RNS No 5946m
BANCO BILBAYO VIZCAYA SA
23rd April 1998
THE BBV GROUP, IN FIRST QUARTER 1998
During the first quarter of 1998, the BBV Group's net attributable profit was
30,778 million pesetas, an increase of 28.1% over 1Q97. Net income clearly
continues to be on an upward path, and this has enabled the Group to post an
18.7% ROE.
The BBV Group's gross lending totalled more than 8.8 trillion pesetas, nearly
21% over the figure registered in 1Q97. Secured and personal loans were among
the most dynamic in the quarter, no doubt as a result of the marketing campaigns
undertaken. Growth in resident sector loans was up by 13.5%, again above the
sector average. There was also strong lending growth in our Latin American
affiliates, which accounts for the over 45% increase in non-resident lending.
Yet another positive point in the lending portfolio was the continued decline of
non-performing loans, which were down by 0.75 percentage points over March 97
for a non-performing loan ratio of 2.81%. This stems from the drop both in
domestic NPLs as well as an intense decline in the Americas.
In addition, customer funds managed performed quite satisfactorily, increasing
the volume by 28.1% over 1Q97. Funds recorded on the balance sheet increased
by 14.3%, and within that figure the resident sector accounted for 5.7%,
surpassing the average of banks and savings banks. Domestically, the BBV Group
gained market share in transactional liabilities, that is in the aggregate of
current and savings accounts, while the 'flight' from traditional time deposits
to mutual funds continues. In the first three months of the year, the Group
asset management affiliates companies have obtained the greatest growth within
the domestic financial system, boosting market share by 0.29 percentage points
over December 1997 and almost one full point above 1Q97. Pension funds in Spain
registered a year-on-year growth rate of 54.2%. Adding funds managed in Latin
America, the figure increases to 1.2 trillion pesetas for a total increase of
70.3% over March 1997.
Net interest margin increased from 2.92% to 3.26%, which is in sharp contrast to
the strong shrinking of margins that is being experienced by banks and savings
banks over all in Spain. This is due, among other reasons, to above-average
business growth and the adequate response to the lower-rate environment in
Spain. Also contributing to this margin growth was the higher margins coming
from our Latin American affiliates.
Recurrent profits were very positively affected by commission activity, which
was up over 68%. The most dynamic commission activity was again seen in mutual
and pension fund products, as well as commissions stemming from stock-related
services offered to clients (notably those associated with privatizations and
IPOs). Greater activity in traditional banking business is also contributing
positively to this heading.
BBV's efficiency ratio of 52.9% has improved by 1.7% from 54.6% in December;
operating income was up more than 39% over 1Q97. Notable on the lower half of
the income statement was the net income coming from Group transactions which
totalled 36.026 million pesetas and includes capital gains obtained in the
strong environment of the domestic stock market of the first quarter. Net
provisions increased by 74,515 million pesetas, 40,000 million of which were of
extraordinary nature. 26,677 million pesetas were set aside for net loan loss
provisions, 92% more than 1Q97 in spite of a further decline of NPL ratio both
domestic and international. Within this category were certain extraordinary
country-risk provisions derived from the reclassification that has been carried
out for some countries. The coverage ratio as of March 31 1998 was 119.2%, or
147.6% if we include mortgage guarantees.
In line with the Group's investment activities in the field of pension fund
management in Latin America, "Consolidar", the pension fund management firm in
Argentina in which BBV has a stake through Banco Frances, will acquire Fecunda,
thereby creating the 'number one' pension manager in Argentina with a market
share of 19%. Similarly, 'AFP Prevision' will begin operating in El Salvador in
April.
As of 31 March 1998, the capital base of BBV reached 1,396,786 million pesetas,
in accordance with Bank of Spain regulations. This represents a capital ratio in
the order of 13.0% and a capital surplus which reached 470,151 million pesetas.
The main component of the capital base continues to be Tier 1 equity, which
totalled 1,092,005 million pesetas equivalent to a TIER 1 ratio of 10.1 %.
