Balance Sheet at 31 December 2010 of BBVA

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Translation of financial statements originally issued in Spanish and prepared in accordance with generally accounting principles Spain (See Note 1 and 54). In the event of a discrepancy, the Spanish-language version prevails. Most of the impairment on financial assets are included under the heading “Loans and receivables - Loans and advances to customers” whose changes for the years ended 2010 and 2009 were as follows: Millions of Euros Changes in the Impairment Losses of the heading Loans and Receivables - Loans and advances to customers 2010 2009 Balance at the beginning 5,029 4,113 Increase in impairment losses charged to income 3,380 3,702 Decrease in impairment losses credited to income (1,597) (2,105) Aquisition of subsidiaries in the period - 144 Transfers to written-off loans (1,413) (780) Exchange differences and other 126 (45) Balance at the end 5,525 5,029 Of which: For impaired portfolio 5,110 3,974 For current portfolio non impaired 415 1,055 5.2 MARKET RISK a) Market Risk Market risk is defined as the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices, resulting in changes in the different assets and financial risk factors. The risk can be mitigated or even eliminated through hedges using other products (assets/liabilities or derivatives), or by undoing the transaction/open position. There are four main risk factors that affect market prices: interest rates, foreign exchange rates, equity and commodities. In addition, for certain positions, other risks also need to be considered, such as spread risk, basis risk, volatility and correlation risk. • Interest rate risk: Defined as changes in the term structure of market interest rates for different currencies. • Foreign-exchange risk: This is the risk resulting from changes in the foreign exchange rate for different currencies. • Price risk: This is the risk resulting from variations in market prices, either due to factors specific to the instrument itself, or alternatively to factors which affect all the instruments traded on the market. • Commodities risk: this is the risk resulting from changes in the price of traded commodities. In addition, for certain positions, other risks also need to be considered: Credit spread risk, basis risk, volatility or correlation risk. Value at Risk (VaR) is the basic variable for measuring and controlling the Group’s market risk. This risk metric estimates the maximum loss that may occur in a portfolio’s market positions for a particular time horizon and given confidence level. VaR is calculated in the Group at a 99% confidence level and a 1-day time horizon. BBVA has received approval from the Bank of Spain to use the internal model to calculate bank capital for market risk. This authorization took effect from December 31, 2004. In BBVA, VaR is estimated using the Historic Simulation methodology. This methodology consists of observing how the profits and losses of the current portfolio would perform if the market conditions from a particular historic period were in force, and from that information to infer the maximum loss at a certain confidence level. It offers the advantage of accurately reflecting the historical distribution of the market variables and of not requiring any specific distribution assumption. The historic period comprises two years. With regard to market risk, limit structure determines a system of VaR and economic capital at risk limits for each business unit, with specific sub-limits by type of risk, activity and desk. 44
Translation of financial statements originally issued in Spanish and prepared in accordance with generally accounting principles Spain (See Note 1 and 54). In the event of a discrepancy, the Spanish-language version prevails. Validity tests are performed on the risk measurement models used to estimate the maximum loss that could be incurred in the positions assessed with a certain level of probability (backtesting), as well as measurements of the impact of extreme market events on risk positions (stress testing). The Group is currently performing stress testing on historical and economic crisis scenarios drawn up by its Economic Research Department. Changes in market risk in 2010 The Bank’s market risk is higher in 2010 compared to the previous year. The average risk for 2010 stood at €321 million (VaR calculation without smoothing). As regards annual trend, consumption fluctuated between €15 and €27 million, with a slight rise in the second half of the year in interest-rate and credit spread risks as a result of greater market volatility, together with greater exposure to interest-rate risk. The following is the market risk trend for the Bank (VaR calculations without smoothing with a 99% confidence level and a 1-day horizon): 45 40 35 30 25 20 15 10 5 0 MARKET RISK EVOLUTION (Millions of Euros) VaR BBVA SA Jan-10 Apr-10 Jul-10 Oct-10 The breakdown of VaR by risk factor as of December 31, 2010 and 2009 was as follows: Millions of Euros VaR by Risk Factor 2010 2009 Interest/Spread risk 19 29 Currency risk 2 1 Stock-market risk 1 3 Vega/Correlation risk 10 14 Diversification effect (16) (27) Total 16 20 VaR medium in the period 21 16 VaR max in the period 27 23 VaR min in the period 15 11 b) Structural interest rate risk The aim of on-balance-sheet interest rate risk management is to maintain the BBVA’s exposure to market interest rate fluctuations at levels in keeping with its risk strategy and profile. In pursuance of this, the Asset- Liability Committee (“ALCO”) undertakes active balance sheet management through operations intended to optimize the levels of risk borne according to the expected earnings and enables the maximum levels of accepted risk with which to be complied. ALCO uses the interest rate risk measurements performed by the Risk Area. Acting as an independent unit, the Risk Area periodically quantifies the impact of interest rate fluctuations on the BBVA’s net interest income and economic value. 45
Page 1: For the year ended December 31, 201
Page 4 and 5: Translation of financial statements
Page 56 and 57: The table below outlines the financ
Page 58 and 59: The breakdown, by transaction type
Page 60 and 61: 2009 Unrealized Gains Millions of E
Page 62 and 63: 11. LOANS AND RECEIVABLES 11.1. BRE
Page 64 and 65: Additionally, this heading of the a
Page 66 and 67: As of December 31, 2010 and 2009 th
Page 68 and 69: As of December 31, 2010 and 2009, t
Page 70 and 71: 15. INVESTMENTS 15.1. INVESTMENTS I
Page 72 and 73: The changes in 2010 and 2009 in the
Page 74 and 75: 16. TANGIBLE ASSETS As of December
Page 76 and 77: directives and regulations and by T
Page 78 and 79: In addition to the income tax recog
Page 80 and 81: 20.2. DEPOSITS FROM CREDIT INSTITUT
Page 82 and 83: The changes in 2010 and 2009 in the
Page 84 and 85: This heading of the balance sheet i
Page 86 and 87: 22. PENSION AND OTHER COMMITMENTS T
Page 88 and 89: The defined benefit commitments as
Page 90 and 91: • Other commitments with employee
Page 92 and 93: 22.2.3. Summary of effects on profi
Page 94 and 95: 24. SHARE PREMIUM The amounts under
