Expected losses

Expected losses not attributed in the performing portfolio, adjusted to the economic cycle average, stood at €3,623m as of the close of December 2013, a year-on-year decrease of 6.7% using comparable data⁽¹⁾. In attributable terms, and not including the non-performing portfolio, the expected loss as of December 2013 stood at €3,283m, 7.3% less than the previous year, considering comparable data.

The main portfolios of the BBVA Group experienced use of expected loss and economic capital as shown in the following table.

BBVA Group. Risk statistics for the main performing portfolios

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	Exposure(1)	Expected loss(2)		Economic capital
Portfolios	Million euros	Million euros	%	Million euros	%
Retail Mortgage
Spain	82,566	56	0.07	1,201	1.45
Mexico	9,708	138	1.42	379	3.90
Other	24,600	81	0.33	576	2.34
Total	116,874	276	0.24	2,156	1.84
Other retail portfolios (3)
Spain	30,305	181	0.60	1,022	3.37
Mexico	15.072	654	4.34	1,110	7.36
Other	29,847	843	2.82	1,583	5.30
Total	75,224	1,678	2.23	3,715	4.94
Companies and institutions(4)
Spain	93,782	546	0.58	3,334	3.56
Mexico	21,595	231	1.07	1,285	5.95
Other (5)	109,407	714	0.65	4,350	3.98
Total	224,784	1,491	0.66	8,969	3.99

(1) Includes off-balanced sheet positions to which the corresponding conversion factors are applied.
(2) Excludes non-performing portfolios.
(3) Other retail portfolios = Consumer finance + credit and debit cards + SMEs + other retail.
(4) Companies and institutions = corporate + companies + developer + institutions.
(5) Includes Real-estate activity in Spain.

The chart below shows expected losses by business area as of the close of December 2013. Banking activity in Spain, with an attributed exposure which accounts for 62.5% of the total, has an expected loss-to-exposure ratio of 0.2%; the real-estate activity accounts for 1.5% of total exposure, with a ratio of 1.9%. The United States has a weight of 9.3% and expected losses of 0.5%. Eurasia accounted for 7.8% of the exposure, with a ratio of 0.6%; Mexico has a weight of 13.3% and a ratio of 1.2%; and South America a weight of 8.3% and a ratio of 1.3%.

BBVA Group. Attributable expected losses (balance not in default) by business area

(Percentage over exposure as of 31-12-2013)

(1) The change rates presented are calculated against the expected losses in the performing portfolio as of December 31, 2012 (€3,882 million in unattributable terms and €3,543m in attributable terms), which includes the annual effects of the update carried out in the credit risk parameters at the end of the year (Mexico, South America and United States).