A. Selected Consolidated Financial Data [Reserved] B. Capitalization and Indebtedness Not Applicable. C. Reasons for the Offer and Use of Proceeds Not Applicable. 7 D. Risk Factors MACROECONOMIC AND GEOPOLITICAL RISKS A deterioration in economic or political conditions in the countries where the Group operates could have a material adverse effect on the Group’s business, financial condition and results of operations The Group is sensitive to the deterioration of economic conditions or the alteration of the institutional environment of the countries in which it operates, especially Spain, Mexico and Turkey, which respectively represented 53.1%, 21.2% and 10.6% of the Group’s assets as of December 31, 2025 (53.3%, 21.8% and 10.7% as of December 31, 2024, respectively, and 58.3% 22.4% and 8.8%, as of December 31, 2023, respectively). Additionally, the Group is exposed to sovereign debt, especially sovereign debt related to these countries. For summarized information on the macroeconomic conditions that these countries are currently facing, and which could significantly affect the Group, see “Item 5. Operating and Financial Review and Prospects—Operating Results—Operating Environment”. The global economy is undergoing significant changes, driven in part by the policies of the U.S. administration. Uncertainty surrounding the consequences of such changes is exceptionally high, substantially increasing geopolitical, economic and financial risks. The increase in U.S. tariffs on imports from its trade partners has triggered financial market volatility, reinforcing risks to the global economic outlook. The final level and duration of these tariffs, and the high uncertainty in connection therewith, could negatively impact the world economy, worsening the prospects for the macroeconomic environment. As a result of adopted or announced tariffs, global growth could slow or decline significantly. While fiscal stimulus and monetary easing measures could partially offset the impact of trade protectionism, particularly in the Eurozone, where significant public spending increases have been announced, the impact of higher U.S. tariffs could be amplified by the adoption of retaliatory measures by other countries, sustained uncertainty, weakening confidence levels and financial deterioration, among other factors. Increased tariffs also raise the risk of inflation in the United States and the Eurozone, which could further slow private demand and, at the same time, constrain the Federal Reserve’s (“Fed”) and the ECB’s ability to lower rates if warranted by activity. Beyond higher import tariffs, tighter U.S. controls on migration flows could also affect the labor market in the United States, add to inflationary pressures and weigh on economic growth. The U.S. administration’s fiscal, monetary, regulatory, industrial and foreign policies, among others, could likewise contribute to financial and macroeconomic volatility. This is compounded by concerns that the Fed’s independence in decision-making may be weakened by political considerations. Amid heightened uncertainty over U.S. policies and the prospect of large fiscal deficits, the U.S. risk premium has increased, and could rise further, pushing up long-term sovereign yields and further weakening the U.S. dollar. These developments could also spark episodes of volatility, especially given the high debt levels in both developed and emerging economies. The relatively high valuations of AI-related stocks are also a source of uncertainty and may lead to financial market volatility. Rising trade protectionism and the U.S.-China rivalry could further heighten geopolitical tensions, especially against the backdrop of ongoing conflicts in Ukraine and the Middle East, recent tensions in Latin America and Iran and the Greenland crisis. In response to these risks and the changes in the foreign policy of the U.S. administration, the European Union (EU) has adopted measures to increase military spending, which could support growth but, to some extent, add pressure on inflation and interest rates in the region. Overall, rising global geopolitical tensions increase uncertainty around the outlook for the world economy and the likelihood of economic and financial disruptions, including an economic recession. Further, the Group is exposed to, among other risks, the following general risks with respect to the economic and institutional environment in the countries where it operates: a deterioration in economic activity, including potential recession scenarios; inflationary pressures which could lead to tightening of monetary conditions; stagflation triggered by intense or prolonged supply shocks, including as a result of protectionist escalation or a sharp rise in oil and gas prices; exchange rate volatility; adverse developments in real estate markets; changes in the institutional environment of the countries where the Group operates, which could lead to sudden and pronounced GDP contractions and/or shifts in regulatory or government policy, including capital controls, dividend restrictions, or the imposition of new taxes or levies; high levels of public debt or external deficits, which could lead to sovereign credit rating downgrades or even defaults or debt restructurings; the impact of policies adopted by the U.S. administration, around which significant uncertainty remains; and episodes of volatility in the financial markets, such as those seen recently. Any of the above could result in significant losses for the Group. Our results may also be adversely affected by factors specific to the countries where we operate. In Spain, political, regulatory, and economic uncertainty may have a negative impact on activity. In Mexico, there is considerable uncertainty regarding the impact of the recently approved constitutional reforms, as well as the policies of the U.S. administration and the outcome of the review of the United States-Mexico-Canada free trade agreement (USMCA). 8 In Turkey, despite the gradual recent improvement, macroeconomic conditions remain relatively unstable, marked by pressure on the Turkish lira, high inflation, a significant trade deficit, relatively low central bank foreign exchange reserves, and high external financing costs. Recent political and social tensions could also trigger new episodes of financial volatility and macroeconomic risks. Moreover, uncertainty remains over the impact on Turkey of the geopolitical situation in the Middle East. These factors could lead to a deterioration in the purchasing power and creditworthiness of the Group’s customers. In addition, official interest rates, regulatory and macroprudential policies affecting the banking sector, hyperinflation and currency depreciation in Turkey have impacted and may continue to impact the Group’s results. In South America, ongoing and potential interventionist actions by the United States in some of its countries constitute a significant source of risk. In Argentina, despite the improved prospects for the economy following significant fiscal, monetary and exchange rate adjustments, the risk of economic and financial turmoil persists. Lastly, in Colombia and Peru, meteorological events, political tensions, and a deterioration of public finances could weigh adversely on economic performance. Given the significance of the Group’s exposure to each of Spain, Mexico and Turkey, any adverse change affecting political, economic and social conditions in any of such countries could have a material adverse effect on the Group’s business, financial condition and results of operations. Any of these factors may have a material adverse effect on the Group’s business, financial condition and results of operations. Political, economic and social conditions in any of Spain, Mexico and Turkey may have a material adverse effect on our business, financial condition and results of operations The Group has historically carried out its lending activity mainly in Spain, which continues to be its primary business area. In addition, the Group is significantly exposed to Mexico and Turkey. As of December 31, 2025, total risk in financial assets in Spain, Mexico and Turkey (in each case calculated as set forth in Appendix IX (Additional information on risk concentration) of the Consolidated Financial Statements) amounted to €252,299 million, €163,059 million and €68,309 million, respectively, equivalent to 32.5%, 21.0% and 8.8%, respectively, of the Group’s total risk in financial assets. The Group’s gross exposure to loans and advances to customers in Spain, Mexico and Turkey totaled €261,536 million, €100,699 million and €55,756 million, respectively, as of December 31, 2025, representing 55.3%, 21.3% and 11.8%, respectively, of the Group’s total amount of loans and advances to customers. Given the significance of the Group’s exposure to each of Spain, Mexico and Turkey, any adverse change affecting political, economic and social conditions in any such country could have a material adverse effect on the Group’s business, financial condition and results of operations. BUSINESS RISKS The Group’s business is subject to inherent risks concerning counterparties’ credit quality and the value of collateral The total maximum credit risk exposure of the Group (calculated as set forth in Note 7.2.2 to the Consolidated Financial Statements) as of December 31, 2025 was €1,104,820 million (€972,990 million and €904,889 million as of December 31, 2024 and 2023, respectively). The Group has exposures to many different products and counterparties, and the credit quality of its exposures can have a significant effect on the Group’s earnings. Adverse changes in the credit quality of the Group’s counterparties (including borrowers), or any adverse changes in the value of collateral they may have provided, may reduce the value of the Group’s assets, and materially increase the Group’s write-downs and loss allowances. Credit risk can be affected by a range of factors, including an adverse economic environment, a decrease in consumption or corporate or government spending, changes in the credit sovereign rating or in the rating of individual contractual counterparties, their debt levels and the environment in which they operate, increased unemployment, higher commodity prices (especially of energy commodities), reduced asset values (including as a result of natural disasters), increased retail or corporate insolvency levels, litigation and legal and regulatory developments. Credit risk may also be significantly affected by changes in interest rates (as well as the timing, magnitude and pace of these changes). While interest rates have decreased in certain countries, they remain relatively high, and the persistence of relatively high interest rates or any increase in interest rates in the future may lead to a deterioration of the Group’s non-performing loan (“NPL”) ratio and an increase in the Group’s risk-weighted assets (“RWAs”). See “—The Group’s business is particularly vulnerable to interest rates”. The impact of an increase in default rates on the Group will depend on its magnitude, timing and pace, and could be significant. Furthermore, it is possible that the Group has incorrectly assessed the creditworthiness or willingness to pay of its counterparties, that it has underestimated the credit risks and potential losses inherent in its credit exposure, that it has made insufficient provisions for such risks in a timely manner and that it has overestimated the extent to which it may be able to recover certain debts, including aged non-performing loans. 