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A. History and Development of the Company
BBVA’s predecessor bank, BBV (Banco Bilbao Vizcaya), was incorporated as a public limited company (a “sociedad anónima” or S.A.) under the Spanish Corporations Law on October 1, 1988. BBVA was formed following the merger of Argentaria into BBV (Banco Bilbao Vizcaya), which was approved by the shareholders of each entity on December 18, 1999 and registered on January 28, 2000. It conducts its business under the commercial name “BBVA”. BBVA is registered with the Commercial Registry of Vizcaya (Spain). It has its registered office at Plaza de San Nicolás 4, Bilbao, Spain, 48005, and operates out of Calle Azul, 4, 28050, Madrid, Spain (Telephone: +34-91-374-6201). BBVA’s agent in the U.S. for U.S. federal securities law purposes is Banco Bilbao Vizcaya Argentaria, S.A. New York Branch (Two Manhattan West 375 9th Avenue, 8th Floor, New York, New York 10001 (Telephone: +1-212-728-1660)). BBVA is incorporated for an unlimited term.
Capital Expenditures
Our principal investments are financial investments in our subsidiaries and affiliates. In 2025, 2024 and 2023, there were no significant capital expenditures.
Capital Divestitures
Our principal divestitures are divestitures in our subsidiaries and affiliates. In 2025, 2024 and 2023, there were no significant capital divestitures.
Public Information
The SEC maintains an Internet site (www.sec.gov) that contains reports and other information regarding issuers that file electronically with the SEC, including BBVA. See “Item 10. Additional Information—Documents on Display”. Additional information on the Group is also available on our website at https://shareholdersandinvestors.bbva.com. The information contained on such websites does not form part of this Annual Report.
B. Business Overview
The BBVA Group is a customer-centric global financial services group founded in 1857. Internationally diversified and with strengths in the traditional banking businesses of retail banking, asset management and wholesale banking, the Group is committed to offering a compelling digital proposition focused on customer experience.
For this purpose, the Group is focused on increasingly offering products online and through mobile channels, improving the functionality of its digital offerings and refining the customer experience, contributing to the delivery of its strategy in a sustainable and inclusive way. BBVA places sustainability at the core of its strategy. Sustainability is impacting the banking business, affecting not only relations with customers but also internal processes.
In 2025, the number of digital and mobile phone customers and the volume of online transactions continued to increase.
Operating Segments
As of December 31, 2025, the structure of the operating segments used by the BBVA Group for management purposes remained the same as in 2024.
Set forth below are the Group’s current five operating segments:
• Spain;
• Mexico;
• Turkey;
• South America; and
• Rest of Business.
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In addition to the operating segments referred to above, the Group has a Corporate Center which includes those items that have not been allocated to an operating segment. It includes the Group’s general management functions, including costs from central units that have a corporate function; management of structural exchange rate positions carried out by the ALCO, including currency hedging; certain proprietary portfolios; certain tax assets and liabilities; certain provisions related to commitments with employees; and goodwill and other intangibles, as well as the financing of such asset portfolios. It also includes the results of the Group’s stake in the venture capital fund Propel Venture Partners.
Following the publication of our consolidated financial statements as of and for the years ended December 31, 2024, 2023 and 2022 included in our annual report on Form 20-F for the year ended December 31, 2024, certain immaterial balance sheet amounts related to specific activities undertaken by the business units were reallocated between the operating segments and the Corporate Center. As a result, certain expenses were reallocated, in particular, between Spain, Rest of Business and the Corporate Center. In order to make the segment information as of and for the years ended December 31, 2024 and 2023 comparable with the segment information as of and for the year ended December 31, 2025, segment information as of and for the years ended December 31, 2024 and 2023 has been revised in conformity with these intra-group adjustments. These intra-group adjustments had no impact at the consolidated level.
The breakdown of the Group’s total assets by each of BBVA’s operating segments and the Corporate Center as of December 31, 2025, 2024 and 2023 was as follows:
As of December 31,
2025 2024 2023
(In Millions of Euros)
Spain 456,419 411,620 452,423
Mexico 182,525 168,470 173,489
Turkey 90,702 82,782 68,329
South America 76,648 73,997 64,779
Rest of Business 88,638 66,534 64,274
Subtotal Assets by Operating Segment 894,931 803,404 823,294
Corporate Center and Adjustments (1) (35,355) (31,002) (47,736)
Total Assets BBVA Group 859,576 772,402 775,558
(1)Includes balance sheet intra-group adjustments between the Corporate Center and the operating segments (see “Presentation of Financial Information—Changes in Intra-Group Adjustments” for information on such adjustments).
