FORM
6-K
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
REPORT
OF FOREIGN ISSUER PURSUANT TO RULE 13a-16 or 15d-16
UNDER
THE SECURITIES EXCHANGE ACT OF 1934
November
12, 2009
Commission
File Number: 001-10110
BANCO
BILBAO VIZCAYA ARGENTARIA, S.A.
(Translation
of registrant’s name into English)
Plaza
San Nicolás 4
48005-Bilbao
(Spain)
(Address
of principal executive offices)
Indicate
by check mark whether the registrant files or will file annual reports under
cover of Form 20-F or Form
40-F:
Indicate
by check mark if the registrant is submitting the Form 6-K in paper as permitted
by Regulation S-T Rule 101(b)(1):
Indicate
by check mark if the registrant is submitting the Form 6-K in paper as permitted
by Regulation S-T Rule 101(b)(7):
Indicate
by check mark whether the registrant by furnishing the information contained in
this Form, is also thereby furnishing the information to the Commission pursuant
to Rule 12g3-2(b) under the Securities Exchange Act of 1934:
If “Yes”
is marked, indicate below the file number assigned to the registrant in
connection with Rule 12g3-2(b): N/A
BANCO
BILBAO VIZCAYA ARGENTARIA, S.A.
TABLE
OF CONTENTS
ITEM
1.
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RESULTS
OF OPERATIONS FOR NINE MONTHS ENDED SEPTEMBER 30, 2009
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1
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ITEM 1. RESULTS OF OPERATIONS FOR NINE MONTHS ENDED
SEPTEMBER 30, 2009
CERTAIN
TERMS AND CONVENTIONS
The terms
below are used as follows throughout this report:
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•
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“BBVA”, “Bank”
or
“Group”
means Banco
Bilbao Vizcaya Argentaria, S.A. and its consolidated subsidiaries unless
otherwise indicated or the context otherwise requires. BBVA was formed by
the merger of Banco Bilbao Vizcaya, S.A. (“BBV”) and Argentaria, Caja
Postal y Banco Hipotecario, S.A. (“Argentaria”), which was approved by the
shareholders of each institution on December 18,
1999.
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•
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“BBVA Compass
”
means Compass
Bancshares, Inc. and its consolidated subsidiaries, unless otherwise
indicated or the context otherwise
requires.
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•
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“Latin America”
refers
to Mexico and the countries in which we operate in South America and
Central America.
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First
person personal pronouns used in this report, such as
“we”, “us”,
or
“our”,
mean BBVA.
In this
report,
“$”, “U.S.
dollars
”, and “dollars” refer to United States Dollars and “
€
” and “
euro
” refer to
Euro.
FORWARD-LOOKING
STATEMENTS
This
report contains statements that constitute forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, Section 21E of
the U.S. Securities Exchange Act of 1934, as amended, and the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995.
Forward-looking statements may include words such as “believe”, “expect”,
“estimate”, “project”, “anticipate”, “should”, “intend”, “probability”, “risk”,
“VaR”, “target”, “goal”, “objective” and similar expressions or variations on
such expressions. Forward-looking statements are not guarantees of future
performance and involve risks and uncertainties, and actual results may differ
materially from those in the forward-looking statements as a result of various
factors.
Factors
that could cause actual results to differ materially from those in
forward-looking statements include, among others:
• general
political, economic and business conditions in Spain, the European Union (“EU”),
Latin America, the United States and other regions, countries or territories in
which we operate;
• changes
in applicable laws and regulations, including taxes;
• the
monetary, interest rate and other policies of central banks in Spain, the EU,
the United States and elsewhere;
• changes
or volatility in interest rates, foreign exchange rates (including the euro to
U.S. dollar exchange rate), asset prices, equity markets, commodity prices,
inflation or deflation;
• ongoing
market adjustments in the real estate sectors in Spain, the United States and
Mexico;
• the
effects of competition in the markets in which we operate, which may be
influenced by regulation or deregulation;
• changes
in consumer spending and savings habits, including changes in government
policies which may influence investment decisions;
• our
ability to hedge certain risks economically;
• our
success in managing the risks involved in the foregoing, which depends, among
other things, on our ability to anticipate events that cannot be captured by the
statistical models we use; and
• force
majeure and other events beyond our control.
Readers
are cautioned not to place undue reliance on such forward-looking statements,
which speak only as of the date hereof. We undertake no obligation to release
publicly the result of any revisions to these forward-looking statements which
may be made to reflect events or circumstances after the date hereof, including,
without limitation, changes in our business or acquisition strategy or planned
capital expenditures, or to reflect the occurrence of unanticipated
events.
PRESENTATION
OF FINANCIAL INFORMATION
BBVA’s
consolidated annual and interim financial statements were prepared in accordance
with the International Financial Reporting Standards adopted by the European
Union (“EU-IFRS”) required to be applied under the Bank of Spain’s Circular
4/2004 of 22 December 2004 on Public and Confidential Financial Reporting Rules
and Formats and as amended thereafter (“Circular 4/2004”).
The
financial information included in this report on Form 6-K is unaudited and has
been prepared by applying EU-IFRS
required to be applied under the Bank
of Spain’s Circular 4/2004
on a consistent basis with that applied to
BBVA’s consolidated annual an interim financial statements.
This
report on Form 6-K should be read in conjunction with the consolidated financial
statements and related notes (the “Consolidated Financial Statements”) included
in BBVA’s 2008 Annual Report on Form 20-F filed with the United States
Securities and Exchange Commission (the “SEC” or “Commission”) on April 2, 2009
(the “2008 Form 20-F”) and BBVA’s Interim Consolidated Financial Statements on
Form 6-K for the six months ended June 30, 2009 (the “June 30, 2009 6-K”) filed
with the SEC on October 5, 2009.