9 The processes involved in making such assessments, which have a crucial impact on the Group’s results and financial condition, require difficult, subjective and complex calculations, including forecasts of the impact that macroeconomic conditions could have on these counterparties. In particular, the Group’s estimates of losses derived from its exposure to credit risk may prove to be inadequate or insufficient in the current environment of economic uncertainty, which could affect the adequacy of the provisions for insolvencies provided by the Group. An increase in non-performing or low-quality loans could significantly and adversely affect the Group’s business, financial condition and results of operations. Furthermore, a deterioration of economic conditions typically results in a decrease in the price of real estate assets. The Group remains significantly exposed to the real estate market, mainly in Spain and, to a lesser extent, Mexico, due to the fact that many of its loans are secured by real estate assets and due to the significant volume of real estate assets that it maintains on its balance sheet. A fall in the price of real estate assets in a particular region would reduce the value of any real estate securing loans granted by the Group in such region and, therefore, in the event of default, the amount of the expected losses related to such loans would increase. Further, a fall in real estate prices could have a material adverse effect on the default rates of the Group’s residential mortgage and real estate developer credit portfolios. The balance of the Group’s residential mortgage portfolio at a global level was €99,668 million as of December 31, 2025 (€94,577 million and €93,358 million as of December 31, 2024 and 2023, respectively), 69.8% of which related to Spain as of December 31, 2025. Further, the Group’s corporate credit portfolios include real estate developers and constructors. As of December 31, 2025, the Group’s exposure to the construction and real estate sectors (excluding the mortgage portfolio) in Spain was equivalent to €10,602 million, of which €2,314 million corresponded to loans for construction and development activities in Spain (representing 1.2% of the Group’s loans and advances to customers in Spain (excluding the public sector) and 0.3% of the Group’s consolidated assets as of December 31, 2025). The total real estate exposure (excluding the mortgage portfolio), including developer credit and foreclosed assets had a coverage ratio of 18.4% in Spain as of December 31, 2025. Any decrease in the value of collateral will adversely affect our potential losses upon an event of default. In addition, the Group is directly and directly exposed to the private equity and private credit sectors. Private market funds, to which the Group provides credit, are playing an increasingly important role in financial intermediation. While the Group monitors its exposure to private market funds, it remains at risk both from direct exposure and contagion and systemic risk, which could materially increase its write-downs and allowances for impairment losses. The Group’s business is particularly vulnerable to interest rates The Group’s results of operations are substantially dependent upon the level of its net interest income, which is the difference between interest income from interest-earning assets and interest expense on interest-bearing liabilities. Changes in market interest rates often affect the Group’s interest-earning assets differently from the Group’s interest-bearing liabilities. This, in turn, may lead to a reduction in the Group’s net interest margin, which could have a material adverse effect on its results. Moreover, changes in interest rates may affect the Group’s credit risk exposure (see “—The Group’s business is subject to inherent risks concerning counterparties’ credit quality and the value of collateral, particularly in Spain, that strengthens its lending portfolio”). Interest rates are highly sensitive to many factors beyond the Group’s control, including fiscal and monetary policies of governments and central banks, regulation of the financial sector, domestic and international economic and political conditions and other factors. The Group’s results of operations have been positively affected by the increases in interest rates adopted by central banks in recent years in an attempt to tame inflation, contributing to a rise in net interest income that exceeded the corresponding rise in funding costs. Interest rates have begun to decline in most of the regions in which BBVA is present (including the Eurozone and the United States) driven by the central banks’ monetary policies in response to easing inflationary pressures. However, interest rates remain relatively high compared to prior years. The continued prevalence of relatively high interest rates or any increase in interest rates in the future could adversely affect the Group by reducing the demand for credit, limiting its ability to generate credit for its clients and/or increasing the default rate of its counterparties (including borrowers). In particular, the repayment capacity of loans tied to variable interest rates is more sensitive to changes in interest rates. As of December 31, 2025, 2024 and 2023, 45.0%, 45.6% and 47.7%, respectively, of the Group’s gross exposure to loans and advances to customers with maturity greater than one year had floating-interest rates. Changes in interest rate policies may be implemented at a different pace across regions and it is possible that such policies could be accelerated or reversed based on various factors, such as inflation, economic growth or financial stability concerns among other considerations. As a result of the foregoing, the evolution of interest rates could have a material adverse effect on the Group’s business, financial condition and results of operations. 10 The Group faces increasing competition and is exposed to a changing business model The markets in which the Group operates are highly competitive and it is expected that this trend will continue in the coming years with the increasing entry of non-bank competitors (some of which have large client portfolios and strong brand recognition) and the emergence of new business models (for example, neobanks, a new generation of financial institutions that operate exclusively online, without physical branch networks). In recent years, the financial services sector has undergone a significant transformation driven by the development of mobile technologies, data-driven innovation, and the entry of new players into activities previously controlled by financial institutions. Although the Group is making efforts to adapt to these changes through its digital transformation, its competitive position is also affected by some regulatory asymmetries that benefit non-bank operators. For example, banking groups are subject to prudential regulations that have implications for most of their businesses, including those in which they compete with non-bank operators (such as FinTechs or BigTechs) that are subject only to regulations specific to the activity they develop or that benefit from loopholes in the regulatory environment. For instance, when banking entities such as the Group carry out financial activities through the use of new technologies, they are generally subject to additional regulations that place them at a competitive disadvantage. Moreover, the widespread adoption of new technologies, including artificial intelligence, cloud computing, big data analysis, crypto currencies and alternative payment systems that do not use the banking system, could erode the Group’s business or require the Group to make substantial investments to modify or adapt existing products and services, including its mobile and internet banking capabilities. Likewise, the increasing use of these new technologies and mobile banking platforms could have an adverse impact on the Group’s investments in facilities, equipment and employees. A faster pace of transformation towards mobile and online banking models could require changes in the Group’s commercial banking strategy, including the closure or sale of certain branches and the restructuring of others, and a significant reduction in headcount. These changes could result in sizable expenses as the Group reconfigures and transforms its commercial network. In addition, the trend towards the consolidation in the banking industry has created larger banks with which the Group must compete. Any failure by the Group to adapt to its competitive environment or failure to implement any necessary changes to its business model efficiently or on a timely basis could have a material adverse impact on the Group’s competitive position or otherwise have a material adverse effect on the Group’s business, financial condition and results of operations. The future success of the Group depends, in part, on its ability to use technology to provide suitable products and services for customers and adequately manage information technology obsolescence. While the Group has focused on developing its technological capabilities in recent years and is committed to digitization, its ability to capture the benefits of emerging technologies and otherwise compete successfully is likely to be adversely affected by, on the one hand, the existing uneven playing field between banks and non-bank players, and on the other hand, the increasing relevance of access to digital data and interactions for customer relationship management, which places digital platforms at an advantage. Digital platforms (such as those maintained by large technology or social media companies, and FinTechs) increasingly dominate access to data and control over digital interactions, and are already eroding the Group’s results in highly relevant markets such as payments. These platforms can leverage their advantage in access to data to compete with the Group in other markets and could reduce the Group’s operations and margins in its core businesses such as lending or wealth management. Some of the Group’s competitors have created alliances with BigTechs that may affect the Group’s ability to compete successfully and could adversely affect the Group. In the event that the Group is not successful in addressing increasing competition, its business, financial condition and results of operations could be materially and adversely affected. The Group faces risks derived from its international geographic diversification and its significant presence in emerging countries, which exposes it to heightened political risks The Group is made up of commercial banks, insurance companies and other financial services companies in various countries and its performance as a global business depends on its ability to manage its different businesses under various economic, social and political conditions, as well as different legal and regulatory requirements (including, among others, different supervisory regimes and different tax and legal regimes related to the repatriation of funds or the nationalization or expropriation of assets). In addition, the Group’s international operations may be exposed to risks and challenges to which its local competitors may not be exposed, such as currency risk, the difficulty of managing or supervising a local entity from abroad, political risks (which could affect only foreign investors) or limitations on the distribution or repatriation of dividends, thus worsening its position compared to that of local competitors. There can be no guarantee that the Group will be successful in developing and implementing policies and strategies in all of the countries in which it operates, some of which have experienced significant economic, political and social volatility in recent decades. In particular, the Group has a significant presence in several emerging countries, particularly in Mexico and in Turkey (see “—Political, economic and social conditions in any of Spain, Mexico and Turkey may have a material adverse effect on our business, financial condition and results of operations”), and is therefore vulnerable to any deterioration in economic, social or political conditions in these countries. 