The following table sets forth information relating to the profit (loss) attributable to parent company for each of BBVA’s operating segments and the Corporate Center for the years ended December 31, 2025, 2024 and 2023. Such information is presented under management criteria; however, for the years ended December 31, 2025, 2024 and 2023, there are no differences between the sum of the income statements of our operating segments and the Corporate Center (calculated in accordance with management criteria used to report segment financial information) and the consolidated income statement of the Group. For additional information on the profit (loss) attributable to parent company for each of BBVA’s operating segments and the Corporate Center, see “Item 5. Operating and Financial Review and Prospects—Operating Results—Results of Operations by Operating Segment”.
Profit / (Loss) Attributable to Parent Company % of Profit / (Loss) Attributable to Parent Company (1)
For the year ended December 31,
2025 2024 2023 2025 2024 2023
(In Millions of Euros) (In Percentage)
Spain 4,175 3,752 2,690 36 34 28
Mexico 5,264 5,447 5,319 45 50 56
Turkey 805 611 527 7 6 6
South America 726 635 601 6 6 6
Rest of Business 627 511 403 5 5 4
Subtotal operating segments 11,597 10,956 9,541 100 100 100
Corporate Center (1,086) (901) (1,522)
Profit attributable to parent company 10,511 10,054 8,019
(1) Based on subtotal from operating segments.
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The following table sets forth certain summarized information relating to the income of each operating segment and the Corporate Center for the years ended December 31, 2025, 2024 and 2023. Such information is presented under management criteria; however, for the years ended December 31, 2025, 2024 and 2023, there are no differences between the sum of the income statements of our operating segments and the Corporate Center (calculated in accordance with management criteria used to report segment financial information) and the consolidated income statement of the Group. For additional information on the income of each of BBVA’s operating segments and the Corporate Center, see “Item 5. Operating and Financial Review and Prospects—Operating Results—Results of Operations by Operating Segment”.
Operating Segments
Spain Mexico Turkey South America Rest of Business Corporate Center Total
(In Millions of Euros)
December 2025
Net interest income / (expense) 6,588 11,424 3,079 4,830 828 (469) 26,280
Gross income 10,027 15,198 5,213 5,363 1,807 (678) 36,931
Operating profit / (loss) before tax 5,933 7,341 1,863 1,758 772 (1,440) 16,227
Profit / (loss) attributable to parent company 4,175 5,264 805 726 627 (1,086) 10,511
December 2024
Net interest income / (expense) 6,384 11,556 1,492 5,589 742 (495) 25,267
Gross income 9,443 15,337 4,212 5,405 1,472 (388) 35,481
Operating profit / (loss) before tax 5,263 7,522 1,741 1,342 648 (1,110) 15,405
Profit / (loss) attributable to parent company 3,752 5,447 611 635 511 (901) 10,054
December 2023
Net interest income / (expense) 5,570 11,054 1,869 4,394 539 (336) 23,089
Gross income 7,848 14,267 2,981 4,331 1,113 (999) 29,542
Operating profit / (loss) before tax 3,855 7,329 1,324 1,189 499 (1,777) 12,419
Profit / (loss) attributable to parent company 2,690 5,319 527 601 403 (1,522) 8,019
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The following tables set forth summarized information relating to the balance sheet of the operating segments and the Corporate Center and adjustments as of December 31, 2025, 2024 and 2023:
As of December 31, 2025
Spain Mexico Turkey South America Rest of Business Total Operating Segments Corporate Center and Adjustments (1)
(In Millions of Euros)
Total Assets 456,419 182,525 90,702 76,648 88,638 894,931 (35,355)
Cash, cash balances at central banks and other demand deposits 19,928 10,417 9,061 8,075 11,564 59,045 (208)
Financial assets at fair value (2) 119,919 59,528 5,010 10,499 2,032 196,988 (2,716)