The
EU-IFRS required to be applied under the Bank of Spain’s Circular 4/2004 differs
in certain respects from generally accepted accounting principles in the United
States, or U.S. GAAP. BBVA’s 2008 Form 20-F and June 30, 2009 6-K
includes a reconciliation of certain financial information under the EU-IFRS
required to be applied under the Bank of Spain’s Circular 4/2004 to U.S. GAAP.
We have not prepared or included in this report on Form 6-K a reconciliation of
the financial information under the EU-IFRS required to be applied under the
Bank of Spain’s Circular 4/2004 as of September 30, 2009 or for the nine months
ended September 30, 2008 and 2009.
The
BBVA Group
BBVA is a
highly diversified international financial group, with strengths in the
traditional banking businesses of retail banking, asset management, private
banking and wholesale banking. For the nine months ended September
30, 2009, BBVA had net income attributed to parent company of €4,179 million,
and as of September 30, 2009 BBVA had total assets of €537,305 million and
stockholders’ equity of €30,707 million.
Selected
Financial Data
EU-IFRS
(*)
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Nine
months ended September 30,
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(in
millions of euros, except per share/ADS data (in euro))
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Interest
and similar income
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18,325
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22,657
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Interest
expense and similar charges
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(8,033
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)
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(14,058
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)
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Net
interest income
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10,292
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8,599
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Dividend
income
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290
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402
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Share
of profit or loss of entities accounted for using the equity
method
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6
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268
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Fee
and commission income
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3,928
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4,177
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Fee
and commission expenses
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(661
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(755
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Net
gains (losses) on financial assets and liabilities
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644
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1,369
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Net
exchange differences
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480
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50
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Other
operating income
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2,502
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2,838
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Other
operating expenses
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(2,106
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(2,528
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)
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Gross
income
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15,375
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14,420
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Administration
costs
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(5,576
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)
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(5,740
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)
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Depreciation
and amortization
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(528
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)
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(512
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)
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Provision
(net)
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(234
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)
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(594
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)
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Impairment
on financial assets (net)
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(3,686
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(2,081
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)
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Net
operating income
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5,351
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5,493
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Impairment
on other assets (net)
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(301
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(11
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Gains
(losses) in written off assets not classified as non-current assets held
for sale
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18
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40
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Gains
(losses) in non-current assets held for sale not classified as
discontinued operations
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882
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776
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Income
before tax
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5,950
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6,298
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Income
tax
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(1,418
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(1,529
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Income
from ordinary activities
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4,532
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4,768
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Income
from discontinued operations (net)
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-
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-
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Net
income
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4,532
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4,768
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Net
income attributed to parent company
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4,179
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4,501
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Profit
or loss attributed to minority interest
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353
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267
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Per
share/ADS
(1)
Data
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Net
operating income
(2)
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1.44
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1.48
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Number
of shares outstanding (at period end)
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3,747,969,121
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3,747,969,121
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Net
income attributed to parent company
(2)
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1.12
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1.21
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(*)
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EU-IFRS
required to be applied under the Bank of Spain’s Circular
4/2004.
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(1)
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Each
American Depositary Share (“ADS” or “ADSs”) represents the right to
receive one ordinary share.
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(2)
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Calculated
on the basis of the weighted average number of BBVA’s ordinary shares
outstanding during the relevant period (3,715 million and 3,713 million
shares in the nine months ended September 30, 2009 and 2008,
respectively).
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EU-IFRS
(*)
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(in
millions of euros, except percentages)
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Consolidated
balance sheet data
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Total
assets
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537,305
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542,650
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527,932
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Capital
stock
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1,837
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1,837
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1,837
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Loans
and receivables (net)
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345,629
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369,494
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364,754
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Deposits
from other creditors
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249,365
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255,236
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237,648
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Minority
interests
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1,254
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1,049
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1,006
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Stockholders’
funds
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29,997
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26,586
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26,575
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Stockholders’
equity
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30,707
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26,705
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27,336
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Nine
months ended September 30,
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Consolidated
ratios
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Profitability
ratios:
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Net
interest margin
(3)
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2.52%
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2.26%
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Return
on average total assets
(4)
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1.11%
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1.25%
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Return
on average equity
(5)
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21.2%
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25.5%
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Nine
months ended September 30,
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(in
millions of euros, except percentages)
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Credit
quality data
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Non-performing
assets
(6)
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12,500
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6,544
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Loan
loss reserve
(7)
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8,459
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8,328
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Non-performing
assets (NPA) ratio
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3.4%
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1.7%
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Non-performing
assets (NPA) coverage ratio
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68%
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127%
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(*)
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EU-IFRS required to be applied
under the Bank of Spain’s Circular
4/2004.
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(3)
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Represents
net interest income as a percentage of average total
assets.
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(4)
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Represents
annualized
net income for the
period, which we calculate as our net income for the period multiplied by
four thirds, as a percentage of average total assets for the
period.
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(5)
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Represents
annualized net
income attributed to the parent company for the period, which we calculate
as our net income attributed to the parent company for the period
multiplied by four thirds, as a percentage of average stockholders’ funds
for the period.
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(6)
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Non-performing
assets include: non-performing loans (€12,130 million and €6,405 million
as of September 30, 2009 and 2008, respectively) and other non-performing
assets (€370 million and €139 millions as of September 30, 2009 and 2008,
respectively).
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(7)
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Includes
loan loss reserve and contingent liabilities loss
reserve.
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Summary
of Results of Operations
Net
interest income rose 19.7% to €10,292 million for the nine months ended
September 30, 2009 from €8,599 million for the nine months ended September 30,
2008 due to our pricing policy and to active management of the structural risks
on our balance sheet in the context of a slowdown in business. In BBVA’s
business with customers in the euro zone the sharp decline in interest rates in
recent quarters initially had a positive effect because assets were repriced
more slowly than liabilities. However, now the reduction in the yield on loans
(down 73 basis points to 3.68% as of September 30, 2009) is greater than the
decline in the cost of funds (down 37 basis points to 0.85% as of September 30,
2009). Consequently the customer spread has dropped to 2.83% for the nine months
ended September 30, 2009, returning to the level prior to the drastic decline in
interest rates. Nevertheless, the risk profile
is now
lower because assets, such as the consumer finance portfolio, have shrunk and
liabilities, in the form of liquid funds, have expanded.
