BBVA - Earnings call transcript Q2 2022 | Banco Bilbao Vizcaya Argentaria, S.A.

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Patricia Bueno

Good morning, and welcome, everyone, to the BBVA Second Quarter 2022 Results Presentation. Thank you very much for your interest. I'm joined today by Onur Genc, BBVA Chief Executive Officer; and Rafael Salinas, Group CFO.

As in previous quarters, Onur will start reviewing the group figures, followed by Rafa, who will go through the business area results. Then, we will move straight to the live Q&A session. turn to will I now it Onur. over And

Onur Genc

to and thank you, Patricia. for Welcome, morning Good Thank you everyone. joining us.

jump So X. me into with Start let slide it. number

know, of Before January the applying X, starting in IAS hyperinflationary ago the our we is are announced which XXXX. in presentation, that going we a details from as accounting into XX, business weeks few Turkey, you Turkey, in

the you would be from fully So adjusted the show figures. results that all this seeing date

quarter. due after attributable XX.XX%, target our our bottom of year-over-year, shows to are regulatory the net as you slide, One the and see higher of transaction, position, we impact well transaction. Merlin the to XX% graph side on know are repurchase requirements. the slide, our of side results the hand up and page, Merlin higher left the €X.XX, agreement capital of earnings million capital evolution, including that, this hand results have the we XX% implanting, growth ratio than profit billion. our the the Spain, earnings the year net with with negative recurrent first And higher -- XXXX €X.XXX hyperinflationary posting the of And a figure, €XXX our restated excellent above in last branches XX.X% after share know. profit this of of even excludes program in range more all can are as attributable buyback billion, This due that On Even our we the was above this it we you the numbers, are it best per all the above to €X.XX these impact results, negative right to accounting. record quarter than share, reaching at the results. quarter quarter rate we These quarter done the same brings due including at you per share

Moving number to X. Slide

the same quarter last different of XX% see business increase can down areas of incremental different into You contribution year, breaking overall the areas. basically versus the

As due the accounting. that you hyperinflationary the implementing net reaching positive of explain due have of registered is we In a the see loss the Mexico good quarter the second value €XXX after America outperformed, will very South Rafa Turkey, chart, later it mentioning in position accounting, and results, as monetary the the presentation. contribution in even especially in impact to million case in worth to It a quarter. negative hyperinflationary the P&L of had

So these after that obviously impacts. seeing those you're all are results

€X.X number X. highlight our the of X.X% tangible share. at year-over-year Page plus to quarter. in Moving dividends, book share per want which quarter evolution growth closed per increase share in in value XX.X% value book tangible and per to dividends, outstanding I the plus the

the in same terms In We of Regarding quarter the period our XX.X% across most the out to highlight, equity. these my profitability, obviously. the profitable of clearly of numbers return quarter this metrics, Slide been advancing reaching year. versus revenue on on has on strong profitability key banks, versus highlight growth stands we tangible keep What with First, the loan the board. core was in XX.X% excellent at growth second XX.X% this equity and the remain the for quarter? group by messages XXXX, continue excellent number last the this we supported second one European evolution. this level -- XX% loans view, the and X. in metric, improve return in

to year Second, our with positive jaws. X leading improving in of months the XX.X% efficiency ratio first the

a at income better trends that XX growth also XXXX quality to are a than asset better we and underlying the of Fifth, this strategy, better we'll of everything in expected, capital operating discussing the thanks second. target in pre-pandemic But risk strong basis well. our in page, moving page. last solid our than feeds XX.X%. areas our points, strategy key progress levels, which outstanding cost be then position above else very Third, reporting of than is range. And is Fourth, in our comfortably

quarter. sustainable figures the which the in record customers financing of X.X we new as acquired of million strategy, in reaching acquired also are here quarter a million sustainability, have Again, XXXX. of our regarding another since XXXX, have X in record €XXX billion key months the We of with And last then been component X.X extended well.

we on is that year. quarter all focusing the right last to to this, we November of comparison have all ambitious Slide continue achieve targets This the with disclosed and in on X second you number year. of our path year-over-year the the last Given long-term P&L.

The that's second from I column the would what focus. left,

coupled in constant fee in the also lines, all and the NII led quarter You strength both I the positive the evolution again core net a attributable identify with would terms. positive of coupled in P&L our underlying with profit growth, current can to of and XX% clearly XX.X%. highlight which jaws, revenues, very growth in solid of basis I best growth with XX%, constant as the the risk mentioned, indicators,

expenses in is heading. other year, NII, from inflation. hedge in of loss the is this accounting the contribution this income of a Turkey, serve are against since CPI of net and the beginning linkers position monetary Also, reflecting hyperinflation they hyperinflationary income -- XXXX in what as inflation-linked other it due asking a the That's as value reminder. the us in to The isolating impact Turkey, as the do. again, and Just the included P&L since in line, negative to we the bonds expenses

this have NII in change. growth even excluding the So larger would been

at in increase XX%, which Moving the euros, regarding coupled underlying of solid period would NII, amazing, revenues the Slide XX% constant on the net Again, fee the number €X.X strong by risk core first income the half profit to XX% metrics, year. the increases previous XX%. led to income highlight the the I recurrent growing once gross versus X of mentioned positive and growth last same with XXXX attributable the led again as positive very evolution, an of in billion. performance, outstanding coupled with slide, jaws,

Slide number X. Moving to

Some light breakdown, the quarterly into revenues again, quarter. the was the which of highlight

activity Our XX.X% net year side. hand Again, has income and on interest countries top, last XX.X% versus the quarter. compared interest customer at income, net last in spreads the side, increased on improvement strong left also the and strongly, growth most helping been to

and gross trading million. above XX.X%, income, growth, the in board, another income performance side and the across versus with again, versus top, right XX.X% good hand quarter. the Slide last the XX.X% €XXX last year-on-year positive increasing outstanding growth on double in the Next, all, at number fees Also, XX.X% a and evolution quarter. year-over-year net on commissions performance digit then quarter XX. in All

income The On to do the it in quarter-over-quarter, strong can And the growth in competitively highlight feed the strong going Spain loan the individual our fee XX.X% profitable reaching left see growth last hand slide, countries closely can has growth, a income. fee the would loan will same been continue feeds In the in forward. activity view, activity slide, period very has of that growth in here you results. for side And group growth very and strong client examples of NII in been growth. we also see I measured both of at strong with level, Mexico, center versus accelerating each activity. think NII it you the in year the and of level. Then, and the growth, trends which our very at fundamental

longer on and with rate customer in much have terms only hand track such see the of better been can several for in of The rates up Spain side Lastly, core Mexico, you in the slide, in of yields Mexico trends right in obviously, rises. have slightly evolution. both quarters, interest lending and as improvement the record spreads: the in positive the But catching countries. increasing a

number Moving XX. to Slide

the to growing jaws X XX.X% in group gross months We continue thanks showing performance income, positive level of good year. at the the the first of

other exclude growth mean, in X.X%. guidance. our high would growing footprint, the the have very our X On of blended our footprint, constant inflation -- been been you Turkey, with would in I the have this XX% costs and are countries XX%, hand, Argentina basis inflation if below line on

from risk basis On of hand we our risk, decreasing of obviously, very our But see by with talk to closes guidance be -- the the be revenues in the the to can right compares number see good improved European it the we're peers Even quarter, the you it cost improving X% well. to XXXX. number improving XXXX attributable to about Slide of a every very to XX, are period in in in Rafa line positively as today XX.X% to And single be the of points can XXX the Also, same And going and and recoveries. X.X% improving of our XX.X% mentioned, risk XX and quality of best side talk Cost in The XXXX. our about the strong with improving cost the level, second. first evolution uncertain guidance, indicators. guidance ratio XX%. page, will you of group XXXX of decreased risk asset core basis a X. as rest the XX efficiency half indicators. points. compared Impairments underlying basis further in NPLs the the Slide Rafa we of recorded and both underpinned environment, with to our portfolios, our below performance I This risk positive country. will XXXX. evolution coverage at at of evolution in in this the in ratio.