11 Further, the Group has significant operations in South America. Generally, emerging economies face higher anti-money laundering and other compliance risks as a result of greater political instability, higher levels of corruption, weaker governance structures and fewer financial and technical resources dedicated to enforcement. Further, emerging markets are generally affected by the conditions of other related markets and by the evolution of global financial markets in general (they may be affected, for example, by the evolution of GDP and interest rates in the United States and the exchange rate of the U.S. dollar), as well as by fluctuations in the prices of commodities. The risks associated with investing in emerging economies, in general, or in emerging markets where the Group operates, in particular, could trigger capital outflows from those economies and adversely affect such economies and therefore the Group. Moreover, emerging countries are more prone to experiencing significant changes in inflation and volatility in exchange rates, which may have a material impact on the Group’s results of operations, assets (including RWAs) and liabilities. In Turkey, for example, inflation was 30.9% for the year ended December 31, 2025 (according to the Turkish Statistical Institute, TUIK) and the Turkish lira depreciated 27.2% against the euro as of December 31, 2025 compared to December 31, 2024. The Group’s operations in emerging countries are also exposed to heightened political risks, such as changes in governmental policies, expropriation, nationalization, interest rate limits, exchange controls, capital controls, government restrictions on dividends or bank fees and adverse tax policies. For example, the repatriation of dividends from BBVA’s Venezuelan, Argentinian and Turkish subsidiaries is subject to certain restrictions and there is no assurance that these restrictions will be lifted in the future, or that further restrictions will not be imposed. Since BBVA’s ability to pay dividends depends, in part, on the receipt of dividends from its subsidiaries, such restrictions may affect, in turn, BBVA’s ability to pay dividends. ESG risks (see “—Environmental, social and governance (ESG) risks may adversely impact the Group”) may also be higher in the emerging markets where the Group operates as a result of, among other things, more limited resources and capital for ESG investment, lack of comprehensive and reliable data on ESG practices, resource dependency that may lead to unsustainable practices that are at odds with ESG initiatives and underdeveloped or inconsistently enforced regulatory frameworks. If the Group failed to adopt effective and timely policies and strategies in response to the risks and challenges it faces in each of the regions where it operates, particularly in emerging countries, the Group’s business, financial condition and results of operations could be materially and adversely affected. Environmental, social and governance (ESG) risks may adversely impact the Group ESG factors present risks associated with (i) climate change, including physical risks and transition risks (linked, among others, to changes in regulations, technologies, and market preferences associated with the transition to a less carbon-dependent economy); (ii) other environmental factors, such as biodiversity loss, water stress and other nature-related factors; (iii) social factors, such as human rights, inclusion, diversity and workplace safety; and (iv) corporate governance matters, such as the governance of environmental and social risks. ESG risks include short, medium and long-term risks that may adversely affect the Group and its customers or counterparties. ESG is an area of significant public debate and focus for governments and regulators, investors, the Group’s customers and counterparties, and other stakeholders, and, as a result, ESG risks are expected to continue to evolve, and may increase over time. Among others, ESG risks include the following: Physical risks: The activities of the Group or those of its customers or counterparties could be adversely affected by the physical risks (including acute and chronic) arising from climate change or other environmental challenges. For example, extreme weather events and chronic shifts in the climate may damage or destroy properties and other assets of the Group or those of its customers or counterparties, make the insurance against certain risks more expensive or unfeasible, result in increased costs, or otherwise disrupt their respective operations (for example, if supply chains are disrupted as a result), diminishing –in the case of the Group’s customers or counterparties - their repayment capacity and, if applicable, the value of assets granted as collateral to the Group. The Group is also exposed to potential long-term physical risks arising from climate change and other environmental challenges, such as any ensuing deterioration in economic conditions that results in credit-related costs, or potential impacts on the Group’s assets and operations. The Group could also be required to change its business models in response to the foregoing. Legal and regulatory risks: The ESG legal and regulatory landscape is increasingly fragmented. While legislatures and regulatory authorities in many jurisdictions continue to impose extensive requirements for financial institutions to integrate ESG considerations into their risk management and reporting frameworks, others are taking a different approach, with regulatory developments moving in the opposite direction, and a reduced emphasis on climate-related risk supervision, adding further complexity and uncertainty to the compliance environment. 12 Legal and regulatory changes related to how banks consider and manage climate and other ESG risks or otherwise affecting banking practices or disclosure of information have resulted, and may continue to result, in higher compliance, operational and credit risks and costs. The Group’s customers and counterparties may be exposed to similar legal and regulatory changes, increasing their own compliance and operational risks and costs. Further, legal and regulatory changes have resulted, and may continue to result, in legal uncertainty and the existence of overlapping or conflicting regulatory or other requirements. They may also give rise to regulatory asymmetries whereby some persons, including the Group and its customers and counterparties, are more heavily regulated than others, placing such persons at a disadvantage. The Group or its customers or counterparties may be unable to meet any new requirements on a timely basis or at all, including new product and service specifications, governance frameworks and practices and disclosure requirements and standards. We expect ESG-related legal and regulatory requirements to continue to evolve in the coming years. In the case of banks in particular, such evolving laws and regulations could include further requirements or restrictions related to lending, investing, capital and liquidity adequacy and operational resilience. The incorporation of ESG risks in the existing prudential framework is still developing and may result in increased risk weighting of certain assets. Moreover, there are significant risks and uncertainties inherent in the development of adequate risk assessment and modeling capabilities with respect to ESG-related matters and the collection and use of customer, third-party and other data, which may result in the Group’s systems or frameworks (or those of its customers and counterparties, where applicable) being inadequate, inaccurate or based on incorrect or insufficient customer, third-party or other data, any of which could adversely affect the Group’s disclosure and financial reporting. Further, increased and/or divergent regulation arising from climate change and other ESG-related challenges could result in increased litigation by different stakeholders (including non-governmental organizations (NGOs)) and regulatory investigations and actions. Technological risks: Certain of the Group’s customers and counterparties may be adversely affected by the progressive transition to a low-carbon economy and/or risks and costs associated with new low-carbon technologies. If the Group’s customers and counterparties fail to adapt to the transition to a low-carbon economy, or if the costs of doing so adversely affect their creditworthiness, this could adversely affect the Group’s loan portfolios. Market risks: The Group and certain of the Group’s customers and counterparties may be adversely affected by changes in market preferences due to, among other things, increased ESG concern, on the one hand, or an opposing sentiment, on the other. These changes could impact the demand for our products and services, as well as for those of our customers and counterparties, and investor interest in our securities. Further, the funding costs of businesses that are perceived to be more exposed to climate change or to other ESG-related risks could increase. Any of this could result in the reduced creditworthiness of such customers and counterparties, adversely affecting the Group’s relevant loan portfolios. The Group and its customers and counterparties could also be adversely affected by changes in prices resulting from shifts in demand or supply brought by climate change or other ESG-related factors, including prices of energy and raw materials, or by their inability to foresee or hedge any such changes. Reputational risks: The perception of climate change and other ESG-related matters as a risk and an