Banco Bilbao Vizcaya Argentaria, S.a. · BME:BBVA

Banco Bilbao Vizcaya Argentaria — Q1 2023 Earnings Presentation

58 slides from Banco Bilbao Vizcaya Argentaria's earnings presentation, Apr 27, 2023

  1. Slide 1: 1Q23 Results

    1Q23 Results April 27, 2023

  2. Slide 2: Disclaimer

    1Q23 Results 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 to buy or inv

  3. Slide 3: BBVA once again reports a very strong quarter

    1Q23 Results 3 BBVA once again reports a very strong quarter NET ATTRIBUTABLE PROFIT CET1 FULLY LOADED (CURRENT €M) (%) +39% +52bps +18% 13.13% 12.61% Target Range 11.5%-12.0% SREP Requirement2 8.75% 1Q22 4Q22 1Q23 Dec-22 Mar-23 EPS (€)1 0.19 0.24 0.29 (reported) NOTE: In the presentation, 2022 figur

  4. Slide 4: Outstanding shareholder value creation and profitability metrics

    1Q23 Results 4 Outstanding shareholder value creation and profitability metrics TBV + DIVIDENDS PROFITABILITY METRICS3 1 (€ / SHARE ) (%) RANKING EUROPEAN TBV / share Dividends / share PEER GROUP4 ROTE +22% +7.1% #1 7.55 8.08 0.122 0.432 6.64 ROE 7.43 7.65 #1 1Q22 2022 1Q23 Mar-22 Dec-22 Mar-23 (1) T

  5. Slide 5: 1Q23 key messages

    1Q23 Results 5 1Q23 key messages 1 CORE REVENUES (NII+FEES) TOTAL LOAN GROWTH1 OUTSTANDING CORE REVENUES AND SOLID ACTIVITY GROWTH +36.7% vs. 1Q22 +9.8% vs. MAR 2022 2 EFFICIENCY RATIO LEADING AND IMPROVING EFFICIENCY WITH POSITIVE JAWS 43.3% -241 BPS. vs. 1Q22 3 COST OF RISK (YTD) ASSET QUALITY STA

  6. Slide 6: 1Q23 Profit & Loss

    1Q23 Results 6 1Q23 Profit & Loss Change Change 1Q23/1Q22 1Q23/4Q22 BBVA Group (€M) 1Q23 % constant % % constant % Net Interest Income 5,642 43.3 43.1 -0.4 5.8 Net Fees and Commissions 1,439 15.8 15.4 2.9 8.3 Net Trading Income 438 -18.7 -24.4 32.3 62.8 Other Income & Expenses1 -561 n.s. n.s. n.s. n.

  7. Slide 7: Excellent core revenues growth following a remarkable trend

    1Q23 Results 7 Excellent core revenues growth following a remarkable trend NET INTEREST INCOME NET FEES AND COMMISSIONS (CONSTANT €M) (CONSTANT €M) +43% +16% -0.4% +2.9% Strong NII growth Sound fee income YoY driven by levered on activity and Payments and improving customer transactional spreads. Qo

  8. Slide 8: NII growth levered on activity and improving customer spreads

    1Q23 Results 8 NII growth levered on activity and improving customer spreads LOAN GROWTH CUSTOMER SPREAD NET INTEREST INCOME (YOY, CONSTANT €) (%) (YOY, CONSTANT €) SPAIN +38% +8.9% BBVA GROUP +9.8% 1Q22 2Q22 3Q22 4Q22 1Q23 1Q22 2Q22 3Q22 4Q22 1Q23 +9.6% MEXICO +29% +4.1% Mar-22 Mar-23 1Q22 2Q22 3Q2

  9. Slide 9: Highly diversified and transactional deposit base with ample liquidity metrics

    1Q23 Results 9 Highly diversified and transactional deposit base with ample liquidity metrics TOTAL DEPOSITS - SPAIN TOTAL DEPOSITS - MEXICO (€ Bn) (CONSTANT € Bn) 1Q21 2Q21 3Q21 4Q21 1Q22 2Q22 3Q22 4Q22 1Q23 1Q21 2Q21 3Q21 4Q21 1Q22 2Q22 3Q22 4Q22 1Q23 (MAR-23) (MAR-23) 69% 57% 77% 59% RETAIL & INSU