Financial assets at amortized cost 263,566 105,972 72,047 54,336 74,448 570,369 (1,477)
Loans and advances to customers 192,958 97,259 53,745 51,151 66,502 461,616 (1,216)
Of which:
Residential mortgages 69,596 18,487 1,906 8,807 872 99,668
Consumer finance 17,596 15,331 7,900 10,297 815 51,940
Other households 5,857 2,242 2,929 900 238 12,166
Credit cards 2,797 11,098 11,033 3,800 26 28,755
Loans to enterprises 79,418 43,426 29,041 25,021 63,770 240,676
Loans to public sector 15,677 7,158 270 1,656 822 25,583
Total Liabilities 441,245 171,511 81,467 69,391 83,421 847,034 (49,256)
Financial liabilities held for trading and designated at fair value through profit or loss 82,785 32,406 1,690 2,428 766 120,074 (9,740)
Financial liabilities at amortized cost - Customer deposits 251,430 93,855 62,984 53,375 40,932 502,576 (75)
Of which:
Demand and savings deposits 198,559 77,148 31,340 32,945 20,888 360,881
Time deposits 39,887 16,669 31,194 20,430 20,044 128,224
Total Equity 15,174 11,014 9,235 7,257 5,217 47,897 13,901
Assets under management 119,535 69,533 26,290 8,289 736 224,383
Mutual funds 92,820 62,657 19,436 8,289 — 183,201
Pension funds 26,715 — 6,855 — 736 34,306
Other placements — 6,876 — — — 6,876
(1)Includes balance sheet intra-group adjustments between the Corporate Center and the operating segments (see “Presentation of Financial Information—Changes in Intra-Group Adjustments” for information on such adjustments).
(2)Financial assets at fair value includes: “Financial assets held for trading”, “Non-trading financial assets mandatorily at fair value through profit or loss”, “Financial assets designated at fair value through profit or loss” and “Financial assets at fair value through other comprehensive income”.
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As of December 31, 2024
Spain Mexico Turkey South America Rest of Business Total Operating Segments Corporate Center and Adjustments (1)
(In Millions of Euros)
Total Assets 411,620 168,470 82,782 73,997 66,534 803,404 (31,002)
Cash, cash balances at central banks and other demand deposits 12,734 12,564 8,828 8,906 8,348 51,379 (234)
Financial assets at fair value (2) 109,569 54,547 4,503 10,884 1,627 181,130 (1,798)
Financial assets at amortized cost 237,279 94,595 64,893 49,983 56,013 502,763 (362)
Loans and advances to customers 179,667 88,725 48,299 46,846 50,392 413,930 (1,453)
Of which:
Residential mortgages 67,975 16,280 1,636 8,011 679 94,580
Consumer finance 15,911 13,087 6,286 9,582 700 45,566
Other households 5,642 2,578 2,306 827 191 11,544
Credit cards 2,798 9,514 10,185 3,557 15 26,070
Loans to enterprises 71,877 40,745 27,605 23,041 48,155 211,423
Loans to public sector 12,516 6,840 225 1,645 654 21,879
Total Liabilities 396,475 156,743 74,537 66,907 61,501 756,163 (43,774)
Financial liabilities held for trading and designated at fair value through profit or loss 75,143 30,885 1,943 2,060 642 110,674 (9,131)
Financial liabilities at amortized cost - Customer deposits 226,391 84,949 58,095 50,738 27,432 447,605 41
Of which:
Demand and savings deposits 192,770 70,091 26,482 31,172 11,295 331,810
Time deposits 27,153 13,871 30,961 19,566 16,137 107,687
Total Equity 15,145 11,727 8,245 7,090 5,033 47,242 12,772
Assets under management 108,694 57,253 18,076 7,936 645 192,604
Mutual funds 82,852 52,528 12,949 7,936 — 156,264
Pension funds 25,841 — 5,128 — 645 31,614
Other placements — 4,726 — — — 4,726
(1)Includes balance sheet intra-group adjustments between the Corporate Center and the operating segments (see “Presentation of Financial Information—Changes in Intra-Group Adjustments” for information on such adjustments).
(2)Financial assets at fair value includes: “Financial assets held for trading”, “Non-trading financial assets mandatorily at fair value through profit or loss”, “Financial assets designated at fair value through profit or loss” and “Financial assets at fair value through other comprehensive income”.
