Summary of Banco Bilbao Vizcaya Argentaria (BBVA) Conference Call - November 20, 2025 Company Overview - **Company**: Banco Bilbao Vizcaya Argentaria (BBVA) - **Industry**: Banking and Financial Services Key Points Strategic Focus and Market Position - **Balance Between Markets**: The management emphasizes a strategy focused on high-quality franchises in selected countries, aiming for sustainable profitability rather than merely expanding into new markets [3][4] - **Exit from Non-Core Markets**: BBVA has exited several markets, including the U.S. and Chile, to concentrate on regions where it can achieve scale and competitive advantage [5] - **Digital Banking Strategy**: The bank has acquired approximately 11 million clients in recent years, with two-thirds of these acquisitions occurring digitally, highlighting a strong focus on digital transformation [5][6] Financial Performance - **Return on Tangible Equity (ROT)**: BBVA reported a ROT of 19.7% and a 16% growth in lending in constant terms, indicating strong financial health [6] - **Capital Return to Shareholders**: Over the next four years, BBVA expects to have around EUR 36 billion available for distribution to shareholders, reinforcing its commitment to capital returns [7] Market Dynamics in Spain - **Outperformance in Spain**: BBVA has outpaced the market in Spain, with a 6% growth in Q3 compared to the market's 3% [8] - **Consumer Loans Growth**: The bank has increased its market share in consumer loans to 16.6%, reflecting a strategic focus on profitable segments [10][11] - **Client Acquisition**: Since 2022, BBVA has gained 3 million clients in Spain, with a significant portion onboarded digitally, enhancing future profitability through cross-selling opportunities [12][13] Mexico Market Insights - **Positive Macro Outlook**: BBVA remains structurally positive on Mexico's growth, with GDP forecasts upgraded to 0.7% for the year, supported by a strong peso and growing foreign direct investment [20][21] - **Retail Portfolio Growth**: The retail portfolio in Mexico has grown by 12.5% year-on-year, with significant increases in credit cards and personal loans [23] - **Loan Growth and FX Impact**: The corporate loan book has grown around 6.7% year-on-year, with favorable FX dynamics contributing to overall growth [25][26] Turkey's Economic Environment - **Hyperinflation Accounting**: BBVA anticipates that Turkey will move past hyperinflation accounting by 2028, with expectations of inflation decreasing to around 23%-25% next year [29][31] - **Garanti's Performance**: Garanti, BBVA's Turkish franchise, has shown strong performance, with a net interest margin (NIM) of around 5%, significantly outperforming peers [32][33] Capital Management - **Surplus Capital**: BBVA has approximately EUR 8 billion in surplus capital, with plans to return capital to shareholders while maintaining a target Common Equity Tier 1 (CT1) ratio of 12% [34][38] - **Regulatory Requirements**: The bank's SREP requirement is expected to decrease, providing additional flexibility for capital returns [35][36] Corporate and Investment Banking (CIB) Strategy - **CIB Growth**: BBVA's CIB business has been a strategic priority, with a focus on expanding cross-border business and enhancing client relationships [41][43] - **Digital Banking Initiatives**: The bank is investing in digital banking platforms in various European markets, aiming to leverage its tech stack for profitable growth [45][46] Conclusion - BBVA is positioned for sustainable growth through strategic market focus, digital transformation, and strong financial performance, with a commitment to returning capital to shareholders while navigating macroeconomic challenges in its key markets.