Hierro”. Lastly, <strong>BBVA</strong> has signed a new l<strong>in</strong>e for local adm<strong>in</strong>istrations <strong>in</strong> order to provide themwith liquidity for pay<strong>in</strong>g the outstand<strong>in</strong>g debts they have with bus<strong>in</strong>esses and self-employedworkers. The Bank has signed 21,673 operations amount<strong>in</strong>g to €1,438m, i.e. a share of 12.5%.• In corporations, <strong>BBVA</strong> is the absolute market leader and the benchmark <strong>in</strong> this segment, witha 95.6% penetration share and 48.6% first supplier share, thanks to the Group’s outstand<strong>in</strong>gservice and customer relations model.• The new “Smart Bus<strong>in</strong>ess” campaign has been launched for SMEs and self-employed workers,aimed at offer<strong>in</strong>g better service and mak<strong>in</strong>g the most appropriate offer for each client. Work<strong>in</strong>gwith POS term<strong>in</strong>als, it offers a number of special services such as po<strong>in</strong>t-of-sale f<strong>in</strong>ance, forcustomers with <strong>BBVA</strong> cards, with the possibility of advanc<strong>in</strong>g part of the revenues collected bythe term<strong>in</strong>als. In the present adverse environment, an <strong>in</strong>crease of 6% has been achieved <strong>in</strong> POSterm<strong>in</strong>al revenues from the SME segment.• Agreements were renewed with: the National Association of Self-Employed Workers (ATA), with450,000 members; the National Federation of Lottery Associations (ANAPAL), with more than5,000 members; the Spanish Hotel Trade and Modern Cater<strong>in</strong>g Association (FEHRCAREM), withmore than 3,000 franchises; the Spanish Trade Confederation (CEC), with 450,000 members;IAC Automoción, with 1,500 members; the Union of Tobacco Dealers (UAEE), with 11,000members; and FEHR (Spanish Hotel Trade and Restaurants Federation), with 270,000 members<strong>in</strong> the sector. Furthermore, 15 partnership agreements have been signed with Chambers ofCommerce across Spa<strong>in</strong>, which will <strong>BBVA</strong> offer its products to over 1 million companies andself-employed workers associated with these organizations.• In Public sector, it is important to highlight <strong>BBVA</strong>’s participation <strong>in</strong> the supplier paymentmechanism –with a contribution of €2,600m– implemented by the government <strong>in</strong> lateFebruary. This measure was designed to <strong>in</strong>ject liquidity <strong>in</strong>to the Spanish productive system asa whole. Also noteworthy is the Bank’s advisory services given to the M<strong>in</strong>istry of Economy andCompetitiveness and the M<strong>in</strong>istry of F<strong>in</strong>ance and Public Adm<strong>in</strong>istrations for the creation anddevelopment of the Regional Liquidity Fund (FLA). The Spanish bank<strong>in</strong>g system will contribute€8,000m to this <strong>in</strong>itiative, and <strong>BBVA</strong>’s contribution will be €1,600m.The Insurance unit comprises several companies with the strategic goal of becom<strong>in</strong>g thebenchmark <strong>in</strong> the <strong>in</strong>surance bus<strong>in</strong>ess among the different <strong>BBVA</strong> customer segments. It managesan extensive range of <strong>in</strong>surance products through direct <strong>in</strong>surance, brokerage and reassurance,us<strong>in</strong>g various networks. Insurance reported a positive trend dur<strong>in</strong>g <strong>2012</strong>, with written premiumstotal<strong>in</strong>g €2,128m (up 13% year-on-year). This <strong>in</strong>crease is largely due to the €1,608m contributed bythe life-sav<strong>in</strong>gs bus<strong>in</strong>ess (up 21% year-o-year), br<strong>in</strong>g<strong>in</strong>g the funds managed by the Bank <strong>in</strong> sav<strong>in</strong>gs<strong>in</strong>surance to €9,501m (up 8% year-o-year). Accord<strong>in</strong>g to ICEA, at the end of the third quarter of<strong>2012</strong> (latest available figures), <strong>BBVA</strong> Seguros was the leader <strong>in</strong> the issue of premiums for IndividualSystematic Sav<strong>in</strong>gs Plans products (PIAS), hav<strong>in</strong>g reached a 30% market share <strong>in</strong> premiums, afterissu<strong>in</strong>g €372m. Risk bus<strong>in</strong>esses for both life and non-life amounted to €520m <strong>in</strong> premiums issued.The unit has also brokered premiums for other companies for €178m.13 Market shares <strong>in</strong> PIAS as of 31-Sep-<strong>2012</strong>. <strong>BBVA</strong> Seguros and ma<strong>in</strong>competitors (1) (Percentage)30.0302519.32013.4159.2105.15.15<strong>BBVA</strong> SegurosInsurancegroup 1Insurancegroup 2Insurancegroup 3Insurancegroup 4Insurancegroup 50(1) Market share <strong>in</strong> issued premiums.146 Bus<strong>in</strong>ess areas
As of 31-Dec-<strong>2012</strong>, <strong>BBVA</strong> Seguros has over 2.8 million policyholders, who receive a very high servicequality. Periodic <strong>in</strong>dependent measurements granted the home <strong>in</strong>surance policies an averagescore of 7.8 out of 10 for service received dur<strong>in</strong>g the claims process, due to resolv<strong>in</strong>g over 95% oflife claims and 99% of home claims without compla<strong>in</strong>ts.14 <strong>BBVA</strong> Seguros. Policyholder breakdown(Thousands policies. 31-12-<strong>2012</strong>)Other non-life <strong>in</strong>dividual130Multi risk home + fire749Individual life risk1.565Group sav<strong>in</strong>gs315Individual sav<strong>in</strong>gs118Policyholders total: 2,813,209In <strong>2012</strong>, <strong>BBVA</strong> Seguros has improved the offer<strong>in</strong>g of “Seguros Remunerados” (remunerated<strong>in</strong>surance), with the aim of attract<strong>in</strong>g new customers and reward<strong>in</strong>g the loyalty of exist<strong>in</strong>gpolicyholders, offer<strong>in</strong>g discounts of up to 35%. Follow<strong>in</strong>g the customer-centric approach tobus<strong>in</strong>ess, the Bank launched the new “<strong>BBVA</strong> Car Insurance Policy” <strong>in</strong> the third quarter of <strong>2012</strong>. Thisis a flexible product which can be adapted to the customer’s needs and allows <strong>BBVA</strong> Seguros tocont<strong>in</strong>ue diversify<strong>in</strong>g its l<strong>in</strong>es of bus<strong>in</strong>ess. The Bank began market<strong>in</strong>g a new life <strong>in</strong>surance catalog<strong>in</strong> the last quarter of the year which enables a high degree of customization, as it can be adaptedto the type of protection each customer needs, thanks to the modular nature of the product <strong>in</strong>terms of arrang<strong>in</strong>g <strong>in</strong>surance and the flexibility <strong>in</strong> adapt<strong>in</strong>g it later.Corporate & Investment Bank<strong>in</strong>gThis unit is responsible for the global bus<strong>in</strong>esses with<strong>in</strong> Spa<strong>in</strong>. It managed gross lend<strong>in</strong>g tocustomers as of 31-Dec-<strong>2012</strong> of €18,906m and on-balance-sheet deposits of €9,175m. Grosslend<strong>in</strong>g to customers has