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As of December 31, 2023
Spain Mexico Turkey South America Rest of Business Total Operating Segments Corporate Center and Adjustments (1)
(In Millions of Euros)
Total Assets 452,423 173,489 68,329 64,779 64,274 823,294 (47,736)
Cash, cash balances at central banks and other demand deposits 44,653 10,089 9,700 6,585 4,748 75,776 (359)
Financial assets at fair value (2) 141,045 60,379 3,692 10,508 15,475 231,099 (18,159)
Financial assets at amortized cost 216,334 96,342 51,543 44,508 43,363 452,089 (357)
Loans and advances to customers 173,168 88,112 37,416 41,213 39,322 379,231 (1,588)
Of which:
Residential mortgages 67,028 17,119 1,041 7,409 766 93,363
Consumer finance 14,949 12,862 4,908 9,335 646 42,699
Other households 5,593 2,613 1,200 833 221 10,460
Credit cards 2,575 9,695 6,734 2,595 13 21,611
Loans to enterprises 66,851 38,689 22,967 19,015 37,035 184,556
Loans to public sector 12,716 7,712 489 1,826 521 23,264
Total Liabilities 437,797 162,271 61,892 58,485 60,083 780,528 (60,235)
Financial liabilities held for trading and designated at fair value through profit or loss 111,682 28,492 1,878 3,289 14,831 160,173 (25,158)
Financial liabilities at amortized cost - Customer deposits 216,114 92,564 50,651 42,567 13,056 414,952 (1,465)
Of which:
Demand and savings deposits 187,937 76,156 23,100 26,080 5,170 318,443
Time deposits 28,067 14,770 26,221 16,488 7,885 93,431
Total Equity 14,626 11,218 6,438 6,294 4,191 42,766 12,500
Assets under management 97,253 53,254 7,768 5,525 566 164,366
Mutual funds 72,875 49,062 4,386 5,525 — 131,848
Pension funds 24,378 — 3,382 — 566 28,326
Other placements — 4,192 — — — 4,192
(1)Includes balance sheet intra-group adjustments between the Corporate Center and the operating segments (see “Presentation of Financial Information—Changes in Intra-Group Adjustments” for information on such adjustments).
(2)Financial assets at fair value includes: “Financial assets held for trading”, “Non-trading financial assets mandatorily at fair value through profit or loss”, “Financial assets designated at fair value through profit or loss” and “Financial assets at fair value through other comprehensive income”.
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Spain
This operating segment includes all of BBVA’s banking and non-banking businesses in Spain, other than those included in the Corporate Center. The primary business units included in this operating segment are:
•Spanish Retail Network: including individual customers, private banking, small companies and businesses in the domestic market;
•Corporate and Business Banking: which manages small and medium sized enterprises (“SMEs”), companies and corporations, and public institutions;
•Corporate and Investment Banking: responsible for business with large corporations and multinational groups and the trading floor and distribution business in Spain; and
•Other units: which includes the insurance business unit in Spain (BBVA Seguros) as well as the Group’s shareholding in Compañía de Seguros y Reaseguros, S.A., the Asset Management unit (which manages Spanish mutual funds and pension funds), lending to real estate developers and foreclosed real estate assets in Spain, as well as certain proprietary portfolios and certain funding and structural interest-rate positions of the euro balance sheet which are not included in the Corporate Center. During 2020, BBVA Seguros transferred to Allianz, Compañía de Seguros y Reaseguros, S.A. (“Allianz”), 50% of the share capital plus one share in BBVA Seguros Generales. Further to the purchase price paid by Allianz at such time, Allianz will need to pay to BBVA up to an additional €100 million if certain business goals and milestones are met. As of December 31, 2025 and 2024, BBVA recorded a portion of the amount corresponding to the earn-out for the respective last five years. As of December 31, 2023, BBVA received the total amount corresponding to the earn-out for the three years 2020 to 2023, which was not material for the consolidated financial statements of the BBVA Group.
Cash, cash balances at central banks and other demand deposits as of December 31, 2025 amounted to €19,928 million, a 56.5% increase compared with the €12,734 million recorded as of December 31, 2024, mainly driven by the narrowing of the credit gap (as loans increased less than deposits), the increase in cash balances held at the ECB through repurchase agreements and, to a lesser extent, the proceeds of debt issuances completed during 2025.
