In Global Transaction Services BBVA topped Euromoney’s
ranking as best provider of cash management services for
companies and institutions in Spain.
In Latin America BBVA Colombia was also Euromoney’s
top choice in cash management services. Furthermore BBVA
Banco Continental won a prize for business creativity
awarded by Proyecto e-mpresario. In the rankings, BBVA is
leader in the bond market and second in syndicated loans
(Source: Thomson Reuters and Dealogic). In Mexico, BBVA
Bancomer is one of the top banks in many of the products:
first in project finance, syndicated loans and equity capital
markets, and second in bonds (Sources: Loan Pricing
Corporation, Thomson Reuters and Bloomberg).
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.
Despite complex conditions Global Markets was able to
take advantage of market opportunities in 2009. In terms of
customers, business with institutional investors is again
growing and the corporate segment is buoyant. The unit
successfully concluded a series of proprietary trading
opportunities in the first half, especially with interest-rates.
In the day to day business, there was an extraordinary
recovery of the debt business on all trading floors and
customer risk hedging in bond operations. Moreover in the
fourth quarter the unit strengthened its position as top
broker in Spanish equities. Its market share in December
was 15.0% whereas that of its competitors is below 10.4%.
It should also be remembered that Global Markets has
become a much more international and geographically
diversified business. This is reflected by the double-digit
growth at all the trading floors in Europe, Asia, Mexico
and South America. In addition cross-border business
continues to improve thanks to the global nature of the
products and customer service, and to the close
co-operation between teams at the various locations.
This is reflected in the extraordinary earnings and efficiency
achieved in 2009. Gross income for the year in Europe,
Asia and New York was up 22.9% to €654m, operating
income rose 36.3% to €427m and net attributable profit
jumped 146.6% to €318m. These figures are the result of a
superb year at Global Markets, which has become a unit
4Q09 BUSINESS AREAS
Wholesale Banking & Asset Management
with highly recurrent earnings despite the difficult
environment. Furthermore careful and steady management
has helped to contain expenses. These achievements led to
an improvement in the cost/income ratio, which now stands
at 34.8%, notably lower than 2008 (41.1%), making the
unit one of the most efficient in the whole industry.
Asset Management and
other business
Asset Management is BBVA’s provider of asset
management solutions. It designs and manages mutual
funds, pension funds and the third-party fund platform
Quality Funds. The unit has solutions tailored for each
customer segment, based on constant product innovation
as the key to success.
At the end of the fourth quarter total assets under
management in Spain stood at €49,972m, a decline of 1.9%
against the third quarter of 2009. Of this amount, mutual
funds account for €32,797m. BBVA ended the year as the
leader in the Spanish market with a 19.3% market share.
The average return on its mutual funds in 2009 was higher
than the net weighted return of the seven biggest managers
(which account for 62% of the market). By net return, more
than 82% of BBVA’s mutual funds (excluding guaranteed
funds) are in the first two quartiles. Lastly, on top of
obtaining higher profitability than most of its competitors,
BBVA’s mutual funds enjoy lower levels of volatility.
The assets managed in pensions funds in Spain were up
6.8% year-on-year to €17,175m. Of this amount
individual plans account for €9,983m and employee and
associate schemes €7,191m. BBVA continues being leader
for the whole of pension plans, with a market share of
19.0% (23.0% in employee schemes and 17% in
individual plans).
In 2009 the capital gains of the Industrial and Real Estate
Holdings increased 71%, easily beating the revaluation of
the Spanish stock index (IBEX-35) during the same period
(29.8%).
Lastly, in the fourth quarter China Citic Bank (CNCB) was
booked by the equity method, as it became classified as
substantial holding. BBVA raised its investment in China
Citic Bank (CNCB) from 10% to 15% (entailing roughly
€1,000m) by executing its purchase option of HK$6.45
per share which will be effective from 1-Mar-10.
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