BBVA in 2012
BBVA in 2012
BBVA in 2012
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CIB highlights <strong>in</strong> <strong>2012</strong>• Lend<strong>in</strong>g activity cont<strong>in</strong>ues strong <strong>in</strong> Lat<strong>in</strong> America and reduction <strong>in</strong> Europe and the United States.• Favorable trend <strong>in</strong> fund gather<strong>in</strong>g <strong>in</strong> the fourth quarter, which represents a turn<strong>in</strong>g po<strong>in</strong>t follow<strong>in</strong>g therat<strong>in</strong>g downgrades announced dur<strong>in</strong>g the year.• Diversified revenue.• Resilience and recurrence of earn<strong>in</strong>gs <strong>in</strong> a very complex environment.• Leadership positions <strong>in</strong> M&A and <strong>in</strong> equity market <strong>in</strong> Spa<strong>in</strong>.• Several awards and recognitions received.Def<strong>in</strong>itionCorporate & Investment Bank<strong>in</strong>g (CIB) embraces the Group’s wholesale bus<strong>in</strong>esses <strong>in</strong> all thegeographical areas where it operates. The area develops products and services that provideadded-value solutions for wholesale customers, i.e. large corporations and <strong>in</strong>stitutional <strong>in</strong>vestors,and retail (customers, i.e. SMEs, companies and <strong>in</strong>stitutions. These products <strong>in</strong>clude: globallend<strong>in</strong>g (f<strong>in</strong>anc<strong>in</strong>g activity), global transactional bank<strong>in</strong>g (transactional bus<strong>in</strong>ess), corporatef<strong>in</strong>ance (f<strong>in</strong>ancial advice and <strong>in</strong>vestment bank<strong>in</strong>g) and global markets (trad<strong>in</strong>g and distributionbus<strong>in</strong>ess).Industry trendsThe environment of economic crisis prevail<strong>in</strong>g <strong>in</strong> <strong>2012</strong> has affected the wholesale bus<strong>in</strong>ess activity,which closed the year with a decl<strong>in</strong>e <strong>in</strong> both volumes and number of transactions, particularly <strong>in</strong>the developed countries. For <strong>in</strong>stance, Spa<strong>in</strong>’s rat<strong>in</strong>g downgrades, especially <strong>in</strong> the second quarterof <strong>2012</strong>, had a negative impact on the bus<strong>in</strong>ess, ma<strong>in</strong>ly <strong>in</strong> Europe.In addition, the large number of regulatory reforms implemented as a reaction to the f<strong>in</strong>ancialcrisis, both <strong>in</strong> the United States and <strong>in</strong> Europe, is result<strong>in</strong>g <strong>in</strong> a decrease <strong>in</strong> <strong>in</strong>come due to thetighten<strong>in</strong>g of capital requirements, greater operat<strong>in</strong>g complexity and various restrictions towholesale bank<strong>in</strong>g activity.This situation is lead<strong>in</strong>g to a structural change <strong>in</strong> the wholesale bus<strong>in</strong>ess, which is shift<strong>in</strong>gtoward a model with greater dis<strong>in</strong>termediation, with more widespread use of digital platforms.Furthermore, a more demand<strong>in</strong>g and meticulous regulatory environment, due to the proliferationof protectionist legislation at the local level, can give rise to a fragmentation of the <strong>in</strong>dustry.Aga<strong>in</strong>st this background, competitors have reacted by focus<strong>in</strong>g on their core products andmarkets, reduc<strong>in</strong>g costs, restrict<strong>in</strong>g lend<strong>in</strong>g and cutt<strong>in</strong>g back on operations with high capitalconsumption products.Unless <strong>in</strong>dicated otherwise, all comments below on percentage changes refer to constantexchange rates, with the aim of provid<strong>in</strong>g a better understand<strong>in</strong>g of the performance of <strong>BBVA</strong>’swholesale bus<strong>in</strong>ess.Management prioritiesIn the above situation, Corporate & Investment Bank<strong>in</strong>g has cont<strong>in</strong>ued to show highlyresilient earn<strong>in</strong>gs, leverag<strong>in</strong>g its relationship with key customers and its geographicaldiversification. In other words, thanks to its customer-centric and diversified bus<strong>in</strong>ess model,202 Bus<strong>in</strong>ess areas