Business areas

Business areas

Spain
€3,630M*
+19.0%
Mexico
€6,774M*
+24.8% (1)
Turkey
€1,480M*
n.s. (1)
South America
€2,415M*
+60.7%(2)
Rest of business
€565M*
+48.4% (2)

Spain

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€3,630 Mill.*

+19.0%


Highlights

  • Significant growth in net interest income
  • Improvement of the efficiency ratio
  • Cost of risk remains at low levels, in line with the previous quarter

Results
(Millions of euros)

Net interest income
2,544
+44.7% (2)
Gross income
3,630
+19.0% (2)
Operating income
2,113
+30.1% (2)
Net attributable profit
1,231
+22.8%(2)

Activity (1)

Variation compared to 31-12-22.
Balances as of 30-06-23.

Performing loans and advances to customers under mangement
-0.3%
Customers funds under management
 
-0.3%

Risks

NPL coverage ratio
61%
57%
NPL ratio
3.9%
4.0%
Cost of risk
0.28%
0.27%
DEC 22
JUN 23


(1) Excluding repos.
(2) Year-on-year changes.

Mexico

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€6,774 Mill.*

+24.8%


Highlights

  • Increase in lending activity, with greater dynamism of the retail segment
  • Relevant increase in net interest income
  • The efficiency ratio continues to improve
  • Excellent evolution of the net attributable profit

Results
(Millions of euros)

Net interest income
5,264
+26.6% (2)
Gross income
6,774
+24.8% (2)
Operating income
4,717
+28.3% (2)
Net attributable profit
2,614
+30.1% (2)

Activity (1)

Variation compared to 31-12-22 at constant exchange rate.
Balances as of 30-06-23.

Performing loans and advances to customers under mangement
+4.6%
Customers funds under management
 
+2.6%

Risks

NPL coverage ratio
129%
129%
NPL ratio
2.5%
2.5%
Cost of risk
2.49%
2.86%
DEC 22
JUN 23


(1) Excluding repos.
(2) Year-on-year changes at constant exchange rate.

Turkey

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1,480 Mill.*

n.s.


Highlights

  • The dedollarization of the balance sheet continues
  • Improvement of the NPL ratio and the cost of risk in the quarter
  • Net attributable profit of the second quarter negatively affected by the strong depreciation of the Turkish lira

Results
(Millions of euros)

Net interest income
980
+29.2% (2)
Gross income
1,480
n.s. (2)
Operating income
888
n.s. (2)
Net attributable profit
525
n.s. (2)

Activity (1)

Variation compared to 31-12-22 at constant exchange rate.
Balances as of 30-06-23.

Performing loans and advances to customers under mangement
+35.8%
Customers funds under management
 
+52.1%

Risks

NPL coverage ratio
90%
97%
NPL ratio
5.1%
4.2%
Cost of risk
0.94%
0.23%
DEC 22
JUN 23


(1) Excluding repos.
(2) Year-on-year changes at constant exchange rate.

South America

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€2,415 Mill.*

+60.7%


Highlights

  • Growth in lending activity
  • Excellent evolution of the net interest income
  • Higher adjustment for hyperinflation in Argentina
  • Improvement of the efficiency ratio

Results
(Millions of euros)

Net interest income
2,503
+74.8% (2)
Gross income
2,415
+60.7% (2)
Operating income
1,332
+75.6% (2)
Net attributable profit
367
+22.6% (2)

Activity (1)

Variation compared to 31-12-22 at constant exchange rates.
Balances as of 30-06-23.

Performing loans and advances to customers under mangement
+4.8%
Customers funds under management
 
-14.2%

Risks

NPL coverage ratio
101%
95%
NPL ratio
4.1%
4.3%
Cost of risk
1.69%
2.34%
DEC 22
JUN 23


(1) Excluding repos.
(2) Year-on-year changes at constant exchange rates.

Rest of business

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€565 Mill.*

+48.4%


Highlights

  • Growth in resources the quarter
  • Dynamism in recurring income and NTI
  • NPL ratio and cost of risk remain at low levels
  • Efficiency improvement continues

Results
(Millions of euros)

Net interest income
260
+69.3% (2)
Gross income
565
+48.4% (2)
Operating income
288
+94.1% (2)
Net attributable profit
212
+68.3% (2)

Activity (1)

Variation compared to 31-12-22 at constant exchange rates.
Balances as of 30-06-23.

Performing loans and advances to customers under mangement
-2.9%
Customers funds under management
 
+6.6%

Risks

NPL coverage ratio
131%
96%
NPL ratio
0.4%
0.5%
Cost of risk
0.04%
0.13%
DEC 22
JUN 23


(1) Excluding repos.
(2) Year-on-year changes at constant exchange rates.

* Gross income
(1) At constant exchange rate.
(2) At constant exchange rates.

This section presents the most relevant aspects of the Group's different business areas. Specifically, for each one of them, it shows a summary of the income statements and balance sheets, the business activity figures and the most significant ratios.

The structure of the business areas reported by the BBVA Group as of June 30, 2023, is the same as the one presented at the end of 2022.