This is another example of BBV's stated policy of actively managing its capital
base, issuing eligible equity when market conditions are adequate and constantly
maintaining a relatively high capital ratio that provides the Group with enough
flexibility to manage ahead with its growth strategy - both domestic and
international - whose ultimate objective is to maximize shareholder return.
Investor relations office
(Spain/34) 94 487 65 87
(Spain/34) 91 374 42 22
(USA/212) 339 43 60
(UK/171) 397 60 76 Internet info (http:/www.bbv.es)
BBV GROUP INCOME STATEMENT
(millions of pesetas)
US $
MAR. 98 MAR.97 % Change (millions)
Financial revenues 412.884 351.513 17.46 2.635
Financial costs -244.043 -227.868 7.10 -1.557
NET INTEREST INCOME 168.841 123.645 36.55 1.078
Fees & Commissions 72.538 42.946 68.91 463
Collection and payment services 26.263 18.888 39.00 168
Investment securities services 14.035 7.481 87.60 90
Mutual and pension funds management 24.807 11.247 n.m. 158
Other Commissions 7.433 5.330 39.50 47
BASIC MARGIN 241.379 166.591 44.90 1.541
Market operations 24.180 19.103 26.58 154
ORDINARY REVENUE 265.559 185.694 43.01 1.695
Administrative Costs -140.404 -97.595 43.86 -896
Personnel -91.897 -67.342 36.46 -587
Wages and other -88.016 -65.427 34.53 -562
Pensions -3.881 -1.915 n.m. -25
General expenses -48.507 -30.253 60.34 -309
Other income-costs -5.141 -1.610 n.m. -33
DGF annual fee -5.078 -1.992 n.m. -32
Other items -63 382 n.m. -1
Depreciation -12.643 -9.653 30.97 -81
OPERATING INCOME 107.371 76.836 39.74 685
Income from associates 38.667 6.430 n.m. 247
Group Net transactions 36.026 3.569 n.m. 230
Income by the equity method 2.641 2.861 -7.69 17
Loan Loss Provisions (net) -26.677 -13.897 91.96 -170
Gross -43.741 -27.331 60.04 -279
Reversals 12.333 10.243 20.40 79
Bad debts' recoveries 4.731 3.191 48.26 30
Securities writedowns -61 171 n.m. -1
Goodwill amortization -26.917 -3.218 n.m. -172
Extraordinary items -21.783 -15.011 45.11 -139
Disposals 1.707 826 n.m. 11
Other -23.490 -15.837 48.32 -150
PROFIT BEFORE TAX 70.600 51.311 37.59 450
Corporate Tax -28.360 -18.496 53.33 -181
NET INCOME 42.240 32.815 28.72 269
Minority interests -11.462 -8.787 30.44 -73
Preference shares -3.455 -2.190 57.76 -22
Other -8.007 -6.597 21.37 -51
NET ATTRIBUTABLE 30.778 24.028 28.09 196
*)l US$ ptas.156.7 Consolidated accounts are presented in accordance with Bank
of Spain 4/91 (and ensuing circulars) and follow generally accepted accounting
principles.
BBV GROUP BALANCE SHEET (*)
(millions of pesetas)
MAR. 98
ASSETS MAR. 98 MAR. 97 % Change (US$
millions)
Cash and Central Banks 426,124 324,024 31.51 2,720
Government Debt 1,214,431 1,418,792 -14.40 7,751
Due from Banks 6,415,204 5,081,181 26.25 40,944
Total lending (Gross) 8,858,097 7,325,298 20.92 56,536
- Reserves -297,040 -275,521 7.81 -1,896
Investment Portfolio 3,092,912 2,756,205 12.22 19,740
Fixed income 2,420,912 2,145,183 12.85 15,451
Securities 672,000 611,022 9.98 4,289
Premises and Equipment 597,206 553,256 7.94 3,812
Other Assets Account 613,633 305,499 n.m. 3,917
Accrual Accounts 290,539 342,929 -15.28 1,854
TOTAL 21,211,106 17,831,663 18.95 135,378
-----------------------------------------------------------------------------
LIABILITIES
Capital 175,903 129,220 36.13 1,123
Reserves 780,247 638,210 22.26 4,980
Minority Interests 506,919 370,216 36.93 3,235
Due to Banks 6,039,448 4,834,707 24.92 38,546
Customer Funds 12,861,244 11,255,777 14.26 82,086
Other Liabilities Accounts 481,268 272,823 76.40 3,072
Accrual Accounts 323,837 297,895 8.71 2,067
Net Income 42,240 32,815 28.72 269
TOTAL 21,211,106 17,831,663 18.95 135,378
-----------------------------------------------------------------------------
(*) 1 US$ ptas. 156.7. Consolidated accounts are presented in accordance with
Bank of Spain Circular 4/91 (and ensuing circulars) and follow generally
accepted accounting principles.
