Banco Bilbao Vizcaya Argentaria, S.a. · BME:BBVA
Banco Bilbao Vizcaya Argentaria — Debt Investor Presentation (February 2023)
51 slides from Banco Bilbao Vizcaya Argentaria's debt investor presentation, Feb 1, 2023
Slide 1: Fixed Income Investors Presentation 4Q22
Creating Opportunities Fixed Income Investors Presentation 4Q22
Slide 2: Disclaimer
4Q22 Fixed Income 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 o
Slide 3: BBVA Investment case
Creating Opportunities Ol BBVA Investment case
Slide 4: About BBVA
4Q22 Fixed Income 4_ About BBVA & he BBVA‘s GLOBAL PRESENCE FINANCIAL HIGHLIGHTS DECEMBER 2022 DECEMBER 2022 Net attributable profit 2022 CETIFL 6,420 me 12 Ble . OUR PURPOSE Total assets - cs t 9g is fy bring the age 713,140 Me , i : - V2 of opportunity Loans and advances to Deposits from ; to ever
Slide 5: To bring the age of opportunity to everyone
4Q22 Fixed Income 5 To bring the age of opportunity to everyone STRATEGIC PRIORITIES = Improving our clients’ Fo Helping our clients transition financial health towards a sustainable future i Driving operational Reaching more clients ." excellence w id ip aaa = Data and Technology engaged team
Slide 6: Leading franchises in very attractive markets
i i By Leading franchises in very attractive markets BBVA | STRONG POSITION Market share! (%) Spain 13.3% Mexico 24.4% Turkey 179% Colombia 10.9% Peru 20.2% (1) Latest available loan market shares, Ranking among peer group. Turkey among private banks. (2) Latest available data according to local cri
Slide 7: Well diversified business model
2) Well diversified business model DIVERSIFICATION UNDER A DECENTRALIZED MODEL TOTAL ASSETS ! DEC-22 7% Rest of Business South America 8% Turkey 9% { Mexico ok GROSS INCOME! 12M22 57% Spain 3%Rest of Business South America “a Turkey 13% ™ 24% Spain Mexico a, (1) Figures exclude the Corporate Center
Slide 8: Capturing value from digitalization
4Q22 Fixed Income 8 3) Capturing value from digitalization NEW CUSTOMER ACQUISITION! GROUP: SALES THROUGH DIGITAL CHANNELS (BBVA GROUP, MILLION; % ACQUISITION THROUGH DIGITAL (BBVA GROUP, % GROWTH OF TOTAL SALES YTD, % OF DIGITAL CHANNELS) TRANSACTIONS AND PRV! OVER TOTAL SALES YTD) 11.2 ° 8.7 e UNI
Slide 9: Proven track record of solid financial returns
4Q22 Fixed Income 9 4) Leading to a proving track record of solid financial returns STRONG PRE-PROVISION PROFIT AND OUTPERFORMING OUR PEERS BEST-IN-CLASS EFFICIENCY ON PROFITABILIY PRE-PROVISION PROFIT / RWA EFFICIENCY RATIO ROTE BBVA 2016-2022 BBVA 2016-2022, % BBVA 2016-2022, % PEERS 2016-9M22, %
Slide 10: NPL Ratio, Coverage ratio, Cost of Risk
NPL Ratio Coverage ratio Cost of Risk
Slide 11: Strong ESG Credentials
4Q22 Fixed Income 11 6) Strong ESG Credentials SUSTAINABLE BUSINESS SOCIAL GOVERNANCE Sustainable Business Community Commitment Directors Increased . % Female taget to 300 eb 20r8.2025 550 emninvestment 2021-2025 Directors A0% coat 40% at least 2018-2022: 2021-2022: 937 emn 62 ~ investment eneficiar
Slide 12: Portfolio alignment target for the Oil&Gas sector
12 Power Auto Steel Cement Coal Oil & Gas Advancing in our commitment in portfolio alignment by setting a new target for the Oil&Gas sector
Slide 13: (1) Excluding discontinued operations and non-recurring results (2) Target customers refers to those customers
(1) Excluding discontinued operations and non-recurring results (2) Target customers refers to those customers in which the bank wants to grow and retain, as they are considered valuable due to their assets, liabilities and/or transactionality with BBVA.