appropriate consideration in business and investment decisions, by society, shareholders, customers, governments and other stakeholders (including NGOs), continues to evolve, including in relation to the financial sector’s activities. This may result in increased scrutiny of the Group’s activities, as well as its ESG-related policies, goals, decisions, disclosures or communications. The Group’s reputation and ability to attract or retain customers may be harmed if its response to concerns regarding ESG-related matters is deemed to be insufficient or inappropriate or if a perception is generated among the different stakeholders that the Group’s statements, actions or disclosure do not fairly reflect the underlying sustainability profile of the Group, its products, services, goals and/or policies. At the same time, the Group may refrain from undertaking lending or investing activities or other services that would otherwise have been profitable in order to fulfill its ESG obligations or goals or to avoid reputational harm. Divergent views on ESG policies may also have a negative impact on the Group’s reputation. Increased scrutiny of the Group’s activities, as well as its ESG-related policies, goals, decisions, disclosures and communications, may result in litigation and investigations and supervisory actions (including potential greenwashing or greenhushing claims). The Group has disclosed certain aspirational ESG-related goals and such goals, which are being pursued over the long term, may prove to be considerably more costly or difficult than currently expected, or even impossible, to achieve, including as a result of changes in regulation and policy, the pace of technological change and innovation and the actions of governments and the Group’s customers and competitors. Potential greenwashing claims arising from ESG-related statements, disclosure and/or actions of the Group may also give rise to reputational risks. Any of these factors may have a material adverse effect on the Group’s business, financial condition and results of operations. The outbreak and spread of a pandemic and other large-scale public health events could have a material adverse effect on the Group’s business, financial condition and results of operations 13 Economic conditions in the countries in which the Group operates may be adversely affected by an outbreak of a contagious disease, which develops into a regional or global pandemic and other large scale public health events. The outbreak of a pandemic or another large-scale public health event may have an adverse material impact on our business, financial condition and results of operations, including as a result of the exacerbation of any of the other risks described in this section. Furthermore, the measures that may be taken by governments, regulators and businesses to respond to any such pandemic or event may lead to slower or negative economic growth, supply disruptions, inflationary pressures and significant increases in public debt, and may also adversely affect the Group’s counterparties (including borrowers), which may lead to increased loan losses. Such measures could also impact the business and operations of third parties that provide critical services to the Group, which may have an adverse material impact on our business, financial condition and results of operations. The Group faces risks related to its acquisitions and divestitures activity The Group has acquired and sold several companies, assets and/or businesses over the past few years, and may acquire or sell additional companies, assets and/or businesses in the future. The Group may not complete any ongoing or future transactions in a timely manner, on a cost-effective basis or at all and, if completed, they may not have the expected results. If any acquisitions or divestitures are completed, the Group’s results of operations could be adversely affected by such acquisition or divestiture-related charges and contingencies. The Group may be subject to litigation in connection with, or as a result of, acquisitions or divestitures, including claims from terminated employees, customers or third parties. In the case of an acquisition, the Group may be liable for potential or existing litigation and claims related to an acquired business, including because either the Group is not indemnified for such claims, or the indemnification is insufficient. Further, in the case of a divestiture, the Group may be required to indemnify the buyer in respect of similar or other matters, including claims against the divested entity or business. In the case of an acquisition, even though the Group reviews the companies it plans to acquire, it is often not possible for these reviews to be complete in all respects and there may be risks associated with unforeseen events or liabilities relating to the acquired companies, assets or businesses that may not have been revealed or properly assessed during the due diligence processes, resulting in the Group assuming unforeseen liabilities or an acquisition not performing as expected. In addition, acquisitions are inherently risky because of the difficulties that may arise in integrating people, operations and technologies. There can be no assurance that any of the companies, assets or businesses the Group acquires can be successfully integrated or that they will perform well once integrated. Furthermore, completion of any acquisition may constitute a breach or default under agreements or instruments of the company that is being acquired, or otherwise result in the acceleration of obligations (including, without limitation, payment obligations) or changes to rights thereunder or the termination thereof. In addition, BBVA may not be able to anticipate all losses, costs and other liabilities that may be incurred in connection with a transaction that is completed or may fail to accurately analyze or estimate the consequences of completing such a transaction, either of which could have an adverse effect on the Group’s business, financial condition and results of operations after completion of the transaction. Acquisitions may also lead to potential write-downs that adversely affect the Group’s results of operations. If an announced transaction is not completed, the market prices of BBVA’s securities may decline or otherwise be subject to fluctuations to the extent the market prices of BBVA’s securities reflect a market assumption that such a transaction would be completed. In addition, the failure to complete a transaction may result in negative publicity or otherwise adversely affect BBVA’s reputation in the investment community and BBVA’s relationship with its employees, clients and other partners in the business community. Following completion of a transaction, BBVA may be exposed to other risk factors specific to the company, asset or business being acquired or otherwise arising from such transaction. Furthermore, completion of a transaction may adversely affect the capital, leverage, liquidity, MREL (as defined below) or resolution profile of BBVA or the Group. Relevant regulators could also impose additional capital, leverage, liquidity, MREL or resolution requirements on the Group as a result of a transaction, which might require the Group to issue additional capital instruments or MREL and/or incur additional costs. Any of the foregoing may cause the Group to incur significant unexpected expenses, may divert significant resources and management attention from the Group’s other business concerns, or may otherwise have a material adverse effect on the Group’s business, financial condition and results of operations. FINANCIAL RISKS The Group has a continuous demand for liquidity to finance its activities and the withdrawal of deposits or other sources of liquidity could significantly affect it 14 Traditionally, one of the Group’s main sources of financing has been savings accounts and demand deposits. As of December 31, 2025, the balance of customer deposits represented 76.3% of the Group’s total financial liabilities at amortized cost. However, the volume of wholesale and retail deposits can fluctuate significantly, including as a result of factors beyond the Group’s control, such as general economic conditions, changes in economic policy or administrative decisions that diminish their attractiveness as savings instruments (for example, as a consequence of changes in taxation, coverage by guarantee funds for deposits or expropriations) or competition from other savings or investment instruments (including deposits from other banks). In the last years, competition for deposits has increased in various of the regions where the Group operates as interest rates have increased and competitors (including neobanks) have offered remuneration on customer deposits. The vast majority of the Group’s deposits are demand deposits, which may be freely withdrawn by depositors at any time. The methods for withdrawing or transferring deposits, and the speed with which such transactions may be realized, continue to increase, which could affect the stickiness of the Group’s deposit base. Changes in interest rates and credit spreads may significantly affect the cost of the Group’s short- and long-term wholesale financing. Changes in credit spreads are driven by market factors and are also influenced by the market’s perception of the Group’s solvency. As of December 31, 2025, debt securities issued by the Group represented 12.4% of the total financial liabilities at amortized cost of the Group. In addition, while the Group’s current use of public sources of liquidity is limited, the Group has historically made significant use of public sources of liquidity, such as the ECB’s extraordinary measures taken in response to the financial crisis since 2008 or those taken in connection with the crisis caused by the COVID-19 pandemic. In the event of a withdrawal of deposits or other sources of liquidity, especially if it is sudden or unexpected, the Group may not be able to finance its financial obligations or meet the minimum liquidity requirements that apply to it, and may be forced to incur higher financial costs, liquidate assets and take additional measures to reduce leverage. Furthermore, the Group could be subject to the adoption of early intervention measures or, ultimately, to the adoption of a resolution measure by the Relevant Spanish Resolution Authority (see “Item 4. Information on the Company—Business Overview—Supervision and Regulation—Capital Requirements, MREL and Resolution”). Any of the above could have a material adverse effect on the Group’s business, financial condition and results of operations. The Group depends on its credit ratings and sovereign credit ratings, especially Spain’s and Mexico’s credit ratings Rating agencies periodically review the Group’s debt credit ratings. Any reduction, effective or anticipated, in any such ratings of the Group, whether below investment grade or otherwise, could limit or impair the Group’s access to capital markets and other possible sources of liquidity and increase the Group’s financing cost, and entail the breach or early termination