Spain
Highlights for the period January - September 2025
- Balanced growth in lending and customer funds in the year
- Dynamism in recurring revenues, boosted by net in fterest income in the quarter
- Good performance of the risk indicators in the quarter
- Quarterly results once again close to €1 billion level
BUSINESS ACTIVITY (1)
(VARIATION COMPARED TO 31-12-24)
(1) Excluding repos.
NET INTEREST INCOME / AVERAGE TOTAL ASSETS
(PERCENTAGE)
OPERATING INCOME (MILLIONS OF EUROS)
NET ATTRIBUTABLE PROFIT (LOSS) (MILLIONS OF EUROS)
| FINANCIAL STATEMENTS AND RELEVANT BUSINESS INDICATORS (MILLIONS OF EUROS AND PERCENTAGE) | |||
|---|---|---|---|
| Income statement | Jan.-Sep.25 | 𝚫 % | Jan.-Sep.24 (1) |
| Net interest income | 4,905 | 2.3 | 4,794 |
| Net fees and commissions | 1,743 | 4.2 | 1,673 |
| Net trading income | 536 | (11.2) | 604 |
| Other operating income and expenses | 289 | n.s. | (6) |
| Of which: Insurance activities | 299 | 3.7 | 288 |
| Gross income | 7,473 | 5.8 | 7,065 |
| Operating expenses | (2,420) | (1.6) | (2,459) |
| Personnel expenses | (1,314) | 0.1 | (1,313) |
| Other administrative expenses | (821) | (6.0) | (873) |
| Depreciation | (285) | 4.8 | (272) |
| Operating income | 5,053 | 9.7 | 4,606 |
| Impairment on financial assets not measured at fair value through profit or loss | (478) | (5.7) | (506) |
| Provisions or reversal of provisions and other results | (53) | (40.6) | (89) |
| Profit (loss) before tax | 4,522 | 12.7 | 4,011 |
| Income tax | (1,381) | 18.3 | (1,168) |
| Profit (loss) for the period | 3,141 | 10.5 | 2,843 |
| Non-controlling interests | (2) | 3.2 | (2) |
| Net attributable profit (loss) excluding non-recurring impacts | 3,139 | 10.5 | 2,841 |
| Balance sheets | 30-09-25 | 𝚫 % | 31-12-24 (1) |
| Cash, cash balances at central banks and other demand deposits | 18,645 | 46.4 | 12,734 |
| Financial assets designated at fair value | 112,794 | 2.9 | 109,569 |
| Of which: Loans and advances | 35,627 | 0.2 | 35,564 |
| Financial assets at amortized cost | 254,126 | 7.1 | 237,279 |
| Of which: Loans and advances to customers | 188,504 | 4.9 | 179,667 |
| Inter-area positions | 39,634 | (10.9) | 44,464 |
| Tangible assets | 2,724 | (2.0) | 2,781 |
| Other assets | 4,009 | (16.4) | 4,793 |
| Total assets/liabilities and equity | 431,932 | 4.9 | 411,620 |
| Financial liabilities held for trading and designated at fair value through profit or loss | 77,865 | 3.6 | 75,143 |
| Deposits from central banks and credit institutions | 28,594 | 1.9 | 28,067 |
| Deposits from customers | 237,858 | 5.1 | 226,391 |
| Debt certificates | 51,901 | 9.4 | 47,424 |
| Inter-area positions | — | — | — |
| Other liabilities | 20,042 | 3.1 | 19,448 |
| Regulatory capital allocated | 15,672 | 3.5 | 15,145 |
| Relevant business indicators | 30-09-25 | 𝚫 % | 31-12-24 |
| Performing loans and advances to customers under management (2) | 186,353 | 5.5 | 176,720 |
| Non-performing loans | 6,765 | (12.1) | 7,700 |
| Customer deposits under management (1)(2) | 229,815 | 4.5 | 219,923 |
| Off-balance sheet funds (1)(3) | 116,041 | 6.8 | 108,694 |
| Risk-weighted assets (1) | 122,022 | 1.1 | 120,661 |
| RORWA (4) | 3.45 | 3.13 | |
| Efficiency ratio (%) | 32.4 | 35.4 | |
| NPL ratio (%) | 3.1 | 3.7 | |
| NPL coverage ratio (%) | 65 | 59 | |
| Cost of risk (%) | 0.34 | 0.38 | |
| (1) Revised balances. For more information, please refer to the “Business Areas” section. (2) Excluding repos. (3) Includes mutual funds, customer portfolios and pension funds. (4) For more information on the calculation methodology, as well as the calculation of the metric at the consolidated Group level, see Alternative Performance Measures at this report. |
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Macro and industry trends
Economic growth remained solid during the second quarter of 2025 and the outlook going forward remains relatively positive. Activity is expected to continue to be supported by resilient services exports, a recovery in construction investment, and growth of private consumption, in the context of loose monetary conditions and rising wages. The acceleration of European Recovery Funds and the boost in defense spending could also contribute to the increase in activity in the coming months. According to BBVA research, GDP growth is very likely to stand at 3.0% in 2025, five tenths above the previous forecast. This improvement is driven by an upward revision of historical data and better-than-expected performance in the construction sector. By 2026, growth is expected to gradually moderate to rates of 2.3% due to factors such as global protectionism, economic policy uncertainty or limited productivity gains. Meanwhile, annual inflation has increased slightly in the last months, reaching 3.0% in September, but it is expected to return to 2.6% during the last quarter of 2025.