Slide 14: 2022 Results
Creating Opportunities O2 2022 Results
Slide 15: EPS Growth
4Q22 Fixed Income 1515 2022 Results EPS GROWTH (RECURRENT) %
Slide 16: 2022 Results
2022 Results 16 6,621 5,069 4,830 4,642 4,627 3,084 2017 2018 2019 2020 2021 2022
Slide 17: 2022 key financial messages
2022 Results 17 2022 key financial messages fe | OUTSTANDING CORE REVENUES CORE REVENUES (NII+FEES) TOTAL LOAN GROWTH! a AND ACTIVITY GROWTH +30.7% vs. 2021 +13.3% vs. DEC 2021 2 LEADING AND IMPROVING EFFICIENCY RATIO EFFICIENCY WITH POSITIVE JAWS 43.2% -277 BPS. vs. 2021 HIGHEST ANNUAL OPERATING IN
Slide 18: (1) Discontinued operations and non-recurring results include US business sold to PNC and net
(1) Discontinued operations and non-recurring results include US business sold to PNC and net cost related to the restructuring process in 2021, and the negative impact of € 201 M due to the agreement reached with Merlin for the purchase of 662 branches in Spain in 2022.
Slide 19: Loan growth
4Q22 19 +26% +17.0% +35% +8.5% Note: Performing loans under management excluding repos.
Slide 20: 4Q21 12M21 1Q22
4Q22 20 4Q21 1Q22 2Q22 3Q22 4Q22 Dec-21 Mar-22 Jun-22 Sep-22 Dec-22 12M21 3M22 6M22 9M22 12M22 Dec-21 Mar-22 Jun-22 Sep-22 Dec-22 NOTE: 2019 and 2021 figures excludes the US business sold to PNC for comparison purposes.
Slide 21: Activity (Dec-22)
4Q22 21 ACTIVITY (DEC-22) € Δ (%) Δ (%) €Bn Mortgages Demand Deposits Consumer + Credit Cards Very small businesses Time Deposits Other Commercial Corporate + CIB Off-BS Funds Public sector Others ▰ ▰ ▰ ▰ .
Slide 22: Activity by segment (Constant €)
4Q22 22 (Constant €) Δ Δ Δ Mortgages Consumer Demand Deposits Credit Cards SMEs Time Deposits Other Commercial Off-BS Funds Public sector . ▰ ▰ ▰ ▰
Slide 23: Turkey activity
4Q22 23 (Constant €; Bank Only) Δ Δ FC Time FC Demand TL TL Commercial Time Retail Demand . ▰ ▰ ▰ .
Slide 24: South America activity
4Q22 24 (Constant €) Δ Δ Δ Colombia Colombia Peru Peru Argentina Argentina Other Other ▰ ▰ ▰
Slide 25: 2023 Outlook
2023 Outlook Group O1 Core revenues expected to grow at mid twenties, maintaining our strategic focus towards the most profitable segments O2 Costs to grow aroun inflation', focus on po jaws 03 Cost of Risk around 100 bps Note: Growth ratesin constant€. (1) Footprint opexweightedaverageinflation 4Q2
Slide 26: Capital & Liquidity
Creating Opportunities OS Capital & Liquidity
Slide 27: A high quality and resilient capital position
A high quality and resilient capital STRONG CAPITAL POSITION CET1 FULLY-LOADED (%) 12.61% Target range 11.5- 12.0% __ CET] Requirement 8.63% | Dec-22 (1) Includes the update of the CCyB calculated on the basis of exposures as of Dec'22. HIGH RWAS DENSITY, WITHA LIMITED USE OF INTERNAL MODELS! RWA/TO
Slide 28: Strong capital position with CET1 FL above our target
Strong capital position with CET1 FL above our target CET1 FULLY-LOADED (%, BPS) +47 bps -20 bps | Mm --25bps +14 bps 12.45% " P Sep-22 Results Dividend RWAS Others (1) Accrual & — (constant €) ATI Coupons (1) Includes, among others, market related impacts, minority inter the NPL backstop deduction
Slide 29: Shareholder remuneration
4Q22 29 47% €3.0 Bn1 € 50 €43 €31 €12 € 422 M 1.1% La retribución total al accionista representa un∼7,8% de la capitalización bursátil3
Slide 30: AT1 and Tier 2 buckets
2.38% 0.04% 1.78% 0.75% 2.50% 0.84% 4.50% CET1 Requirement Total Requirement Phased-in ratios Dec.22
Slide 31: Tier 2 requirement
0.05% 2.50% 0.84% 4.50% CET1 Requirement Total Requirement Phased-in ratios Dec.22
Slide 32: Sound MREL position