  10. Slide 10: Positive jaws and continue to lead in efficiency

    1Q23 Results 10 Positive jaws and continue to lead in efficiency POSITIVE JAWS EFFICIENCY RATIO (1Q23 YOY, CONSTANT €) (COST-TO-INCOME, % CONSTANT €) FOOTPRINT INFLATION1 19.7% RANKING EUROPEAN 12M AVERAGE #1 PEER GROUP2 +32.7% +25.7% Excluding 42.0 extraordinary banking tax in Spain Gross Operating

  11. Slide 11: Asset quality stable and within guidance

    1Q23 Results 11 Asset quality stable and within guidance, in a context of sound activity growth FINANCIAL ASSETS IMPAIRMENTS NPL (CONSTANT €M) (€BN) 1Q22 2Q22 3Q22 4Q22 1Q23 Mar-22 Jun-22 Sep-22 Dec-22 Mar-23 COST OF RISK NPL & COVERAGE RATIOS (%, QUARTERLY) (%) COVERAGE 2019 at 1.04% NPL 2022 CoR 0

  12. Slide 12: Strong capital position above our target

    1Q23 Results 12 Strong capital position above our target CET1 FULLY-LOADED (%, BPS) +54 bps -29 bps +19 bps 13.13% -23 bps +12 bps +19 bps 12.80% 12.61% Target Range 11.5%-12.0% SREP SREP Requirement Requirement 8.63% 8.75% Dec -22 NPL Dec -22 Dividend RWAs Market Results Others3 Mar -23 (reported)

  13. Slide 13: Excellent customer acquisition driven by digital

    1Q23 Results 13 Excellent customer acquisition driven by digital NEW CUSTOMERS1 (BBVA GROUP, MILLION; % ACQUISITION THROUGH DIGITAL CHANNELS) DIGITAL 64% TOTAL DIGITAL 11% 1Q18 1Q19 1Q20 1Q21 1Q22 1Q23 (1) Gross customer acquisition through own channels for retail segment. Excludes the US business s

  14. Slide 14: Advancing in our clear commitment to sustainability

    1Q23 Results 14 Advancing in our clear commitment to sustainability SUSTAINABLE BUSINESS (€ Bn) New target (2022) 300 €Bn €14 Bn Revised target channeled in 1Q23 (2021) 200 €Bn €150 Bn Channeled since 2018 Initial target (2018) 100 €Bn 2018 2019 2020 2021 2022 2023 2024 2025 Note: Sustainable busine

  15. Slide 15: We have a positive impact on society

    1Q23 Results 15 We have a positive impact on society BBVA GROUP LOAN GROWTH1 (YOY, CONSTANT €) +9.8 % INCLUSIVE GROWTH FINANCING 34,000 130,000 70,000 3.3 €Bn MOBILIZED IN 1Q23 FAMILIES BOUGHT SMEs AND LARGER THEIR HOME2 SELF - EMPLOYED CORPORATES BOOSTED THEIR INVESTED IN BUSINESS2 GROWTH3 (1) Perf

  16. Slide 16: We are on the right path to achieve our ambitious long-term goals

    1Q23 Results 16 We are on the right path to achieve our ambitious long-term goals COST-TO-INCOME ROTE1 TBV/SHARE + DIVIDENDS (%) (%, ANNUALIZED) (YOY %) 2021-24 CAGR NEW TARGET CUSTOMERS2 SUSTAINABLE BUSINESS (MILLION CUMULATIVE) (€ BILLION, CUMULATIVE SINCE 2018) (1) Excluding discontinued operatio

  17. Slide 17: Business Areas

    Business Areas Creating Opportunities

  18. Slide 18: Spain

    1Q23 Results 18 Spain PROFIT & LOSS (€M) ACTIVITY (MAR-23) Δ (%) €Bn YoY YoY vs. vs. +2.2% 1Q23 1Q22 4Q22 €Bn Net Interest Income 1,183 38.2 8.9 +0.1% Net Fees and Commissions 536 0.0 2.9 Net Trading Income 120 -36.9 79.6 -4.1% Mortgages Demand Other Income & Expenses -112 n.s. n.s. Deposits +0.6% G

  19. Slide 19: Mexico

    1Q23 Results 19 Mexico PROFIT & LOSS (CONSTANT €M) ACTIVITY (MAR-23) (CONSTANT €) €Bn YoY Δ Constant (%) Δ Current (%) €Bn YoY +6.2% 1Q23 vs. 1Q22 vs. 4Q22 vs. 1Q22 +13.9% Net Interest Income 2,589 29.2 4.1 48.2 Net Fees and Commissions 483 22.4 6.6 40.4 Mortgages +10.6% Net Trading Income 149 41.1