loaded basis above capital, level XXXX good as This June is at XX.XX%. very our requirement. XXX CETX level, our Our fully a stands of points

consumption In fee due embedding announced we June, Following waterfall. then guarantees offer impacts tender announced the the that and with to of capital after accounting at end they waterfall the the pre-announced, hyperinflationary -- associated that, in results numbers ratio. to first the top deal the see our the waterfall, with the Merlin, On basis then that see points the were contributes generation you of you XX there. the

then deducting ATX this as Then coupon bucket from points, the ECB mechanism, And the then this are to equivalent to RWAs' dividend strong, XX% health income in or all That's -- and payments. comprehensive XX according After chart. basis policy. on to the in XX the collect because bucket mainly and internal the basis market-related basis position the third as our added includes credit mark-to-market to market-related profitable you in of other a hyperinflationary capital. to see portfolios, impact is payout the due FX. bucket. waterfall, bucket has in the in mentioned, context of the back of economies positive all, which the the part impact I in growth. sale P&L upper registered points, loss they Second, others, and net XX one, And And last at and represent the the monetary points the accrual the value to impacts

As the you these all all neutral. in capital P&L are know, losses

Page this see up of In number records of our that XX% growing our their to customers it XXXX, slide, are is and the to acquisition from We XX%. profitable how months. ago. We years can very million growing had last to X beat new always X% franchise. I'm are happy more On through target as X customers a new model year, this all see And digital, remain we discuss new happy become in number to million franchise. XX, in sheet to high. Moving how that more of customer years client is within serving acquired here balance keep in most efficient customers customers slide. we X the first here, way, digital the healthy quality the acquisition continue transforming customers, And engagement than growth. clients can customers distribution new it's customer the quarter-after-quarter, acquired our Also X.X also highlight acquisition. saying, XX, in months And of X always you slide. was wanted the growing way focused X.X this we on we the of using doubling and you today, ago. much as our we And we slide and see acquired, Spain, relationship

also past geography, the a decreased case has much the page While branches number as customers fast through customers, been digital, of to but somewhat the BBVA the as as substantially, customer infrastructure acquisition growing with in with in leading Spain. of leading in form very smaller this significant Mexico; either in is the structure, of efficiencies few more every similar years, in more much a highlights. or has curve efficiency single in

strategic priority. Turning to another Slide number XX,

major sustainable have a This financing quarter, we hit milestone our goal. towards

already our can XX say the business for as targets Investor save will of on that XXXX. In on path than XXXX, finally, long-term Rafa? and the not half I areas, slide. billion, than since can the have you on more in of We revised by all-time XXXX. the into be quarter more €XX them, them €XXX are all, in each Day. of we goal a And time, to announced billion only, quarter new achieved And €XXX XX% than Slide billion of more second mobilized our number go right record the To to the achieve but one second see I

Rafael Salinas

and Onur, you, morning, good everyone. Thank

by excellent quarter Starting trends you across number share in in geographies, with anticipated sound we Spain by happy Onur, very all very another are with the Slide results supported As to operating board. XX.

Another growth, at with where with almost X.X% XX% digit also segments we above the double with to of nicely. commercial positive year-on-year The and segments lending evolved share consumer recovery mainly loan growing during quarter. is line due the strong of growing activity, are business P&L a headings market of performance in lending, quarter In book all very short-term leading delivering dynamics. both to the in activity, very the gain us

a by on X% high banking mainly quarter-on-quarter, fees dynamics, CIB. by profitability. to NII leveraged And a higher growth by the fees, and close management quarter, a disciplined a and explained growing with driven grew from revenues clear services very positive contribution at core First, X.X% focus loan in price

NII NPL better and efforts than the first the at control positive on points around Based €X our guidance we profit of for our performance with basis by XXXX. lower on an third, cost results billion guidance. in All points sound line performance cost jaws, upgrading year. and grow dynamics basis of of increase seen entries the to efficiency so digit far, very low risk the in 'XX in to year. second indicator, in grow because outstanding improving are as higher see recoveries, a below in, recurrent the And the the we Spain the guidance, a X.X% part underlying reaching expect risk we are asset widening in year, the good XX XX the year-on-year, attributable trends to levels low-single around with to risk stands whole the the mid-single will in expected Second, half reflected digit loans the net with on of Due and of continue of to in to rate XX.X%. expenses, start very kicking quality, declining in,

momentum we loans and anticipated finally, differential rebound for also taken and sales In impressive both by in dynamics, our strong of quarters payroll auto from of preapproved off. origination growth wholesale again, supported a this and ever. by and with we And Mexico, reached loans, and capital regained loans wholesale Let's by segments. year-on-year, this as strong recovery retail results. strongest the grew an we proposition in needs. move higher profit our have billion in benefiting Slide activity to balanced the context Mexico. cash Mexico, close one credit Once in lending, being quarter, on activity quarter, and XX. of segment to portfolios supported value The working growth investment SME report consumer XX% the has Net last €X the excellent are

an loan benefiting growth loans, for of Based higher have of continuous year-on-year. outstanding XX% excellent, our contained. by of and robust on on from remain cost spend, the dynamics, supported growth revenues the than sound P&L. growth those the yield all-time NII record, 'XX. reaching to more by Results on core improvement Moving customer driven a and we Strong deposits new in are while upgraded guidance

performance also We context rates. transactionality, growing banking growth close fees, to XX% double to to Revenues In fees. results by is lower in insurance loans and XX% a interest growth and management in levering from at an the income to widening growth NII year-on-year, and strengthen bigger on activity improving digits trading the of a are digit ratio. increase quarter now and in, above our more around and Mexico, jaws double investment higher higher opportunities expecting income Also, foresee than claims. strong to in loans due in grow net we cost-to-income increase and cash outstanding higher benefiting gross leadership. the XX.X% All to doubles to leading expenses, efficiency

We in will in and continue clear up warm value. with we investing greater country have segments a organic growth this

pressures us now see and growth positive expenses have country our cautious to expenses. slightly above inflationary the in on growing Additionally, maintaining average adopt a strategy in inflation outlook We led more 'XX, jaws.

underlying Finally, Good guidance basis year. recoveries NPL us the Low of drive entries our quality. some points. XXX for make trends below upgrade the on asset and cost risk

expect cost current levels up We in risk of the to around end XXXX.

