03 Capital & Liquidity
Slide 25: A high quality and resilient capital
2Q24 Fixed Income 25 A high quality and resilient capital STRONG CAPITAL HIGH RWAS DENSITY, WITH A LIMITED CAPITAL RESILIENCE UNDER POSITION USE OF INTERNAL MODELS 2 STRESS SCENARIOS CET1 FULLY-LOADED RWA/TOTAL ASSETS LEVERAGE RATIO FL 2023 EBA ST -ADVERSE SCENARIO (%) BBVA JUN-24/PEERS MAR-24 BBVA
Slide 26: Solid capital position with CET1 above our target
2Q24 Fixed Income 26 Solid capital position with CET1 above our target CET1 FULLY-LOADED AT1 AND TIER 2 FL BUCKETS (%, BPS) JUN-24 (%) Very preliminary estimate for Basel IV impact reduces from +73 bps below 40 bps to -39bps less than 15 bps 2.47% -40 bps 2.38% 12.82% -1 bps 12.75% 1.78% -23bps mark
Slide 27: Among the lowest SREP requirement with a comfortable MDA distance
2Q24 Fixed Income 27 Among the lowest SREP requirement with a comfortable MDA distance BBVA, GROUP CET1 REQUIREMENT AND DISTANCE TO MDA BBVA JUN-24/ PEERS MAR-24 Distance to MDA 2 13.60% 340 bps 16.77% T2 11.13% 13.27% 10.80% AT1 10.22% T2 10.20% 10.10% 9.60% 9.34% 9.11% 8.60% 8.59% 9.11% AT1 CCyB 1
Slide 28: Strong capital position in BBVA, S.A., above requirement
2Q24 Fixed Income 28 Strong capital position in BBVA, S.A., above requirement BBVA, S.A. REQUIREMENT AND DISTANCE TO MDA JUN-24 Distance to MDA2 17.58% 450 bps €9.9 Bn T2 12.12% AT1 T2 AT1 7.96% 1 CCyB 1 CCB CET 1 Pillar 2R CET 1 Pillar 1 CET1 Total Capital Total Capital Ratio Requirement 2024 Requi
Slide 29: Sound MREL position
2Q24 Fixed Income 29 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: Prelimi
Slide 30: Liquidity ratios well above requirements with ample quality collateral
2Q24 Fixed Income 30 Liquidity ratios well above requirements with ample quality collateral BBVA GROUP LIQUIDITY BALANCE SHEET1 BBVA GROUP LIQUIDITY AND FUNDING METRICS JUN-24 JUN-24 Mexico Turkey3 South BBVA S.A.2 America LTD 89% 104% 80% 94% LCR 178% 154% 162% >100% NSFR 121% 133% 161% >100% LCR G
Slide 31: Limited wholesale funding maturities in all geographies
2Q24 Fixed Income 31 Limited wholesale funding maturities in all geographies DEBT OUTSTANDING BY PRODUCT WHOLESALE FUNDING MATURITIES JUN-24, € BN JUN-24, € BN Others1 Senior Preferred EURO 11.3 17% 21.1 € 51.3 bn 32% T2 / TOTAL Subordinated 19% 65.3 12.3 MEXICO 9% 14% €8.3 bn AT1 / Preferred 9% Sen
Slide 32: 2024 Funding Plan
2Q24 Fixed Income 32 2024 Funding Plan c. €8-9 bn. Oriented to meet both 2024 maturities and regulatory requirements Subject to Balance Sheet and liquidity evolution BBVA, S.A. 2024 2024 Strategy1 €BN Executed (subject to market conditions) AT1 € 0.75 bn Proactive and effective management of the cap
Slide 33: All Ratings Agencies assign BBVA a rating on the single A space
2Q24 Fixed Income 33 All Ratings Agencies assign BBVA a rating on the single A space, with stable outlook BBVA LONG TERM BBVA RATINGS BY TYPE OF INSTRUMENT AND ISSUER SENIOR PREFERRED RATINGS Moody’s S&P Fitch DBRS Investment Aaa AAA AAA AAA CB Positive outlook grade Aa1 CB CB AA+ AA+ AA (H) Moody’s
Slide 34: Update on the Offer to Banco Sabadell Shareholders
04 Update on the Offer to Banco Sabadell Shareholders
Slide 35: Compelling offer for a powerful combination
2Q24 Fixed Income 35 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 gainin
Slide 36: Financial impacts of takeover
2Q24 Fixed Income 36 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) ADM
Slide 37: Process is progressing according to plan
2Q24 Fixed Income 37 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 appro
Slide 38: Annex
Annex 01 2Q24 Profit & Loss 09 CET1 Sensitivity to market impacts 02 6M24 Profit & Loss 10 Group RWA breakdown BBVA Group Net 11 Debt Issuances 2023-2024 YTD 03 Attributable Profit 2Q24 04 ALCO Portfolio 12 Called notes 2018-2024 YTD NII sensitivity to interest rate 13 Wholesale maturities 2024 - 2028+
Slide 39: 2Q24 Profit & Loss
2Q24 Fixed Income 39 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 3
Slide 40: 6M24 Profit & Loss
2Q24 Fixed Income 40 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 In
Slide 41: Business Areas Contribution to Group's NAP 2Q24 yoy growth
2Q24 Fixed Income 41 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 growt
Slide 42: ALCO Portfolio
2Q24 Fixed Income 42 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 Re
Slide 43: NII sensitivity to interest rates movements
2Q24 Fixed Income 43 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, u
Slide 44: Customer spreads: quarterly evolution
2Q24 Fixed Income 44 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 De
Slide 45: Stages breakdown by business areas
2Q24 Fixed Income 45 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
Slide 46: Capital Base BBVA Group & BBVA, S.A.