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The percentages of treasury stock h
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29. FINANCIAL GUARANTEES AND DRAWAB
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The amounts recognized in equity in
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38. NET GAINS (LOSSES) ON FINANCIAL
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Equity-instrument-based employee re
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43. IMPAIRMENT LOSSES ON FINANCIAL
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48. ACCOUNTANT FEES AND SERVICES Th
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50. REMUNERATION OF THE BANK’S DI
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The number of “theoretical shares
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APPENDICES 112
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BANCO BILBAO VIZCAYA ARGENTARIA, S.
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APPENDIX II. Additional information
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Additional Information on Consolida
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APPENDIX III. Additional informatio
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APPENDIX V. Changes and notificatio
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APPENDIX V. Changes and notificatio
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APPENDIX VI. Fully consolidated sub
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APPENDIX VIII: Information on data
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B) DEBIT OPERATIONS Millions of Eur
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Appendix X. Balance sheets as of De
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APPENDIX XII. List of Agents 3U EMP
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ARCOS GONZALEZ, FELIX ARTEKARITZA A
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BARRIONUEVO VACA, JOSE LUIS BLANCO
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COLL PEREZ-GRIFO, ANA MARTA COOP. O
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EUROCONSULTING ECONOMISTAS, S.L. FE
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GESTION DE INVERSIONES Y PROMOCIONE
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INVERSIONES BARCARES 55, S.L. JAURE
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MARTINEZ FERNANDEZ, HECTOR MAYORDOM
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ORRIOLS GESE, JORDI PASOCORRECTO, S
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ROJAS ALBENDIN, S.L. RUIZ-ESTELLER
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SUBCONTAB, S.L. TORRICO Y SALMERON,
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APPENDIX XIII. Balance Sheet of Ban
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APPENDIX XIV. Years in which the di
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Deposits from customers Redeemable
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Mortgage-backed bonds Non-current a
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inflation, this is forcing the auth
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6. COMMON STOCK AND TREASURY STOCK
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The grievances and complaints handl
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Development of virtual banking In 2
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Development and coordination of Inn
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12. OTHER INFORMATION AND SUBSEQUEN
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Termination of Directorship Directo
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ANNUAL CORPORATE GOVERNANCE REPORT
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A.3. Complete the following tables
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24/MAY/2010 9/JUN/2010 24/JUN/2010
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Description of the legal restrictio
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B.1.3.Fill in the following tables
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Name of director (person or company
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B.1.8. List, where applicable, any
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c) Total remuneration by type of di
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Article 50 b of the BBVA bylaws est
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4. Propose the senior management re
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Should the board decide against the
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. Matters on which a tie-breaking v
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NO Identify, if applicable, the per
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Amount of non-audit work / Aggregat
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B.2. Committees of the Board of Dir
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Article 32. Composition The Appoint
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The Remuneration committee shall me
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egulators from Spain and abroad may
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established in the specific regulat
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Name of committee Brief description
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Bank or companies of its Group hold
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This organisational set-up is suppl
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MARKET RISK: This risk arises as a
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Liquidity risk. Liquidity risk is t
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Risk materialised in the financial
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During the first half of the year,
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On second summons, twenty-five perc
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the General Meeting as established
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Resolution Three adopted by 95.29%.
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a) The transformation of listed com
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See section: B.1.3 Complies 12. Amo
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See sections: B.1.28 and B.1.30 Com
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34. Directors who give up their pla
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4.- Propose the remuneration policy
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a) To monitor the preparation and t
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G OTHER INFORMATION OF INTEREST If
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(3) Roman Knörr Borrás, who stood
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The provisions registered as of Dec
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Balance Sheet at 31 December 2010 of BBVA

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