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BUSINESS AREAS 3Q09
Wholesale Banking & Asset Management
In Equity Capital Markets BBVA participated as global
co-ordinator and adviser in a €222m share capital increase
with preferential subscription rights for NH Hotels.
For the first time the Corporate Finance unit became the
leader in the M&A market in Spain by volume of
operations according to figures from Thomson Reuters.
During the first nine months it provided guidance in
closing nine operations in different sectors and of various
types, totalling more than €18,000m. One of the most
important was the Ferrovial-Cintra merger in which BBVA
acted as exclusive adviser to the Ferrovial Group.
In Global Transaction Services, Tecnocom appointed
BBVA as agent bank in the increase of capital. And
following a 2009 survey of agent banks in major markets,
Global Custodian classified BBVA as “Commended” for
both non-resident and domestic customers.
In Latin America, BBVA led the ranking in syndicated
loans for the second consecutive quarter, according to
information provided by LPC Reuters. Moreover BBVA is
the leader in investment banking in Mexico. It is the top
bank in debt capital markets, equity capital markets and
project finance (sources: Bloomberg and Thomson
Financial).
Global Markets
This unit handles the origination, structuring, distribution
and risk management of market products, which are placed
through the trading rooms in Europe, Asia and the
Americas.
In the third quarter the unit’s revenues from customers and
proprietary trading continued to perform well. Its business
model is increasingly more diversified and international
with strong revenue growth from customers of the trading
floors in Europe (London, Milan, Paris, Lisbon and
Dusseldorf) and the Asian branches. Interest-rate hedging is
one of the main activities apart from recovering volumes of
new issues in the debt market. It also maintained its
position as top broker in Spanish equities with a market
share of 12.8% as of September 2009.
These factors helped the unit’s gross income in Europe and
New York to rise 7.8% year-on-year to €570m. Operating
income was €403m (up 13.9%) and net attributable profit
came to €295m (up 42.0%). The cost/income ratio
improved considerably to 29.4% (33.2% a year earlier).
Mexico and Latin America also achieved double-digit
growth in revenues. Operations included the launch of a
new ETF (MEXTRAC) on the Mexican stock exchange,
which will track the 20 counters in the Dow Jones Mexico
Titans 20 (a stock index). This launch was arranged in
close co-operation with Asset Management.
Asset Management and
other business
Asset Management is BBVA’s provider of asset
management solutions. It designs and manages mutual
funds, pension funds and a third-party fund platform.
In the year to September the unit obtained gross income of
€129m, a decline of 2.5% compared to the same period
last year. Nonetheless, the latest quarter reflects a positive
trend compared to the previous two, thanks to the
recovery of funds under management.
At 30-Sep-09 total assets under management in Spain
stood at €50,925m, up 0.8% during the third quarter
helped by the improvement in the capital markets. Of this
amount, mutual funds accounted for €33,974m. This
amount is down 8.8% but the decline is smaller compared
to that of the system, which fell 12.4%. So far this year
BBVA has added 77 basis points to its market share, which
now stands at 19.9%, confirming its leadership. The
average return of its mutual funds is higher than the net
weighted return of the seven biggest managers (which
account for 62.1% of the market). By net return, nearly
70% of BBVA’s mutual funds are in the first two quartiles.
The assets managed in Spanish pension funds grew 5.3%
to €16,951m. Of this amount, individual plans account for
€9,856m and employee and associate schemes €7,095m.
In the first nine months the value of Industrial and Real
Estate Holdings increased around 44%, easily exceeding
the rise in the Ibex35 during the same period.
Lastly, BBVA and CITIC closed their first joint operation in
the third quarter as part of their general finance agreement.
It entails a €75.5m credit for the Chinese railways over 10
years.
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