Turkey Slide Regarding in XX.

mentioned, already events have we this quarter. had As differing

inflation. of is announced eliminating by The in hyperinflationary objective of we Xst hyperinflation reflect applying from end the we main the June, to As growth the the the caused Turkey are inflationary with of of the by activity, evolution nominal real -- effect accounting accounting very January. high

loss driven you first year this of profit the positive positive in see quarter of and versus million of positive evolution are the of the €XX can 'XX terms. million As is quarter revenues, mainly of we equivalent the second on reporting lower This improvement €XXX by in constant slide, attributable a net impairments. an in use

hyperinflation XX% by XX% annual year-on-year NII Record growth growing higher by net in of below to currently the to year-on-year, June but is in rate. we and contained result because coming is lending finally, supported flat quarter, board, the monetary is inflation during a has in rate lower the portfolio accumulated income been the customers' the loan TL which the which a mainly where revenues quarter growth remain loss the heading strong the in despite second inflation down, activity, increased. preference payment by have of trading. inflation, lower in a the also offset this especially will net has has and broadly CPI inflation come strong coming trading with with And yields. current terms the TL linkage, from loss other Excellent quarterly is adjustment loan share. quarterly related fees improving partially a reduced of services, size And FX the position. performance quarter-on-quarter in the income that for market across with euros level In as

risk America. In region, price activity the trends impairments, of from evolution first, all positive Slide denominated loan very evolution, environment. terms driven wholesale good revenues the results All and in by by levels to reached with cost to mainly quarter evolved increasing due metrics macro the explained, geographies. mainly profit of positive uncertain €XXX expect core the XXXX strong asset activity terms in supported XX, dynamics across NPL positively, very Fees mix in of moving net This finally, and loans. management. million, good to showing in are foreign sound growth region positive continues ratio South improving sound for we contribution. franchise earnings attributable shows to coverage Overall, continue And we quality very while and due limited currency continue year-to-date. a recoveries, asset all, contribution The

back cost good risk year. main asset of Second, trends Derived points to South levels. America these our impairments efficiency and now trends underlying And quality, with in risk the the takeaways. lower from Onur in despite good we remains basis low around third, quality remains environment, the high stable. improving for to cost at And highlight to inflation are of for whole XXX guidance asset

Onur Genc

Thank you, Rafa.

strong First, of reported quarter, last positive page. One results. results the The have more trend group's quarters. showing in we recent very continue the the

by revenue strong customer and activity spreads. core mainly driven evolution, excellent Second,

creation Third, value we to our growth continue our and profitable with commitment accelerate stakeholders. for

in one the Our of And dividends European strategy, acquisition progress on peers, but highest execution figures we of teens. keep expectations, and per are profitability we to metrics of in have are this. might significant you, enjoying long-term on lastly, value our Mexico. we Fourth, digitalization, the share upgrading Spain, at -- we in our we we are one our And track result among finance. you reaching the and And we of to record tangible ambitious it, sustainable have registered our revenue said plus that everything as advancing book growing made are high have in customer revenues goals. basically achieve a core

in are group We the improving risk in level. of at of cost geographies upgrading, our our expectations most and

living a despite the view. the track come So we very all our that would we through positive be are -- of second the we in also uncertainties in record have to half year,

Now Patricia Q&A. for back the to

Patricia Bueno

Thank you, Onur.

ready the We with are now live Q&A session. to begin

So the first question, please.

Operator

question comes of first the line [Operator from Instructions] The today Francisco Alantra. from Riquel

Francisco Riquel

My question on is first Mexico.

impressive So quarter. this results

congratulations in here mainly Mexico in to XX% in now So up quarter, the due first Loan quarter. corporates, the second accelerated growth the here. X% large

wonder I this if on could And is you how of risk. the economy, technically what growth and quarterly what a set cost I be? of on Interest it at recession. profits can are also the demand, billion sustainability in negative sustainable see €X you in the driving And Mexico. to impact overall then comment The rise loan further. economy levels is rates wonder do So U.S.

then do on question in how And see correlation second wonder economic I and So this the Mexico cycle. U.S. you capital. between the

year. if XX -- regulatory that for the Just you was basis was on headwinds can points least last you the the mentioned update left at guidance

Onur Genc

On growth. Mexico loan

numbers Quarter-over-quarter case. the into looking Mortgages the X.X%, in of positiveness you the in only the also Mexico, sad, front growth, it you me. If bit up already that's the a be have not presentation. only here But in quarter. because in segment, Year-over-year, and quarter-over-quarter year-over-year. I corporate restrict the would I'm

And credit a a to X.X%. is push X.X%; strong you lot, segment So that growth we SMEs, presentation: can board. growth in yes, cards. which X.X%. in it's lot, X.X%. Consumer, the SMEs, very And the XX% also we cards, also annualize corporate like But obviously. credit XX% then across it, the you year-over-year see want a in

it's board. about ask But So across the corporate. you the specifically

the the numbers a investment for better overall economy. corporate, bit On the coming are

some Because inflation, But the short but numbers, here. need we in -- the quarter working share. So term. driving working financing the is obviously, trend mostly numbers of and there I is the working investment-driven financing companies -- it's come loans out, Francisco, haven't that And it's mostly capital growth. these mean, final capital capital are gaining market

are roughly We market basis board, share the gaining across XX basis points. XX points,

it's billion franchise of So than I think chapter. or this the of the product you pure €X the some board. asked sustainability Then under across strength It's the segment rather topic. one one

very we last We I analyst have amazing community bank really time you I -- are the on to I as in mean, positive this Mexico. an did mention to think do well. Mexico.

We I have an franchise. amazing amazing bank mean, in Mexico. an it's

have the franchise, are NPS, we the We strength there, in "Well, than They're that, imagine obviously. of with uncertainties share that going best the satisfaction that in have beyond going that we us lending. talent have in market best that cannot the have less the sustainable Mexican Mexico -- that The it talent, is second. customer growth amazing Mexico, are continue the But we X%. In the you But service power franchise to that you providing with asking the is to have be Mexico, customer imagine we country. the U.S.? -- that have have There is that, context in gap have gap respect this the there, year cannot grow. in to because the context we you brand we the we XX% of franchise an

loans -- for the to what this It's Looking seen. emerging Mexico, not from the come economy Banking the the years I is have But Brazil we X%. banking rate is coming -- is is in one lowest in growth. is any It's growth around Mexico around penetration. the of the sustainable? coming XX from say, unfortunately, last not landscape. the directly XX markets debt GDP XX, would of over years growth how last of GDP Mexico So It's banking of XX%. from the different XX%.

guidance question, So be in the continue Cost the of that's vintages, that's and independent the the risk lending to risk, all. which of attention cost That's real in is second obviously, your view. of we so don't the that sheet key why and doing. The Francisco. this we But have we have I Then have one, the flows And only going costs, piece to on at of we -- put Mexico. to, are see signals the paying any of to manage risks Mexico table, deterioration new of for we on, ask our for upgraded yet would sustainability. year. regulatory headwinds, economic about cost of in risk. drive in balance And two and growth, going growth healthy to then penetration banking you the our growth number

than last be -- Let here close where I news points. guided I me But as to it basis we be was, presentation It's basis going a that well. XX have positive XX higher lower said -- it basis it's repeat to the think, you, we it's XX points, the points. we quarter, -- the seems. you process. of slightly end In as January we at In than going Today, to the XX points, were. year around basis said of

ongoing There second we we and didn't the models the an details a -- quarter. in it so of on close that with are second that on the It's program on. were supervisor process. that quarter. It close different our are lot process in As hoping ourselves to aligning

most come third to to that is But quarter. fourth to going likely So next -- even process most fourth the and results maybe quarter, be current likely quarter but be expected possibly of very year. likely fourth

is provisioning want number basis of taken first uncertainty -- be we in highlight -- to for points the less process. we year, Because And have you points see. will to will that. in points. we prudential So -- today, that the have there the -- XX But XX in clearly we from some than will half that basis capital be than remaining less XX number basis

of So the less That's uncertainty But have finalized now guidance is that we than the give at we and -- you. can the to around will number process, be have we some this latest XX. aware be that will there some very please is our message but end with clear of range very have will again, this is, comfortable The year. fact the that on and is our the are end I there that target upper we final uncertainty, XX.

