Banco Bilbao Vizcaya Argentaria, S.a. · BME:BBVA
Banco Bilbao Vizcaya Argentaria — Debt Investor Presentation (June 2017)
42 slides from Banco Bilbao Vizcaya Argentaria's debt investor presentation, Jun 1, 2017
Slide 1: Fixed Income Investors Presentation 1Q17
» Fixed Income Investors Presentation 1Q17
Slide 2: Disclaimer
Fixed Income Presentation/ 2 Disclaimer This document is only provided for information purposes and does not constitute, nor should it be interpreted as, an offer to sell or exchange or acquire, or an invitation for offers to buy securities issued by any of the aforementioned companies. Any decision
Slide 3: Index
BBV: Creating Opportunities Index 01 02 03 04 BBVA's Strengths & 1Q17 Financial Highlights Diversified Footprint Asset Quality Capital Fixed Income Presentation/3 O5 MREL O06 Liquidity & Funding O7 Transformation Strategy APPENDIX BBVA Group 1Q17 Profit & Loss Capital Base: BBVA Group & BBVAS.A. Deb
Slide 4: BBVA's Strengths & 1Q17 Financial Highlights
Fixed Income Presentation/ 4 BBVA cprertnitis BBVA’s Strengths & 1Q17 Financial Highlights
Slide 5: BBVA's Strengths: Resilience and Low Earnings Volatility
BBVA’'s Strengths Resilience and Low Earnings Volatility 3.7% 42% 38% 3.79 % O) 3.2% 3.3% 3.9% 2.8% 3.0% 3.3% 12.3 11.9 10.5 10.6 «(11.1 na 11.9 10.2 10.4 | | 3.2 L 2008 2009 2010 2011 2012 2013 2014 2015 2016 1Q17 (1) Annualized Pre-provision profit for comparison purposes Pre-provision profit / RW
Slide 6: 1Q17 Financial Highlights
1Q17 Financial Highlights Core revenues growth Cost control Net interest income and fees Gross income vs. Op. Expenses (€m constant) (YoY, %, constant) 5,546 5,077 Bb 19.2%) 2% 15.0 m Gross 72. 6A Income m™ Operating I | a Expenses 1Q16 1Q17 12M16——- 3M17 Sound asset quality NPL COST COVERAGE CORE C
Slide 7: Diversified Footprint
Fixed Income Presentation/7 BBVA sororities Diversified Footprint
Slide 8: Well diversified footprint with high growth prospects
FixedIncome Presentation/& Well diversified footprint with high growth prospects Breakdown by Business Area“ Higher Growth Prospects 24 28 Developed Markets South 17 1.6 America Hi B8VA's Footprint 4 Positive macro outlook Mexico, E UK EPA 4 ies ( Set 20176 2018e srosores « Well positioned to benefi
Slide 9: Business areas in 1Q17
Business areas in 1Q17 SPAIN Banking activity NET ATTRIBUTABLE PROFIT 3/5€m +54.2% vs. 1Q16 Non Core Real Estate NET ATTRIBUTABLE PROFIT -109€m -3.8% vs. 1Q16 NET ATTRIBUTABLE PROFIT 134€m 163.1% vs. 1016 NPLRATIO 5.8% vs. 6.4% 1Q16 OST OF RIS O. 38% vs. 0.45% 1Q16 RE developer loans NPL RATI¢ 1.3%
Slide 10: Business areas in 1Q17
/10 Business areas in 1Q17 MEXICO co NET ATTRIBUTABLE PROFIT NPLRATIO Improved macro outlook and FX recovery 536 £ m . vs. 2.6% 1¢ High single digit lending growth ST OF RIS! Excellent trend in customer spreads, on the back of rising rates +19.2% 1Q net profit growing at 19%, above year-end expectat
Slide 11: Asset Quality
Fixed Income Presentation/11 BBVA sororities Asset Quality
Slide 12: Asset Quality: continued improvement after the crisis
Asset Quality: continued improvement after the crisis NPL Ratio (%) Coverage ratio (%) Cost of Risk (%) (1) Cumulative Cost of Risk 92 72 74°70 71 2.15 115 155 1.33 1.19 1.59 1.25 1.06 0.84 0.90 2008 2009 2010 2011 2012 2013 2014 2015 2016 1Q17 Fixed Income Presentation / 12 Risk Framework A Risk Ma
Slide 13: A prudent risk profile
Fixed Income Presentation / 13 A prudent risk profile 58 6.4 | | 15 12 22 22 aa 7 2.0 es s 2 Foe F beast BBVA Banking Peers BBVA Peers BBVA Peers Garanti Peers BBVA Peers Activity in Average Compass Average Bancomer Average Average S. America Average Spain SPAIN (1) USA MEXICO, TURKEY, S. AMERICA 34
Slide 14: Capital
Fixed Income Presentation/ 14 BBVA sororities Capital
Slide 15: FL Capital Ratios