Dividend
income decreased to €290 million for the nine months ended September 30, 2009,
compared to €402 million for the nine months ended September 30, 2008. The
difference is due to timing differences associated with our receipt of
Telefonica S.A.’s second dividend (€133 million), which was booked in the third
quarter last year; whereas, this year it will be booked in the fourth
quarter.
Share
of profit or loss of entities accounted for using the equity method comes to €6
million for the nine months ended September 30, 2009. This is significantly
lower than €268 million for the nine months ended September 30, 2008, which
included €212 million on sales from the industrial holdings portfolio,
principally our interest in
Gamesa
Corporación Tecnológica, S.A..
Fees and
commission income and expenses (net) was down 4.5% to €3,267 million for the
nine months ended September 30, 2009 from €3,422 million for the nine months
ended September 30, 2008, mainly due to the decrease on fees and commission
income from mutual funds and pensions funds.
Net gains
(losses) on financial assets and liabilities and exchange rates decreased to
€1,124 million for the nine months ended September 30, 2009 from €1,419 million
for the nine months ended September 30, 2008, which is €295 million less than
the same period last year. The €1,419 million for the nine months ended
September 30, 2008 included €232 million related to the Group’s sale of shares
in the initial public offering of Visa, Inc.
Net
operating income and expenses for the nine months ended September 30, 2009 was
€396 million, an increase of 28.1% compared to €310 million for the nine months
ended September 30, 2008.
Administration
costs and depreciation and amortization for the nine months ended September 30,
2009 was €6,105 million compared to €6,252 million for the nine months ended
September 30, 2008, a decrease of 2.4% due to a strict control in administration
cost.
Net
provisions for the nine months ended September 30, 2009 came to €234 million.
This is €360 million less than €594 million provided for the nine months ended
September 30, 2008, which included €470 million for one-off early
retirements.
Impairment
on financial assets (net) were up 77.1% in the nine months ended September 30,
2009 to €3,686 million from €2,081 million in the nine months ended September
30, 2008, mainly due to the increase of non-performing assets (€12,500 million
and €6,544 million as of September 30, 2009 and 2008, respectively) due
primarily to the deterioration of the economic environment. The Group’s
non-performing asset ratio increased substantially to 3.4% as of September 30,
2009 from 1.7% as of September 30, 2008. In addition, the Group’s coverage ratio
dropped significantly to 68% as of September 30, 2009 from 127% as of September
30, 2008 mainly due to the write-offs made during the nine months ended
September 30, 2009.
Impairment
on other assets (net) for the nine months ended September 30, 2009 was €301
million compared to €11 million for the nine months ended September 30, 2008, an
increase of €290 million due primarily to impairment charges for investments in
tangible assets and inventories from our real estate businesses.
Gains
(losses) in non-current assets held for sale not classified as discontinued
operations for the nine months ended September 30, 2009 was €882 million, an
increase of 13.6% million, compared to €776 million for the nine months ended
September 30, 2008. The €882 million for the nine months ended September 30,
2009 included capital gains of €830 million generated by the sale on September
25, 2009, of 948 fixed assets (mainly branch offices and various individual
properties) to a third-party real estate investor. At the same time, BBVA signed
a sale and leaseback long-term contract with such investor, which includes an
option to repurchase the properties at fair values, exercisable by the Group on
the agreed dates (in most cases, the termination date of each lease agreement).
The €776 million for the nine months ended September 30, 2008 included a gross
gain of €727 million from the sale of our stake in Bradesco.
Income
tax for the nine months ended September 30, 2009 was €1,418 million, a decrease
of 7.2% from €1,529 million for the nine months ended September 30,
2008.
Net
income for the nine months ended September 30, 2009 amounted to €4,532 million,
a decrease of 4.9% compared to €4,768 million for the nine months ended
September 30, 2008.
Net
income attributed to parent company for the nine months ended September 30, 2009
was €4,179 million, a decrease of 7.2% from €4,501 million for the
nine months ended September 30, 2008.
Profit or
loss attributed to minority interest for the nine months ended September 30,
2009 was a profit of €353 million, an increase of 31.8% from a profit of €267
million for the nine months ended September 30, 2008, primarily due to the
increase in the profits obtained by certain of our subsidiaries in Latin
American, primarily in Venezuela, Peru and Chile, which have minority
shareholders.
Key
Indicators
Return on
equity was 21.2% for the nine months ended September 30, 2009 compared to 25.5%
for the nine months ended September 30, 2008.
The
cost/income ratios including depreciation, for the nine months ended September
30, 2009 and 2008 were 39.7% and 43.4%, respectively.
The
Group’s total assets as of September 30, 2009 were €537,305 million, compared to
542,650 million as of December 31, 2008 and €527,932 million as of September 30,
2008.
As of
September 30, 2009 lending to customers amounted to €331,005 million, compared
to €342,671 million as of December 31, 2008 and €344,641 million as of September
30, 2008, which represents a 3.4% decrease as of September 30, 2009 compared to
as of September 30, 2008.
Lending
to domestic customers in Spain increased in economic sector where the risk was
lower. The public sector accounted for €20,247 million as of September 30, 2009,
which was a year-on-year increase of 20.5%. The loan portfolio of the domestic
private sector stood at €184,750 million as of September 30, 2009 and secured
loans account for the main part of this. They came to €106,761 million, which is
similar to the amount as a year earlier. Conversely, items of higher risk, such
as commercial lending in Spain have dropped significantly (down 38.0%
year-on-year).