Financial assets at fair value of this operating segment (which includes the following portfolios: “Financial assets held for trading”, “Non-trading financial assets mandatorily at fair value through profit or loss”, “Financial assets designated at fair value through profit or loss” and “Financial assets at fair value through other comprehensive income”) amounted to €119,919 million as of December 31, 2025, a 9.4% increase from the €109,569 million recorded as of December 31, 2024, mainly as a result of the increase in loans and advances through reverse repurchase agreements in the corporate portfolio, and the increase in holdings of sovereign debt securities of European countries and equity instruments, partially offset by the decrease in derivatives and decreases in loans and advances to credit institutions (through reverse repurchase agreements), all of which were recorded under “Financial assets held for trading”.
Financial assets at amortized cost of this operating segment as of December 31, 2025 amounted to €263,566 million, an 11.1% increase compared with the €237,279 million recorded as of December 31, 2024. Within this heading, loans and advances to customers amounted to €192,958 million as of December 31, 2025, a 7.4% increase compared with the €179,667 million recorded as of December 31, 2024, mainly due to the increases in corporate loans, public sector loans and consumer loans. Loans to the public sector included the recognition of an asset under the “Financial assets at amortized cost - General Governments” line item in the balance sheet as of December 31, 2025, as a result of the €295 million payment corresponding to the new tax on the net interest margin and commissions of certain financial entities (the Interest Margin and Commission Tax or “IMIC”) for the year ended December 31, 2024, given that such payment was made but considered undue with respect to such year under the existing legal framework as of December 31, 2025 (see Note 14 to the Consolidated Financial Statements). In addition, within this heading, debt securities of this operating segment as of December 31, 2025 amounted to €55,491 million, a 29.7% increase compared with the €42,791 million recorded as of December 31, 2024, mainly as a result of an increase in holdings of sovereign debt securities of European countries recorded under “Financial assets at amortized cost”.
Financial liabilities held for trading and designated at fair value through profit or loss of this operating segment as of December 31, 2025 amounted to €82,785 million, a 10.2% increase compared with the €75,143 million recorded as of December 31, 2024, mainly due to the increase in deposits (through repurchase agreements), supported by higher liquidity in the financial system, partially offset by the decrease in derivatives.
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Customer deposits at amortized cost of this operating segment as of December 31, 2025 amounted to €251,430 million, an 11.1% increase compared with the €226,391 million recorded as of December 31, 2024, mainly due to the increase in time deposits from public institutions (through repurchase agreements) within the Corporate and Investment Banking portfolio, supported by higher short-term liquidity placements of the public sector within a low interest rate environment, increases in time deposits within the corporate portfolio and the increase in demand deposits from households.
Off-balance sheet funds of this operating segment (which includes “Mutual funds” (including customers’ portfolios) and “Pension funds”) as of December 31, 2025 amounted to €119,535 million, a 10.0% increase compared with the €108,694 million recorded as of December 31, 2024, mainly due to the shift towards mutual funds from other instruments, as declining interest rates reduced deposit yields and boosted the performance of fixed-income and equity funds.
This operating segment’s non-performing loan ratio (defined as non-performing loans divided by total credit risk and calculated as the sum of impaired loans and advances to customers, impaired guarantees to customers and other impaired commitments divided by the sum of loans and advances to customers, guarantees to customers and other commitments) decreased to 3.0% as of December 31, 2025 from 3.7% as of December 31, 2024. This ratio was positively affected by the sale of non-performing loan portfolios and a decrease in the amount of non-performing retail loans due to improvements in collateralized loans, and increases in corporate loans, loans to the public sector and consumer loans, increasing the overall loans and advances to customers in the ratio’s denominator. This operating segment’s non-performing loan coverage ratio (defined as allowance for credit losses divided by non-performing loans and calculated as loss allowances on loans and advances divided by the sum of impaired loans and advances to customers, impaired guarantees to customers and other impaired commitments) increased to 67% as of December 31, 2025 from 59% as of December 31, 2024.
Mexico
The Mexico operating segment includes the banking, insurance and asset management business conducted in Mexico by BBVA Mexico. It also includes BBVA Mexico’s agency in Houston.
The Mexican peso appreciated 2.0% against the euro as of December 31, 2025 compared with December 31, 2024. See “Item 5. Operating and Financial Review and Prospects―Operating Results―Factors Affecting the Comparability of our Results of Operations and Financial Condition―Trends in Exchange Rates”.