of certain contracts or give rise to additional obligations under those contracts, such as the need to grant additional guarantees. Furthermore, if the Group were required to cancel its derivative contracts with some of its counterparties and were unable to replace them, its market risk would worsen. Likewise, a reduction in the credit rating could affect the Group’s ability to sell or market some of its products or to participate in certain transactions, and could lead to the loss of customer deposits and make third parties less willing to carry out commercial transactions with the Group (especially those that require a minimum credit rating), having a material adverse effect on the Group’s business, financial condition and results of operations. Furthermore, the Group’s credit ratings could be affected by variations in sovereign credit ratings, particularly the rating of Spanish and Mexican sovereign debt. The Group holds a significant portfolio of debt issued by Spain, Spanish autonomous communities, Mexico and other Spanish and Mexican issuers. As of December 31, 2025 and 2024, the Group’s exposure (per European Banking Authority (“EBA”) criteria) to Spain’s public debt portfolio was €58,760 million and €51,833 million, respectively, representing 6.8% and 6.7% of the consolidated total assets of the Group, respectively. As of December 31, 2025 and 2024, the Group’s exposure (per EBA criteria) to Mexico’s public debt portfolio was €31,025 million and €31,681 million, respectively, representing 3.6% and 4.1% of the consolidated total assets of the Group, respectively. Any decrease in the credit rating of Spain or Mexico could adversely affect the valuation of the respective debt portfolios held by the Group and lead to a reduction in the Group’s credit ratings. Additionally, counterparties to many of the credit agreements signed with the Group could also be affected by a decrease in the credit rating of these countries, which could limit their ability to attract additional resources or otherwise affect their ability to pay their outstanding obligations to the Group. It is possible that current or future economic and geopolitical conditions or other factors could lead to ratings actions and changes to BBVA’s credit ratings, any of which could have a material adverse effect on the Group’s business, financial condition and results of operations. The trading market for securities issued by BBVA depends in part on the research reports of third-party securities analysts 15 The trading market for securities issued by BBVA depends in part on the research reports that third-party securities analysts publish about BBVA and the industry and the countries in which it operates. The publication by one or more of these analysts of a negative recommendation or unfavorable outlook with respect to BBVA or the industry and countries in which it operates could cause the trading price of any such securities to decline. The Group’s earnings and financial condition have been, and its future earnings and financial condition may continue to be, materially affected by asset impairment Regulatory, business, economic or political changes and other factors could lead to asset impairment. In recent years, severe market events such as the past sovereign debt crisis, rising risk premiums and falls in share market prices, have resulted in the Group recording large write-downs on its credit market exposures. Doubts regarding the asset quality of European banks have also affected their evolution in the market in recent years. Several ongoing factors could depress the valuation of the Group’s assets or otherwise lead to the impairment of such assets (including goodwill and deferred tax assets). These include a deteriorating macroeconomic and geopolitical environment, including the risk of a sharp global growth slowdown. Any asset impairments resulting from these or other factors could have a material adverse effect on the Group’s business, financial condition and results of operations. The Group has a substantial amount of commitments with personnel considered wholly unfunded due to the absence of qualifying plan assets The Group faces liquidity risk in connection with its ability to make payments on its unfunded commitments with personnel (which are recognized under the heading “Provisions—Provisions for pensions and similar obligations” in the Group’s consolidated balance sheet), which it seeks to mitigate, with respect to post-employment benefits, by maintaining insurance contracts which were contracted with insurance companies owned by the Group. The insurance companies have recorded in their balance sheets specific assets (fixed interest deposit and bonds) assigned to the funding of these commitments. The Group’s Assets and Liabilities Committee (“ALCO”) and the insurance companies also manage derivatives (primarily swaps) to mitigate the interest rate risk in connection with the payments of these commitments. The Group seeks to mitigate liquidity risk with respect to early retirements and post-employment welfare benefits through oversight by the ALCO of the Group. The Group’s ALCO manages a specific asset portfolio to mitigate the liquidity risk resulting from the payments of these commitments. These assets are government and covered bonds which are issued at fixed interest rates with maturities matching the aforementioned commitments. Should BBVA fail to adequately manage liquidity risk and interest rate risk either as described above or otherwise, it could have a material adverse effect on the Group’s business, financial condition and results of operations. LEGAL RISKS The Group is party to a number of legal and regulatory actions and proceedings The financial sector faces an environment of increasing regulatory and litigation pressure. The Group is party to government procedures and investigations, such as those carried out by the antitrust authorities which, among other things, have in the past and could in the future result in sanctions, as well as lead to claims by customers and others. The various Group entities are also frequently party to individual or collective judicial proceedings (including class actions) resulting from their activity and operations, as well as arbitration proceedings. For example, in April 2017, the Mexican Federal Economic Competition Commission (Comisión Federal de Competencia Económica) launched an antitrust investigation relating to alleged monopolistic practices of certain financial institutions, including BBVA’s subsidiary BBVA Mexico, in connection with transactions in Mexican government bonds. This investigation concluded with the Commission imposing fines on all financial institutions involved, including a fine insignificant in amount imposed on BBVA Mexico, which BBVA Mexico has challenged. In March 2018, BBVA Mexico and certain other affiliates of the Group were named as defendants in a putative class action lawsuit filed in the United States District Court for the Southern District of New York, alleging that the defendant banks and their named subsidiaries engaged in collusion with respect to the purchase and sale of Mexican government bonds. In December 2019, following a decision from the judge assigned to hear the proceedings, the plaintiffs withdrew their claims against BBVA Mexico’s affiliates. In November 2020, the judge granted the remaining defendants’ motion to dismiss for lack of personal jurisdiction. The plaintiffs filed a motion for reconsideration of that decision in May 2021, which the judge denied in March 2022. Final judgment dismissing the plaintiffs’ claims was entered in August 2022. In September 2022 the plaintiffs appealed the district court’s decisions to the United States Court of Appeals for the Second Circuit. 16 On February 9, 2024, the United States Court of Appeals for the Second Circuit vacated the district court’s decisions, and in June 2024, the plaintiffs filed an amended complaint in the United States District Court for the Southern District of New York. In July 2024, the defendants moved to dismiss the amended complaint. On January 15, 2025, the judge denied the defendants’ motion to dismiss. The case is ongoing. More generally, in recent years, regulators have increased their supervisory focus on consumer protection and corporate behavior, which has resulted in an increased number of regulatory actions. In Spain and in other jurisdictions where the Group operates, legal and regulatory actions and proceedings against financial institutions, prompted in part by certain national and supranational rulings in favor of consumers (with regards to matters such as credit cards and mortgage loans), have increased significantly in recent years and this trend could continue in the future. Legal and regulatory actions and proceedings faced by other financial institutions in relation to these and other matters, especially if such actions or proceedings result in favorable resolutions for the consumer, could also adversely affect the Group. See “Item 4. Information on the Company—Business Overview—Supervision and Regulation—Principal Markets” for information on certain additional legal and regulatory actions and initiatives. There are also claims before the Spanish courts challenging the validity of certain revolving credit card agreements. Rulings in these types of proceedings, whether against the Bank or other financial institutions, could negatively affect the Group. All of the above may result in a significant increase in operating and compliance costs and/or a reduction in revenues, and it is possible that an adverse outcome in any proceedings (depending on the amount thereof, the penalties imposed or the resulting procedural or management costs for the Group) could materially and adversely affect the Group, including by damaging its reputation. It is difficult to predict the outcome of legal and regulatory actions and proceedings, both those to which the Group is currently exposed and those that may arise in the future, including actions and proceedings relating to former Group subsidiaries or in respect of which the Group may have indemnification obligations. Any of such outcomes could be adverse to the Group. In addition, a decision in any matter, whether against the Group or against another credit entity facing similar claims as those faced by the Group, could give rise to other claims against the Group. In addition, these actions and proceedings draw resources away from the Group and may require significant attention on the part of the Group’s management and employees. As of December 31, 2025, the Group had €805 million in provisions for the proceedings it is facing. See Note 24 to the Consolidated Financial Statements. However, the uncertainty arising from these proceedings (including those for which no provisions have been made, either because the probability of an unfavorable outcome for the Group is estimated to be remote, because it is not possible to estimate such provisions or for other reasons) makes it impossible to guarantee that the possible losses arising from the resolution of these proceedings will not exceed, where