BBVA(US:BBVA)2026-02-20 11:55Asset Distribution and Exposure - As of December 31, 2025, the Group's assets were distributed as follows: Spain 53.1%, Mexico 21.2%, and Turkey 10.6%[49] - The Group is exposed to sovereign debt, particularly related to Spain, Mexico, and Turkey, which are critical to its financial stability[49] - The Group's total risk in financial assets in Spain, Mexico, and Turkey amounted to €252.3 billion, €163.1 billion, and €68.3 billion, respectively, as of December 31, 2025, representing 32.5%, 21.0%, and 8.8% of the Group's total risk in financial assets[58] - The Group's gross exposure to loans and advances to customers in Spain, Mexico, and Turkey totaled €261.5 billion, €100.7 billion, and €55.8 billion, respectively, as of December 31, 2025, accounting for 55.3%, 21.3%, and 11.8% of the total amount of loans and advances[58] - The Group's exposure to Spain's public debt portfolio was €58,760 million as of December 31, 2025, representing 6.8% of consolidated total assets[102] - The Group's exposure to Mexico's public debt portfolio was €31,025 million as of December 31, 2025, representing 3.6% of consolidated total assets[102] Financial Performance - Profit attributable to the parent company for the year ended December 31, 2025, was €10,511 million, up from €10,054 million in 2024 and €8,019 million in 2023[168] - In 2025, the profit from the Mexico segment was €5,264 million, accounting for 45% of the total profit attributable to the parent company[168] - The Turkey segment reported a profit of €805 million in 2025, representing 7% of the total profit attributable to the parent company[168] - The South America segment's profit for 2025 was €726 million, maintaining a consistent 6% share of the total profit attributable to the parent company[168] - The Corporate Center reported a loss of €1,086 million in 2025, compared to a loss of €901 million in 2024[168] Regulatory and Compliance Risks - The Group is subject to a complex regulatory framework that could adversely affect its business and financial condition[121] - The Group's regulatory authorities may require an increase in loan loss allowances and asset impairments, adversely affecting its financial condition[125] - Legal and regulatory changes related to ESG factors may result in increased compliance costs and operational risks for the Group and its customers[84] - The Group's compliance with anti-corruption laws and regulations is critical, as violations could result in significant penalties and reputational damage[140] - The Group faces heightened compliance risks in emerging economies due to political instability and corruption, which could adversely affect its operations[75] Economic and Market Risks - The global economic environment is volatile, with U.S. tariffs potentially impacting the Group's financial outlook and operations[50] - The Group's financial results are subject to risks from high interest rates and trade tariffs, which could impact credit demand and increase funding costs[27] - The geopolitical tensions and economic uncertainties in the regions where the Group operates could lead to significant financial and operational risks[52] - The Turkish economy has been classified as hyperinflationary since 2022, affecting the financial reporting of entities in that region[34] - The Group's ability to pay dividends is affected by restrictions on repatriation from subsidiaries in Venezuela, Argentina, and Turkey, which may impact its overall financial health[77] Technological and Competitive Landscape - The Group's ability to manage technological advancements and competition from neobanks is crucial for maintaining its market position[27] - The Group faces increasing competition from non-bank competitors and new business models, which could adversely affect its competitive position[68] - The Group's ability to adapt to technological changes and manage information technology obsolescence is crucial for its future success[71] - The number of digital and mobile phone customers continued to increase in 2025, with approximately 66% of new clients choosing digital channels to start their relationship with BBVA[148] Financial Metrics and Ratios - Total assets as of December 31, 2025, amounted to €894,931 million, up from €803,404 million in 2024, representing an increase of 11.4%[171] - Total liabilities as of December 31, 2025, were €847,034 million, compared to €756,163 million in 2024, indicating a growth of 12%[171] - Total equity as of December 31, 2025, was €47,897 million, slightly increasing from €47,242 million in 2024, reflecting a growth of 1.4%[171] - Loans and advances to customers reached €461,616 million as of December 31, 2025, up from €413,930 million in 2024, indicating a growth of 11.5%[171] - Total net interest income for December 2025 reached €26,280 million, an increase from €25,267 million in December 2024, representing a growth of 4%[170] Customer Deposits and Funding - As of December 31, 2025, customer deposits accounted for 76.3% of the Group's total financial liabilities at amortized cost[98] - Customer deposits at amortized cost in Spain grew by 11.1% to €251,430 million as of December 31, 2025, from €226,391 million in 2024[189] - Customer deposits at amortized cost in Mexico rose by 10.5% to €93,855 million as of December 31, 2025, compared to €84,949 million in 2024[197] - Customer deposits at amortized cost in Turkey increased by 8.4% to €62,984 million as of December 31, 2025, from €58,095 million in 2024[208] Non-Performing Loans and Coverage - The non-performing loan ratio in Spain decreased to 3.0% as of December 31, 2025, down from 3.7% in 2024[191] - The non-performing loan ratio rose to 3.9% as of December 31, 2025, up from 3.1% in 2024, attributed to a rise in non-performing retail loans due to deteriorating credit quality[210] - The non-performing loan coverage ratio decreased to 76% as of December 31, 2025, down from 96% in 2024, due to new Stage 3 entries and lower requirements from the wholesale portfolio[210]