Cash, cash balances at central banks and other demand deposits as of December 31, 2025 amounted to €10,417 million, a 17.1% decrease compared with the €12,564 million recorded as of December 31, 2024, mainly driven by the decrease in cash balances at the Mexican Central Bank (“BANXICO”), through repurchase agreements activity, partially offset by the proceeds of debt issuances completed during the year ended December 31, 2025.
Financial assets at fair value of this operating segment (which includes the following portfolios: “Financial assets held for trading”, “Non-trading financial assets mandatorily at fair value through profit or loss”, “Financial assets designated at fair value through profit or loss” and “Financial assets at fair value through other comprehensive income”) as of December 31, 2025 amounted to €59,528 million, a 9.1% increase from the €54,547 million recorded as of December 31, 2024, mainly due to the increase in loans and advances through reverse repurchase agreements recorded under “Financial assets held for trading”.
Financial assets at amortized cost of this operating segment as of December 31, 2025 amounted to €105,972 million, a 12.0% increase compared with the €94,595 million recorded as of December 31, 2024. Within this heading, loans and advances to customers of this operating segment as of December 31, 2025 amounted to €97,259 million, a 9.6% increase compared with the €88,725 million recorded as of December 31, 2024, mainly as a result of increases in the volume of mortgages and consumer loans within the retail loan portfolio.
Financial liabilities held for trading and designated at fair value through profit or loss of this operating segment as of December 31, 2025 amounted to €32,406 million, a 4.9% increase compared with the €30,885 million recorded as of December 31, 2024, mainly as a result of the increase in deposits from financial institutions resulting from repurchase agreements, partially offset by decreases in short positions.
Customer deposits at amortized cost of this operating segment as of December 31, 2025 amounted to €93,855 million, a 10.5% increase compared with the €84,949 million recorded as of December 31, 2024, mainly as a result of increases in time deposits from the household and the corporate portfolios.
Off-balance sheet funds of this operating segment (which includes “Mutual funds” (including customers’ portfolios) and “Other placements”) as of December 31, 2025 amounted to €69,533 million, a 21.4% increase compared with the €57,253 million as of December 31, 2024, mainly as a result of the continuing search by customers for higher-return investments, which continued to boost mutual funds.
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This operating segment’s non-performing loan ratio (as defined herein) stood at 2.7% as of December 31, 2025 and 2024. The impact of the increase in the non-performing loan entries in the retail loan portfolio on the ratio was partially offset by decreases in the non-performing wholesale loan portfolio. This operating segment’s non-performing loan coverage ratio (as defined herein) increased to 124% as of December 31, 2025 from 121% as of December 31, 2024, mainly due to the higher coverage requirements in the retail portfolio as a result of the deterioration of the macroeconomic outlook.
Turkey
This operating segment comprises the activities carried out by Garanti BBVA as an integrated financial services group operating in the banking, insurance and asset management business in Turkey, including corporate, commercial, SME, payment systems, retail, private and investment banking, together with its subsidiaries in pension and life insurance, leasing, factoring, brokerage and asset management, as well as its international subsidiaries in Romania and the Netherlands.
The Turkish lira depreciated 27.2% against the euro as of December 31, 2025 compared to December 31, 2024, adversely affecting the business activity of the Turkey operating segment as of December 31, 2025 expressed in euros. See “Item 5. Operating and Financial Review and Prospects―Operating Results―Factors Affecting the Comparability of our Results of Operations and Financial Condition―Trends in Exchange Rates”.
Since the first half of 2022, the Turkish economy has been considered to be hyperinflationary as defined by IAS 29 “Financial Reporting in Hyperinflationary Economies”. See “Presentation of Financial Information—Hyperinflationary Economies” and Note 2.2.18 to the Consolidated Financial Statements for information on the impact of hyperinflation accounting. Regulation and monetary policy, including the liraization strategy adopted by the CBRT to protect the Turkish lira, has affected this operating segment. See “Item 4. Information on the Company―Business Overview—Supervision and Regulation—Principal Markets—Turkey” for information on certain regulation that is relevant to our operations.
Cash, cash balances at central banks and other demand deposits as of December 31, 2025 amounted to €9,061 million, a 2.6% increase compared with the €8,828 million recorded as of December 31, 2024, mainly driven by the increase in equity, due to retained earnings, the proceeds of debt issuances completed during the year together with foreign currency deposit accumulation partially offset by an increase in the credit gap (loans grew more than deposits) and the depreciation of the Turkish lira against the euro.