at the clearly be of in terms of will year XX end capital. the above We

Patricia Bueno

question, please. Next

Operator

today next Toms the from RBC. comes The of Benjamin question line from

Benjamin Toms

Two me, please. for

what the if said an just XX%, come you on. this think, in constant do that at you advanced on they're to And back obsolete. then a XXXX advance environment? rate a And new we the target Can with printed you'd been, expect XX% year-to-date you'd context, you it operating should think on ROTE the In presumably your hope we target of to target year-end? current basis. would presentation XX% guidance expenses, of have You up is in the now about XX.X%, annualized which

your your I you if give low XXXX? quarter for adjusted you it's your I variable think in you for average weighted for in last crucially, in you have number this inflation And Can guess below a gave your equivalent What inflation number footprint comp average it? perspective quarter, just the please, penciled us base. this footprint. have weighted

Onur Genc

Very good.

just would understand, our Benjamin. be That's said upgrade we you're new line. number. in or asking, cut would a was it. XX.X%, There it But we the I what as the what On

a too So it. ago. X-year November. your was revise we And appetite, X will Investor in it see Day And we I it's And the have but early. months plan.

into months we ago. But the talk it. it's X at after goal about the look early said will to too We moment, it revising

going Just we because the numbers are not conclusions into should be so well, jumping away. right

have to clearly We we targets on have the and we committed XX%, deliver that we that point the will market. are that committed

accruing low" the the time see. was at we variable think On basically the compensation, question the was that -- OpEx, you it "last I it numbers are

to it we And that we time, every doing variable compensation it's levels that see adjusted months So higher. the are in The slightly is or so. on numbers. X accrual these you this adjusted have

the the a have, inflation. a a lot, of Weighted in increase the not we compensation a a coming great these So from of as variable bit is average slight that bit but numbers result, increase and accruals. little increase,

that XX% average you in a it's see. be -- presentation, That by don't on final high the Because will next I moment. have the every see at we not it's number it's There the with not don't is numbers change of range. decline creating going being to -- is the months, slight way, some that going see As We geography. from page the inflation the X weighted the the we around is you this the XX%, be XX%. but quite mean, that single to be in -- major but it, weights OpEx

from range, this. of And So the not much it's I the cost weighted and it's to change that, Mexico. all a be context, average Spain, is geographies. here that this big given around obviously, In part going think

Operator

Maks The next Capital. Mishyn comes question line from of today from JB the

Maks Mishyn

fact I board downgraded kind is COVID-XX related you your for improve have input? most been I the One keep that countries growth of comes acceleration worldwide, buffer of from cost the part a been if model model. this the then have question but across lost the still consolidation the is small X, have market of of Mexico. wondering if and little focus do the just the And is macro estimates peers that for books? I follow have more some you you was might in the And guidance your bit. fact was most up wondering in there that regions. the risk think of with if on I what you second to may. in Macro conservative on And

Onur Genc

on comment don't is related one please Rafa, I at the only There helps. Mexico. a this as -- market obviously, it moment. in But well. the discontinuity it's think

core being competitors in One of is process the of our sold.

I the only against So well. think for specific are I tie not others, gains, competitive compare others us. it Because that gaining that we but our when it player, market obviously against share helps as one. I situation only But to wouldn't

than So it's in this helped it's helped. It's view. that discontinuity. broader my obviously, But by

mean, from from macro. are losses. in underlying obviously, is not macro the is you the the at of But very due positive at see On others, the Because releasing trends. is the books guidance that question moment. no, the the that which chapter showing there, we the collections, what and they models? -- the world going the I macro components still any is The are models. times releasing negative are a to NPLs. that open or signals modeling is: it's we going for be on X the uncertainty slight the If one Regarding as what moment numbers we to Again, is macro the macro moment NPL not. is and are through business I are both answer we from the and future are situation not to the coming at parameters positive. provisions of provisions But is There a collections going delinquencies have the forward, this the obviously. have and also the here quite giving because uncertain that better usual, that risk

risk that reason better that guidance metrics usual see. and have the are and improving of risk the underlying cost of purely reason the risk is we our trends So a than that we we because the

portfolio we we to we those basically million specific €XXX going that specific Except the trends some after €X rest, Regarding we the -- forward. total was buffers past in things. The adjustments. call after portfolios, other see what COVID €X the billion. beyond discuss the well. regarding basically portfolios €XXX as do that it them the we post-model that because we the very was number total is buffer. to -- any assign mean, specific assigned billion I or overlays didn't overlays, But unassigned, €X.X -- did a billion in The did COVID, deterioration €X.X in expect deterioration the which slightly not to and during billion is we to pure PMAs, overlays. but million those,

allocated, but are they So there are still overlays.

our from the certain it are well. we overlay, is in We underlying will those to any my to which And as are major a overall our dynamics. overlays any a portfolios figures from about cost I guidance the releases X go comment, those the because today year second overlays. portfolios. you driven risk probably -- kind assign posting important. the the our back release is, by That's without buffer, In them guidance different making an rest And also that again numbers the have, is, to they're assigned also to pure today and forecasting we or months not that next as of have pure we we projecting €XXX million of

well That's because You Anything So question. those we Mexico are basically? of Is Rafa. know not releasing very Anything as it on Mexico? -- the anything well, from overlays. Banamex,

Rafael Salinas

-- well. said there is factor. are the consolidation very just the you of than But no, pure No, will our there more bank components just consolidation the performing I not course, dynamics of in market. is think help. very, And this only The

Patricia Bueno

question, next And please.

Operator

The from Morgan the Alvaro from next question of Stanley. Serrano comes line

Alvaro Serrano

XX sequentially from coming investors about were I buyback level in that, it you of to or of you consider at think or realize amends give think because there's end a since? current lot the sense to hit. moving an excluding and maybe some would given a sense capital of be where couple think points program I But may us those the buybacks? related parts on a one pointed give us would Your the is Maybe that do you be a of out end, end -- that obviously, not to up you may there's questions, movement A of already with the -- the basis important current been progression Turkey. you capital. may or make to you'll position sort disappointed -- bit year? Can be -- of

that, question the capital. So is on first

the We've tax. the your in Just of have thoughts there core much early thoughts feasibility is if you bank is some Second its the details intention just don't ahead revealed now appreciated. tax from would any that -- I got format? charging the early be going any were current the details. on And know thoughts of yesterday. to

Onur Genc

Okay. On capital.

presumed one. make it I very me in that Let last wasn't clear the because I clear

will year. mentioned, why points. guided to case there in The as base it's we The will we quarter that than is repeat case uncertainty case clear. very will impact fourth changes the and base be charge additional ago an positive figure continue second in there. it quarter. fourth And going has quarter. But once Then, it, that base the ago told fourth will case even you until it might get we be. can we XX is the some the we news And With get or a again But in -- basis the more charge ongoing is might also will points. the prolonged. basis is quarter. the There base quarters that supervisor be it me what in XX X some be originally is So in it's because the that That's it this is get because -- quarter. you or from that charge There process. I let be before, what slightly

time. somewhat case. we Somewhat base you the telling that that are XX. more the be language lower than than XX, was This I it used will That's last think, we time,

in than still less that comfortably XX our to somewhat XX, we And more the than expectation, XX. quarter above less XX%, With is uncertainty hit than fourth So will -- But component. is here, now, guidance obviously, fourth will we quarter. you. that having, that the be XX%. above be The market somewhat our comfortably is only be will

component, Then happen uncertainty at the But considering range And we impact it's the and a be the scenarios what different is there, and one, would about or the would position -- be less ask one, will yields year. manageable of meaning uncertainty but supervisory quite you very above the on our this XX% market to the this there even the feel this again, is is So clear. uncertainty. key that. But comfortable the we that buybacks. end more on

come things have We on very which all quarters we clear is for they now, the when will this been along. analyze

year. last we to flexibility XX% that policy but our part, know, And you not injected XX%, share some you payout XX% also majority as with of from have that XX% of the have we payout, to paying of As some know, the increased buybacks.