cont<strong>in</strong>ued to fall, basically as a result of the aforementioned deleverag<strong>in</strong>gprocess. This head<strong>in</strong>g has registered an accumulated decl<strong>in</strong>e over the last year of 18.9%.On-balance-sheet customer funds are down 7.8% over the same period. On-balance-sheetcustomer funds grew significantly <strong>in</strong> the last three months of <strong>2012</strong> by 29.5%, thanks to the ongo<strong>in</strong>gefforts made to attract deposits.The follow<strong>in</strong>g are worth highlight<strong>in</strong>g as regards earn<strong>in</strong>gs:• 16.7% year-on-year <strong>in</strong>crease <strong>in</strong> gross <strong>in</strong>come to €927m, underp<strong>in</strong>ned ma<strong>in</strong>ly by goodperformance of revenue from customers and, <strong>in</strong> particular, revenue generated by the GlobalTransactional Bank<strong>in</strong>g unit. In the last part of the year, a better market mood has also made apositive contribution to the generation of gross <strong>in</strong>come.• Control of operat<strong>in</strong>g expenses, which have grown well below the <strong>in</strong>flation rate (up 1.2%year-on-year) to €323m.• Operat<strong>in</strong>g <strong>in</strong>come is up 27.1% on 2011 to €603m.• Greater volume of impairment losses on f<strong>in</strong>ancial assets as a result of the current situation. Evenso, the NPA ratio <strong>in</strong> this segment cont<strong>in</strong>ues to be low.Spa<strong>in</strong>147
- Page 2 and 3:
BBVA Group Highlights
- Page 4 and 5:
“ In 2012 the Group generateda ne
- Page 6:
2
- Page 9 and 10:
Letter from the Chairman 5
- Page 11 and 12:
All this is the result of a strateg
- Page 13 and 14:
1 As the main expression of t
- Page 15 and 16:
Our communication in 2012 has conti
- Page 17 and 18:
Brand management in 2012 was highly
- Page 19 and 20:
BBVA Board CommitteesIn order to be
- Page 21 and 22:
• Across-the-board operational co
- Page 23 and 24:
Primary stakeholdersIntroduction: t
- Page 25 and 26:
BBVA earnings figures presented in
- Page 28 and 29:
High liquidity ofBBVA shareBBVA is
- Page 30 and 31:
Management modelA model of peoplema
- Page 32 and 33:
To sum up, the combination of the a
- Page 35 and 36:
South AmericaIn 2012, a common syst
- Page 37 and 38:
Number of claims filed at the Banki
- Page 39 and 40:
Environmentand BBVA positioningThe
- Page 41 and 42:
the measures taken to correct imbal
- Page 44 and 45:
The easing of financial tensions in
- Page 46 and 47:
Positioning of BBVA GroupBBVA conti
- Page 48 and 49:
20 2. A business model based on th
- Page 50 and 51:
- Innovate with teams dedicated exc
- Page 52 and 53:
25 In short, this banking model
- Page 54 and 55:
2. …reflected ingross income…28
- Page 56 and 57:
Risk under controlBBVA NPAs versusp
- Page 58 and 59:
Business areasSpainStrong franchise
- Page 60 and 61:
EurasiaAn area ofgrowth andpositive
- Page 62 and 63:
South AmericaBusiness activity(Year
- Page 64 and 65:
In short, abusinesstransformationre
- Page 67 and 68:
Group financialinformation65 Earnin
- Page 69 and 70:
EarningsIn 2012, BBVA Group reporte
- Page 71 and 72:
Consolidated income statement: quar
- Page 73 and 74:
• Resilience in Spain, in a conte
- Page 75 and 76:
allocations to the deposit guarante
- Page 77 and 78:
8 • Maintain its leadership p
- Page 79 and 80:
13 Provisions and othersCumulativ
- Page 81 and 82:
Lastly, earnings per share (EPS) fr
- Page 83 and 84:
In short, a year in which there has
- Page 85 and 86:
20 Lastly, non-performing loans ha
- Page 87 and 88:
Off-balance-sheet customer funds st
- Page 89 and 90:
Capital baseThe main highlight in 2