applicable, the amounts that the Group currently has provisioned and, therefore, could affect the Group’s consolidated results. As a result of the above, legal and regulatory actions and proceedings currently faced by the Group or to which it may become subject in the future or which may otherwise affect the Group, whether individually or in the aggregate, if resolved in whole or in part adversely to the Group’s interests, could have a material adverse effect on the Group’s business, financial condition and results of operations. The Spanish judicial authorities are carrying out a criminal investigation relating to possible bribery and revelation of secrets by BBVA Spanish judicial authorities are investigating the activities of Centro Exclusivo de Negocios y Transacciones, S.L. (“Cenyt”). Such investigation includes the provision of services by Cenyt to BBVA. On July 29, 2019, BBVA was named as an investigated party (investigado) in a criminal judicial investigation (Preliminary Proceeding No. 96/2017 – Piece No. 9, Central Investigating Court No. 6 of the National High Court) for alleged facts which could constitute bribery, revelation of secrets and corruption. Certain current and former employees of the Group, as well as former directors and officers, have also been named as investigated parties in connection with this investigation. Since the beginning of the investigation, BBVA has been proactively collaborating with the Spanish judicial authorities, including sharing with the courts information obtained in the internal investigation hired by the entity in 2019 to contribute to the clarification of the facts. By order of the Criminal Chamber of the National High Court, the pre-trial phase ended on January 29, 2024. On June 20, 2024, the Judge issued an order authorizing the continuation of abbreviated criminal proceedings against BBVA and certain current and former employees of BBVA, as well as against some former directors and officers, for alleged facts which could constitute bribery and revelation of secrets. It is not possible at this time to predict the possible outcomes or implications for the Group of this matter, including any fines, damages or harm to the Group’s reputation caused thereby. REGULATORY, TAX, COMPLIANCE AND REPORTING RISKS 17 The financial services sector is one of the most regulated sectors in the world. The Group is subject to a broad regulatory and supervisory framework, which has increased significantly in the last decade. Regulatory activity in recent years has affected multiple areas, including changes in accounting standards; strict regulation of capital, liquidity and remuneration; bank charges and taxes on financial transactions; regulations affecting mortgages, banking products and consumers and users; recovery and resolution measures; stress tests; prevention of money laundering and terrorist financing; market abuse; conduct in the financial markets; conduct with clients; the protection of personal data; antitrust; anti-corruption; and requirements as to the periodic publication of information. Governments, regulatory authorities and other institutions continually make proposals to strengthen the resistance of financial institutions to future crises. Further, there is an increasing focus on the climate-related financial risk management capabilities of banks. Furthermore, the international nature of the Group’s operations means that the Group is subject to a wide and complex range of local and international regulations in these matters, sometimes with overlapping scopes and areas regulated. This complexity, which can be exacerbated by differences and changes in the interpretation or application of these standards by local authorities, makes compliance risk management difficult and costly, requiring highly sophisticated monitoring, qualified personnel and general training and awareness of employees. Any change in the Group’s business that is necessary to comply with any particular regulations at any given time, especially in Spain, Mexico or Turkey, could lead to a considerable loss of income, damage to the Group’s reputation, limit the Group’s ability to identify business opportunities, affect the valuation of its assets, force the Group to increase its prices and, therefore, reduce the demand for its products, impose additional costs on the Group or otherwise adversely affect its business, financial condition and results of operations. The Group is subject to a comprehensive regulatory and supervisory framework, including resolution regulations, which could have a material adverse effect on its business, financial condition and results of operations The Group is subject to a comprehensive regulatory and supervisory framework, the complexity and scope of which has increased significantly following the 2008 financial crisis and the crisis caused by the COVID-19 pandemic. In particular, the banking sector is subject to continuous scrutiny at the political level and by the supervisory bodies, and it is foreseeable that in the future there will continue to be political intervention in regulatory and supervisory processes, as well as in the governance of the main financial entities. For these reasons, the laws, regulations and policies to which the Group is subject, as well as their interpretation and application, may change at any time. In addition, supervisors and regulators have significant discretion in carrying out their duties, which gives rise to uncertainty regarding the interpretation and implementation of the regulatory framework. Moreover, regulatory fragmentation and the implementation by some countries of more flexible or stricter rules or regulations could also negatively affect the Group’s ability to compete with financial institutions that may or may not have to comply with any such rules or regulations, as applicable. Regulatory changes over the last decade, as well as those currently being proposed (including changes in the interpretation or application of existing regulations), have increased and may continue to substantially increase the Group’s operating expenses and adversely affect its business model. For example, the imposition of prudential capital standards has limited and is expected to continue to limit the ability of subsidiaries to distribute capital to the Group, while liquidity standards may lead the Group to hold a higher proportion of financial instruments with higher liquidity and lower performance, which can adversely affect its net interest margin. The Group’s regulatory and supervisory authorities may also require the Group to increase its loan loss allowances and record asset impairments, which could have an adverse effect on its financial condition. Any legislative or regulatory measure, any necessary change in the Group’s business operations as a consequence of such measures, as well as any failure to comply with them, could result in a significant loss of income or reputation, represent a limitation on the ability of the Group to take advantage of business opportunities and offer certain products and services, affect the value of the Group’s assets, force the Group to increase prices (which could reduce the demand for its products), impose additional compliance costs or result in other possible adverse effects for the Group. One of the most significant regulatory changes resulting from the 2008 financial crisis was the introduction of resolution regulations (see “Item 4. Information on the Company—Business Overview—Supervision and Regulation—Capital Requirements, MREL and Resolution”). In the event that the Relevant Spanish Resolution Authority (as defined herein) considers that the Group is in a situation where conditions for early intervention or resolution are met, it may adopt the measures provided for in the applicable resolution regulations, including without prior notice. Such measures could include, among others, the write down and/or conversion into equity (or other securities or obligations) of the Group’s unsecured debt. Likewise, the Relevant Spanish Resolution Authority may apply Non-Viability Loss Absorption (as defined herein) in the event that it determines that the entity meets the conditions for its resolution or that it will no longer be viable unless capital instruments are written down or converted into equity or extraordinary public support is provided. 18 Any such determination, or the mere possibility that such determination could be made, could materially and adversely affect the Group’s business, financial condition and results of operations, as well as the market price and behavior of certain securities issued by the Group or their terms, if amended following any exercise of the Spanish Bail-in Power (as defined herein)). Increasingly onerous capital and liquidity requirements may have a material adverse effect on the Group’s business, financial condition and results of operations The Group is subject to various minimum capital, liquidity and funding requirements, among others. For example, in its capacity as a Spanish credit institution, the Group is subject to compliance with a “Pillar 1” solvency requirement, a “Pillar 2” solvency requirement and a “combined buffer requirement”, at both the individual and consolidated levels. For additional information on such requirements, see “Item 4. Information on the Company—Business Overview—Supervision and Regulation—Capital Requirements, MREL and Resolution” and, with respect to the Group’s requirements in particular, “Item 5. Operating and Financial Review and Prospects—Liquidity and Capital Resources—Capital” and Note 32.1 to the Consolidated Financial Statements. While the Group believes it meets its current requirements (as applicable to BBVA and the Group as a whole, respectively), the capital requirements, the minimum requirement for own funds and eligible liabilities (“MREL”) and the calculation of the own funds and the eligible liabilities available for MREL purposes are subject to interpretation and change and, therefore, no assurance can be given that the Group’s interpretation is the appropriate one or that BBVA and/or the Group will not be subject to more stringent requirements at any future time. Likewise, no assurance can be given that BBVA and/or the Group will be able to fulfil whatever future requirements may be imposed, even if such requirements were to be equal or lower than those currently in force, or that BBVA and/or the Group will be able to comply with any capital target that may have been announced to the market. Any such failure could be adversely perceived by investors and/or supervisors who could interpret that a lack of capital-generating capacity for BBVA and/or the Group exists or that the capital structure has deteriorated, either of which could adversely affect the market value or behavior of securities issued by BBVA and/or the Group (in particular, any of its capital instruments and eligible liabilities). Further, BBVA and/or the Group may report amounts different from consensus estimates, which may also affect market perceptions of BBVA and the Group. If BBVA or the Group failed to comply with