Lending
to non-resident customers as of September 30, 2009 was €126,008 million, a
decrease of 6.6% compared to €134,872 million as of September 30, 2008. This
item is partly affected by the depreciation of Latin-American currencies and
especially by the slowdown in lending in Mexico, in the United States and in
some South American countries.
Non-performing
loans amounted to €12,130 million as of September 30, 2009, up significantly
from €8,358 million as of December 31, 2008 and €6,405 million as of September
30, 2008, a year-on-year increase of 89.4%. Total non-performing assets (which
include non-performing loans and other non-performing assets) amounted to
€12,500 million as of September 30, 2009, compared to €6,544 million as of
September 30, 2008, an increase of 91.0%. The non-performing asset ratio was
3.4% as of September 31, 2009 and 1.7% as of September 30, 2008. The
non-performing asset coverage ratio was 68% as of September 31, 2009, down
significantly from 127% as of September 30, 2008.
Non-performing
loans in the domestic private sector as of September 30, 2009 stood at €8,391
million, up significantly from €3,855 million as of September 30, 2008, but
continuing to slow on a quarter-by-quarter basis. In 2009 they increased 25.7%
in the first quarter, 13.2% in the second quarter and 7.6% in the third quarter.
The reasons behind the improvement are the lower additions to NPL and the active
debt recovery policy.
As of
September 30, 2009 total customer funds, on and off the balance sheet, were
€499,695 million, an increase of 1.4%, from €492,654 million as of September 30,
2008.
Customer
funds on the balance sheet rose by 3.2% to €366,581 million, compared to
€355,283 million as of September 30, 2008. This item is slightly higher than the
customer loan portfolio, resulting in a favorable liquidity positioning. Of the
above amount, customer deposits account for €249,365 million (up 4.9%
year-on-year), marketable debt securities account for €98,622 million (down 3.4%
year-on-year) and subordinate liabilities account for €18,594 million (up
19.9%).
Customer
funds off the balance sheet came to €133,115 million, a 3.1% decrease compared
to €137,371 million as of September 30, 2008.
Base
Capital
Based on
the framework of Basel II and using such additional assumptions as we consider
appropriate, we have estimated that as of September 30, 2009 and
December 31, 2008 our consolidated Tier I risk-based capital ratio was 9.4%
and 7.9%, respectively, and our consolidated total risk-based capital ratio
(consisting of both Tier I capital and Tier II capital) was 13.2% and 12.2%, as
of September 30, 2009 and December 31, 2008, respectively. Basel II
recommends that these ratios be at least 4% and 8%.
The
increase in the Tier I risk-based capital ratio was primarily the result of the
generation and retention of profit during the nine months ending September 30,
2009 and the issuance in September 2009 of mandatory convertible bonds in an
aggregate amount of €2,000 million.
Segment
Analysis
BBVA has
a organizational structure pursuant to which it operates in the following
business areas: Spain and Portugal; Wholesale Banking and Asset Management
(“
WB&AM
”); Mexico;
the United States; South America; and Corporate Activities. The
following tables present information regarding our results of operations by
business area for the nine months ended September 30, 2009 and 2008:
|
|
Information
By Business Areas for the nine months ended September 30,
2009
|
|
|
|
(Million
euros)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
interest income
|
|
|
3,693
|
|
|
|
871
|
|
|
|
2,505
|
|
|
|
1,100
|
|
|
|
1,822
|
|
|
|
301
|
|
|
|
10,292
|
|
Net
fees and commissions
|
|
|
1,123
|
|
|
|
389
|
|
|
|
805
|
|
|
|
411
|
|
|
|
619
|
|
|
|
(80
|
)
|
|
|
3,267
|
|
Net
gains (losses) on financial assets and liabilities and exchange
differences
|
|
|
153
|
|
|
|
(13
|
)
|
|
|
310
|
|
|
|
135
|
|
|
|
360
|
|
|
|
179
|
|
|
|
1,124
|
|
Other
income (expenses)
|
|
|
324
|
|
|
|
156
|
|
|
|
102
|
|
|
|
(26
|
)
|
|
|
(1
|
)
|
|
|
137
|
|
|
|
692
|
|
Gross
income
|
|
|
5,293
|
|
|
|
1,403
|
|
|
|
3,722
|
|
|
|
1,620
|
|
|
|
2,800
|
|
|
|
540
|
|
|
|
15,375
|
|
Administration
costs
|
|
|
(1,752
|
)
|
|
|
(381
|
)
|
|
|
(1,110
|
)
|
|
|
(805
|
)
|
|
|
(1,031
|
)
|
|
|
(497
|
)
|
|
|
(5,576
|
)
|
Personnel
expenses
|
|
|
(1,132
|
)
|
|
|
(253
|
)
|
|
|
(550
|
)
|
|
|
(498
|
)
|
|
|
(574
|
)
|
|
|
(410
|
)
|
|
|
(3,417
|
)
|
General
