the same period last year. The lower growth rate is due to
higher taxes because the capital gains booked in 2008 by the
equity method were net of taxes.
The business and earnings of WB&AM units in Latin America
are recorded in their respective areas (Mexico and South
America). After adding their contributions (except Asset
Management in South America), the area contributed to the
Group the amounts shown in the attached table:
Wholesale Banking & Asset
Management including the Americas
(Million euros)
Gross income
Operating income
Income before tax
Net attributable profit
Customer lending
Deposits
Corporate and Investment Banking
This unit co-ordinates origination, distribution and
management of a complete catalogue of corporate &
investment banking products (corporate finance, structured
finance, syndicated loans and debt capital markets), global
trade finance and global transaction services. Coverage of
large corporate customers is specialised by sector (industry
bankers).
In the first quarter the unit’s business activity was
characterised by implementation of stricter risk acceptance
criteria compared to the end of the previous year. The loan
portfolio rose 15.4% compared to the first quarter last year,
to €45,955m, but it is similar to the end of 2008 (down
2.0%). New operations were adjusted to match current
market conditions, entailing customers of high credit quality
and exceeding the minimum required threshold of
risk-adjusted return. In addition, geographic diversification
continues to increase.
Furthermore the unit is working intensely on repricing the
portfolio, which is accompanied by a higher level of
transactional business. This has a favourable effect on
customer funds and fee income.
All the aspect mentioned above are reflected in gross income,
which rose 23.2% to €215m. Operating income came to
31-03-09
Δ% 31-03-08
846 26.7 668
667 34.0 498
638 38.7 460
425 23.8 343
60,114 16.8 51,480
60,347 34.4 44,887
1Q09 BUSINESS AREAS
Wholesale Banking & Asset Management
€173m, which is 25.1% higher than the first quarter last year.
After net provisions and income tax, net attributable profit
comes to €120m (up 89.5%).
Important operations during the quarter in Debt Capital
Markets include a large number in the bond market with
record issue volumes and high levels of oversubscription.
BBVA led issues for ENI (€1,500m), Telefónica (€2,000m),
Vodafone (€1,250m), E.ON (€750m), Telecom Italia
(€1,500m) and Repsol (€1,000m). Moreover, in terms of
institutions it co-ordinated the ICO issue (€2,000m) and
participated in Kingdom of Spain issues (€7,000m).
Operations entailing banks with a Spanish Treasury guarantee
included Banco Pastor (€1,000m) and Banco Popular
(€1,500m).
During the quarter this unit also signed an operation with
Enel for an €8,000m syndicated loan to finance its purchase
of a 25% stake in Endesa. Moreover it signed operations with
the regional governments of the Balearic Islands (€413m) and
Murcia (€100m).
Structure finance activity was high in the energy sector,
including operations with Acciona Eólica, Canaport, Renomar,
Canal de Navarra and Aguas del Güesna. Infrastructure projects
included finance for the Transmontana Motorway and the
Baixo Alentejo licence for the ACS Group – both in Portugal.
During the quarter Euromoney Project Finance, an
international trade magazine, announced its annual prizes for
the most outstanding operations in 2008. BBVA’s structured
finance team achieved six “Deals of the Year”. They were
BAA Grupo Ferrovial, “European Airports Deal of the Year”;
Tuin Zonne, “European Solar Deal of the Year”; Grupo
Lotos, “European Petrochemical Deal of the Year”; Gate
LNG, “European Oil and Gas Deal of the Year”; Ras Laffan
C, “Middle East Power Deal of the Year” and Air Tanker,
“European PPP Deal of the Year”.
Various capital increases were handled by Equity Capital
Markets, including those of Saint Gobain and Vértice 360º, as
well as Quatttor Participaçoes’s takeover bid.
The Global Trade Finance unit obtained ten “Deals of the
Year” including two for Empresas Públicas de Medellín
(Colombia), two for Perú LNG (Peru), Saudi Polymers (Saudi
Arabia), Reliance Industries (India), two for Tele Norte Leste
(Brazil), Votorantrade (Brazil) and Rosneft (Russia).
Furthermore it was top in the world ranking of mandated lead
arrangers, thanks to its number one position in the rankings
for Asia-Pacific, Latin America and Brazil-India-China. This
demonstrated excellent management in especially complex
conditions such as those of 2008.
35
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