As for the banking system, with data at the end of August 2025, the volume of credit to the private sector grew by 2.8% year-on-year, with similar growth in the portfolios of credit to households (+3.4%) and credit to non-financial companies (+2.5%). System credit grew in 2024 for the first time since 2009 (with the exception of 2020 due to COVID support measures), a trend that has been confirmed in the first months of 2025. Customer deposits grew by 6.4% year-on-year in August 2025, due to an 8.6% increase in demand deposits, which amply offset the reduction of 5.4% in time deposits. The NPL ratio stood at 2.93% in August 2025, 51 basis points lower than in August last year. It should also be noted that the system maintains comfortable levels of solvency and liquidity.
Activity
The most relevant aspects related to the area's activity during the first nine months of 2025 were:
Lending balances were 5.5% higher than at the end of December 2024, mainly driven by the performance of the corporate segments. Thus, lending to large-sized companies grew by 12.6% and to medium-sized companies by 8.2%.
Total customer funds grew by 5.2%, with an increase in off-balance sheet funds (mutual and pension funds) of 6.8% and of 4.5% on customer deposits, the latter being favored by the wholesale customer balances.
The most relevant aspects related to the area's activity during the third quarter of 2025 were:
Stability in lending activity compared to June (+0.3%), mainly due to the reduction of the activity during the summer months.
Regarding asset quality, the NPL ratio stood at 3.1%, with a decrease of 37 basis points compared to the end of June, supported by portfolio sales made during the quarter, contributing to the improvement of the coverage ratio, which increased by 389 basis points in the quarter to 65% at the end of September 2025, due to the significant decline in non-performing loans during the quarter.
Total customer funds grew in total by 3.9% in the third quarter of 2025, of which 4.3% refers to customer deposits and 3.0% to off-balance sheet funds.
Results
Spain generated a net attributable profit of €3,139m in the first nine months of 2025, which is 10.5% above the result achieved in the same period of 2024, driven by the evolution of the recurring revenue from the banking business.
The most relevant aspects of the year-on-year changes in the area's income statement at the end of September 2025 were:
Net interest income grew 2.3%, favored mostly by a higher contribution from the securities portfolio and a lower cost of liabilities, factors that offset the reduction in credit yields resulting from lower interest rate environment.
Net fees and Commissions increased by 4.2% compared to the same period of the previous year, especially those generated by asset management, as well as, and to a lesser extent, those related to payments and insurance.
Net Trading Income (NTI) was 11.2% below the figure achieved for the same period of the previous year, reflecting the evolution of the Global Markets unit.
The year-on-year comparison of the aggregate other operating income and expenses is conditioned by the recording in 2024 of the annual amount of the temporary tax on credit institutions and financial credit institutions for a total of €285m.
Operating expenses decreased by 1.6% due to the reduction in operating expenses, as they include a positive effect from the recognition of a lower Value Added Tax (VAT) expense following the upward re-estimation of its applied pro-rata. As a result of the evolution of the area's income and expenses, the gross income grew by 5.8% and, in addition, the efficiency ratio improved.
Impairment on financial assets decreased by 5.7%, mainly as a result of lower recurring inflows of non-performing loans, mainly in the mortgage portfolio. On the other hand, the cumulative cost of risk at the end of September 2025 remained practically stable compared to June, that is, 0.34%.
Finally, the income tax line includes the accrual, for the first nine months of 2025, of the new tax on net interest income and net fees and commissions amounting to approximately €224m, of which €75m correspond to the third quarter of the year.
Spain generated a net attributable profit of €994m in the third quarter of 2025, representing a decrease of 11.2% compared to the previous quarter. This evolution is mainly due to a lower contribution from the components of the gross income, except the net interest income (+3.2% in the quarter), and to an increase in operating expenses, as the second quarter reflects the positive impact of the adjustment of the pro-rata VAT.
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