and administrative expenses
|
|
|
(620
|
)
|
|
|
(127
|
)
|
|
|
(560
|
)
|
|
|
(308
|
)
|
|
|
(457
|
)
|
|
|
(87
|
)
|
|
|
(2,159
|
)
|
Depreciation
and amortization
|
|
|
(79
|
)
|
|
|
(9
|
)
|
|
|
(48
|
)
|
|
|
(156
|
)
|
|
|
(85
|
)
|
|
|
(151
|
)
|
|
|
(528
|
)
|
Impairment
on financial assets (net)
|
|
|
(1,595
|
)
|
|
|
53
|
|
|
|
(1,097
|
)
|
|
|
(479
|
)
|
|
|
(310
|
)
|
|
|
(258
|
)
|
|
|
(3,686
|
)
|
Provisions
(net) and other gains (losses)
|
|
|
805
|
|
|
|
-
|
|
|
|
(24
|
)
|
|
|
(30
|
)
|
|
|
(9
|
)
|
|
|
(377
|
)
|
|
|
365
|
|
Income
before tax
|
|
|
2,672
|
|
|
|
1,066
|
|
|
|
1,443
|
|
|
|
150
|
|
|
|
1,365
|
|
|
|
(746
|
)
|
|
|
5,950
|
|
Income
tax
|
|
|
(795
|
)
|
|
|
(293
|
)
|
|
|
(340
|
)
|
|
|
(47
|
)
|
|
|
(316
|
)
|
|
|
373
|
|
|
|
(1,418
|
)
|
Net
Income
|
|
|
1,877
|
|
|
|
773
|
|
|
|
1,103
|
|
|
|
103
|
|
|
|
1,049
|
|
|
|
(373
|
)
|
|
|
4,532
|
|
Profit
or loss attributed to minority interest
|
|
|
-
|
|
|
|
3
|
|
|
|
2
|
|
|
|
-
|
|
|
|
360
|
|
|
|
(12
|
)
|
|
|
353
|
|
Net
income attributed to parent company
|
|
|
1,877
|
|
|
|
770
|
|
|
|
1,101
|
|
|
|
103
|
|
|
|
689
|
|
|
|
(361
|
)
|
|
|
4,179
|
|
|
|
Information
By Business Areas for the nine months ended September 30,
2008
|
|
|
|
(Million
euros)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
interest income
|
|
|
3,547
|
|
|
|
495
|
|
|
|
2,809
|
|
|
|
963
|
|
|
|
1,554
|
|
|
|
(769
|
)
|
|
|
8,599
|
|
Net
fees and commissions
|
|
|
1,222
|
|
|
|
311
|
|
|
|
944
|
|
|
|
401
|
|
|
|
561
|
|
|
|
(17
|
)
|
|
|
3,422
|
|
Net
gains (losses) on financial assets and liabilities and exchange
differences
|
|
|
206
|
|
|
|
310
|
|
|
|
316
|
|
|
|
99
|
|
|
|
163
|
|
|
|
325
|
|
|
|
1,419
|
|
Other
income (expenses)
|
|
|
315
|
|
|
|
371
|
|
|
|
69
|
|
|
|
18
|
|
|
|
6
|
|
|
|
201
|
|
|
|
980
|
|
Gross
income
|
|
|
5,290
|
|
|
|
1,487
|
|
|
|
4,138
|
|
|
|
1,481
|
|
|
|
2,284
|
|
|
|
(260
|
)
|
|
|
14,420
|
|
Administration
costs
|
|
|
(1,861
|
)
|
|
|
(365
|
)
|
|
|
(1,293
|
)
|
|
|
(785
|
)
|
|
|
(951
|
)
|
|
|
(485
|
)
|
|
|
(5,740
|
)
|
Personnel
expenses
|
|
|
(1,219
|
)
|
|
|
(236
|
)
|
|
|
(649
|
)
|
|
|
(484
|
)
|
|
|
(523
|
)
|
|
|
(417
|
)
|
|
|
(3,528
|
)
|
General
and administrative expenses
|
|
|
(642
|
)
|
|
|
(128
|
)
|
|
|
(645
|
)
|
|
|
(301
|
)
|
|
|
(427
|
)
|
|
|
(69
|
)
|
|
|
(2,212
|
)
|
|
|
Information
By Business Areas for the nine months ended September 30,
2008
|
|
|
|
(Million
euros)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation
and amortization
|
|
|
(81
|
)
|
|
|
(6
|
)
|
|
|
(57
|
)
|
|
|
(177
|
)
|
|
|
(75
|
)
|
|
|
(116
|
)
|
|
|
(512
|
)
|
Impairment
on financial assets (net)
|
|
|
(607
|
)
|
|
|
(205
|
)
|
|
|
(758
|
)
|
|
|
(252
|
)
|
|
|
(212
|
)
|
|
|
(47
|
)
|
|
|
(2,081
|
)
|
Provisions
(net) and other gains (losses)
|
|
|
9
|
|
|
|
8
|
|
|
|
(23
|
)
|
|
|
5
|
|
|
|
(5
|
)
|
|
|
217
|
|
|
|
211
|
|
Income
before tax
|
|
|
2,750
|
|
|
|
919
|
|
|
|
2,007
|
|
|
|
272
|
|
|
|
1,041
|
|
|
|
(691
|
)
|
|
|
6,298
|
|
Income
tax
|
|
|
(834
|
)
|
|
|
(172
|
)
|
|
|
(475
|
)
|
|
|
(87
|
)
|
|
|
(247
|
)
|
|
|
286
|
|
|
|
(1,529
|
)
|
Net
Income
|
|
|
1,916
|
|
|
|
747
|
|
|
|
1,532
|
|
|
|
184
|
|
|
|
794
|
|
|
|
(405
|
)
|
|
|
4,768
|
|
Profit
or loss attributed to minority interest
|
|
|
1,916
|
|
|
|
742
|
|
|
|
1,531
|
|
|
|
184
|
|
|
|
539
|
|
|
|
(413
|
)
|
|
|
4,501
|
|
Net
income attributed to parent company
|
|
|
-
|
|
|
|
5
|
|
|
|
1
|
|
|
|
-
|
|
|
|
255
|
|
|
|
6
|
|
|
|
267
|
|
Spain
and Portugal
Net
interest income of this business area for the nine months ended September 30,
2009 was €3.693 million, a 4.1% increase over the €3,547 million recorded for
the nine months ended September 30, 2008, due to the pricing policy and a change
in the deposit mix (with current and savings accounts playing a bigger role than
time deposits).
Net fees
and commissions of this business area amounted to €1,123 million for the nine
months ended September 30, 2009, a 8.0% decrease from the €1,222 million
recorded for the nine months ended September 30, 2008, due primarily to the drop
in fees income from mutual and pension funds and other market-related
products.
Net gains
on financial assets and liabilities and exchange differences of this business
area for the nine months ended September 30, 2009 was €153 million, a 25.5%
decrease from the net gains of €206 million for the nine months ended September
30, 2008, due primarily to the result of lower activity given market
volatility.