4Q22 Fixed Income 32 Sound MREL position >80% OF MREL ELIGIBLE POSITION AS OF DEC-22 WITH SUBORDINATION > OR = TO SNP % RWA! MREL REQUIREMENT + CBR SUBORDINATION REQUIREMENT + CBR M-MDA Buffer 169 bps (3.5€bn) Subordination Buffer 494 bps (10.2€bn) CBR: 3.30% * 21.74% 16.80% 3 MREL CBR: 3.30% 21.46%
Slide 33: Liquidity ratios well above 100% minimum
Liquidity ratios well above 100% minimum Ample quality collateral BBVA GROUP LIQUIDITY BALANCE SHEET! DEC-22 60% 66% = Deposits BECB = M&L/T Funding = Net Loans to Customers = Fixed Assets & Others 5% Ea 4% = Financial Assets Box mEquity & Others 9 35 on 17% & S/T Funding ea 4% Assets Liabilities Re
Slide 34: Limited wholesale funding maturities in all geographies
4Q22 Fixed Income 34 Limited wholesale funding maturities in all geographies DEBT OUTSTANDING BY PRODUCT MEDIUM & LONG-TERM WHOLESALE DEC-22, €BN FUNDING MATURITIES DEC-22, €BN Others! Senior 12.9 10.3 Wl 10 Preferred B&R EURO 6.0 5.9 17% Vv € 46.2 bn | Py a a 30% Subordinated Total 8 14% WI wexico
Slide 35: Funding plan 2023
4Q22 Fixed Income 35 Funding plan 2023 oriented to meet both 2023 maturities and regulatory requirements BBVA, S.A. 2023 = 2023 Strategy! €BN Executed (subject to market conditions) ATl Dynamic management of the capital stack structure? Tier 2 SNP €1bn : Could issue € 2-3 bn SP-SNP. At least 1 trans
Slide 36: All Ratings Agencies assign BBVA a rating in the single A space
All Ratings Agencies assign BBVA a rating’ on the single A space, with stable outlook BBVA LONG TERM SENIOR PREFERRED RATINGS , Stable outlook Moody's 2a? ign dors) S&P Stable outlook (Mar, 22%, 2022) i Stable outlook Fitch (Dec. 19", 2022) Stable outlook DBRS (Mar. 29%, 2022) Note: CB = Covered Bon
Slide 37: Annex
BBVA Creating Opportunities Annex « BBVA Group 4Q22 Profit & Loss a Nil sensitivity to interest rate movements a ALCO Portfolio a Stages breakdown by business area « Covid-related loans backed by State guarantees « Capital Base: BBVA Group & BBVA, S.A. a CET1 Sensitivity to market impacts « Group RW
Slide 38: 4Q22 Profit & Loss
BBVA Group Ae22Fmaeame 38 4Q22 Profit & Loss Change Change 4Q22/4Q21 4Q22/3Q22 BBVA Group (€M) AQ22 %constant % %constant % Net Interest Income 5,342 49.0 34.3 12.0 1.6 Net Fees and Commissions 1,323 12.0 6.1 2.5 4.2 Net Trading Income 269 -9.] -38.6 -38.7 -53.1 Other Income & Expenses -410 ns. ns.
Slide 39: NII sensitivity to interest rates movements
4Q22 Fixed Income 39 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) = | | +] O/ 1 5y, +3.7% EURO BALANCE MEXICO SHEET Note: Nl sensitivities to parallel interest rates movements as of
Slide 40: ALCO Portfolio
40 (1) (1) Figures exclude SAREB senior bonds (€4.5bn as of Dec-21, and €4.3bn as of Sep-22 and Dec22) and High Quality Liquid Assets portfolios (€11.3bn as of Dec-21, €10.0bn as of Sep-22 and €7.6bn as of Dec-22) . (2) Note: HQLA – High Quality Liquid Assets
Slide 41: Stages breakdown by business area
Stages breakdown by business area CREDIT RISK BREAKDOWN BY BUSINESS AREA (DEC-22,€M) BBVA GROUP Stage 1 Stage 2 Stage 3 TURKEY Stage 1 Stage 2 Stage 3 COLOMBIA Stage 1 Stage 2 Stage 3 Gross Accumulated Exposure impairments 372,601 2,067 37,277 2111 14,463 7,586 Gross Accumulated Exposure impairments
Slide 42: Covid-related loans backed by State guarantees
3Q22 Results 42 Covid-related loans backed by State guarantees € bn; DEC-22 GROUP SPAIN@) MEXICO TURKEYS) ARGENTINA COLOMBIA PERU Loans Weight Loans Weight Loans Weight Loans Weight Loans Weight Loans Weight Loans Weight Households 13° 08% 12 12% O00 0.0% 0.0 0.0% 0.0 06% 0.0 03% 0.1 1.1% Corporates
Slide 43: Capital Base: BBVA Group & BBVA, S.A.