FL Capital Ratios BBVA Group 1017 (%) 15.01% Tier 2 2.48% Tier1 1.52% y! €500m AT1 Issuance CET 11.01% 1017 @ 1Q17 CET] fully loaded in line with our 11% Target © 1.5% AT1 and 2% T2 buckets already covered on a fully- loaded basis Fixed Income Presentation / 15 Sound capital position and proven abil
Slide 16: Low earnings volatility and ability to generate capital
Fixed Income Presentation/ 16 Low earnings volatility and ability to generate capital allow for lower capital needs Pre-provision profit / Net Loans Pre-provision profit / RWAs (BBVA and European Peer Group“, Dec. 2016) (BBVA and European Peer Group“, Dec. 2016) Peer] 2.9% Peer 1 3.9% BBVA 2.9% Peer
Slide 17: BBVA in the EBA's Adverse Scenario
Fixed Income Presentation / 17 BBVA in the EBA’s Adverse Scenario Profit generation in the adverse scenario CET1 Fully Loaded ratio evolution in the adverse scenario Cumulative 2016-2018 (€ m) 2015-2018 (bps) "183 BBVA 199 ——< Peer | The only bank -445 m Peer] -208 =m BBVA generating -750 mm Peer2 R
Slide 18: High quality capital
Fixed Incom itation/ 18 High quality capital RWAs/ Total Assets Fully-Loaded Leverage Ratio BBVA 54 d BBVA 66 Peer 1 Peer 1 61 Peer 2 4 Pear 2 : Peer 3 ct 5, () Peer 4 Peer 5. Peer 6 cof 5 () Peer 5 0 Peers Av. Peers Av, Peer 6 + + Peer? BBVA maintains Peer 9 j Peer 10 Poe 10 the highest RWAs peer f
Slide 19: Risk-Weighted Assets distribution
Risk-Weighted Assets distribution TOTAL RWAS 1917 15% 121,516 em 64,800 en Turkey 70,387 €n 50,184 em m South America 58,076 en 14,394 em ™ Corporate Center 10,317 €m CVA 0.6% FXRisk 1.3% Trading Act. Risk 3.1% Operational Risk 8.8% Note: Distribution of RWAs as of 1Q17 by type of risk and Model, ba
Slide 20: 2017 CET1 SREP and Total Capital Requirement
T2: 2.0% AT1: 1.5% 0.375% 1.25% 1.5% 4.5% 2017 CET1 SREP 2017 Total Capital BBVA's Total capital Requirement SREP Requirement ratio phased-in 1Q17
Slide 21: High level of Available Distributable Items (ADIs)
High level of Available Distributable Items (ADIs) BBVA S.A. (Parent Company) December 2016, € bn € 9.2 bn c. 35x 2016 AT1 coupons € 0.26 bn ADIs 2016 AT1 net coupons Fixed Income Significant payment capacity from distributable items despite conservative calculation (Share Premium not included) Supp
Slide 22: FX Hedging policy
FX Hedging policy Capital Policy BBVA hedges c.70% of the excess capital (what is not naturally hedged by the ratio) GOAL —_ Reduce Consolidated CET] volatility as aresult of FX movements CET1 FL Ratio Sensitivity to a 10% Depreciation of EM Currencies (March, 2017) BELOW _ ? b For each currency . p
Slide 23: ALCO & Equity AfS Portfolio
Fixed Income Presentation / 23 ALCO & Equity AfS Portfolio ALCO Portfolio breakdown by region 3.3. South America ; € 58.8 bn o.w. HTM Portfolio breakdown Diversified portfolio €167¢ ! ‘ | 10.2 Turkey [ei 7bn Gi Spain across BBVA's footprint ° 48% Spain 18.7 . 279 Eurozone [tly 69 others HTM portfoli
Slide 24: MREL
Fixed Income Presentation/ 24 BBVA sororities MREL
Slide 25: MREL: uncertainty remains but closer to the final outcome
MREL: uncertainty remains but closer to the final outcome Framework Unclear MREL requirements and calendar: a “Asa first step, the SRB intends to set binding MREL targets at a consolidated level or appropriate sub-consolidated level according to the resolution strategy for major banking groups under
Slide 26: BBVA's MREL Strategy
BBVA’s MREL Strategy Hypothesis BBVA is an O-SII entity: subject to MREL (not TLAC) Based on its decentralized business model, BBVA follows a MPE resolution strategy Perimeter: BBVA Euro subconsolidated level Potential transition period exceeding 4 years (similar to UK framework) Expected Rating for
Slide 27: Liquidity & Funding
Fixed Income Presentation / 27 BBVA sororities Liquidity & Funding
Slide 28: Liquidity & Funding
Liquidity & Funding Self-sufficient subsidiaries from a liquidity point of view, with robust supervision and control by parent company Retail profile of BBVA Group balance sheet with limited dependence on wholesale funding Fixed Income Presentation Ample high quality collateral available, compliant
