BBVA in 2012

This has enabled BBVA to maintain its position as the number one manager in both mutualand pension funds in Spain, with market shares of 17.4% in mutual funds (according to the latestinformation available as of December) and 19.9% in pensions (according to data published byInverco in December).With respect to asset quality, the slight upward movement in the NPA ratio has continued, due tothe difficult macroeconomic situation and the reduced volumes of lending activity. Despite this, theratio is still far below that reported in the sector overall, and closed December at 6.9%, includingthe Unnim figures. The significant provisions made explain the improvement in the coverage ratio,which increased from 44% as of 31-Dec-2011 to 67% at year-end.9 Spain. NPA and coverage ratios(Percentage)596744 4350CoverageratioNPA ratio6.56.94.8 4.95.1December2011March June September December2012EarningsThe most significant aspect of earnings in the area in 2012 is the resilience of income, in anenvironment marked by very low activity and fierce competition to attract customer funds, strictcost control and a significant increase in provisions to cover the impairment of assets related to thereal-estate sector in Spain.Cumulative net interest income stands at €4,836m, which confirms the high resilience shownfrom quarter to quarter, resulting in a 10.1% year-on-year growth in this heading. Good pricemanagement, and the protection of the residential mortgage portfolio against changes in interestrates, have contributed to this positive trend. Fees and commissions have also performed well,growing by 10.0% year-on-year. This, together with negative NTI (though it improved in the fourthquarter) and a lower amount of other income/expenses compared with the figure for the previousyear, has resulted in a year-on-year increase of 7.2% in gross income to €6,784m. This trend is verysignificant given the economic context in which it has taken place.Operating expenses are up 1.1% over the previous year due to the incorporation of Unnim. Even so,their rate of increase has been below inflation as a result of continued strict control. The efficiencyratio thus improves on the figure posted in 2011, thanks to the better performance of revenue. Itclosed 2012 at 41.5% (44.0% in 2011). As a result, operating income has risen 12.0% to €3,967m.142 Business areas