In a context of gradual recovery in the health and economic sectors, BBVA was able to produce excellent results - once again demonstrating the strength of its diversified business model.
In 2021, the BBVA Group's net attributable profit amounted to €5.07 billion, excluding non-recurring impacts. This is the highest figure in the last decade, thanks to excellent performance from recurring revenues and lower impairment on financial assets provisions. If non-recurring impacts are taken into account, (i.e. the result of discontinued operations and the net costs related to the restructuring process) net attributable profit was €4.64 billion.
Gross income, or total revenue, ended the year with double-digit year-on-year growth at constant exchange rates, (i.e. excluding the impact of the exchange rate) thanks mainly to strong performance from recurring revenues, which grew by 9.1%. This growth in recurring revenue was primarily due to greater business activity, which has been gaining momentum in all countries, leading to a 7% year-on-year increase in lending and a very positive impact on net interest income and net fees and commissions.
The strong performance of the operating income has allowed us to more than offset the increase in operating expenses, above the Group's average inflation, and improve the efficiency ratio, which stood at 45.2% at the end of 2021. This represents an improvement of 53 basis points compared to the ratio at the end of December 2020, at constant exchange rates, and we continue to lead in this metric among our European competitors. All this has led to a solid growth of 10.8% in the operating income, compared to last year, in constant terms.
At the bottom of the P&L account, the lower amount of impairments on financial assets and provisions stands out - a figure that was especially high in 2020 due to the outbreak of the pandemic. The normalization of the situation has resulted in risk indicators performing better than expected.
The cost of risk stood at 0.93% - a decline of 62 basis points from the end of 2020, and below pre-pandemic levels. The NPL ratio stood at 4.1%, 10 basis points below the figure recorded in December 2020. Finally, the NPL coverage ratio remained at high levels, ending the year at 75%.
For yet another year, our profitability metrics were ahead of our competitors. Excluding the one-off impacts from the year, i.e. the result of discontinued operations and the net costs related to the restructuring process, Return on Equity (ROE) stood at 11.4% and Return on Tangible Equity (ROTE) was 12%. We were also able to continue to create value for shareholders, with a tangible book value per share plus dividends of €6.66, which is 10.1% higher than a year ago.
In terms of capital adequacy, BBVA boasts an excellent capital position with a fully-loaded CET1 ratio of 12.75% - well above the regulatory requirement of 8.60% and the Group’s target range of 11.5% to 12%.
These results were possible thanks to BBVA's significant strengths, such as our leading franchises in attractive markets, our leadership in digitization and sustainability, and the best team.
These strengths also allowed us to make progress in our objectives of becoming a larger and more profitable bank, a distinctive bank for our clients, based on a unique value proposition, and continue leading efficiency through operational excellence.
With regard to the main business areas, I would like to highlight the following:
None of this would have been possible without the efforts of the more than 110,000 people that make up BBVA, whom I would like to thank for their sustained commitment, and continued effort and contribution to these results, in what was still a complicated year for all of us.
And of course, my thanks also to you, the shareholders, for your ongoing trust and support, as it helps us make our purpose of bringing the age of opportunity to everyone a reality.