2Q24 Fixed Income 46 Capital Base BBVA Group & BBVA, S.A. CAPITAL RATIOS JUN-24 (%) 16.77% 17.58% T2 AT1 CET1 BBVA Group BBVA, S.A. CET 1 € 48,861 m € 27,448 m AT1 € 5,914 m € 5,552 m T2 € 9,468 m € 5,726 m Total Capital Base € 64,243 m € 38,726 m RWA € 383,179 m € 220,311 m Note: Preliminary Data W
Slide 47: CET1 Sensitivity to Market Impacts
2Q24 Fixed Income 47 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
Slide 48: Group RWA breakdown
2Q24 Fixed Income 48 Group RWA breakdown TOTAL RWA BREAKDOWN PHASED-IN 51% IRB Models ▰ Optimizing Capital Allocation is part of BBVA’S Strategic Priorities 0.3% CVA ▰ Limited usage of internal 0.9% FX Risk 87.5% Credit Risk models in Credit Risk RWAs, mitigating potential impacts 3.2% Trading Act R
Slide 49: Debt Issuances 2023 - 2024 YTD
2Q24 Fixed Income 49 Debt Issuances 2023 - 2024 YTD NOMINAL PRODUCT ISSUE DATE CALL DATE MATURITY COUPON CURRENCY BBVA, S.A. AT1 Jun-24 Jun-31* Perp € 750 M 6.875% SP Jun-24 - Jun-27 € 1,000 M 3mE+45 bps SP Jun-24 - Jun-30 € 750 M 3.625% SP Mar-24 - Mar-31 € 1,000 M 3.500% SNP Mar-24 Mar-34 Mar-35 $
Slide 50: Called notes 2018 - 2024 YTD
2Q24 Fixed Income 50 Called notes BBVA 2018 - 2024 YTD follows an economic call policy OUTSTANDING PRODUCT ISSUE DATE REDEMPTION COUPON CURRENCY (M) BBVA, S.A. AT1 Mar-19 Mar-24 € 1,000 M 6,000% BBVA, S.A. T2 Feb-19 Feb-24 € 750 2.575% BBVA, S.A. AT1 Sep-18 Sep-23 € 1,000 5.875% BBVA, S.A. AT1 May-1
Slide 51: Wholesale maturities 2024 - 2028+
2Q24 Fixed Income 51 Wholesale maturities 2024 - 2028+ Bn € EURO 2024 2025 2026 2027 2028+ TOTAL Senior Preferred 0.9 4.7 2.0 2.3 5.8 15.6 Senior Non Preferred 1.0 1.9 1.2 2.0 3.1 9.1 Covered Bonds 0.0 2.4 1.0 1.7 0.9 5.9 Preferred Shares 0.0 0.9 1.0 0.9 2.7 5.6 Subordinated 0.0 1.2 0.4 1.3 3.7 6.5
Slide 52: Main Subsidiaries ratings
2Q24 Fixed Income 52 Main Subsidiaries ratings BBVA LONG TERM SENIOR UNSECURED RATINGS BBVA Mexico Garanti BBVA BBVA Argentina BBVA Colombia BBVA Peru Investment AAA/Aaa AAA/Aaa AAA/Aaa AAA/Aaa AAA/Aaa grade AA+/Aa1 AA+/Aa1 AA+/Aa1 AA+/Aa1 AA+/Aa1 AA/Aa2 AA/Aa2 AA/Aa2 AA/Aa2 AA/Aa2 AA-/Aa3 AA-/Aa3 A
Slide 53: Book Value of the main subsidiaries
2Q24 Fixed Income 53 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 valua
Slide 54: BBVA
BBVA
Banco Bilbao Vizcaya Argentaria, S.A. (BBVA) — Debt Investor Presentation (August 2024) on 6ix