  20. Slide 20: Turkey

    1Q23 Results 20 Turkey PROFIT & LOSS (CONSTANT €M) ACTIVITY (MAR-23) €Bn Δ Constant (%) Δ Current (%) (CONSTANT €; BANK ONLY) YoY1 1Q23 vs 1Q22 vs. 4Q22 vs. 4Q22 FC -23.7% Net Interest Income 626 63.0 -19.1 -3.7 €Bn YoY1 Net Fees and Commissions 172 61.0 2.2 24.3 Time -56.9% Net Trading Income 224 6

  21. Slide 21: South America

    1Q23 Results 21 South America YoY NET ATTRIBUTABLE PROFIT ACTIVITY (MAR-23) €Bn (CONSTANT €M) (CONSTANT €) +17.9% Δ Constant (%) Δ Current (%) YoY €Bn Colombia +21.1% 1Q23 vs. 1Q22 vs. 4Q22 vs. 1Q22 +14.3% Colombia 41 -34.0 54.2 -43.3 Peru 57 8.2 59.7 12.9 Colombia +17.5% Peru +7.6% Argentina 52 n.s

  22. Slide 22: Takeaways

    1Q23 Results 22 Takeaways BBVA delivered another very strong quarter mainly driven by Spain and Mexico Excellent core revenues evolution on the back of activity growth and higher spreads Delivering exceptional value creation for all our stakeholders: shareholders, clients, employees and society at l

  23. Slide 23: Annex

    Annex 01 Net Attributable Profit 08 CET1 Sensitivity to market evolution impacts 02 Gross Income breakdown 09 RWAs by business area 03 P&L Accounts by business 10 Book Value of the main unit subsidiaries 04 Customer spread by country 11 TBV per share & dividends evolution 05 Stages breakdown by 12 MR

  24. Slide 24: Net Attributable Profit evolution

    01 Net Attributable Profit evolution

  25. Slide 25: Business Areas Contribution to Group's NAP 1Q23 yoy growth

    1Q23 Results 25 Business Areas Contribution to Group's NAP 1Q23 yoy growth NET ATTRIBUTABLE PROFIT (BUSINESS AREAS CONTRIBUTION TO 1Q23 YOY GROWTH; CURRENT €M) +39% 1Q22 Spain Mexico Turkey South Rest of Corporate 1Q23 America Business Center NAP 1Q23 (€M) 541 1,285 277 184 92 -531 NAP growth (YoY)

  26. Slide 26: Gross Income breakdown

    BBVA Creating Opportunities Gross Income breakdown

  27. Slide 27: Gross Income breakdown

    1Q23 Results 27 Gross Income breakdown 1Q23 (€M, %) Rest of business 260 €M Spain (*) South America 4% 1,726€M 1,175 €M 16% 24% Turkey 11% 802 €M 45% Mexico 3,306 €M (*) Gross Income excluding extraordinary banking tax in Spain: 1,951€M (implying a 26% weight for Spain, 44% for Mexico, 11% for Turke

  28. Slide 28: P&L Accounts by business unit

    03 P&L Accounts by business unit Rest of Corporate Turkey Argentina Colombia Peru Business Center (hyperinflation (hyperinflation adjustment) adjustment)

  29. Slide 29: Rest of Business - Profit & Loss

    1Q23 Results 29 Rest of Business - Profit & Loss PROFIT & LOSS (€M) Δ (%) 1Q23 vs 1Q22 vs 4Q22 Net Interest Income 113 50.3 27.7 Net Fees and Commissions 69 22.3 20.2 Net Trading Income 77 12.9 33.1 Other Income & Expenses 1 -65.8 -46.7 Gross Income 260 28.5 26.5 Operating Expenses -138 20.1 -5.7 Ope

  30. Slide 30: Corporate Center - Profit & Loss

    1Q23 Results 30 Corporate Center - Profit & Loss PROFIT & LOSS (€M) Δ (%) 1Q23 vs 1Q22 vs 4Q22 Net Interest Income -60 60.8 n.s. Net Fees and Commissions -4 1.4 -33.8 Net Trading Income -258 n.s. 21.0 Other Income & Expenses 11 n.s. -75.5 Gross Income -311 293.0 68.1 Operating Expenses -205 9.7 -20.7

  31. Slide 31: Turkey - hyperinflation adjustment

    1Q23 Results 31 Turkey - hyperinflation adjustment PROFIT & LOSS1 (€M) 3M23 Hyperinflation 3M23 (reported) adjustment (2) Ex.Hyperinflation Net Interest Income 626 16 610 Net Fees and Commissions 172 4 168 Net Trading Income 224 8 216 Other Income & Expenses -220 -667 446 Gross Income 802 -639 1,441 Op