Financial assets at fair value of this operating segment (which includes the following portfolios: “Financial assets held for trading”, “Non-trading financial assets mandatorily at fair value through profit or loss”, “Financial assets designated at fair value through profit or loss” and “Financial assets at fair value through other comprehensive income”) as of December 31, 2025 amounted to €5,010 million, an 11.2% increase from the €4,503 million recorded as of December 31, 2024, mainly due to the increase in local currency-denominated debt securities, whose valuation increased supported by the decrease in interest reference rates during the year ended December 31, 2025, offset, to a great extent, by the depreciation of the Turkish lira against the euro.
Financial assets at amortized cost of this operating segment as of December 31, 2025 amounted to €72,047 million an 11.0% increase compared with the €64,893 million recorded as of December 31, 2024. Within this heading, loans and advances to customers of this operating segment as of December 31, 2025 amounted to €53,745 million, an 11.3% increase compared with the €48,299 million recorded as of December 31, 2024, mainly due to the increase in the volume of Turkish lira-denominated consumer and wholesale loans, due, in part, to the measures adopted by the Turkish authorities (e.g., the lessening of loan reserve requirements) to encourage Turkish lira-denominated loans (see “—Supervision and Regulation—Principal Markets—Turkey”), partially offset by the depreciation of the Turkish lira against the euro. In addition, within this heading, debt securities of this operating segment amounted to €6,299 million, a 15.1% decrease from the €7,417 million recorded as of December 31, 2024, as a result of the depreciation of the Turkish lira against the euro, partially offset by increases in the volume of local currency-denominated bonds as part of our liquidity management measures. Further, loans and advances to central banks increased in the year ended December 31, 2025, as a result of increases in the volume of Turkish lira deposits and the continued existence of reserve ratio requirements applicable to Turkish lira deposits established by the CBRT during the period. See “—Supervision and Regulation—Principal Markets—Turkey”.
Financial liabilities held for trading and designated at fair value through profit or loss of this operating segment as of December 31, 2025 amounted to €1,690 million, a 13.1% decrease compared with the €1,943 million recorded as of December 31, 2024, mainly due to the depreciation of the Turkish lira against the euro, partially offset by the increase in debt certificates issued by Garanti BBVA.
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Customer deposits at amortized cost of this operating segment as of December 31, 2025 amounted to €62,984 million, an 8.4% increase compared with the €58,095 million recorded as of December 31, 2024, mainly due to the increase in Turkish lira-denominated retail and wholesale demand deposits and wholesale time deposits due in part to the phase-out of the foreign currency-protected deposit scheme (“KKM”) scheme resulting in the transfer of foreign currency deposits towards Turkish lira deposits, and certain additional measures adopted by the Turkish authorities to encourage and protect deposits denominated in Turkish lira and prevent further dollarization of deposits, which included the increase —in May 2025— in the reserve requirements applicable to deposits denominated in foreign currencies (see “—Supervision and Regulation—Principal Markets—Turkey”)), partially offset by the depreciation of the Turkish lira against the euro.
Off-balance sheet funds of this operating segment (which includes “Mutual funds” and “Pension funds”) as of December 31, 2025 amounted to €26,290 million, a 45.4% increase compared with the €18,076 million as of December 31, 2024, mainly due to increases in mutual funds as a result of the shift towards higher-return investments, partially offset by the depreciation of the Turkish lira against the euro.
The non-performing loan ratio (as defined herein) of this operating segment increased to 3.9% as of December 31, 2025 from 3.1% as of December 31, 2024, mainly as a result of the increase in the balance of non-performing retail loans (mainly credit card and consumer loans) due, in part, to a deterioration in credit quality as a result of the lower repayment capacity of retail customers, as interest rates have grown at a greater pace than inflation within the period, partially offset by the increase in the volume of Turkish lira-denominated consumer and wholesale loans. This operating segment’s non-performing loan coverage ratio (as defined herein) decreased to 76% as of December 31, 2025 from 96% as of December 31, 2024, mainly due to new Stage 3 entries and lower requirements from the wholesale portfolio.
South America
The South America operating segment includes the Group’s banking, finance, insurance and asset management business mainly in Argentina, Chile, Colombia, Peru, Uruguay and Venezuela.
The main business units included in the South America operating segment are:
•Retail and Corporate Banking: includes banks in Argentina, Chile, Colombia, Peru, Uruguay and Venezuela.