The composition of BBVA Group's business areas is summarized below:

  • Spain mainly includes the banking, insurance and asset management activities that the Group carries out in this country.
  • Mexico includes banking, insurance and asset management activities in this country, as well as the activity that BBVA Mexico carries out through its agency in Houston.
  • Turkey reports the activity of the group Garanti BBVA that is mainly carried out in this country and, to a lesser extent, in Romania and the Netherlands.
  • South America includes banking, financial, insurance and asset management activities conducted, mainly, in Argentina, Chile, Colombia, Peru, Uruguay and Venezuela.
  • Rest of Business mainly incorporates the wholesale activity carried out in Europe (excluding Spain), the United States, and BBVA’s branches in Asia.

The Corporate Center contains the centralized functions of the Group, including: the costs of the head offices with a corporate function; structural exchange rate positions management; portfolios whose management is not linked to customer relations, such as financial and industrial holdings; stakes in Funds & Investment Vehicles in tech companies; certain tax assets and liabilities; funds due to commitments to employees; goodwill and other intangible assets as well as such portfolios and assets' funding.

Finally, in the description of this aggregate, it is worth mentioning that the Corporate Center tax expense includes the difference between the effective tax rate in the period of each business area and the expected tax rate of the Group for the year as a whole.

In addition to these geographical breakdowns, supplementary information is provided for the wholesale business carried out by BBVA, Corporate & Investment Banking (CIB), in the countries where it operates. This business is relevant to have a broader understanding of the Group's activity and results due to the important features of the type of customers served, products offered and risks assumed.

The information by business areas is based on units at the lowest level and/or companies that make up the Group, which are assigned to the different areas according to the main region or company group in which they carry out their activity.

Regarding the shareholders' funds allocation, in the business areas, a capital allocation system based on the consumed regulatory capital is used.

Finally, it should be noted that, as usual, in the case of the different business areas, that is, Mexico, Turkey, South America and Rest of Business, and, additionally, CIB, in addition to the year-on-year variations applying current exchange rates, the variations at constant exchange rates are also disclosed.

GROSS INCOME(1), OPERATING INCOME(1) AND NET ATTRIBUTABLE PROFIT(1) BREAKDOWN (PERCENTAGE. 1H23)

(1) Excludes the Corporate Center.

Main income statement line items by business area (Millions of euros)

Business areas
BBVA
Group		 Spain Mexico Turkey South
America		 Rest of
Business		 ∑ Business areas Corporate Center
1H23
Net interest income 11,410 2,544 5,264 980 2,503 260 11,550 (140)
Gross income 14,148 3,630 6,774 1,480 2,415 565 14,863 (716)
Operating income 8,209 2,113 4,717 888 1,332 288 9,339 (1,129)
Profit (loss) before tax 6,122 1,821 3,585 787 780 272 7,246 (1,123)
Net attributable profit (loss) excluding non-recurring impacts 3,878 1,231 2,614 525 367 212 4,950 (1,072)
Net attributable profit (loss) 3,878 1,231 2,614 525 367 212 4,950 (1,072)
1H22 (2)
Net interest income 8,538 1,758 3,686 1,153 1,849 155 8,601 (64)
Gross income 11,417 3,050 4,813 1,335 1,982 384 11,563 (147)
Operating income 6,393 1,624 3,260 838 1,059 150 6,932 (539)
Profit (loss) before tax 4.858 1.404 2.446 633 745 162 5.391 (532)
Net attributable profit (loss) excluding non-recurring impacts (1) 3,159 1,003 1,781 59 418 128 3,389 (230)
Net attributable profit (loss) 2,957 801 1,781 59 418 128 3,188 (230)

(1) Non-recurring impacts includes the net impact arisen from the purchase of offices in Spain in the second quarter of 2022.

(2) Restated balances according to IFRS17 - Insurance contracts.

MAIN BALANCE-SHEET ITEMS AND RISK-WEIGHTED ASSETS BY BUSINESS AREA (MILLIONS OF EUROS)

Business areas
BBVA
Group		 Spain Mexico Turkey South
America		 Rest of
business		 ∑ Business areas Corporate Center Deletions
30-06-23
Loans and advances
to customers		 369,761 173,944 83,693 35,673 41,548 36,175 371,033 250 (1,522)
Deposits from customers 402,344 214,276 84,865 50,793 43,086 10,470 403,490 185 (1,331)
Off-balance sheet funds 155,739 92,848 49,660 6,800 5,925 506 155,739 1 -
Total assets/liabilities and equity 762,456 452,360 164,758 67,324 67,541 54,242 806,225 22,910 (66,679)
RWAs 347,488 116,767 85,111 50,672 50,144 32,728 335,421 12,066 -
31-12-22 (1)
Loans and advances
to customers		 357,351 173,971 71,231 37,443 38,437 37,375 358,456 278 (1,383)
Deposits from customers 394,404 221,019 77,750 46,339 40,042 9,827 394,978 187 (760)
Off-balance sheet funds 150,172 86,759 38,196 6,936 17,760 520 150,170 2 -
Total assets/liabilities and equity 712,092 427,116 142,557 66,036 61,951 49,952 747,613 22,719 (58,239)
RWAs 337,066 114,474 71,738 56,275 46,834 35,064 324,385 12,682 -

(1) Restated balances according to IFRS17 - Insurance contracts.

Number of employees

Number of branches

Number of ATMs