  32. Slide 32: Argentina - hyperinflation adjustment

    1Q23 Results 32 Argentina - hyperinflation adjustment PROFIT & LOSS1 (€M) 3M23 Hyperinflation 3M23 (reported) adjustment (2) Ex.Hyperinflation Net Interest Income 593 33 560 Net Fees and Commissions 49 2 47 Net Trading Income 35 2 33 Other Income & Expenses -307 -241 -66 Gross Income 371 -204 574 Opera

  33. Slide 33: Colombia - Profit & Loss

    1Q23 Results 33 Colombia - Profit & Loss PROFIT & LOSS (€M CONSTANT) Δ (%) 1Q23 vs 1Q22 vs 4Q22 Net Interest Income 171 -6.3 -9.0 Net Fees and Commissions 24 11.6 9.0 Net Trading Income 33 58.4 43.1 Other Income & Expenses 2 n.s. n.s. Gross Income 230 2.0 9.8 Operating Expenses -106 39.7 -8.7 Operati

  34. Slide 34: Peru - Profit & Loss

    1Q23 Results 34 Peru - Profit & Loss PROFIT & LOSS (€M CONSTANT) Δ (%) 1Q23 vs 1Q22 vs 4Q22 Net Interest Income 304 33.6 1.8 Net Fees and Commissions 73 10.8 11.8 Net Trading Income 47 36.8 16.0 Other Income & Expenses -13 46.5 26.4 Gross Income 412 28.8 4.3 Operating Expenses -154 23.8 2.7 Operating

  35. Slide 35: Customer Spread by country

    04 Customer Spread by country

  36. Slide 36: Customer spreads: quarterly evolution

    1Q23 Results 36 Customer spreads: quarterly evolution AVERAGE 1Q22 2Q22 3Q22 4Q22 1Q23 1Q22 2Q22 3Q22 4Q22 1Q23 Spain 1.71% 1.72% 1.85% 2.21% 2.75% Turkey TL 5.22% 6.65% 9.00% 7.19% 3.92% Yield on Loans 1.71% 1.74% 1.93% 2.42% 3.11% Yield on Loans 17.75% 18.60% 20.92% 18.67% 16.84% Cost of Deposits

  37. Slide 37: Stages breakdown by business areas

    05 Stages breakdown by business areas

  38. Slide 38: Stages breakdown by business areas

    1Q23 Results 38 Stages breakdown by business areas CREDIT RISK BUSINESS BREAKDOWN BY AREA (MAR-23, € M) Gross Accumulated Gross Accumulated Gross Accumulated BBVA GROUP Exposure impairments SPAIN Exposure impairments MEXICO Exposure impairments Stage 1 377,908 2,062 Stage 1 171,265 438 Stage 1 75,75

  39. Slide 39: Exposure to Covid-related loans and Commercial Real Estate

    06 Exposure to Covid-related loans and Commercial Real Estate

  40. Slide 40: Exposure to Covid-related loans backed by State guarantees and Commercial Real Estate

    1Q23 Results 40 Exposure to Covid-related loans backed by State guarantees and Commercial Real Estate COVID-RELATED LOANS, SPAIN AND PERU COMMERCIAL REAL ESTATE (OUTSTANDING LOANS AS OF MAR’23) (GROUP’s CRE EAD, %, AS OF MAR’23) 11.7 Bn€1 1.1 Bn€ c.9 Bn€ 2 of which of which 57% Retail 56% Retail c.2

  41. Slide 41: ALCO Portfolio, NII Sensitivity and LCRs & NSFRs

    07 ALCO Portfolio, NII Sensitivity and LCRs & NSFRs

  42. Slide 42: ALCO Portfolio

    1Q23 Results 42 ALCO Portfolio ALCO PORTFOLIO BREAKDOWN BY REGION (€ BN) Amort Cost Fair Value (HTC) (HTC&S) (duration Mar-23 (€BN) (€BN) incl. hedges) South America 0.2 6.0 0.9 years Turkey 7.0 3.2 3.8 years Mexico 6.2 8.2 1.9 years Euro 19.5 13.4 2.7 years (1) Spain 14.1 6.0 Italy 3.2 4.2 Rest 2.2

  43. Slide 43: NII sensitivity to interest rates movements

    1Q23 Results 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, %) +10 /15% +3.4% EURO BALANCE MEXICO SHEET Note: NII sensitivities to parallel interest rates movements as of Feb-23, u