Other
income (expenses) of this business area for the nine months ended September 30,
2009 was €324 million, a 2.6% increase over the €315 million recorded for the
nine months ended September 30, 2008.
As a
result of the foregoing, gross income of this business area for the nine months
ended September 30, 2009 was €5,293 million, a 0.1% increase over the €5,290
million recorded for the nine months ended September 30, 2008.
Administration
costs of this business area for the nine months ended September 30, 2009 was
€1,752 million, a 5.9% decrease from the €1,861 million recorded for the nine
months ended September 30, 2008, due primarily to the Group’s transformation
plan, which helped to reduce wages and salaries, and thorough continued
streamlining of the branch network.
Impairment
on financial assets (net) of this business for the nine months ended September
30, 2009 was €1,595 million, a 163.0% increase over the €607 million recorded
for the nine months ended September 30, 2008, due primarily to the significant
increase in non-performing assets as a result of the economic downturn. The
business area’s non-performing assets ratio increased to 4.0% as of September
30, 2009 from 1.9% as of September 30, 2008.
On
September 25, 2009, BBVA sold 948 fixed assets (mainly branch offices and
various individual properties) to a third-party real estate
investor. At the same time, BBVA signed a sale and leaseback
long-term contract with such investor, which includes an option to repurchase
the properties at fair values, exercisable by the Group on the agreed dates (in
most cases, the termination date of each lease agreement). The price of sale was
€1,154 million, generating capital gains of approximately €830 million, recorded
in the line item “Other gains (losses)” under the heading “Provisions (net) and
other gains (losses)”.
As a
result of the foregoing, income before tax of this business area for the nine
months ended September 30, 2009 was €2,672 million, a 2.9% decrease from the
€2,750 million recorded for the nine months ended September 30,
2008.
Income
tax of this business area for the nine months ended September 30, 2009 was €795
million, a 4.7% decrease from the €834 million recorded for the nine months
ended September 30, 2008, primarily as a result of the decrease in income before
tax.
As a
result of the foregoing, net income attributed to parent company of this
business area for the nine months ended September 30, 2009 was €1,877 million, a
2.1% decrease from the €1,916 million recorded for the nine months ended
September 30, 2008.
Wholesale
Banking and Asset Management
For
internal management purposes, “Net interest income” and “net gains (losses) on
financial assets and liabilities and exchange differences” for this business
area are analyzed together. Net interest income includes the cost of funding of
the market operations whose revenues are accounted for in the heading “Net gains
(losses) on financial assets and liabilities and exchange
differences”.
Net
interest income for the nine months ended September 30, 2009 was €871 million, a
75.9% increase over the €495 million recorded for the nine months ended
September 30, 2008. Net gains (losses) on financial assets and liabilities and
exchange differences amounted to losses of €13 million, compared to gains of
€310 million for the nine months ended September 30, 2008. The sum of these
headings for the nine months ended September 30, 2009 was €858 million, a 6.6%
increase over the €805 million recorded for the nine months ended September 30,
2008, due primarily to active price management and an increase in the number of
customer transactions.
Net fees
and commissions of this business area amounted to €389 million for the nine
months ended September 30, 2009, a 24.9% increase from the €311 million recorded
for the nine months ended September 30, 2008, due to the fact that the area has
increased its strategic focus on customers with the potential to generate high
business volumes.
Other
income (expenses) of this business area for the nine months ended September 30,
2009 was €156 million, a 57.6% decrease from the €371 million recorded for the
nine months ended September 30, 2008, primarily reflecting the gains recognized
on the sale of ownership interests in Gamesa in 2008.
As a
result of the foregoing, gross income of this business area for the nine months
ended September 30, 2009 was €1,403 million, a 5.6% decrease over the €1,487
million recorded for the nine months ended September 30, 2008.
Administration
costs of this business area for the nine months ended September 30, 2009 was
€381 million, a 4.4% increase from the €365 million recorded for the nine months
ended September 30, 2008.
Impairment
on financial assets (net) of this business for the nine months ended September
30, 2009 was a recovery of provision of €53 million compared to an impairment of
€205 million recorded for the nine months ended September 30, 2008, due to this
area requiring less provisions owing to the decline in the loan portfolio and to
the focus on customers of greater credit-worthiness (which is also boosting
transactional business). The business area’s non-performing assets
ratio increased to 0.8% as of September 30, 2009 from 0.1% as of September 30,
2008.
As
a result of the foregoing, income before tax of this business area for the nine
months ended September 30, 2009 was €1,066 million, a 16.0% increase from the
€919 million recorded for the nine months ended September 30, 2008.
Income
tax of this business area for the nine months ended September 30, 2009 was €293
million, a 70.6% increase from the €172 million recorded for the nine months
ended September 30, 2008.
Net
income for the nine months ended September 30, 2009 was €773 million, a 3.5%
increase from the €747 million recorded for the nine months ended September 30,
2008.
As a
result of the foregoing, net income attributed to parent company of this
business area for the nine months ended September 30, 2009 was €770 million, a
3.7% increase from the €742 million recorded for the nine months ended September
30, 2008.
Mexico
The
average Mexican peso to euro exchange rate for the nine months ended September
30, 2009 decreased by 14.1% compared to the average exchange rate for
the nine months ended September 30, 2008 resulting in a positive exchange rate
effect on the income statement for the nine months ended September 30,
2009.
Net
interest income of this business area for the nine months ended September 30,
2009 was €2,505 million, a 10.8% decrease from the €2,809 million recorded for
the nine months ended September 30, 2008. At constant exchange rates, net
interest income climbed 3.9% year-on-year, due primarily to the strong
performance in retail banking (where demand deposits and customer loans both
registered growth), as well as an active pricing policy. Positive price
management has helped the area offset the current product-portfolio’s lower
contribution to net interest income.