4Q22 Tier 2 Tier 2 Additional Tier 1 Additional Tier 1 CET1 CET1 CET1 € 42,740 m € 26,333 m CET1 € 42,486 m € 26,292 m AT1 € 5,193 m € 4,875 m AT1 € 5,193 m € 4,875 m T2 € 5,930 m € 3,730 m T2 € 6,023 m € 3,821 m Total Capital Base € 53,863 m € 34,938 m Total Capital Base € 53,701 m € 34,988 m RWA €
Slide 44: CET1 Sensitivity to Market Impacts
2022 Results 44 CET1 Sensitivity to Market Impacts TO A 10% CURRENCY DEPRECIATION TO A 10% DECLINE IN TELEFONICA’S (DEC-22) SHARE PRICE (DEC-22) MXN -5pbps TRY -5pps TO +100 BPS MOVEMENT IN THE SPANISH SOVEREIGN BOND (DEC-22) USD +] Opps
Slide 45: Group RWA breakdown
4Q22 Optimizing Capital Allocation is part of 47% IRB Models BBVA’s Strategic CVA 1 Priorities FX Risk Trading Act. Risk Limited usage of internal models in Credit Risk Operational Risk RWAs, mitigating Credit Risk potential impacts from future regulatory requirements 53% Standardized Models Note 1:
Slide 46: Debt Issuances 2020 – 2023 YTD
Debt Issuances 2020 — 2023 YTD @ BBVAS.A. Wi BBVA MEXICO 4Q22 Fixed Income 46 PRODUCT ISSUE DATE CALL DATE MATURITY NOMINAL CURRENCY COUPON cB Jan-23 ° Jul27 €1,500 M 3.125% SNP Jan-23 Jan-30 Jan-31 €1,000M 4.625% SP Nov-22 ° Nov-28 CHF 210M 2.77% ) SP Nov-22 ° Nov-25 CHF 215 M 2.4075% SP Oct-22 - O
Slide 47: Called notes 2018 – 2023 YTD
4Q22 Fixed Income 47 Called notes 2018 — 2023YTD economic call policy OUTSTANDING PRODUCT ISSUE DATE REDEMPTION CURRENCY (M) COUPON BBVA, S.A. AT May-17 May-22* €500 5.875% BBVA, S.A. ATI Apr-16 Apr-21 € 1,000 8.875% Caixa Terrassa SPP Preferred Ago-05 Jan-21 €75 10yCMS+0.10% BBVA Intl. Preferred Un
Slide 48: Main Subsidiaries ratings
Main Subsidiaries ratings! BBVA LONG TERM SENIOR UNSECURED RATINGS Investment grade Non Investment Grade BBVA Mexico AAA/Aaa AA+/Aal AA/Aa2 AA-/Aa3 A+/Al ASAZ A-/AS aS oY BBB-/Baa3 BB+/Bal BB/Ba2 BB-/Ba3 B+/B1 B/B2 B-/B3 ccc cc .) Garanti BBVA AAA/Aaa AA+/Aal AA/Aa2 AA-/Aad A+/Al A/A2 A-/AZ BBB+/Baa
Slide 49: Sovereign Exposure by geography
Sovereign Exposure by geography! € bn; DEC-22 Amortized Cost debt securities (HTC) Spain 19.1 Italy 33 Mexico 4.2 USA 2.1 Turkey ad All Others 15 Fair Value debt securities (HTC&S) 10.4 42 8.8 Sovereign Non-trading Trading financial assets securities | mandatorily at fair value through P&L 4.6 0.0 3
Slide 50: Book Value of the main subsidiaries
4Q22 Fixed Income 50 Book Value of the main subsidiaries(:2) € BN; DEC-22 Mexico By ss | 4 Turkey ae 7 Argentina = W114 Colombia se Peru a) 01.3 Chile wy 103 Venezuela zm | 0.1 (1) Includes the initial investment + BBVA’s undistributed results + FX impact + other valuation adjustments, The Goodwill
Slide 51: BBVA
BBVA
Banco Bilbao Vizcaya Argentaria, S.A. (BBVA) — Debt Investor Presentation (February 2023) on 6ix