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January-June 2013

Earnings

In the second quarter of 2013, the BBVA Group’s net attributable profit stood at €1,147m, with an accumulated figure of €2,882m in the first half of the year. The most relevant items in the quarter are:

1. Strong net interest income in an environment marked by high pressure on customer spreads in several geographical regions where the Group operates.

2. Fees and commissions have also performed well and compare favorably with the figures posted both in the first quarter and in the same period last year.

3. Strong generation of NTI in the first half of the year as a whole, in a situation of high volatility on the markets.

Net attributable profit (1)

(Million euros)

(1) Adjusted (2) At constant exchange rates: -34.6%
Consolidated income statement: quarterly evolution  (1)

(Million euros)

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2013 2012

2Q 1Q 4Q 3Q 2Q 1Q
Net interest income 3,679 3,623 3,910 3,877 3,741 3,594
Net fees and commissions 1,126 1,052 1,126 1,104 1,061 1,062
Net trading income 630 719 646 319 461 340
Dividend income 47 19 17 35 311 27
Income by the equity method 164 51 191 169 175 191
Other operating income and expenses (153) 7 (32) 6 57 51
Gross income 5,493 5,471 5,858 5,512 5,806 5,265
Operating costs (2,814) (2,758) (2,855) (2,771) (2,633) (2,528)
Personnel expenses (1,454) (1,458) (1,472) (1,447) (1,396) (1,347)
General and administrative expenses (1,080) (1,025) (1,089) (1,064) (1,001) (951)
Depreciation and amortization (279) (276) (294) (259) (236) (230)
Operating income 2,679 2,712 3,003 2,741 3,173 2,738
Impairment on financial assets (net) (1,336) (1,376) (2,675) (2,038) (2,182) (1,085)
Provisions (net) (130) (167) (228) (195) (98) (130)
Other gains (losses) (172) 343 (269) (561) (311) (223)
Income before tax 1,040 1,512 (168) (53) 582 1,299
Income tax (261) (395) 220 275 3 (223)
Net income from on-going operations 779 1,118 52 222 584 1,076
Net income from discontinued operations 570 823 138 83 75 96
Net income 1,349 1,941 190 305 659 1,173
Non-controlling interests (202) (207) (170) (159) (154) (168)
Net attributable profit 1,147 1,734 20 146 505 1,005
Adjusted (2) 200 870 (1,155) (901) (1,067) (226)
Net attributable profit (adjusted) (2) 947 865 1,175 1,047 1,572 1,231
Basic earnings per share (euros) 0.20 0.31 0.01 0.03 0.09 0.19
Basic earnings per share diluted (euros) (3) 0.20 0.31 0.01 0.03 0.09 0.20
Adjusted earnings per share diluted (euros) (2-3) 0.16 0.15 0.21 0.19 0.29 0.23
(1) Pro forma financial statements with Garanti Group accounted for by the proportional consolidation method, without early application of the IFRS 10, 11 and 12. (2) Adjusted based on the result of real-estate activity in Spain, the profit from the pension business in Latin America, the badwill from Unnim and the reinsurance operation on the individual life-risk insurance portfolio in Spain. (3) Basic earnings per share which includes the eventual dilution of the contingent convertible securities into shares, issued in the second quarter of 2013.
Consolidated income statement: quarterly evolution (1)

(Million euros)

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1H13 ∆% Δ % at constant exchange rates 1H12 Δ % Δ % at constant exchange rates 2H12
Net interest income 7,302 (0.5) 2.0 7,335 (6.2) (1.7) 7,787
Net fees and commissions 2,178 2.6 4.1 2,123 (2.4) 0.7 2,230
Net trading income 1,349 68.4 73.4 801 39.7 42.6 966
Dividend income 66 (80.4) (80.4) 338 25.4 27.4 53
Income by the equity method 214 (41.5) (41.4) 366 (40.5) (40.4) 360
Other operating income and expenses (146) n.m. n.m. 107 n.m. n.m. (25)
Gross income 10,964 (1.0) 0.7 11,071 (3.6) (0.2) 11,370
Operating costs (5,572) 8.0 9.6 (5,161) (0.9) 2.0 (5,625)
Personnel expenses (2,912) 6.2 7.7 (2,743) (0.2) 2.4 (2,919)
General and administrative expenses (2,105) 7.8 9.4 (1,952) (2.2) 1.0 (2,153)
Depreciation and amortization (555) 19.3 21.8 (465) 0.4 3.8 (553)
Operating income 5,392 (8.8) (7.1) 5,911 (6.1) (2.5) 5,745
Impairment on financial assets (net) (2,712) (17.0) (17.0) (3,267) (42.5) (42.0) (4,713)
Provisions (net) (297) 30.2 42.1 (228) (29.7) (23.9) (423)
Other gains (losses) 170 n.m. n.m. (535) n.m. n.m. (830)
Income before tax 2,553 35.7 42.4 1,881 n.m. n.m. (222)
Income tax (656) 198.1 219.2 (220) n.m. n.m. 496
Net income from on-going operations 1,897 14.2 19.5 1,661 n.m. n.m. 274
Net income from discontinued operations 1,393 n.m. n.m. 172 n.m. n.m. 221
Net income 3,290 79.5 86.7 1,832 n.m. n.m. 495
Non-controlling interests (408) 26.7 43.7 (322) 24.1 44.7 (329)
Net attributable profit 2,882 90.8 94.9 1,510 n.m. n.m. 166
Adjusted (2) 1,070 n.m. n.m. (1,293) n.m. n.m. (2,056)
Net attributable profit (adjusted) (2) 1,812 (35.4) (34.6) 2,803 (18.4) (15.7) 2,222
Basic earnings per share (euros) 0.51

0.28

0.03
Basic earnings per share diluted (euros) (3) 0.51

0.28 0.03
Adjusted earnings per share diluted (euros) (2-3) 0.32

0.50 0.40
(1) Pro forma financial statements with Garanti Group accounted for by the proportional consolidation method, without early application of the IFRS 10, 11 and 12. (2) Adjusted based on the result of real-estate activity in Spain, the profit from the pension business in Latin America, the badwill from Unnim and the reinsurance operation on the individual life-risk insurance portfolio in Spain. (3) Basic earnings per share which includes the eventual dilution of the contingent convertible securities into shares, issued in the second quarter of 2013.

4. Increase in expenses, highly concentrated in emerging economies, and kept in check in the rest of geographical regions.

5. Stable impairments and provisions at the same levels as in the previous quarter.

6. Capital gains from the closing of the sale of the pension business in Colombia and Peru.

To sum up, another quarter with high earnings, with revenue from one-off transactions combined with notable stability of the most recurring earnings.


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