Net fees
and commissions of this business area amounted to €805 million for the nine
months ended September 30, 2009, a 14.8% decrease from the €944 million recorded
for the nine months ended September 30, 2008, due to the lower pace
of growth in credit cards.
Net gains
on financial assets and liabilities and exchange differences of this business
area for the nine months ended September 30, 2009 was €310 million, a 2.0%
decrease from the net gains of €316 million for the nine months ended September
30, 2008. The nine months ended September 30, 2008 included non-recurring gains
from the sales of shares in the initial public offering of Visa Inc. and there
was no comparable transaction in the same period of 2009.
Other
income (expenses) of this business area for the nine months ended September 30,
2009 was €102 million, a 49.9% increase over the €69 million recorded for the
nine months ended September 30, 2008, due primarily to an increase in income
from the pension and insurance businesses.
As a
result of the foregoing, gross income of this business area for the nine months
ended September 30, 2009 was €3,722 million, a 10.0% decrease from the €4,138
million recorded for the nine months ended September 30, 2008.
Administration
costs of this business area for the nine months ended September 30, 2009 was
€1,110 million, a 14.2% decrease from the €1,293 million recorded for the nine
months ended September 30, 2008. In the latter part of 2008 we instituted
certain cost-control programs to limit the rate of local currency growth in
administration costs in this business area, whose effects began to be felt in
2009.
Impairment
on financial assets (net) of this business for the nine months ended September
30, 2009 was €1,097 million, a 44.9% increase over the €758 million recorded for
the nine months ended September 30, 2008, due primarily to increases from the
consumer loan and credit card segments due to a general deterioration in
economic conditions. The business area’s non-performing assets ratio increased
to 4.0% as of September 30, 2009 from 2.7% as of September 30,
2008.
As a
result of the foregoing, income before tax of this business area for the nine
months ended September 30, 2009 was €1,443 million, a 28.1% decrease from the
€2,007 million recorded for the nine months ended September 30,
2008.
Income
tax of this business area for the nine months ended September 30, 2009 was €340
million, a 28.5% decrease from the €475 million recorded for the nine months
ended September 30, 2008, primarily as a result of the decrease in income before
tax.
Net
income for the nine months ended September 30, 2009 was €1,103 million, a 28.0%
decrease from the €1,532 million recorded for the nine months ended September
30, 2008.
Net
income attributed to parent company of this business area for the nine months
ended September 30, 2009 was €1,101 million, a 28.1% decrease from the €1,531
million recorded for the nine months ended September 30, 2008.
United
States
The
average dollar to euro exchange rate for the nine months ended September 30,
2009 increased by 11.4% to the average exchange rate for the nine months ended
September 30, 2008 resulting in a negative exchange-rate effect on the income
statement for the nine months ended September 30, 2009.
Net
interest income for the nine months ended September 30, 2009 was €1,100 million,
a 14.2% increase over the €963 million recorded for the nine months ended
September 30, 2008, due to increased volumes of activity, a lower average
dollar/euro, exchange rate and our active pricing policy.
Net fees
and commissions of this business area amounted to €411 million for the nine
months ended September 30, 2009, a 2.5% increase from the €401 million recorded
for the nine months ended September 30, 2008.
Net gains
on financial assets and liabilities and exchange differences of this business
area for the nine months ended September 30, 2009 was €135 million, a 36.1%
increase from the net gains of €99 million for the nine months ended September
30, 2008.
Other
income (expenses) of this business area for the nine months ended September 30,
2009 was a loss of €26 million compared to a gain of €18 million recorded for
the nine months ended September 30, 2008, due primarily to higher contributions
to the deposit guarantee fund, as a result of the one-off $28 million
contribution made during the second quarter of 2009 to the Federal Deposit
Insurance Corporation (FDIC).
As a
result of the foregoing, gross income of this business area for the nine months
ended September 30, 2009 was €1,620 million, a 9.3% increase over the €1,481
million recorded for the nine months ended September 30, 2008.
Administration
costs of this business area for the nine months ended September 30, 2009 was
€805 million, a 2.5% increase over the €785 million recorded for the nine months
ended September 30, 2008, primarily as a result of the exchange rate effects
described above.
Impairment
on financial assets (net) of this business for the nine months ended September
30, 2009 was €479 million compared with €252 million recorded for the nine
months ended September 30, 2008, due to the write off impaired assets in light
of the country’s economic situation. The business area’s non-performing assets
ratio increased to 3.9% as of September 30, 2009 from 2.7% as of
September 30, 2008.
As a
result of the foregoing, income before tax of this business area for the nine
months ended September 30, 2009 was €150 million, a 44.7% decrease from the €272
million recorded for the nine months ended September 30, 2008.
Income
tax of this business area for the nine months ended September 30, 2009 was €47
million, a 45.9% decrease from the €87 million recorded for the nine months
ended September 30, 2008.
As a
result of the foregoing, net income attributed to parent company of this
business area for the nine months ended September 30, 2009 was €103 million, a
44.1% decrease from the €184 million recorded for the nine months ended
September 30, 2008.
In
addition on August 21, 2009, BBVA Compass announced that it acquired the banking
operations of Guaranty Bank based in Austin, Texas from the Federal Deposit
Insurance Corporation (FDIC), effective immediately. BBVA Compass acquired $12.0
billion of assets and assumed $11.5 billion of deposits and entered into a loss
sharing agreement with the FDIC that covers all of the acquired loans, where the
FDIC will bear 80% of the first $2.3 billion of losses and 95% of the losses
above that threshold. At the date of acquisition, Guaranty Bank operated 105
branches in Texas and 59 branches in California.
The
acquisition results in BBVA Compass being the 15th largest U.S. commercial bank
in terms of deposits with approximately $49 billion in deposits and operations
in seven high growth markets in the Sunbelt: Texas, Alabama, Arizona,
California, Florida, Colorado and New Mexico. This strategic acquisition
significantly strengthens BBVA Compass’ existing presence in Texas, solidifying
its ranking as the 4th largest bank in Texas based on its deposit market share,
which increased from 4.9% to 6.4% as a result of the acquisition. The
acquisition also extends BBVA Compass’ general banking business into the
California market.
