The consolidated fully-loaded additional Tier 1 capital (AT1) stood at 1.35% as of March 31, 2024, resulting a decrease of -31 basis points from the previous quarter, mainly due to the early redemption of a contingent convertible issuance valued at €1 billion.

On the other hand, the consolidated fully-loaded Tier 2 ratio at the end of March 2024 stood at 2.49%, with an increase of 24 basis points in the quarter, mainly due to the issuance of a subordinated bond in Spain for € 1,250m and, to a lesser extent, to the issuance in Mexico, Turkey and Peru of subordinated debt valued at 900, 500 and 300 million dollars, respectively. On the contrary, a subordinated issuance valued at €750 million has been redeemed in Spain Thus, the total fully-loaded capital ratio stood at 16.66%.

Following the latest SREP (Supervisory Review and Evaluation Process) decision, the ECB has informed to the Group that, with effect from January 1, 2024, it will have to maintain a total capital ratio of 13.25% and a CET1 capital ratio of 9.09% at the consolidated level (9.10% with the countercyclical buffer update calculated as of December 31, 2023), which includes the consolidated Pillar 2 requirement of 1.68% (of which at least 1.02% shall be met with CET1), of which 0.18% is determined on the basis of the ECB's prudential provisioning expectation and shall be met with CET1.

It is worth mentioning that, with effect from January 1, 2023, the application of part of the transitional effects applied by the Group in the determination of the phased-in ratio has ended, so that as of March 31, 2024, this ratio coincides with the fully-loaded ratio.

⁽¹⁾ The difference between the phased-in and fully-loaded ratios arises from the temporary treatment of certain capital items, mainly of the impact of IFRS 9, to which the BBVA Group has adhered voluntarily (in accordance with article 473bis of the CRR and the subsequent amendments introduced by the Regulation (EU) 2020/873). For the periods shown in this table, there are no differences between phased-in and fully-loaded ratios due to the aforementioned temporary treatment.

⁽²⁾ Preliminary data.

Regarding leverage ratio, as of March 31, 2024, the Group's fully-loaded ratio stood at 6.5%⁵, -6 basis points less than in December 2023, mainly due to the increase of the exposure.

Lastly, with regard to MREL, the RWA and leverage ratios⁶ stand at 27.8% and 11.5%, respectively, reaching the subordinated ratios of 22.0% and 9.1%, respectively. A summarizing chart is shown below:

In terms of requirements, on March 27, 2024 the Group disclosed the receipt of a new communication from the Bank of Spain regarding its MREL requirement, established by the Single Resolution Board (hereinafter “SRB”). In accordance with this communication, BBVA has to reach, from that day on, an MREL in RWA equal to 22.79%⁷, without taking into consideration the current combined capital requirement of 3.61%. Additionally, BBVA must reach, also by March 27, 2024, a volume of own funds and eligible liabilities in terms of total exposure considered for the purpose of the calculation of the leverage ratio of 8.48% (the "MREL in LR")⁸. Given the own funds and eligible liabilities of the resolution group, as of March 31, 2024, the Group meets the requirements.

Likewise, with the aim of reinforcing compliance with these requirements, BBVA has made several debt issuances during the first quarter of 2024. For more information on made issues, see "Structural risks" section within the "Risk management" chapter.

Shareholder remuneration

Regarding shareholder remuneration, as approved by the General Shareholders´ Meeting on March 15, 2024, in its first item on the agenda, on April 10, 2024, a cash payment of €0.39 gross per each outstanding BBVA share entitled to receive such amount was made against the 2023 results, as an additional shareholder remuneration for the financial year 2023. Thus, the total amount of cash distributions for 2023, taking into account the €0.16 gross per share that was distributed in October 2023, amounted to €0.55 gross per share.

Total shareholder remuneration includes, in addition to the cash payments mentioned above, the remuneration resulting from the BBVA's buyback program for the repurchase of own shares announced on January 30, 2024 for a maximum amount of €781m, and which started being executed on March 1, 2024. By means of an Other Relevant Information notice dated April 9, 2024, BBVA announced the completion of the share buyback program upon reaching the maximum monetary amount, having acquired 74,654,915 own shares, between March 4 and April 9, 2024, representing, approximately, 1.28% of BBVA's share capital as of such date. The redemption of such shares is pending execution.

As of March 31, 2024 and December 31, 2023, BBVA’s share capital amounted to €2,860,590,786.20 divided into 5,837,940,380 shares.

Note: in the case of shares kept by investors through a custodian placed outside Spain, only the custodian will be considered as a shareholder, which is who appears registered in the accounting record of book entries, so the number of shareholders stated does not consider those indirect holders.

Ratings

During the first quarter of 2024, BBVA’s rating has continued to demonstrate its strength and all agencies have maintained their rating in the A category. In March, Moody´s changed its long-term outlook on the senior preferred debt from stable to positive (maintaining its rating in A3) after a similar action on the Spanish Sovereign rating and reflecting the expectations of the agency that the profitability levels of the bank will continue being high and that the pressures on the quality of assets will remain contained. Additionally, in March too, DBRS communicated the result of its annual revision of BBVA confirming the rating in A (high) with a stable outlook. S&P and Fitch have maintained without changes in the quarter the BBVA rating in A and A-, respectively, both of them with a stable outlook. The following table shows the credit ratings and outlooks assigned by the agencies:

⁽¹⁾ Ratings assigned to long term senior preferred debt. Additionally, Moody’s and Fitch assign A2 and A- rating, respectively, to BBVA’s long term deposits.

⁴ This includes the update of the countercyclical capital buffer calculated on the basis of exposure at end December 2023.

⁵ 5 The Group’s leverage ratio is provisional at the date of release of this report.

⁶ Calculated at consolidated level in accordance with the resolution strategy MPE (“Multiple Point of Entry”) of the BBVA Group, established by the SRB. The resolution group is made up of Banco Bilbao Vizcaya Argentaria, S.A. and subsidiaries that belong to the same European resolution group.

⁷ The subordination requirement in RWA is 13.5%.

⁸ The subordination requirement in Leverage ratio is 5.78%.

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