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Earnings

The most relevant aspects of earnings in this area in the first quarter of 2012 are summarized below:

  • Positive performance of net interest income due to the more favorable position of structural interest-rate risk and improved liquidity in the euro zone. Two contributing factors were the cuts in interest rates in recent months and lower wholesale finance costs, due basically to the ECB liquidity auctions.
  • NTI below the levels posted in the first quarter of 2011 as a result of good performance of the markets in the first part of the previous year and capital gains on the sale of portfolios carried-out in the first quarter of 2011.
  • As a consequence, gross income for the quarter was a negative €136m (€16m up in 2011).
  • Operating expenses, which continue to reflect the Group’s investment effort in staff training, technology, brand and infrastructure amounted to €235m.
  • As a result, operating income in the area was a negative €371m (–€189m in the first three months of 2011).
  • Higher allocation to provisions for real estate and foreclosed assets.
  • In short, net attributable profit of –€438m was generated, compared with –€327m in the first quarter of 2011.

Income statement

(Million euros)


Corporate Activities

1Q12 Δ% 1Q11
Net interest income (78) (24.0) (103)
Net fees and commissions (71) 59.8 (44)
Net trading income 28 (82.7) 163
Other income/expenses (15) n.m. (0)
Gross income (136) n.m. 16
Operating costs (235) 15.2 (204)
Personnel expenses (137) 12.4 (122)
General and administrative expenses (17) (9.8) (19)
Deprecation and amortization (81) 27.8 (63)
Operating income (371) 96.9 (189)
Impairment on financial assets (net) 1 n.m. (42)
Provisions (net) and other gains (losses) (287) 27.7 (225)
Income before tax (657) 44.4 (455)
Income tax 220 70.7 129
Net income (438) 34.1 (326)
Non-controlling interests - - -
Net attributable profit (438) 34.0 (327)

Balance sheet

(Million euros)


Corporate Activities

31-03-12 Δ% 31-03-11
Cash and balances with central banks (352) n.m. 900
Financial assets 33,321 11.2 29,973
Loans and receivables (4,733) 0.1 (4,730)
Loans and advances to customers (2,129) 5.7 (2,013)
Loans and advances to credit institutions and other (2,604) (4.2) (2,717)
Inter-area positions (373) n.m. (9,083)
Tangible assets 3,204 4.4 3,068
Other assets 18,775 5.1 17,857
Total assets/Liabilities and equity 49,842 31.2 37,984
Deposits from central banks and credit institutions 3,862 n.m. (5,893)
Deposits from customers 23,210 4.5 22,203
Debt certificates 70,358 (13.8) 81,626
Subordinated liabilities 2,350 (62.5) 6,269
Inter-area positions (50,496) (27.1) (69,313)
Financial liabilities held for trading (4,039) 6.9 (3,776)
Other liabilities (9,269) 82.0 (5,094)
Valuation adjustments (2,577) 42.9 (1,803)
Shareholders’ funds 40,911 10.7 36,957
Economic capital allocated (24,468) 5.5 (23,192)

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