Average Total Assets 19,809,328 15,651.351 26.57 126,431
Average shareholders'funds 734,143 654,085 12.24 4,686
BIS Ratio (Tier 1) 13.9(10.1) 14,5(10.4)
Risk weighted assets 10,042,310 7,716,066 30.15 64,094
BBV BBV (1)
------------------------------ -------
MAR. 98 MAR. 97 MAR. 98
Lending quality (B. of Spain's regulations)
NPL as % Lending 2.81 3.56 2.38
------------------------------------------------------------------------------
N.P.L.
Initial 257,980 227,203 135,374
MARCH 31st 249,248 260,797 126,697
Net Change -8,732 33,594 -8,677
% Net Change -3.38 14.79 -6.41
NPL's Reserves
Last 297,040 275,521 155,905
% Coverage NPL 119.17 105.65 123.05
-------------------------------------------------------------------------------
Lending quality (International regulations)
NPL as % Lending 1.59 1.74 0.80
% Coverage NPL 183.95 181.55 220.04
(1) Excluding Probursa (Mexico), Continental (Peru), Ganadero (Colombia),
Frances (Argentina) and Provincial (Venezuela).
TOTAL LENDING AND CUSTOMER FUNDS BREAKDOWN
(millions of pesetas)
MAR. 98 MAR. 97 % Change
Due from Public Sector 436,177 448,941 -2.84
Due from residents 5,136,848 4,526,737 13.48
Commercial bills 637,802 687,662 -7.25
Borrowers with collateral 1,546,937 1,261,880 22.59
Personal loans 1,725,043 1,515,977 13.79
Credit accounts 527,948 520,126 1.50
Other term loans 223,220 130,464 71.10
Others 230,613 195,845 17.75
Leasing 245,285 214,783 14.20
Due from non residents 3,035,824 2,088,823 45.34
Non performing loans 249,248 260,797 -4.43
TOTAL LENDING (GROSS) 8,858,097 7,325,298 20.92
(-) Reserves -297,040 -275,521 7.81
TOTAL LENDING (NET) 8,561,057 7,049,777 21.44
Pesetas 5,437,351 4,866,251 11.74
Foreign currencies 3,123,706 2,183,526 43.06
MAR. 98 MAR. 97 % Change
Public Sector 590,547 515,984 14.45
Other resident sectors 6,477,830 6,127,211 5.72
Current accounts 1,567,307 1,353,593 15.79
Savings accounts 1,083.497 987,955 9.67
Time deposits 2,019,672 2,047,696 -1.37
Sales with repurchase agreements 1,784,404 1,698,138 5.08
Others 22,950 39,829 -42.38
Non-residents 4,478,713 3,556,614 25.93
Marketables Debt Securities 1,025,252 769,950 33.16
Subordinated Debt 288,902 286,018 1.01
TOTAL CUSTOMER FUNDS 12,861,244 11,255,777 14.26
Pesetas 7,456,046 7,046,555 5.81
Foreign currencies 5,405,198 4,209,222 28.41
Mutual funds 4,533,061 2,886,042 57.07
Pension funds 1,217,771 715,267 70.25
Portfolio management 2,007,851 1,243,439 61.48
OFF-BALANCE FUNDS 7,758,683 4,844,748 60.15
TOTAL MANAGED CUSTOMER FUNDS 20,619,927 16,100,525 28.07
YIELDS AND COSTS
(millions of pesetas and %)
MARCH 98 MARCH 97
Average Average Average Average
Balance Yield Rates Balance Yield Rates
Total lending 8,868,228 227,628 10.41 7,003,801 180,775 10.47