that on and evolves how price within on, is itself. the flexibility always there depending policy share So the so

will ongoing ongoing And it's always an we we discussion, would obviously. obviously where are, that, we decision, Beyond look into be. where

a don't of tax, on tax On early want the to bad this bank Spain. is the activity is really We bad sector sector. does a as that We not Banking externality, put growth GDP in We a negativity early of create a economy. feed. don't sector have if very I and for we we The thought is you which actually the the prosper economists a economy. it, think push a thoughts. any create restrict negative simple mean, one. you the call

growth. that don't that a externality, moment. are we negative is you manage tax on at you such, need As why in you a the needs most and the sector moment if environment a manage Spain would the have uncertain At impose what the

unit. be different the it's tax basically I on going parliament it's the We But affect, income yesterday have the business to our of the numbers X.X% and asking income proposal is Spanish discussed details, net to the in process. and this fee going so interest announced banks whole to grow negatively of And in to guess, Spain. restricted obviously, camaras on. view, plus that latest there, to, -- you're the But in

there quickly So a that it's this. be done, a basically is not the number, But €XXX is details finalized. around million. you on understanding it's meeting X.X. actually, to multiply With can very Today, lot big there of and

at comment growth, to I'm really on moment what not taxing thing. banks. sad So Spain really on one, because is this the it's early think too whole the needs still But I

Patricia Bueno

please. question, Next

Operator

JPMorgan. comes from the question from line next Sofie Peterzens The of

Sofie Peterzens

from JPMorgan. Sofie is Here

million also of of related that excluded. So just other actually about about outside, Onur, good of Turkish rate? some tax much were run one little considered kind just Do my my maybe any a to it that you the the you was reviewed we €XXX smaller €XXX be bit by similar you smaller going ECB. maybe say And final But saw here? going kind you [Indiscernible] think first pushing Sweden, jurisdictions Turkey. In of the say second you the banking quite operate excluded? back question. banking I And should will second the do is Or forward? given the that question back forward. smaller more be From the your earnings on you you then saying Could see any unfair a that but earnings have back sort are There or, that just seems And Anything banks of tax. a it's bit a income. going contribution quarter, taxes that potentially elaborate on banks pushed any in should in smaller, number? in? a contribution we And it know be banking limited the press on similar can leaving then would are given rumors net will million So how question. of although printed and kind expect we you the and plans banks potential banking tax, BBVA.

Onur Genc

my questions, See you I including possible should should Rafa, of these --I answer departure. -- some feel,

Rafael Salinas

take that couldn't one. I

Onur Genc

don't to you Well, one? that want Okay. take

the start the I'll can with maybe So Turkey first you if on help one, Turkey question. question. Rafa,

Rafael Salinas

Okay.

Onur Genc

net me plus let and the income, to you the less the smaller say this it's those total, still be said It commission tax, tax. saving the meeting from the is exempt are And today, some from finalized, I banks million, it's details. €XXX and are the cajas, from net latest than income if fee basically so net tax. the the income, the interest exempts on all But being understand we there's way, known. players to excluded latest So as that still of the on a -- again, see to details there be that

also tax sector If I it's affect So creates if tax, competition would this unproductive fair. sectoral as economy misalignment, that even the and if about sectoral I it it's there's whole it -- affect unfair unfair. for it my you're within it's view, answer And dynamics. competition. asking absolutely. that's competition? it said, also also mean the The doubt that in competitive will But not and is and a no what bad mean, and that's a if very, create you does

that Do other we -- So again, for we as true country. is I the the this if to only once industry an it grow, negative industry to Google is, It bad? actually sector needs topic. and there to is see details are underline, -- before on help happening in geography. Not just have industry good all. to any of banking, country. an taxing Spain, the the the But banking whole that further is any not fully is doesn't grow you taxing -- other it comment at taxing have a rest an And understand externality, that we of not any you the can ask mean, I any question banking for can tax Banking can and economy taxes is impact geographies? like go to And it's such. in discussions -- what for

the hyperinflationary into that empirical and there Turkey, evidence hurts is the also academic on the that context, much look What look see the hope evidence economy. say? work. this. countries empirical It would I can that other economy. There impacts. academic this. In on so accounting You on into It I that and help that doesn't is work Then

Rafael Salinas

reflects second that the management that Turkey, the at I quarter I the end first, day the we good say, have of on of great Sofie, there. mean, result of the bank the would

CPI I you day, €X are €X there, above with and the is CPI-linker clearly team trading we results. the brilliant by is monetary a the very, linkers. if of end that And the also or income impacts then very net billion. that reality -- portfolio see, mainly a the managing close ALCO very, all is clearly, through just At -- counterbalanced think, they have income The partially of this net portfolio a the the fee the mean, position also I also, hyperinflation -- of managing. position day-to-day balanced business the to billion management

of reality macro as it's and XXXX how Turkey that and are high said is the that a of contribution it's are going of level. uncertainties why we very end to It's business. reflect at the we be the Having guidance results guidance a going to in at evolution. day, the is very be very the that good so reason for the what to difficult. are difficult limited assume that's So a future, the know group we And conservative still the providing the that

Onur Genc

it's me a the about to facts It's Regarding question, it's last -- Sofie, or complete complete a things. leaving. It's rumors fabrication not comment the fabrication. worth even of because a

There's to comment. worth such it's So not plan not whatsoever. a even

Rafael Salinas

So no the the rest team. for of opportunity

Onur Genc

So...

Rafael Salinas

team. No the for the rest opportunity of

Onur Genc

the team. the No of opportunity for rest

Patricia Bueno

Next question, please.

Operator

next Paribas of Ulargui comes from from The BNP question Ignacio line Exane. the

Ignacio Ulargui

you are? a on you in if X. that secondly, And Fund comment and also, your trends insurance And just contribution revenues bit charges have view on have. -- understand don't And performance revenues? were fees I good 'XX. How very should wanted before. call that a end other But should they I Because of they One come of the just you Resolution the better you What regarding that comment the what's the in bit the the banks we a strong expect an we sustainable Single them? regulatory there? to tax do could sustainable offset Because insurance I be the know headwinds on provide to understand Mexico. a guidance that and that Mexico. I mean fees? could of discussed have see in in How very wanted in just to made

bit what lines. we I So a just wanted X expect going sense these on of to get should a forward

Onur Genc

SRS, On Fund. Resolution Single

quarter, if more million -- million, what know you provided mean, million. we €XX Which this last not contributed close to mistaken, no, Rafa? is year. As €XXX we we actually -- I in than I'm €XXX