  44. Slide 44: Liquidity and funding ratios

    Resultados 1T23 44 Liquidity and funding ratios BBVA GROUP AND SUBSIDIARIES LCR & NSFR (MAR-23) LCR NSFR Loan To Total Group 184% / 142%1 132% Deposits BBVA, S.A. 161% 123% 91% Mexico 188% 138% 96% 2 Turkey 217% 173% 79% S. America 96% All countries >100% >100% (1) Using a more restrictive criterion

  45. Slide 45: CET1 Sensitivity to market impacts

    08 CET1 Sensitivity to market impacts

  46. Slide 46: CET1 Sensitivity to Market Impacts

    1Q23 Results 46 CET1 Sensitivity to Market Impacts1 TO A 10% CURRENCY DEPRECIATION TO A 10% DECLINE IN TELEFONICA’S (MAR-23) SHARE PRICE (MAR-23) MXN -11bps -3 pbs TRY -1bps TO +100 BPS MOVEMENT IN THE SPANISH SOVEREIGN BOND (MAR-23) USD +17bps -11 bps (1) CET1 sensitivity considering the FL capital

  47. Slide 47: RWAs by business area

    Creating Opportunities RWAs by business area

  48. Slide 48: Risk-weighted assets by business area

    1Q23 Results 48 Risk-weighted assets by business area Fully-Loaded RWAs Breakdown by business area (€M) Mar-22 Dec-22 Mar-23 Spain 109,623 114,474 116,550 Mexico 67,626 71,738 78,316 Turkey 49,589 56,275 58,683 South America 46,330 46,834 47,341 Argentina 6,767 8,089 7,910 Chile 1,888 2,174 2,367 Co

  49. Slide 49: Book Value of the main subsidiaries

    10 Book Value of the main subsidiaries

  50. Slide 50: Book Value of the main subsidiaries

    1Q23 Results 50 Book Value of the main subsidiaries1,2 € BN; MAR-23 Mexico 17.3 Turkey 7.8 Argentina 1.4 Colombia 1.3 Peru 1.2 Chile 0.3 Venezuela 0.1 (1) Includes the initial investment + BBVA’s undistributed results + FX impact + other valuation adjustments. The Goodwill associated to each subsidi

  51. Slide 51: TBV per share & dividends evolution

    11 TBV per share & dividends evolution

  52. Slide 52: Shareholders' return: TBV per share & dividends evolution

    1Q23 Results 52 Shareholders’ return: TBV per share & dividends evolution TBV PER SHARE & DIVIDENDS(1) (€ PER SHARE) TBV Dividends +21.7% (2) (2) (2) (after implementation of IAS29 in Turkey) (1) 2022 figures restated for IFRS17. Including the deduction of the whole Share Buy Back program. (2) Octobe

  53. Slide 53: MREL

    Creating Opportunities MREL

  54. Slide 54: Sound MREL position

    1Q23 Results 54 Sound MREL position POSITION AS OF MAR-23 (% RWA1) MREL REQUIREMENT + CBR SUBORDINATION REQUIREMENT + CBR 26.89% 24.76% 22.19% CBR: 3.30% 3 16.80% 3 CBR: 3.30% MREL 21.46% Subordination 13.50% 2 2 M-MDA Buffer 213 bps (4.4€bn) Subordination Buffer 539 bps (11.1€bn) Note: Preliminary

  55. Slide 55: Digital metrics

    13 Digital metrics Digital & mobile Digital customers sales

  56. Slide 56: Digital metrics: digital & mobile customers

    1Q23 Results 56 Digital metrics digital & mobile customers DIGITAL CUSTOMERS MOBILE CUSTOMERS (MILLION CUSTOMERS, %) (MILLION CUSTOMERS, %) +36% +40% CUSTOMER PENETRATION RATE1 CUSTOMER PENETRATION RATE1 64.3% 70.0% 73.6% 60.5% 67.0% 71.3% Note: data excludes USA, Paraguay and Chile. (1) Digital and

  57. Slide 57: Digital metrics: digital sales

    1Q23 Results 57 Digital metrics digital sales (% OF TOTAL SALES YTD, # OF TRANSACTIONS AND PRV1) GROUP SPAIN MEXICO UNITS PRV TURKEY COLOMBIA PERU Note: Group excludes USA, Venezuela, Chile, Paraguay. (1) Product Relative Value as a proxy of lifetime economic representation of units sold.

  58. Slide 58: BBVA

    BBVA

Banco Bilbao Vizcaya Argentaria — Q1 2023 Earnings Presentation on 6ix