January-December 2012


The most important deals carried out by the different CIB departments and the highlights of the fourth quarter of 2012 are summarized below.

In Corporate Finance, BBVA closed the year consolidating its position as leading financial advisor in the Spanish mergers and acquisitions (M&A) market, with a total of 55 deals since 2009, according to Thomson Reuters. These transactions include the award to Abertis (in a consortium with BTG Pactual) of the contract for the Cadí and Vallvidrera tunnels in Catalonia, the acquisition of Hojiblanca by Deoleo and the sale of the GH Induction Group to Miura Private Equity.

In equity capital markets, the Bank participated as co-lead manager in the IPO of the German company Telefónica Deutschland, the biggest operation of this kind in Europe in 2012 and in Germany since 2007. BBVA also participated in the share capital increase with subscription rights of Banco Popular, the largest operation in the primary market carried out in Spain. In Latin America, BBVA was the global coordinator in Mexico for Fibra Macquarie and FibraHotel. Also in Mexico, BBVA was bookrunner in the share capital increase of Mexichem. Finally, the Bank participated as global coordinator in the IPO of Cemex Latam Holdings in Colombia.

The corporate lending business in Europe continued to support its customers with debt financing for German companies (Dufry, Fresenius) and French companies (Nestlé, Areva). Of note in Latin America was the bridge to bond financing of Cencosud for the purchase of Carrefour’s assets in Colombia, and numerous bilateral financing deals in Argentina. Finally, in the United States, several financing deals were completed through BBVA Compass, including one for Mary Kay.

Project Finance has boosted its financial advice activity in Spain with the award to Abertis of the contract for the Barcelona access tunnels (TABASA) and the funding of the second section of line 9 of the Barcelona subway. Of note in Latin America was the funding of line 12 of the Mexico City subway, where BBVA acted as financial adviser and provider of structured finance. In addition, the Group has improved its positioning in the telecommunications market after funding the acquisition of Atento by Bain Capital. Finally, in the United States, a tranche of financing was closed for the privatization of the OSU parking lot. BBVA’s franchise in the U.S. has clearly strengthened its position as financial adviser after obtaining Morgan Stanley’s mandate for financing three wind farms.

Global Transactional Banking has launched the Widget Alert application in Europe, the “Recaudación Referenciada” (index-linked collection) service in Venezuela and a service for BBVA Bancomer customers in Mexico, which enables them to access ACH payments in the United States from their accounts in Mexico. The most relevant deals were: in Spain, the issue of technical guarantees with CESCE coverage for a leading company in the infrastructure sector; in Mexico, the winning of the operating account of the country’s largest mining consortium; and in the United States, the issue of guarantees for U.S. subsidiaries of customers with registered offices in Mexico and Europe. Global transactional activity has been recognized as “Top Rated” in the Agent Banks in Major Markets survey by Global Custodian in the “Cross Border/Non Affiliated” and “Domestic” categories. Euromoney magazine has also named BBVA “Best Cash Management Provider in Venezuela”, thus consolidating the Bank’s position in the top five ranking of the “Best Cash Management Providers in euros in Latin America for International Financial Institutions”.

In Structured Trade Finance, new deals were arranged, notably the finance granted to the Ministry of Finance of Brazil for the purchase of metal bridges in the State of Tocantins. BBVA acts as agent and mandated lead arranger.

In a macroeconomic environment marked by greater stability in the fourth quarter, Global Markets closed 2012 with revenue growth in its main products and geographical areas (except for rest of Europe and Asia). Gross income in 2012 stood at €1,152m, up 18.0% year-on-year. These good earnings figures are the result of an adequate strategy of geographical and customer diversification.

The business model of Global Markets continues to reinforce customer focus as the core element of its value proposition. This has been recognized by the specialized media. BBVA was chosen best bank in Spain in exchange rates at the IAIR Awards, and tops the Bloomberg ranking for the best exchange rate forecasts of Latin American currencies against the dollar.

In Spain, revenue from customers is up 5% year-on-year, with growth, above all, in strategic businesses such as exchange rates and credit, where the increases are over 15%. Revenue from SMEs and retail customers rose by more than 50%, thanks to the close collaboration of Global Markets with the commercial network. By products, exchange rates and credit have grown at double-digit rates year-on-year. In equity, BBVA continues to hold first place in stock market brokerage, with an 18.9% market share according to December 2012 data, nearly 11 percentage points above the nearest competitor. In bond issues, BBVA tops the ranking with all types of customers in Spain.

In the rest of Europe and Asia, revenue from customers in Lisbon and Milan rose by more than 25%. London consolidated its position in 2012 as the strategic hub of the credit business, a product that has doubled the earnings posted in the previous year.

In Mexico, Global Markets maintains a clear leading position in the following products: leader as bond market maker, number one bank by volume in currencies, first place in equity notes and number one in the MXN bond origination ranking, well above its competitors. Revenue from customers continues to grow at a fast pace, with gross income growing by 47.1% over the previous year.

In South America, Global Markets continues to develop its local capabilities to make the most of the region’s growth and increased activity. This effort can be seen in the 27% year-on-year increase in gross income. Revenue from customers is up 21%. By countries, practically all franchises have performed well.

In the United States, revenue from customers has grown by around 2% year-on-year. Revenue from retail customers has increased significantly, strongly supported by the Compass distribution network. By type of product, interest rates maintain their positive trend. Of particular note is the performance of revenue from exchange rates, which more than doubles the figure for the same period the previous year.