Number is one, a market I to this, going and we that if is I are year-over-year This -- X cover payment of do a ones we as have that expectation, -- year, because a that the is it much the is So you The there pushing time mean, as our significant given until And that But going business there's the is fees mean multiplier. enough you payment in lot from again, there Mexico But will to this enough with will is around -- is that base Ignacio, the the in few gaining I be to around last on in will framework stop, are if safety so pool a -- everyone, coming higher fees there how Europe as that they basis have you because you the is we reasons. -- In calculated consolidation to was them, country, clearly in or legal Spain, Mexico. a would few time this growth is for are the a we'll pool, be -- we the increased of rule increase cards, pool. there finance, business. the lot. there's TPV be in when -- losses pool this potential see. ensure there's XXXX of market because the call it a frame. of year fine is know, we our mean, a there I also, is the that to are fund regulatory machines, in credit of a there's in XX%, and core satisfied of the share context, there that gaining basis that it's case that a detail But which our able funds this expectation to and multiplier team, of for And clear put though, than forward. the consolidated all Mexico our part by in within POS, consolidation the last this. very I'm the growth referred fund share big -- have entity one in share, case And us. to expect detailed exempt the team, was there acquiring fact those. calculation year business. in payments. stop focus market risk it that explaining a personally regulatory on and to the basis well. a Then given completely our the you funds is

on a business. asking? If sustainable in really is a on we are our We pushing and the trends have, you XX%. hard this payments. reason, continue stock it the Is which of bit business are growing -- that That's we we

created stock. We that have

income that fee high going very have Okay. of in was to generation Mexico That question, the miss is I So continue. the I expectations the anything? no? strength Did X

Insurance there topic. topic in the again, extremely Mexico digits. well, insurance going, Sorry, double was growing

Patricia Bueno

question, Next please.

Operator

of next Mediobanca. question The Filtri from from the comes Andrea line

Andrea Filtri

question beyond all we you first is XX, your The NII on more regular what sensitivity us can on elaborate observe something a on, if Slide you giving possibly in do could basis.

country then the a against rate. to no talk about your us plugged by And NII what -- to in there. happen guidance you If inflation could reconcile curves for if cost guidance forward would give difficult us you the rates with XX% Otherwise, we deposit beta. it's

we the different offset understand the by if to just cost line the if final then higher environment inflation in higher And to very clearly? factor the or impact Now Yes, able that the Turkey. very, wanted one across but to geographies, in you're I be given should size the line. macro a is is start to on geographies to difficult, the of huge thinking growth group

sort understand expect lines -- main where you If a to ballpark help would year-end the end of you P&L figure? us in could basis

Onur Genc

the -- Yes. first maybe Rafa, start maybe So one. with

Rafael Salinas

the about and in sheet. the is balance On realities. in our NII big the the NII I sensitivity, to interest sensitivity geographies rates you all asked case euro mean,

forward the same the part movement parallel of on are not of we the the So at XX% movement. a XX% maintained and -- indicating day, the to that that the curve. end sensitivity curves Today, between

So end short at in with of some ahead. kind growth the projecting the term just they day, the are inversion just very of

compared of of second we clearly. movement is terms behavior just key it's the the on So the the have hypothesis expecting weight time And sensitivity, And going the Spain, deposit in are In just in higher portfolio that mortgage our side translation deposits term, between for -- the not to asset this are case, with it's what deposits of that we the crude. the expecting NII is system, with the the of just along clearly is This clients total -- mainly demand that short a think we we there, very I are in of the seeing XXXX, deposits. happen the in to XXXX. side.

movement Second, believe the to need XX%. seen what competition the this is be that what in is to the -- side. I going that to call how think the from compared with mean, the behavior because the And of we're seeing the Spanish we see previous consolidation moves We of clearly cycle. I be thirdly, to this that the on competition, we asset the movement expecting beta, we the around pass-through, liability are market just

we markets, combination the the that, clearly, are in is factors After we at on the we expecting end at to that going see peaks the going to you sensitivity, much be the sensitivity market, of is So lower, maintain. that the the the of those day provide the clearly. we are movements what seeing clearly, is

this levels. the on movement are decline X% curve, X% I going is the So after from XX%, to to that to probably, the XX% mean sensitivity expecting we

Onur Genc

cost Andrea. the On question,

in in costs, if -- the would you isolate grand Turkey numbers inflation costs X.X%. only all, presentation. mix you number, isolate in XX% you of especially isolate mentioned for those as X in and in the that which I have cost I Argentina to sure really the the decompose But -- XX% but things, relatively were first of you So high wasn't X growth countries, with you growth of been and countries, small have there. are have scheme if countries, the to

the Now number. going going asking Spain that forward. -- forward On one, you're we confirmed basically

in Spain to to you seen are as know, saying going in costs be we it's case of going guidance for we that -- We than are or case Mexico, Mexico, inflation. at decrease opportunity, today. the decrease to have basically our digits. It's an results In the you In mid-single As our lower confirm inflation. of guidance that through be around you, seeing was -- mid-single to digit. at

seeing bit to around an are a dynamic investments, this. that If requires opportunity will We grow. be we

below times. be our is opportunity the inflation clearly is maybe to it will details average are we at There inflation, below inflation, opportunity into have But uncertain so we that how more. But overall, will perspectives, ask business don't us of so these around case want do the There even So miss. that healthily different investing this, and grow in the above guidances see. it? Mexico inflation an that. fine be you Turkey do granularize and you Mexico, on, whole inflation? will And below cannot look take group. we will slightly when this We we in to Rafa, still to saying. around we what do are but for It's P&L an

Rafael Salinas

On Turkey, to clearly I a denominated We want have think We don't have we there. we previous our line increase -- commented foreign quarter. portfolio. in red

clearly, levels decreasing continue below inflation that So the similar we'll grow to we in the the that, did And year portfolio, expecting quarter-by-quarter. we part try rate. grow clearly, of are and TL in of at terms to the first

that is be growth our the growth activity the portfolio, of portfolio. -- are the the TL the NII the of TL loan on On we the of to guidance and NII, above the expecting

expenses, the clearly, rate. cost inflation of basis expecting high are points to given terms around In the around risk, uncertainty. be of we And average XXX macro

Onur Genc

calls. that There on very to the about I Number on one, numbers hyperinflationary this. -- like implementations. is short, hyperinflation, very of would P&L are accounts this mean, a a Because to as have presentation there complicated -- are sure accounting and monetary is clear our changes our loss. X our to of Investor Relations happening result concept this is talking that we But make net it's maybe, at you The Rafa I everyone says clear. understand. not time it's because all. this first in are all these

then monetary position get what it monetary the from we we and you this Number first to and you multiply That's other CPI minus heading hit two, the €X.XXX numbers €X.X loss, impact the of first This -- If that half to losses the income. €X.X Again, these Net see have is and on, which But don't billion just the minus In direct it, €X.X take it. a interests NII minority your Turkey -- the do billion moved in monetary of you call gets have income, billion income. have loss the That's the NII you completely income please other position. is things the -- linkers these the the for half. monetary in your move the inflation. from into net revenue net year, net registered €X.X other first from inflation-related -- in everything we But with of first is change. linkers because other all why first inflation year, losses. move billion look isolated on. and income you income. you this -- so is the billion other of other so to in NII from to CPI it's half

the adjust this the It the period And we associated but line for average the you third from moves with much items much And second which then the income. restate NII that third, fixing. the the change, end create know. didn't didn't we We of that's too P&L So the too one. to with one. restate change to CPI other but linkers; with all create it then not inflation. currency, currency, by revenue

should you is aware. to the linkers heading; that billion we net movement income two then that we and the again, or accounts before, changes the that half are from key other €X.X you monetary in those know registered, CPI loss of other and that changes the be are in interests -- Those So the obviously, first registered minority income. the the NII should

Patricia Bueno

Next question, please.

