The Spain & Portugal Area manages private individual
customers through Retail Banking Spain and BBVA
Patrimonios. The latter unit specialises in the
high-net-worth segment. In addition, SMEs, large
companies, public and private institutions and real
estate developers are handled by Corporate & Business
Banking. Consumer finance and internet banking are
managed by Consumer Finance and the bancassurance
business by BBVA Seguros. BBVA Portugal is in charge
of activities in that country.
In the first quarter, supported by solid capital adequacy
and positive liquidity, the area maintained its
commitment to society and continued to offer a wide
range of products and services. Its constant goal is to
provide the best financial and non-financial solutions
for private individuals, companies and the
self-employed, adapted to the current economic context.
During the quarter, lending in the Spanish market
declined especially in consumer loans and, at the same
time, demand for conservative forms of customer funds
increased. The latter include deposits, bonds and mutual
funds with low exposure to equities. At the same time
banks adjusted their pricing policies for assets and
liabilities after the European Central Bank (ECB)
lowered rates. The non-performing asset ratios of banks
and savings banks (cajas) continued to rise although
their capital adequacy ratios are high. Their coverage
ratios, which are supported by a large proportion of
generic provisions made in previous years, continue to
compare favourably with markets in other countries.
The area uses an original business model based on the
customer as the principal source of recurrent income
and entailing prudent and strict risk policies.
Furthermore it controls its costs through a
transformation plan, which it implemented in 2006. The
area’s operating income in the first quarter grew 5.6%.
Spain and Portugal. Operating income
(Million euros)
1,132 1,143
1,139
1,074 1Q 2Q 3Q 4Q
1Q
2008
2009
+5.6%
1,135
Relevant business indicators
(Million euros and percentages)
Customer lending (gross)
Customer deposits (1)
Off-balance-sheet funds
•Mutual funds
•Pension funds
Other placements
Customer portfolios
ROE (%)
Efficiency ratio (%)
NPA ratio (%)
Coverage ratio (%)
(1) Including collection accounts and individual annuities.
And this increase is 7.1% if net trading income, which
is affected by variations in the financial markets, is
excluded.
During the quarter, lending activities included the
distribution of the Spanish government’s ICO credit
lines, of which BBVA handled a share of 11.8%. In
addition the portfolio of loans with a mortgage
guarantee came to €84,984m, thanks in part to the
positive performance of a new mortgage (Hipoteca
Solución) with the aim to balance the cost of the debt
with the payment capacity of customers. The area also
increased 12 basis points its market share in residential
mortgage loans in the individuals segment. Lending to
the public sector, in which BBVA plays a prominent role
in large market operations, increased 3.9% in the
quarter. Consequently the portfolio of loans to all
customers rose 1.7% to €205,976m, compared to
31-Mar-08. The positive variations mentioned above
Spain and Portugal. Net attributable profit
(Million euros)
673 619 649
624
1Q 2Q 3Q 4Q
1Q
2008
2009
–2.4%
31-03-09
1Q09 BUSINESS AREAS
Spain and Portugal
Δ%
205,976 1.7 202,448
94,509 0.9 93,619
40,520 (19.0) 50,046
31,010 (23.0) 40,264
9,511 (2.8) 9,782
,
6,252 19.3 5,240
10,394 (19.9) 12,983
37.0 37.6
35.0 37.9
3.2 0.9
60 185
31-03-08
657
29
To view a Ceros magazine you need to have JavaScript enabled in your browser and have the flash player 8 or higher installed. To install the latest flash player, click the icon above, install the flash plugin and then click here to refresh this page.