South
America
For the
nine months ended September 30, 2009, the appreciation of the currencies in
Venezuela and Peru positively affected the results of operations of our
subsidiaries in such countries in euro terms, which was offset in part by the
depreciation of the currencies in Argentina, Colombia and Chile against the
euro.
Net
interest income for the nine months ended September 30, 2009 was €1,822 million,
a 17.3% increase over the €1,554 million recorded for the nine months ended
September 30, 2008, due to larger business volumes and more favorable customers
spreads.
Net fees
and commissions of this business area amounted to €619 million for the nine
months ended September 30, 2009, a 10.5% increase from the €561 million recorded
for the nine months ended September 30, 2008, mainly due to an increase in
banking commissions due primarily to larger business volumes.
Net gains
on financial assets and liabilities and exchange differences of this business
area for the nine months ended September 30, 2009 was €360 million, a 121.6%
increase from the net gains of €163 million for the nine months ended September
30, 2008, due to recovery in the financial markets, which enabled some entities
to realize capital gains on their fixed income portfolios as well as higher
returns on proprietary trading positions held by the pension fund managers and
insurance providers.
Other
income (expenses) of this business area for the nine months ended September 30,
2009 was a loss of €1 million compared to a gain of €6 million recorded for the
nine months ended September 30, 2008.
As a
result of the foregoing, gross income of this business area for the nine months
ended September 30, 2009 was €2,800 million, a 22.6% increase over the €2,284
million recorded for the nine months ended September 30, 2008.
Administration
costs of this business area for the nine months ended September 30, 2009 was
€1,031 million, a 8.4% increase from the €951 million recorded for the nine
months ended September 30, 2008, due primarily to growth rates that were in line
with average inflation in the region.
Impairment
on financial assets (net) of this business for the nine months ended September
30, 2009 was €310 million compared with €212 million recorded for the nine
months ended September 30, 2008, due to generic provisions attributable to the
rise in lending volume as under Bank of Spain rules recently-made loans require
higher generic provisions than older loans in our portfolio. The business area’s
non-performing assets ratio increased to 2.8% as of September 30, 2009 from 2.0%
as of September 30, 2008.
As a
result of the foregoing, income before tax of this business area for the nine
months ended September 30, 2009 was €1,365 million, a 31.2% decrease from the
€1,041 million recorded for the nine months ended September 30,
2008.
Income
tax of this business area for the nine months ended September 30, 2009 was €316
million, a 28.2% increase from the €247 million recorded for the nine months
ended September 30, 2008.
As a
result of the foregoing, net income attributed to parent company of this
business area for the nine months ended September 30, 2009 was €689 million, a
27.8% decrease from the €539 million recorded for the nine months ended
September 30, 2008.
Corporate
Activities
Net
interest income for the nine months ended September 30, 2009 was a gain of €301
million compared to a loss of €769 million recorded for the nine months ended
September 30, 2008, due primarily to the favorable impact of lower interest
rates and active balance sheet management.
Net fees
and commissions of this business area was a loss of €80 million for the nine
months ended September 30, 2009, compared to a loss of €17 million recorded for
the nine months ended September 30, 2008
Net gains
on financial assets and liabilities and exchange differences of this business
area for the nine months ended September 30, 2009 was €179 million, a 45.0%
decrease from the net gains €325 million for the nine months ended September 30,
2008.
Other
income (expenses) of this business area for the nine months ended September 30,
2009 was €137 million, a 30.1% decrease from the net gains €201 million recorded
for the nine months ended September 30, 2008.
As a
result of the foregoing, gross income of this business area for the nine months
ended September 30, 2009 was €540 million compared to a loss of €260 million
recorded for the nine months ended September 30, 2008.
Administration
costs of this business area for the nine months ended September 30, 2009 was
€497 million, a 2.5% increase from the €485 million recorded for the nine months
ended September 30, 2008.
Impairment
on financial assets (net) of this business for the nine months ended September
30, 2009 was €258 million compared with €47 million recorded for the nine months
ended September 30, 2008, due primarily to the
increase
of country risk provisions related to Brazil due to the reclassification of
Brazil as a “country with transitory difficulties” by the Bank of
Spain.
Provision
(net) and other gains (losses) for the nine months ended September 30, 2009 was
a loss of €377 million, compared with a gain of €217 million for the nine months
ended September 30, 2008. This decrease was primarily due to impairment charges
for investments in tangible assets and inventories from our real estate
businesses during the nine months ended September 30, 2009. The nine
months ended September 30, 2008 included the gross gain of €727 million from the
sale of our stake in Bradesco, which was offset in part by a one-off charge of
€470 million related to early retirements.
As a
result of the foregoing, income before tax of this business area for the nine
months ended September 30, 2009 was a loss of €746 million, a 7.9% increase from
the loss of €691 million recorded for the nine months ended September 30,
2008.
Income
tax of this business area for the nine months ended September 30, 2009 was €373
million, a 30.8% increase from the €286 million recorded for the nine months
ended September 30, 2008.
As a
result of the foregoing, net income attributed to parent company of this
business area for the nine months ended September 30, 2009 was a loss of €361
million, a 39.1% decrease from the €592 million recorded for the nine months
ended September 30, 2008.
Recent
developments
On
September 29, 2009, the BBVA Board of Directors agreed to appoint D. Ángel Cano
Fernández as President and Chief Operating Officer, in substitution of D. José
Ignacio Goirigolzarri Tellaeche who leaves the Board.
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned, thereunto
duly authorized.
Date:
November 12, 2009
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Banco
Bilbao Vizcaya Argentaria, S.A.
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By:
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/s/ Javier Malagon Navas
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Name:
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Javier
Malagon Navas
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Title:
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Authorized
representative of BBVA
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