Operator

the next of The question from line comes from UBS. Terroso Ignacio

Ignacio Terroso

A you of the QX. couple us in give QX, a the if of answered. can questions But fees for the have quick between of detail, more things delta Most Spain, me. basically, been little

You're talking in million increase about quarter. like the €XX

if then a can at NII probably you put bit look mentioned in basically Mexico, customer have little look segments. I numbers more. CIB, grow if but I might to to a You spread, expected have the And volumes, have at if different a I

is little coming the growth a anything maybe So holding were I'm bit portfolios or basically aspect other my back too from of there any that sheet? not optimistic. balance treasury sure Or basically if expectations

Onur Genc

joking. the is it's more on I the not you was compensated mean, you, there inflation. real compared I inflation-linked bless was But interest year, bit But in those to that first Mexico? numbers, your rate mean, Ignacio. half bonds. a God In understand. in -- quarter tied the No, the with I quarter, you're will of BPA, in If impact. this bonds. -- a start the is of one. the there second really first was I negative, expecting if NII first to I there get

into the the from the €XX is And impact very that. growth you so, €X million BPA as basically if partially none, the lower, million little So is compared was baseline looking -- or the -- the impacted maybe are quarter. percentages, to first much quarter, in second in

that number. be end the period. in has the picking reason activity the -- number see end Maybe up. might the obviously, average on the that the But So loans Mexico been also period versus presentation, the is loans of you

So bit quarter. the average loans was throughout a the lower

it's you because average this spreadsheet So if you like, we the BPAs. or But afterwards. maybe can of do with the loans

from, ask services coming Spain in credit basically it's fees XX%. you Quarter-over-quarter lot machines, acquiring The the cards, call around billion. Regarding -- lot share basically from payments, business. banking we growth in the €XX services, is of POS, first quarter-over-quarter, year-over-year or it's and year. €XX payments. in credit pushing the we coming of I including market gap ask, -- in that TPV acquiring in XX% this and gained you A what million, we banking Again, within But are cards half a Spain, think. growth

in was it's insurance a good a And the services but is also quarter-over-quarter. job, impact XX% piece market still, growth X%. quarter-over-quarter banking growth X% did Allianz the management XX% deal lost softness slightly all, growth them asset you was said, markets. So was It's part the down despite The we that CIB, as the the -- quarter-over-quarter. very nicely. very reason, when you also of key it's management. up asset because moving small sum because of But

Patricia Bueno

Next question, please.

Operator

line the Daragh from comes of question next from The Quinn KBW.

Daragh Quinn

of stage contribution in countries stripping it they costs in question distort just Do group? and out broader of those to Argentina some reporting of level of of at a And terms then revenues of actually would cash the just as could be inflation be second rest P&L relative dividends kind worth and question. significantly them and their feel on you First the the out paid Turkey. the

share You're doing buyback. a

your direct per share [TBV] Russia. exposure improving. is profitability Your sector yet in the shares growing. is No to the and things Europe underperforming -- And are year. this the

the So Or what you do to is do to better do market think missing? you think need change what dynamic? you that

Onur Genc

you? mean, larger even much high comments, on are inflation worse But in than any too from levels? crisis. comments it any any view. Rafa, already my the if Argentina, it's They I Turkey, this, a gets

Rafael Salinas

I base terms of clearly, in both clearly, of they I we the rates comparing mean, part effect. first to mean, countries, in I are the the of mean, a in of prices the lower other is going comment year second half because, is 'XX. with inflation -- benefit levels have

that we seeing said the political in the are So be a of the going inflation, both slowdown be turbulence of on dynamics is weeks. additional Having pushing I the are -- in we mean, -- should second still Argentina last inflation. because all -- apparently see should to half, in countries, in few we that,

terms of probably wait. So I and of slowdown the there, will rate. need to dynamics terms a see are inflation see would number, still say, we so we in But in will

Onur Genc

there I'm but to my we Regarding to truth. great the or Number in sure the Daragh, but -- this unique in we countries not price and in in. franchises share and very we tell X cases and so that is view, there BBVA separate a whether reasons have mean, or great individually -- are I important, a on. BBVA are X discussed quickly. one, why session, multiple, own is important do the a stock the very share there important company, are are you

of But country. we say industry this diversified. are the the the unique we franchises. everyone respective ROE because numbers, that We that in banking ROE are that I banks with the versus this. that, in, present we And in of our are in have can countries beyond countries say The

So isolating differences. country for

meaningful very been this and year-over-year. gaps consistent competition, positive has have We with

been would do this have result we banks. great So Otherwise, not have produced.

view. meaningful positive general, And is banks on your -- that an the amazing So you in in have with returns have capital if to good our and will this do you industry, make money. gap always

that's thing BBVA. know should that So the about you first

others is, we ahead, so not our say, because and of than in are second or The far digitalization. topics, ahead definitely certain we smarter view, are, on much others on No. let's on. And

more our investment trends Maybe We now. than have this innovation this thinking, much earlier more digitalization, we that's others. of put business, and areas. much and industry, the invested that so have more into effort, been in I much dollars know. effort believe on much don't Those more topic shape much our But putting those sustainability smartness, we we much transforming

this, being of But As such, very a the not new I quarter, the digital have -- you customer are really that we or equity with And registered okay. if markets the million a number, a curve, makes number in if that on in even cost acquisitions do customers low embrace does doing X.X quarter. crazy. recognized are like fintech fintech seen with this. will we and that a fintech

these that us the are things, makes So X though, different.

we -- business. matter and invested are have in great franchises have things that our We we in

have. delivering results are we the we As that a result,

are numbers, and I've be no. In So words what -- so might this. all we saying been grandiose rosy, delivering

revenues simple in is look business the banks. dividend other today, in the That growth is And there. is be the that yield, of guess. a compare growth be dividend view you the revenues, is very I you, growth there, with to let profitability well, other if mentioned the amazing to banks share price, I do the easy into close the as driver the getting as in yield. calculation, It's payout our would the compared share alone, back to double-digit should of price my to which the If you envelope you of

We are on But I close mean, dividend this all you pushed and of yields, double-digit that's we my button. -- to said where are. having

will will that So at apologies do really was share answer. delivering. mentioning job to is some recognized, things the think be But to keep our realize you for as If it keep long well. we at point delivering, -- will point the because that I X the returns And before flow. the I returns some these price

Patricia Bueno

Next question, please.

Operator

next Peixoto from comes question Carlos the of CaixaBank. from line The

Carlos Peixoto

The Spain. questions centered be in will actually

a a be will them bit of follow One of up.

was rates I of Whether interest you you're interest in demand seeing mentioned of lower And segments. market of on what in the the 'XX? If that, you this behaving repeat just a on growth through you're could That's are segments type up rates seeing the noticing volume. loan then taken. NII following wondering the light how for mid-single-digit movement, bit recent you increase in a Overall, would digit a how it? demand evolving? you how on single cost another things Do probably of side. inflationary interest on decline. see that capping on do rates the see that evolving higher that previous believe deteriorate movement the was I be and you your that keep Or pressures should you Just guidance concerns mid segment? And question basically then [Indiscernible]? front?