its “combined buffer requirement”, BBVA would have to calculate the Maximum Distributable Amount (“MDA”) and, until such calculation has been undertaken and reported to the Bank of Spain, BBVA would not be able to make any (i) distributions relating to CET1 capital; (ii) payments related to variable remuneration or discretionary pension benefits; and (iii) distributions linked to additional tier 1 (AT1) instruments (collectively, “discretionary payments”). Once the MDA has been calculated and reported, such discretionary payments would be limited to the calculated MDA. Likewise, should BBVA or the Group not meet the applicable combined buffer requirement, it could result in the imposition of additional requirements of “Pillar 2”. Regarding MREL, failure by BBVA to meet its respective “combined buffer requirement” for these purposes, taken together with its MREL requirements could result in the imposition of restrictions or prohibitions on discretionary payments (the MREL-MDA). Additionally, failure to comply with the capital requirements may result in the implementation of early intervention measures or, ultimately, resolution measures by the resolution authorities. For additional information on such requirements, see “Item 4. Information on the Company—Business Overview—Supervision and Regulation—Capital Requirements, MREL and Resolution”. Regulation (EU) No. 575/2013 of the European Parliament and of the Council of June 26, 2013 on the prudential requirements for credit institutions establishes a binding requirement for the leverage ratio effective from June 28, 2021 of 3.00% of Tier 1 capital (as of December 31, 2025 the phased-in and the fully loaded leverage ratios of the Group were 6.15%). Any failure to comply with this leverage ratio buffer may also result in the need to calculate and report the MDA, and restrictions on discretionary payments. Additionally, the implementation of the ECB expectations regarding prudential provisions for NPLs (published on May 15, 2018) and the ECB’s review of internal models being used by banks subject to its supervision for the calculation of their RWAs (“TRIM”), as well as complementary regulatory initiatives like the EBA’s roadmap to repair internal models used to calculate own funds requirements for credit risk under the Internal Ratings Based (IRB) approach, could result in the need to increase provisions for future NPLs and increases in the Group’s capital needs. Furthermore, the implementation of the Basel III reforms (informally referred to as Basel IV) described in “Item 4. Information on the Company—Business Overview—Supervision and Regulation—Capital Requirements, MREL and Resolution” (including changes to the calculation of the Group’s operational risk) could result in an increase of BBVA’s and the Group’s total RWAs and, therefore, could also result in a decrease of BBVA’s and the Group’s capital ratios. Likewise, the lack of uniformity in the implementation of the Basel III reforms across jurisdictions in terms of timing and applicable regulations could give rise to inequalities and competition distortions. Moreover, the lack of regulatory coordination, with some countries bringing forward the application of Basel III requirements or increasing such requirements, could adversely affect an entity with global operations such as the Group and could affect its profitability. 19 Additionally, should the Total Loss Absorbing Capacity (TLAC) requirements, currently only imposed upon financial institutions of global systemic importance (“G-SIBs”), be imposed on non-G-SIBs entities or should the Group once again be classified as a G-SIB, additional minimum requirements similar to MREL could in the future be imposed upon the Group. There can be no assurance that the capital or MREL requirements will not adversely affect BBVA’s or its subsidiaries’ ability to make discretionary payments, or result in the cancellation of such payments (in whole or in part), or require BBVA or such subsidiaries to issue additional securities that qualify as eligible liabilities or regulatory capital, to liquidate assets, to curtail business or to take any other actions, any of which may have adverse effects on the Group’s business, financial condition and results of operations. Furthermore, an increase in capital or MREL requirements could adversely affect the return on equity and other of the Group’s financial results indicators. Moreover, BBVA’s or the Group’s failure to comply with their capital or MREL requirements could have a material adverse effect on the Group’s business, financial condition and results of operations. Lastly, the Group must also comply with liquidity and funding ratios. Several elements of the liquidity coverage ratio (“LCR”) and net stable financing ratio (“NSFR”), as introduced by national banking regulators, have required implementing changes in some of the Group’s commercial practices, which have exposed the Group to additional expenses (including an increase in compliance expenses) and affected the profitability of its activities and could result in a material adverse effect on the Group’s business, financial condition and results of operations. For information on the Group’s requirements, see “Item 5. Operating and Financial Review and Prospects—Liquidity and Capital Resources”. The Group is exposed to tax risks that may adversely affect it The size, geographic diversity and complexity of the Group and its commercial and financial relationships with both third parties and related parties result in the need to consider, evaluate and interpret a considerable number of tax laws and regulations, as well as any relevant interpretative materials, which in turn involve the use of estimates, the interpretation of indeterminate legal concepts and the determination of appropriate valuations in order to comply with the tax obligations of the Group. In particular, the preparation of the Group’s tax returns and the process for establishing tax provisions involve the use of estimates and interpretations of tax laws and regulations, which are complex and subject to review by the tax authorities. Any error or discrepancy with tax authorities in any of the jurisdictions in which the Group operates may give rise to prolonged administrative or judicial proceedings that may have a material adverse effect on the Group’s results of operations. In addition, governments in different jurisdictions, including Spain, have sought to identify new funding sources, and they have recently focused on the financial sector, including in response to the demands of various political forces. The Group’s presence in various jurisdictions increases its exposure to regulatory and interpretative changes, which may include (i) increases in the tax rates to which the Group is subject, such as the introduction in Spain of a minimum effective tax rate for purposes of the Spanish Corporate Income Tax and the Non-Residents Income Tax introduced by Law 22/2021, of December 28, with effect as of January 1, 2022 (in particular, the minimum net tax liability for credit institutions is 18% of their tax base), and the introduction of a global minimum effective tax rate of corporate taxation (15%) for multinational enterprises and large-scale domestic groups in the EU introduced by the EU Council Directive 2022/2523 of December 14, 2022 that has already been transposed into Spanish law, or (ii) the creation of new taxes and/or levies, like the common financial transaction tax (“FTT”) in the proposed Tax Directive of the European Commission for the Financial Transactions Tax (which would tax the acquisitions of certain securities negotiated in markets where the Group operates) and the Spanish FTT which came into effect in Spain in January 2021. Further, in Spain, new taxes have been created that apply only to credit institutions. On December 19, 2024, the Spanish Congress passed Law 7/2024 which transposes the EU Council Directive 2022/2523, creating a new tax on the net interest income and commissions of certain credit institutions in Spain, including BBVA. The taxable base of this tax is the positive balance of the net interest income and the net commissions derived from the activity carried out in Spain, subject to an exemption of €100 million. The net taxable base cannot be negative, and the applicable tax rate varies from 1% to 7%. Certain reductions and deductions from the tax quota are provided for in the law. The new tax applies for the first three consecutive tax periods starting on or after January 1, 2024. For additional information, see “Item 4. Information on the Company—Business Overview—Supervision and Regulation—Principal Markets—Spain—Interest Margin and Commission Tax (IMIC)”. Increases in the tax burden of the Group could materially and adversely affect the Group’s business, financial condition and results of operations. The Group is exposed to compliance risks The Group, due to its role in the economy and the nature of its activities, is singularly exposed to certain compliance risks. In particular, the Group must comply with regulations regarding customer conduct, antitrust, market conduct, the prevention of money laundering and the financing of terrorist activities, the protection of personal data, the restrictions established by national or international sanctions programs and anti-corruption laws (including the U.S. Foreign Corrupt Practices Act of 1977 and the UK Bribery Act of 2010), the violations of which could lead to very significant penalties. 