Slide 29: Principles of BBVA Group's self-sufficient business model
Fixed Income Presentation / 29 Principles of BBVA Group's self-sufficient business model © Subsidiaries =) Advantages ‘ Self-sufficient balance-she@ is a Market discipline and proper management incentives / sustainable credit 4 Own capital and liquidity growth se management aD) a C ent (A | | ZO qd
Slide 30: Financial soundness based on the funding of lending activity
Fixed Income Presentation / 30 Financial soundness based on the funding of lending activity BBVA Group Liquidity balance sheet BBVA Group Liquidity metrics (1Q17) (1Q17) Euroz.@) USA Mexico Turkey S.Amer 1% 64% = Net Loans to . LTD 109% 93% 95% 119% 100% Customers = Deposits =ECB = Fixed assets mm 4
Slide 31: Broaden geographical diversification of access to market
Fixed Income Presentation / 31 Broaden geographical diversification of access to market Medium & long-term wholesale funding maturities (1017; bn) EURO USA MEXICO € 42.9 bn 6s € 2.3bn € 6.5bn 75 58 3.1 49 44 50 08 | 0.7 06 [ | 130012 0.2 05 02 i i i l l l 7 os « @ FF JF 2017 2018 2019 2020 2021: >20
Slide 32: BBVA Group Ratings
BBVA Group Ratings Latest Rating Actions Three major agencies — Long Term Issuer / Senior Unsecured Rating Moody's Baal Baa2 Baa3 S&P BBB+ BBB 2013 2014 2015 2016 = 2017 BBVA’s rating has improved since end 2013 Fixed Income Presentation/ 32 BBVA’s Ratings Moody's S&P Fitch DBRS Scope Outlook Issuer
Slide 33: Transformation Strategy
Fixed Income Presentation/ 33 BBVA cprertnitis Transformation Strategy
Slide 34: Defined strategic path
Fixed Income Presentation / 34 Defined strategic path Our Purpose Six Strategic Priorities aro bring the age of opportunity to everyone 7? New standard in customer experience e r-) ld Drive digital sales Le New business models BBVA 7] Optimize capital allocation e Unrivaled efficiency Creating Oppor
Slide 35: More engaged and satisfied customers through customer experience
Fixed Income Presentation / 35 More Engaged and Satisfied customers as a result of amazing customer experience Customer Interaction Channel NPS at BBVA BBVA Leading in NPS (Average customer’) (Spain Dec-16) (Dec-16) @ 4 .B } 32% #1 @ # oor BRANCH ” #1 Ss # = * 40 A 43% al @ « times WEB per year = #1
Slide 36: Dec. 16 Mar. 17 Dec. 16
24.0 17.1 11.9 13.6 Dec. 16 Mar.17 Dec. 16 Mar. 17 15.4 22.3 25.2 30.1 Dec. 16 Mar. 17 Dec. 16 Mar. 17 21.7 19.4 Dec. 16 Mar. 17
Slide 37: Appendix
Fixed Income Presentation / 37 BBVA cprertnitis APPENDIX BBVA Group 1Q17 Profit & Loss Capital Base: BBVA Group & BBVAS.A. Debt Issuances - 2017 Amortized notes - 2017
Slide 38: BBVA Group 1Q17 Profit & Loss
(€m) Net Attributable Profit 1,199 69.0 79.2
Slide 39: Capital Base: BBVA Group & BBVA S.A.
Fixed Income Presentation / 39 Capital Base: BBVA Group & BBVA S.A. Phased-in capital ratios 1Q17 (%) 227 153 | MTier2 m 24 @ Additional Tier 1 = 1.2 17.9 11.6 WCET BBVA Group BBVAS.A CET1 €45,358m € 36,005m ATI €4,670m €5,936m T2 €9,397'm €3,856m Total Capital Base €59,425m €45,797m RWA € 389,674 m
Slide 40: Debt Issuances - 2017
Fixed Income Presentation / 40 Debt Issuances - 2017 Issue Nominal Nominal € Issuer Product Date Call Date Maturity Currency (M) (M) Coupon _Isin BBVASA AT1 May-17 May-22 Perp 500 500 5.875% XS1619422865 BBVASA — Tier2 May-17 - May-27 CHF 20M 18 1.60% XS1615673701 BBVASA _ Tier2 May-17 = May-27 150
Slide 41: Amortized notes - 2017
Fixed Income Presentation/ 41 Amortized notes - 2017 . Outstanding . Product Issue Date Redemption currency (M) Outstanding €(M) Coupon BBVA Preferred Apr-07 Apr-17 $600M 536 5.919% International Preferred SA Preferred Sep-06 Mar-17 164 164 = 3ME+1.95% Unipersonal P Preferred Sep-05 Mar-17 86 86 3ME
Slide 42: Fixed Income Investors Presentation 1Q17
» Fixed Income Investors Presentation 1Q17
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