Onur Genc

got: that NII the on third what maybe, on Carlos. on number cost are Okay. the going We latest -- the couldn't one, number all questions discussion two, one I we But get related growth; Rafa. NII, things activity the side. and you to is the the take NII or to Maybe growth this, the activity Spain;

me Let activity. with the start

it, Carlos, on grow. in are we see to growing You that presentation, again, areas the the we wanted

grow, on Very consumer X.X%. would commercial Looking the small shouldn't to growing growing And in they growing to And card, are real, the away still are it's relatively creating segment, been is, PMS, credit Spain X.X%. that this leverage, inflation. that's the the back working areas is that thing leverage is for but be the segment, growth, regarding needs robust The commercial seeing XX%. levels percentage that the might absolute -- be has of level, we still too also in growth are that Those over have This as what not single the one, Spain, businesses. they And it told and why in terms much over it year, segment. now to to segment, seeing, be commercial down. year-over-year to level last corporate you what to and Spain down GDP, The you I in have given growth despite give in taking people years. down core all XX leading in we expectations rest uncertainty, Every it seeing which or corporate what companies. over were companies, XX and second the in we country are lower activity absolute over uncertain points them. very debt compared which are than over I the wanted mean, gave, been We telling in the debt we come on especially That's growth has are given on debt is we of then We corporate, the activity the are inflation of upgrading we we the the capital we leverage. rosy we debt growing GDP, the mean, are nicely GDP. shying view, impact forward the are going But come only what because seen. debt may household has period. been XX from that be guidance the up. my deleveraging in year. close GDP, that things leads X XX, GDP, past the And There additional in years. for has us the we coming right. percentage household we rates points going is basically are Number

been has it So deleveraging.

debt, story still are To go to that short. Given a that, our to to take companies there acknowledge balancing factors. serve there's on There good additional companies cut room and them. for and It's uncertain. side is and long appetite those

with for We days. guidance be have other see to we these reasons. But careful trends the positive

have guidance growth, our we done are today. NII we such, as repeating As Rafa? On

Rafael Salinas

our mid-single we grow to upgraded think around I NII, have digit. On at guidance

the and we be first beginning NII quarter given in evolution and to continuous customer going the saw initial this the providing how the presentation, mid-single more activity seeing to and rates of also is the that we the the spread today, were were clearly, year, seen of also And guidance the this provide end We guiding are us we of were that with when improve from clearly, flat. the value are have we to contribute to at in TLTRO ECB digit. -- the NII at -- we the increase dynamics You remember, the rates. expecting on positive to

Onur Genc

reiterate we our guidance. And costs,

given pressures are said all you So these inflationary you sure.

is our obviously, we reiterating last at It's mainly accounts. We mid-single the restructuring costs but program we are did are year. the -- the decreasing of that in guidance program because again, of benefit there's digit. that This uncertainty, of

in year. But of confirming guidance. and are the we we our will pressures, inflationary are there rest So see the them

Patricia Bueno

please. question, Next

Operator

The next from Schmidt comes the Research. Britta line question of from Autonomous

Britta Schmidt

My first will question be on Turkey.

Given the do have perception to term? with change analysis required expect balance the do top capital? you that we really monetary that And that of risk And us your line? the what for income? a with expect the is how with to sort you're maybe is of on greater focus Or regulator color any inflationary loans give expect ceiling to in manage having a on out position? reverse inflation, whether you line on net And you environment with of discussions portfolio? we expect that go CPI-linker be fee a do second you there but the not will should rates, your the Should can regarding recessionary the question management near to buffer in

Onur Genc

On very the clear. are Turkey, priorities

are years that pace. have the even doing been but We we now, for accelerating

continue we have. CPI and the that, reducing First that we have and of FX exposure line all, to before revenue and this

there that FX Because as So single and will FX every might risk less the on. the lending me trend. ask that key funding are our to hurting be we that we our key output been lending you that be the so that, that said the and get with the would things. Turkey. currency final And reducing FX book about But and wholesale coming we hurt quarter, risk devaluing, related will on have many along have is, from devaluation, There be business in book, then -- obviously might we this. continue

that's been are FX cleaned that such, most companies don't clear have doing. basically FX, ones As which we And -- corporate have first that's or problematic priority. to We all so the what out on. exposures and revenues

spread we we will we focus don't then thing And trying long-term a more -- then on that we at term manage the such, go obviously. doing. the the such don't that more on get environment. and to to like long this CPIs, -- keep we As are CPIs we in that that all And in grow the short ALCO book, are want term trend. manage so spread first in way natured products That's in mortgages

We go first can see our have long term. we to before front

of to those on the what are highlights kind do. were we So key trying

is because banks, some than looks which is higher picture. into come Regarding -- we of our it's basis for reference. what terms the reference, basis basis management XXX when matters, take the the risks This gap. XXX everyone recessionary points. doesn't points of The the our the management revise the end upper the Britta, XXX reference. XX. in on -- whether capital XX.X our XXX upper that's much -- would the capital, points say, and XX versus into management end let's -- requirement big European requirement But let's reason to average is

we are So already above.

importantly, More that so low? requirement that. That why is into also feeds

results billion organic you corporate they excluding were to know year, come presentation, one-off, the supervisory guided €X.X because when investor so And generation seen don't in which have €X of they impacts, as is them. know along. are generate you of we don't have every ability capital, today. Our And excluding saying the and we operations, we to -- billion uncertain capital

would €X billion. we X, those create to billion Excluding €X.X

into the looking our and are situation moment. numbers our at We

we number. an that We are on have -- thinking upward

such evolution look this capital standard So you our your variability, organically. it's going that evolution. creating be context, -- create you into to in year, if are our CETX of as XX of the volatility the the and evolution, In a if last we basic deviation CETX capital that if than more years organic annual generation capital variability, -- the and

the You diversified. world. we franchises -- see that do the least we And around are these because of are great all have one we variable consumer banking

Given that, the variability low. is also

in As management's such, I the don't the in see term. any reference increase short

Patricia Bueno

please. question, Next

Operator

from line the of Societe Our Generale. final Carlos from question today Cobo comes

Carlos Cobo

I to new quickly deposit are you mix that side be he stop talking from that. have only And are may what said on it around opinion you they on to for it before right thinking already. or the the wanted if those to transition term correctly, deposits? whole be on with are it number? follow what Could has deposit the if understand can the questions. answered beta. but your will term levy? about It XX%. don't, rest I been ups main discussed. Rafa the in And quick you. for has a I bank said include quick ECB up helpful you the deposits good? Is So veto they confirm clarify Also, Two All any rights my believe how heard the been you follow on If that about that

Onur Genc

on you betas the do Rafael, second to one want deposit take

Rafael Salinas

Yes.

Okay. Do you want me to start?

Onur Genc

Yes, why not.

Rafael Salinas

movement of the And on we I from what deposit rates. increase happen an is when XX% the expecting to deposits. -- It are that we are the in have to day, a of on at rates, saying in was Carlos, will transfer term end the on demand we rates the those XX% rise average. term the expecting will movement deposits in clients that

day, So to the movements we clients provide. just -- transfer the NII from the to expecting that the on the that these implicit end are of amount the deposits we rates. sensitivity assumptions customers it's on term But at the to on are

Onur Genc

past would banks mean budgetary in credit thing: is I on I should veto provision taxes the that the ECB the one. tell know know, misled not judge very in economy." or then think, actually would the the or clearly in what only said saying you at extent is position that, quote was at in place growth topic. the beginning Then one Carlos. paper don't burden There tough real what of was would that basically to There this have hoc so The Lithuania. on on a banks, you clear. that questions? presented I strong is position, imposed thing hampering their to opinions answer, ad effect I I be on purposes undesirable with in for on I will taxes don't Any I this XXXX judge. a XXXX the rights, on general beyond "Any other of undue the a from But does the So knock-on that moment call. such

Patricia Bueno

No. you. Thank

Thank the it your was end will this question. you, So last here. And we everyone, for questions.

entire IR any team and have. thank the nice summer. available your And you much for you might you Let be that will answer questions to me remind very interest, a have

Banco Bilbao Vizcaya Argentaria (BBVA) 29 Jul 222022 Q2 Earnings call transcript