Financial statements 1H 05
Banco Bilbao Vizcaya Argentaria SA
28 July 2005
BBVA: Consolidated income statement
(Million euros)
1H 05 % increase 1H 04
Core net interest income 3,224 11.7 2,887
Dividends 142 (1.5) 145
NET INTEREST INCOME 3,367 11.1 3,031
Net income by the equity method 51 15.0 44
Net fee income 1,853 10.2 1,681
Income from insurance activities 219 13.0 194
CORE REVENUES 5,490 10.9 4,950
Net trading income 611 20.9 505
ORDINARY REVENUES 6,100 11.8 5,455
Net revenues from non-financial 68 23.0 55
activities
Personnel costs (1,710) 6.5 (1,605)
General expenses (1,011) 12.0 (903)
Depreciation and amortization (206) (7.8) (224)
Other operating income and expenses (39) (34.2) (60)
(net)
OPERATING PROFIT 3,201 17.7 2,719
Impairment losses on financial assets (325) (21.4) (413)
(net)
. Loan-loss provisions (304) (26.0) (411)
. Other (20) n.m. (2)
Provisions (net) (254) (50.7) (515)
Other income/losses (net) 102 (71.4) 357
. From disposal of equity holdings 16 (93.9) 262
. Other 86 (9.0) 94
PRE-TAX PROFIT 2,724 26.9 2,147
Corporate income tax (788) 44.0 (547)
NET PROFIT 1,936 21.0 1,600
Minority interests (123) 37.2 (89)
NET ATTRIBUTABLE PROFIT 1,813 20.1 1,510
EARNINGS PER SHARE CALCULATION
Average ordinary shares in circulation 3,390,852 1.1 3,353,352
(thousand)
Basic earnings per share (euros) 0.53 18.7 0,45
Diluted earnings per share (euros) 0.53 18.7 0,45
BBVA: Consolidated balance sheet
(Million euros)
30-06-05 %increase 30-06-04 31-03-05 31-12-04
Cash and balances at Central 13,799 50.2 9,186 12,434 10,123
Banks
Trading portfolio assets 53,437 24.7 42,835 47,960 43,432
Other financial instruments at 925 3.9 890 1,000 1,118
fair value
Financial instruments available 52,315 (8.8) 57,357 51,774 58,053
for sale
Loans 231,303 21.2 190,905 207,651 197,483
. Due from banks 25,076 5.2 23,832 17,305 17,571
. Loans to customers 195,286 23.2 158,556 180,831 171,339
. Other 10,942 28.5 8,517 9,515 8,573
Fixed income portfolio held to 3,519 81.1 1,943 3,404 2,195
maturity
Investments in associates 1,392 17.7 1,183 1,405 1,369
Property and equipment 4,249 15.1 3,692 3,982 3,939
Intangible assets 1,675 27.2 1,317 1,032 809
Other assets 15,078 (15.4) 17,821 14,961 14,223
TOTAL ASSETS 377,694 15.5 327,129 345,603 332,743
Trading portfolio liabilities 18,212 57.7 11,546 15,417 12,379
Other financial liabilities at 775 (13.7) 899 794 834
fair value
Financial liabilities at 310,616 14.0 272,484 282,960 271,179
amortised cost
. Deposits by Central Banks and 69,093 (6.2) 73,686 67,116 64,628
banks
. Due to customers 168,204 13.3 148,428 153,323 149,030
. Marketable debt securities 59,666 50.1 39,750 49,519 45,503
. Subordinated debt 9,322 23.3 7,562 8,547 8,490
. Other 4,330 50.2 2,883 4,454 3,529
Insurance contract liabilities 9,680 22.2 7,919 9,723 8,840
Other liabilities 19,265 9.0 17,678 18,819 21,861
Loan capital 3,589 (3.0) 3,700 3,829 3,809
TOTAL LIABILITIES 362,137 15.2 314,226 331,542 318,903
Minority interests 837 20.2 697 750 746
Valuation adjustments 2,952 80.7 1,633 2,112 2,062
Shareholders' funds 11,767 11.3 10,573 11,198 11,032
EQUITY 15,556 20.6 12,903 14,061 13,840
TOTAL LIABILITIES AND EQUITY 377,694 15.5 327,129 345,603 332,743
MEMORANDUM ITEM:
Contingent liabilities 24,640 28.7 19,143 22,984 21,653
January-June 2005 Results
BBVA's net attributable profit rises 20.1% to €1.8 billion
- Net attributable profit for the quarter was a record €998m, an increase of
21.8%
- Earnings per share (EPS) rose 18.7% in the first half, return on equity
(ROE) increased to 35.6% and the first interim dividend is 15% higher
- Driven by higher revenues, operating profit grew faster, rising 17.7%
to €3.2 billion
- All margins grew strongly, supported by a sharp increase in activity and
more favourable spreads. Net interest income grew 11.1%, core revenues grew
10.9% and ordinary revenues grew 11.8%
- The cost/income ratio improved from 44.7% to 43.4%. Including amortisation,
it improves 2.1 percentage points to 46.7%.
- In Retail Banking in Spain and Portugal, lending and customer funds grew
faster at 20.5% and 10.7%, respectively. Operating profit increased 13.1%
and net attributable profit was up 12.5%.
- The Wholesale and Investment Banking Area increased operating profit 17%
and net attributable profit by 29.1%
- The Americas Area maintained its high rate of business growth. Operating
profit increased 27.7% and net attributable profit was 62.7% higher.