Pesetas 5,662,716 100,147 7.17 4,958,419 112,121 9.17
Foreign
currencies 3,205,512 127,481 16.13 2,045,382 68,654 13.61
Investment
securities 3,206,543 74,306 9.40 3,242,237 77,612 9.71
Pesetas 945,117 13,737 5.89 1,356,842 22,236 6.65
Foreign
currencies 2,261,426 60,569 10.86 1,885,395 55,376 11.91
Equity method
securities 570,226 15,115 10.75 532,297 12,565 9.57
Other
investment
securities 124,644 859 2.79 89,521 855 3.87
Credit
entities 6,744,030 87,974 5.29 5,183,155 76,541 5.99
Pesetas 2,832,311 29,821 4.27 2,332,886 36,048 6.27
Foreign
currencies 3,911,719 58,153 6.03 2,850,269 40,493 5.76
Bank of Spain 145,851 2,247 6.25 187,824 2,926 6.32
Non-income
producing
assets 1,363,755 962,078
Other financial products 4,755 239
INTEREST
REVENUES 21,023,277 412,884 7.96 17,200,913 351,513 8.29
MARCH 98 MARCH 97
Average Average Average Average
Balance Cost Rates Balance Cost Rates
Customers'funds 13,189,904 155,473 4.78 10,637,269 146,370 5.58
Pesetas 7,822,907 59,094 3.06 7,126,612 76,512 4.35
Customers'
deposits 5,839,228 35,783 2.49 5,258,201 47,806 3.69
Repo assets 1,877,023 21,500 4.65 1,779,138 27,146 6.19
Marketable debt
securit. 106,656 1,811 6.89 89,273 1,560 7.09
Foreign
currencies 5,366,997 96,379 7.28 3,510,657 69,858 8.07
Due to cre.ent. and B. of Spain
5,666,477 86,381 6.18 4,890,371 78,230 6.49
Pesetas 2,129,937 26,174 4.98 2,115,674 33,645 6.45
Foreign currencies
3,536,540 60,207 6.90 2,774,697 44,585 6.52
Shareholders'funds
825,555 729,781
Funds without cost
1,341,341 943,492
Other interest expenses 2,189 3,268
INTEREST EXPENSES
21,023,277 244,043 4.71 17,200,913 227,868 5.37
NET INTEREST INCOME 168,841 3.26 123,645 2.92
BBV GROUP HIGHLIGHTS
(consolidated figures)
MAR. 98 MAR. 97 %Change
Balance sheet (Millions of pesetas)
Total assets 21,211,106 17,831,663 19.0
Total lending 8,858,097 7,325,298 20.9
Customer funds recorded on the balance
sheet 12,861,244 11,255,777 14.3
Other Customer funds managed 7,758,683 4,844,748 60.1
Shareholders' funds 820,604 718,828 14.2
Income statement (Millions of pesetas)
Basic Margin 241,379 166,591 44.9
Operating income 107,371 76,836 39.7
Income before taxes 70,600 51,311 37.6
Net attributable profit 30,778 24,028 28.1
Data per share (Pesetas)
Net attributable profit 46 36 27.7
Book value 1,213 1,066 13.8
Share price 7,370 2,860 157.7
Key ratios (%)
R.O.A. (Net income/Average total assets) 0.96 0.84 -
RORWA ((Net income/Risk weighted assets) 1.89 1.71 -
R.O.E. (Net attributable/Average equity) 18.7 16.5 -
Other relevant figures
Number of employees 60,940 58,071 -
Spain 24,971 24,909 -
Abroad 35,969 33,162 -
Number of branches 4,285 4,048 -
Spain 2,833 2,841 -
Abroad 1,452 1,207 -
END
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