20 These anti-corruption laws generally prohibit providing anything of value to government officials for the purposes of obtaining or retaining business or securing any improper business advantage. As part of the Group’s business, the Group directly or indirectly, through third parties, deals with entities whose employees are considered to be government officials. Generally, all these regulations require banking entities to, among other measures, use due diligence measures to manage compliance risk. Sometimes, banking entities must apply enhanced due diligence measures due to the very nature of their activities (among others, private banking, money transfer and foreign currency exchange operations), as they may present a higher risk of money laundering or terrorist financing. Although the Group has adopted policies, procedures, systems and other measures to manage compliance risk, it is dependent on its employees and external suppliers for the implementation of these policies, procedures, systems and other measures, and it cannot guarantee that these are sufficient or that the employees (127,174 as of December 31, 2025) or other persons of the Group or its business partners, agents and/or other third parties with a business or professional relationship with the Group do not circumvent or violate regulations or the Group’s ethics and compliance regulations, acts for which such persons or the Group could be held ultimately responsible and/or that could damage the Group’s reputation. In particular, acts of misconduct by any employee, and particularly by senior management, could erode trust and confidence and damage the Group’s reputation among existing and potential clients and other stakeholders. Actual or alleged misconduct by Group entities in any number of activities or circumstances, including operations, employment-related offenses such as sexual harassment and discrimination, regulatory compliance, the use and protection of data and systems, and the satisfaction of client expectations, and actions taken by regulators or others in response to such misconduct, could lead to, among other things, sanctions, fines and reputational damage, any of which could have a material adverse effect on the Group’s business, financial condition and results of operations. Furthermore, the Group may not be able to prevent third parties outside the Group from using the banking network in order to launder money or carry out illegal or inappropriate activities. The inherent risk of money laundering has increased in recent years, due to the accelerated transformation of the financial services business model, including the digitalization of the customer relationship, increased complexity in clients (including clients’ legal structures), and the growing cross-border interconnection of operations and products. Further, financial crimes continually evolve and emerging technologies, such as cryptocurrencies and blockchain, could limit the Group’s ability to track the movement of funds. Additionally, in a context of adverse economic conditions and growing geopolitical tensions, it is possible that financial crime attempts will increase significantly. If there is a breach of the applicable regulations or the Group’s ethics and compliance regulations or if the competent authorities consider that the Group does not perform the necessary due diligence inherent to its activities, such authorities could impose limitations on the Group’s activities, the revocation of its authorizations and licenses, and economic penalties, in addition to having significant consequences for the Group’s reputation, which could have a material adverse effect on the Group’s business, financial condition and results of operations. Furthermore, the Group from time to time conducts investigations related to alleged violations of such regulations and the Group’s ethics and compliance regulations, and any such investigation or any related proceedings could be time consuming and costly, and its results difficult to predict. BBVA’s financial statements are based in part on assumptions and estimates which, if inaccurate, could cause material misstatement of the results of its operations and financial condition The preparation of financial statements in compliance with IFRS-IASB and EU-IFRS requires the use of estimates. It also requires management to exercise judgment in applying relevant accounting policies. The key areas involving a higher degree of judgment or complexity, or areas where assumptions are significant to the consolidated and individual financial statements, include the classification, measurement and impairment of financial assets, particularly where such assets do not have a readily available market price, the assumptions used to quantify certain provisions and for the actuarial calculation of post-employment benefit liabilities and commitments, the useful life and impairment losses of tangible and intangible assets, the valuation of goodwill and purchase price allocation of business combinations, the fair value of certain unlisted financial assets and liabilities, the recoverability of deferred tax assets and the exchange and inflation rates of certain countries where the Group operates. There is a risk that if the judgment exercised or the estimates or assumptions used subsequently turn out to be incorrect then this could result in significant loss to the Group beyond that anticipated or provided for, which could have a material adverse effect on the Group’s business, financial condition and results of operations. Observable market prices are not available for many of the financial assets and liabilities that the Group holds at fair value and a variety of techniques to estimate the fair value are used. Should the valuation of such financial assets or liabilities become observable, for example as a result of sales or trading in comparable assets or liabilities by third parties, this could result in a materially different valuation to the current carrying value in the Group’s financial statements. The further development of standards and interpretations under IFRS-IASB and EU-IFRS could also significantly affect the results of operations, financial condition and prospects of the Group. 21 OPERATIONAL RISKS Attacks, failures or deficiencies in the Group’s procedures, systems and security or those of third parties to which the Group is exposed could have a material adverse effect on the Group’s business, financial condition and results of operations, and could harm its reputation The Group’s activities depend to a large extent on its ability to process and report effectively and accurately on a high volume of highly complex transactions with numerous and diverse products and services, in different currencies and subject to different regulatory regimes. Therefore, it relies on information technology (“IT”) systems for data transmission, processing and storage. However, IT systems are vulnerable to various problems, such as hardware and software malfunctions, computer viruses, hacking, and physical damage to IT centers. BBVA’s exposure to these risks has increased significantly in recent years due to the Group’s implementation of its ambitious digital strategy. Currently, approximately 66% of new clients choose digital channels to start their relationship with BBVA. The Group suffers cybersecurity incidents and other attacks, failures or deficiencies in the Group’s procedures, systems and security from time to time. Such attacks, failures and deficiencies have from time to time in the past and may in the future lead to, among other things, the misappropriation of funds of the Group’s clients or the Group itself and the unauthorized disclosure, destruction or use of confidential information or personal data, as well as prevent the normal operation of the Group, and impair its ability to provide services and carry out its internal management. In addition, such attacks, failures or deficiencies have from time to time in the past and may in the future result in the loss of customers and business opportunities, damage to computers and systems, violation of regulations regarding data protection and/or other regulations, exposure to litigation, fines, sanctions or interventions, loss of confidence in the Group’s security measures, damage to its reputation, reimbursements and compensation, and additional regulatory compliance expenses and may have a material adverse effect on the Group’s business, financial condition and results of operations. Furthermore, it is possible that such attacks, failures or deficiencies will not be detected on time or ever. The Group is likely to be forced to spend significant additional resources to improve its security measures in the future. As cyber-attacks are becoming increasingly sophisticated and difficult to prevent (including as a result of the use of artificial intelligence), the Group may not be able to anticipate or prevent all possible vulnerabilities, nor implement preventive measures that are effective or sufficient. The prolific use of artificial intelligence technologies has increased the risk of unauthorized access to BBVA’s IT systems and client accounts and of unauthorized disclosure, destruction or use of confidential information or personal data. While there is potential for these technologies to support BBVA’s detection of and defense against unauthorized access attempts and accidental disclosures, malicious or negligent use of these technologies by employees or other third parties may increase these risks. For example, our employees or other third parties may input confidential information into a generative artificial intelligence system (in particular, a system that is managed, owned or controlled by a third party), thereby compromising our business operations or the integrity of BBVA’s proprietary information or client data. Any such incident of unauthorized access or disclosure could have a material adverse effect on the Group’s business, financial condition and results of operations, and could harm its reputation. The integrity of the Group’s communications and the security of its digital assets face an unprecedented structural challenge due to the advancement of quantum computing. The emergence of the so-called 'Q-Day'—the point at which a quantum computer becomes capable of breaking current public-key cryptography algorithms—represents a systemic risk to data confidentiality. The Group is exposed to the “Harvest Now, Decrypt Later” threat, wherein malicious actors intercept and store encrypted data with the intent of decrypting it once quantum technology matures. Furthermore, the emergence of quantum computing poses a significant risk regarding the potential breaking and forgery of digital signatures. Despite efforts to implement Quantum-Safe protocols and post-quantum cryptography (PQC) standards, the complexity of migrating legacy systems and the sheer speed of technological advancement could outpace the Group’s response capacity. Failure to ensure a timely transition to a quantum-resilient infrastructure could result in the vulnerability of sensitive historical information, compromising client trust and exposing the entity to significant legal and financial consequences. Customers and other third parties to which the Group is significantly exposed, including the Group’s service providers (such as providers of data processing or cloud computing services to which the Group has outsourced certain services), face similar risks. Any attack, failure or deficiency that may affect such third parties could, among other things, adversely affect the Group’s ability to carry out operations or provide services to its clients or result in the unauthorized disclosure, destruction or use of confidential information or personal data. Furthermore, the Group may not be aware of such attack, failure or deficiency in time, which could limit its ability to react. Moreover, as a result of the increasing consolidation, interdependence and complexity of financial institutions and technological systems, an attack, failure or deficiency that significantly degrades, eliminates or compromises the systems or data of one or more financial institutions could have a significant impact on its counterparts or other market participants, including the Group. Given the increasing consolidation among technology service providers, a systemic adverse event at a key third party could materially impact the Group’s operational continuity and its ability to provide core financial services in the markets where it operates, which could have a material adverse effect on the BBVA Group’s reputational standing or otherwise have a material adverse effect on the Group’s business, financial condition and results of operations. 22