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. In addition to measuring the sensitivity to 100-basis-point changes in market interest rates, the Bank performs probability calculations that determine the economic capital and risk margin for structural interest rate risk in the BBVA’s banking activity (excluding the Treasury area), based on interest rate curve simulation models. The Bank regularly performs stress tests and sensitivity analysis to complement its assessment of its interest rate risk profile. All these risk measurements are subsequently analyzed and monitored, and levels of risk assumed and the degree of compliance with the limits authorized by the Executive Committee are reported to the various managing bodies of the Bank. As part of the measurement process, the Bank established the assumptions regarding the movement and behavior of certain items, such as those relating to products with no explicit or contractual maturity. These assumptions are based on studies that estimate the relationship between the interest rates on these products and market rates and enable specific balances to be classified into trend-based balances maturing at long term and seasonal or volatile balances with short-term residual maturity. c) Structural currency risk Structural foreign exchange risk is basically caused by exposure to variations in foreign exchange rates that arise in the Bank’s foreign subsidiaries and the provision of funds to foreign branches financed in a different currency to that of the investment. The ALCO is responsible for arranging hedging transactions to limit the capital impact of fluctuations in exchange rates, based on their projected trend, and to guarantee the equivalent euro value of the foreign currency earnings expected to be obtained from these investments. Structural currency risk management is based on the measurements performed by the Risk Area. These measurements use a foreign exchange rate scenario simulation model which quantifies possible changes in value for a given confidence interval and a pre-established time horizon. The Executive Committee authorizes the system of limits and alerts for these risk measurements, which include a limit on the economic capital or unexpected loss arising from the foreign exchange risk of the foreign-currency investments. d) Structural equity risk The Bank’s exposure to structural equity risk comes largely from its holdings in industrial and financial companies with medium- to long-term investment horizons, reduced by the short net positions held in derivative instruments on the same underlying assets, in order to limit portfolio sensitivity to potential price cuts. The Risk Area measures and effectively monitors structural risk in the equity portfolio. To do so, it estimates the sensitivity figures and the capital necessary to cover possible unexpected losses due to the variations in the value of the equity portfolio at a confidence level that corresponds to the institution’s target rating, and taking account of the liquidity of the positions and the statistical performance of the assets under consideration. These figures are supplemented by periodic stress comparisons, back-testing and scenario analyses. 5.3 LIQUIDITY RISK The aim of liquidity risk management, tracking and control is to ensure, in the short-term, that the payment commitments can be duly met without having to resort to borrowing funds under burdensome terms, or damaging the image and reputation of the institution. In the medium term the aim is to ensure that the financing structure is ideal and that it moves in the right direction, in the context of the economic situation, the markets and regulatory changes. Liquidity management and structural finance in the BBVA Group are based on the principle of the financial autonomy of its subsidiaries. This management approach helps prevent or limit liquidity risk by reducing the vulnerability of the BBVA Group during high-risk periods. Once the decentralization is considered by geographical areas/subsidiaries, the management and monitoring of liquidity risk is carried out comprehensively in each of the Group’s units with both a short and long-term Approach. The short-term liquidity approach has a time horizon of up to 366 days. It is focused on the management of payments and collections from Treasury and Markets and includes the operations specific to the areas and the Bank's possible liquidity requirements. The second medium-term or medium-financing approach is focused on financial management of all the balance sheet, with a time horizon of one year or more. 46
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. The comprehensive management of liquidity is carried out by the Assets and Liabilities Committee (ALCO) in each Management Unit. The Financial Management unit, as part of the Financial Division, analyzes the implications of the Bank’s various projects in terms of finance and liquidity and its compatibility with the target financing structure and the situation of the financial markets. The Financial Management unit executes proposals agreed by the ALCO in accordance with the agreed budgets and manages liquidity risk using a broad scheme of limits, sub-limits and alerts approved by the Permanent Delegate Committee. The Risk Area uses these limits to carry out its mediation and control work independently and provides the manager with the support tools and metrics needed for decision-making. Each of the local risk areas, which are independent from the local manager, complies with the corporative principles of liquidity risk control that are established by the Global Market Risk (GRM) unit, which is the global structural risks unit for the whole Group. At the level of each entity, the managing areas request and propose a scheme of quantitative and qualitative limits and alerts that affect liquidity risk in the short and medium term. Once agreed with GRM, controls and limits are proposed to the Board of Directors through its delegate bodies, for approval at least once a year. The proposals submitted by GRM are adapted to the situation of the market according to the risk tolerance level aimed for by the Group. The implementation of a new Liquidity and Finance Manual, which was approved in the last quarter of the year, has meant the extension of schemes limiting the internal financing of business units, the financial structure and financing concentration, as well as establishing alerts in qualitative liquidity indicators. GRM carries out regular measurements of risk incurred and the monitoring of consumption of limits. It develops tools and adapts valuation models, carries out regular stress tests and reports to ALCO and the Group’s Management Committee on a monthly basis about liquidity levels. It also reports more often to the management areas themselves and to the GRM Management Committee. The frequency of communication and the amount of information under the current Contingency Plan is decided by the Liquidity Committee on the proposal of the Technical Liquidity Group (TLG). The TLG carries out the initial analysis of the Bank's short or long-term liquidity situation. The TLG is made up of specialized staff from the Short-Term Cash Desk, Financial Management and the Global Market Risk Unit (UCRAM-Structural Risk). If the alert levels suggest a deterioration of the relative situation, the TLG reports the matter to the Liquidity Committee, which is composed of the managers of the related areas. If required, the Liquidity Committee is responsible for calling the Financing Committee, which is made up of the President and COO, the Director of the Financial Area, the Director of the Risk Area, the Director of Global Business and the Director of Business of the country in question. One of the most significant aspects regarding monitoring and management of liquidity risk in 2010 has been the management and development of the sovereign risk crisis. In this sense, the role of the central banks has been decisive in calming markets during the Eurozone debt crisis and the ECB has been proactive in guaranteeing the liquidity conditions of the interbank markets. The BBVA Group has not needed to use the extraordinary measures established by the Spanish and European authorities to mitigate tension in bank financing. On the regulatory side, the Basel Committee on Banking Supervision (Bank for International Settlements) has proposed a new liquidity regulatory scheme based on two ratios: the Liquidity Coverage Ratio (LCR), to enter into force in 2015; and the Net Stable Funding Ratio (NSFR), which will be implemented in 2018. The Group participated in the corresponding impact study (QIS) and has included the new regulatory challenges in its new general framework for action in the field of Liquidity and Finance. 47
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
Page 96 and 97: 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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