BBVA has also announced that it will apply hyperinflationary accounting in Türkiye, effective Jan 1, 2022, in accordance with the IAS 29 accounting rules, ‘Financial Information in Hyperinflationary Economies’. Hyperinflationary accounting involves the restating of the financial statements with the aim of showing them in real terms, and not nominal, (i.e. adjusting the figures to the high inflation in the country), thus allowing a fairer comparison of the P&L and the balance of the bank in different moments in time.

The impacts, which are positive on capital and negative on the P&L, will be reflected in BBVA Group’s consolidated financial financial statements for 2Q22. The impacts related to the first quarter are as follows:

• A positive impact on the fully-loaded CET1 capital ratio of approximately +19 bps.
• A negative impact¹ on the Group’s attributable profit of about €-324 million.

Considering the annual inflation forecast² in Türkiye, for 2022 the contribution from the Group’s entities in Türkiye to the results is expected to be negligible, while the capital is expected to see a positive impact in the coming quarters.

BBVA’s financial goals for 2024 announced at the Investor Day remain unchanged.

¹For the calculation of this impact, the exchange rate of 16.28 Turkish Lira per Euro (applicable on 31 March 2022) and the cumulative inflation rate in Turkey in the first quarter of 2022 of 22.8% (published by the Turkish Statistical Institute) have been used.
²According to BBVA Research estimates, Turkey’s annual inflation rate will be around 60% in 2022, which implies a moderation in the quarterly inflation rate in the coming quarters.

See presentation