- Mexico lifted operating profit 38.9% and its net profit rose 55.7% with
strong growth in the more profitable businesses
- The non-performing loans ratio continued to fall. It now stands at 1.01%
(1.32% a year earlier) and coverage rose from 206.5% to 240.5%
- BBVA's capital base remains sound with a BIS ratio of 12.2% and core
capital at 5.8%
BBVA increased the rate of business and revenue growth and achieved net
attributable profit of €1.81 billion in the first half of 2005. This is 20.1%
higher than last year. At the end of the first half year BBVA's return on equity
(ROE) stands at 35.6%. Earnings per share (EPS) increased 18.7% and the first
interim dividend is up 15%. Net attributable profit in the second quarter was
€998m (up 21.8%). This is a new group record.
The income statement reflects the solid performance of recurrent margins on
positive development of revenues and operating profit. The latter grew faster,
at 17.7%, and is the key factor behind the first half results. BBVA once more
strengthened fundamentals. Non-performing loans fell to 1.01% (from 1.32% a year
earlier) and coverage rose to 240.5% (previously 206.5%). The cost/income ratio
improved from 44.7% to 43.4% (from 48.8% to 46.7% including amortisation) and
capital adequacy strengthened. The BIS ratio stands at 12.2% and core capital is
5.8%.
The level of activity and the group's results in the second quarter of 2005
confirm the positive trend noted in the first quarter. There was strong growth
in business activity in Spain and the Americas and revenue growth was higher. As
a result, there was a substantial improvement in all margins and in net
attributable profit. All indicators of group profitability, risk quality,
capital adequacy and efficiency were higher.
At the end of June, BBVA's total assets had grown 15.5%, lending to customers
was up 22.7% and total customer funds 18.6%. There were double-digit increases
in all recurrent margins.
Taken as a whole, the first-half figures show that BBVA is advancing in its
strategy of profitable growth based on dynamic commercial activity in its main
retail markets (Spain and the Americas). They also reveal the favourable
activity and results of its Wholesale Banking and Investment Area.
During the first half, the group concluded the acquisition of Laredo National
Bancshares, reinforcing BBVA's franchise in the USA.
In the Spanish market the group added 77 branches under its network expansion
plan, which has thus grown from 3,371 to 3,448 outlets.
Quarterly financial information complies with 'Circular 4/2004' of the Bank of
Spain and with the International Financial Reporting Standards (IFRS) and data
is reported on a uniform basis. The most relevant aspects of the group's
financial status in the first half are summarised below:
- In the second quarter of 2005 the BBVA group obtained net attributable
profit of €998m. This is the highest amount ever achieved by the group in a
single quarter and is 21.8% more than the same period last year. As a
result, profit in the first half came to €1.81 billion (a year-on-year
increase of 20.1%), earnings per share increased 18.7% and ROE rose to
35.6%.
- Driven by higher revenues, operating profit in the half-year grew faster at
17.7% (15.0% in the first quarter) and came to €3.2 billion. This positive
performance was the determining factor behind the higher profit.
- Net interest income rose 11.1% (6.8% in the first quarter) and 11.7% if
dividends are excluded. The upward trend is the result of notable increases
in business activity in Spain and the Americas, and interest spreads that
were more favourable than in previous periods.
- Net fee income and insurance income rose 10.5% with increases that were
higher than the previous quarter in all business areas. Net trading income
grew 20.9%. As a result, ordinary revenues grew 11.8% in the first half,
compared to 8.4% in the first quarter. Net sales of non-financial
activities also performed well.
- Operating costs including amortisation increased 7.2%. On a comparable
basis (ie, excluding Laredo National Bancshares, Hipotecaria Nacional and
Valley Bank) the increase was 5%.
- The cost/income ratio improved to 43.4% in the first half compared to 44.7%
in the same period last year. Including amortisation, the ratio is 46.7%
and the year-on-year improvement is 2.1 percentage points.
- The sharp increase in customer lending and lower non-performing loans
(NPLs) resulted in a further improvement in the NPL ratio to 1.01% at the
end of June (1.32% at 30-Jun-04). At the same time coverage rose to 240.5%
(206.5% a year earlier).
- At 30-Jun-05 the group's capital base remained sound with the BIS ratio at
12.2% and core capital at 5.8%. Without the Laredo acquisition core capital
would be 6.1%.
- On July 11th a first interim dividend of €0.115 per share was paid against
2005 results. This is an increase of 15% over the first interim dividend
paid in 2004.
- In the Retail Banking Area in Spain and Portugal, lending and customer
funds grew faster compared to March. Lending grew 20.5% (with a growing
percentage of SME finance) and customer funds increased 10.7%. This led to
a 7.5% increase in ordinary revenues (6.1% in the first quarter). In
year-on-year terms, operating profit grew 13.1% and net attributable profit
grew 12.5% to €793m.
- In the Wholesale and Investment Banking Area overall operating profit grew
17% and 20.5% in wholesale banking alone (corporate and institutional
customers). As loan provisioning requirements were lower than last year,
net attributable profit increased 29.1% to €280m.
- The Americas Area maintained the high rate of growth of recent quarters and
the main margins on the income statement grew faster year-on-year. Net
interest income rose 25%, operating profit increased 27.7% and net
attributable profit grew 62.7% to €823m. In a like-for-like comparison
based on the same units, operating profit grew 22.9% and attributable
profit 56.3%.
- Mexico recorded strong growth in the more profitable business lines
(consumer finance and credit cards in terms of lending, and transaction
accounts in terms of customer funds). Thus net interest income grew 34.4%
in the first half. Following the increase in net fee income and especially
in net trading income in the second quarter, cumulative operating profit to
June grew 38.9%. Net profit increased 55.7% (47.1% excluding Hipotecaria
Nacional).
This information is provided by RNS
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