- Page 91 and 92:
26 RatingsIn 2012, BBVA’s ratin
- Page 93 and 94:
Risk management90 Global Risk Manag
- Page 95 and 96:
Integration of risks andoverall ris
- Page 97 and 98:
Credit riskCredit risk quantificati
- Page 99 and 100: Behavioral scoring is used to revie
- Page 101 and 102: The economic cycle in PDThe current
- Page 103 and 104: 13LGD for Autos Finanzia, BBVA Spai
- Page 105 and 106: The portfolio model and concentrati
- Page 107 and 108: The exposure breakdown by rating of
- Page 109 and 110: 22 Real-estate exposure and coverag
- Page 111 and 112: ConcentrationExcluding sovereign ri
- Page 113 and 114: 27 BBVA Group. Net NPA entries(Mill
- Page 115 and 116: Structural risksStructural interest
- Page 117 and 118: Interest rate risk measurement is s
- Page 119 and 120: Structural risk in the equity portf
- Page 121 and 122: BBVA continues working to improve a
- Page 123 and 124: Credit risk in market activitiesThe
- Page 125 and 126: Operational riskOperational risk is
- Page 127 and 128: Operational risk management in the
- Page 129 and 130: Reputational riskThis is another ty
- Page 131 and 132: The economic capital of the Pension
- Page 133 and 134: Categories of financing and advice
- Page 135 and 136: Business areas135 Spain149 Eurasia1
- Page 137 and 138: Furthermore, as usual in the case o
- Page 139 and 140: SpainIncome statement(Million euros
- Page 141 and 142: • On July 20, the Government requ
- Page 143 and 144: 3 Spain. Efficiency ratio versus pe
- Page 145 and 146: These lines axes of action will con
- Page 147 and 148: 10 Spain. Operating income(Million
- Page 149: - Creation of a SICAV module on the
- Page 153 and 154: EurasiaIncome statement(Million eur
- Page 155 and 156: Management prioritiesIn 2012, the E
- Page 157 and 158: 17 Eurasia. Efficiency(Million euro
- Page 159 and 160: • The above, together with the hi
- Page 161 and 162: Highlights• The Bank has been rec
- Page 163 and 164: MexicoIncome statement(Million euro
- Page 165 and 166: area has been positive year-on-year
- Page 167 and 168: 30 Mexico. Consumer finance plus cr
- Page 169 and 170: The increase of operating expenses
- Page 171 and 172: As a result of the above, the net a
- Page 173 and 174: government employees and tax collec
- Page 175 and 176: South AmericaIncome statement(Milli
- Page 177 and 178: advancing together with economic ac
- Page 179 and 180: 43 South America. Net attributable
- Page 181 and 182: Grupo BBVA. Business share ranking
- Page 183 and 184: Colombia Peru Venezuela2012 ∆%
- Page 185 and 186: The macroeconomic and competitive e
- Page 187 and 188: VenezuelaIn 2012, the growth of the
- Page 189 and 190: By companies, Seguros Argentina, fo
- Page 191 and 192: Significant ratios(Percentage)The U
- Page 193 and 194: opportunities in key markets throug
- Page 195 and 196: 51 The United States. NPA and cover
- Page 197 and 198: The area was able to successfully m
- Page 199 and 200: HighlightsThe most relevant awards
- Page 201 and 202:
Definition of the aggregateCorporat
- Page 203 and 204:
held by retail investors. The conve
- Page 205 and 206:
Additional information:Corporate &
- Page 207 and 208:
greater efficiency, cost control an
- Page 209 and 210:
The trend in operating expenses sho
- Page 211 and 212:
Main Corporate Finance transactions
- Page 213 and 214:
Corporate LendingCorporate Lending
- Page 215 and 216:
In Latin America, the funding of Li
- Page 217 and 218:
In Mexico, Global Markets maintains
- Page 219 and 220:
Supplementaryinformation216 Consoli
- Page 221 and 222:
IFRS (Bank of Spain’s Circular 4/
- Page 223:
JapanTokyoFukoku Seimei Bldg. 12 th