Balance Sheet at 31 December 2010 of BBVA

BANCO BILBAO VIZCAYA ARGENTARIA, S.A.
MANAGEMENT REPORT FOR THE YEAR ENDED DECEMBER 31, 2010
Banco Bilbao Vizcaya Argentaria, S.A. (hereinafter, the Bank or BBVA) is a private-law entity, subject to the
rules and regulations governing banking institutions operating in Spain. The Bank conducts its business
through branches and offices located throughout Spain and abroad.
The Bank's management report has been prepared based on the individual book and management entries of
Banco Bilbao Vizcaya Argentaria, S.A.
BBVA is the parent company of the BBVA Group (the Group), which is an international diversified financial
group with a significant presence in retail banking, asset management, private banking and wholesale
banking.
The financial information included in this management report is presented in accordance with the criteria
established by Bank of Spain Circular 4/2004, December 22, 2004, International Public and Confidential
Financial Reporting Standards and Financial Statement Models, and their subsequent amendments.
1. ECONOMIC ENVIRONMENT IN 2010
In 2010 the world economy recovered from the major slump in 2009. GDP picked up from a fall of 0.6% to a
rise of nearly 5% in 2010. This figure is in line with those in the years immediately before the start of the
crisis in the summer of 2007. However, the economic recovery is not evenly spread across regions.
Throughout the year it became clear that the emerging economies, particularly in emerging Asia and Latin
America, showed stronger growth and are contributing to global growth, while in advanced economies, and
particularly in some European economies, recovery continues to be sluggish.
Three elements have given shape to the economic developments in the different areas. First, the focus of
attention has continued to be the level of stress in the financial markets and the various measures that the
authorities were taking to counter it. The second element that has shaped 2010 has been the cyclical doubts
on the U.S. economy in the first half of the year and the response in terms of economic policy in the second
half, particularly the new monetary expansion introduced by the Federal Reserve (Fed) known as
quantitative easing 2 (QE2) and its effect on other economies. Finally, 2010 was also marked by the
collateral effects of lax economic policies, in particular monetary policy, in advanced economies, giving rise
to growing economic policy dilemmas in emerging economies.
In the United States cyclical concerns continue, derived from the weakness shown by private demand since
some of the fiscal stimulus programs began to expire. Thus, throughout the quarter there has been a gradual
loss of activity in the real estate market, while the labor market remains weak, and all this while households
continue to be immersed in a deleveraging process. Given the limited room for maneuver of fiscal policy in
the US for reactivating the economy, the Fed has begun a new monetary expansion program (known as
QE2), which initially led to a downward pressure on short-term interest rates and a significant depreciation of
the dollar. In any event, no return to recession is expected, but rather a gradual slowdown from the high
rates of growth at the end of 2009 and the start of 2010.
In Europe, the economy slowed gradually in line with expectations, although some countries, especially
Germany, maintain their strength. Tension has also returned to the debt markets, particularly in peripheral
countries, and above all in Ireland and Portugal. Doubts remain about the capacity of these countries to
achieve their fiscal targets. In addition, tensions have been heightened by the uncertainty surrounding the
new European governance mechanisms and, in particular, by the final details of the new permanent crisis
resolution mechanism that will come into effect in 2013, once the current framework approved in May
expires. In any event, forecasts indicate that 2010 will close with growth at around 1.5%.
Throughout the second half of 2010 the Mexican economy has shown resistance to the loss of strength in
foreign demand. This is reflected in a less notable slowdown of its growth rates than expected, with growth in
2010 at around 5%. Inflation closed 2010 at a historically low level of 4.4% as a result of the appreciation of
the peso over the year, moderate international prices and the lack of pressure from domestic demand. Thus,
the monetary pause is expected to remain in place, at least throughout 2011. Finally, in an economic
environment focused on fiscal sustainability, the commitment to budget balance is a strength that sets the
Mexican economy apart from the rest.
In China, the latest economic indicators point to the existence of a renewed boost to growth and increased
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