•Insurance: includes insurance businesses in Argentina, Colombia and Venezuela.
As of December 31, 2025, the Argentine peso and the Peruvian sol depreciated against the euro by 37.4% and 1.2%, respectively, compared to December 31, 2024. On the other hand, the Colombian peso appreciated against the euro by 3.8% compared to December 31, 2024. Overall, changes in exchange rates resulted in a negative exchange rate effect on the business activity of the South America operating segment as of December 31, 2025 expressed in euros. See “Item 5. Operating and Financial Review and Prospects―Operating Results―Factors Affecting the Comparability of our Results of Operations and Financial Condition―Trends in Exchange Rates”.
As of and for the years ended December 31, 2025, 2024 and 2023, the Argentine and Venezuelan economies were considered to be hyperinflationary as defined by IAS 29 “Financial Reporting in Hyperinflationary Economies”. See “Presentation of Financial Information—Hyperinflationary Economies” and Note 2.2.18 to the Consolidated Financial Statements for information on the impact of hyperinflation accounting.
Cash, cash balances at central banks and other demand deposits as of December 31, 2025 amounted to €8,075 million, a 9.3% decrease compared with the €8,906 million recorded as of December 31, 2024, mainly driven by the credit gap widening (as loans increased more than deposits) in Colombia and Peru and the depreciation of the Argentine peso against the euro.
Financial assets at fair value for this operating segment (which includes the following portfolios: “Financial assets held for trading”, “Non-trading financial assets mandatorily at fair value through profit or loss”, “Financial assets designated at fair value through profit or loss” and “Financial assets at fair value through other comprehensive income”) as of December 31, 2025 amounted to €10,499 million, a 3.5% decrease compared with the €10,884 million recorded as of December 31, 2024, mainly due to the depreciation of the Argentine peso against the euro, partially offset by the increase in debt securities in Argentina and the increase in derivatives in Colombia.
Financial assets at amortized cost of this operating segment as of December 31, 2025 amounted to €54,336 million, an 8.7% increase compared with the €49,983 million recorded as of December 31, 2024. Within this heading, loans and advances to customers of this operating segment as of December 31, 2025 amounted to €51,151 million, a 9.2% increase compared with the €46,846 million recorded as of December 31, 2024, mainly as a result of increases in corporate loans in Argentina and Colombia and increases in household loans in Argentina and Peru, partially offset by the depreciation of the Argentine peso against the euro.
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Financial liabilities held for trading and designated at fair value through profit or loss of this operating segment as of December 31, 2025 amounted to €2,428 million, a 17.9% increase compared with the €2,060 million recorded as of December 31, 2024, mainly due to increases in derivatives in Colombia.
Customer deposits at amortized cost of this operating segment as of December 31, 2025 amounted to €53,375 million, a 5.2% increase compared with the €50,738 million recorded as of December 31, 2024, mainly as a result of the increase in demand deposits in the household portfolios in Peru and Colombia, and in the wholesale portfolios in Argentina, and the increase in time deposits in the wholesale portfolios in Colombia and Argentina, partially offset by the depreciation of the Argentine peso against the euro.
Off-balance sheet funds of this operating segment (which includes “Mutual funds”, including customers’ portfolios, in Argentina, Colombia and Peru) as of December 31, 2025 amounted to €8,289 million, a 4.5% increase compared with the €7,936 million as of December 31, 2024, mainly due to increases in mutual funds in Peru and, to a lesser extent, in Colombia and Argentina, as a result of the shift towards higher-return investments, partially offset by the depreciation of the Argentine peso against the euro.
The non-performing loan ratio (as defined herein) of this operating segment as of December 31, 2025 decreased to 4.0% from 4.5% as of December 31, 2024, mainly as a result of the decrease in non-performing loans in the retail portfolios in Peru and Colombia, partially offset by higher impairment requirements in the retail loan portfolio un Argentina. This operating segment’s non-performing loan coverage ratio (as defined herein) increased to 92% as of December 31, 2025, from 88% as of December 31, 2024 as a result of the abovementioned decreases in non-performing loans in the retail portfolios in Peru and Colombia.
Rest of Business
This operating segment mainly includes the wholesale activity carried out by the Group in Europe (excluding Spain), the United States and (through BBVA branches located therein) Asia, as well as the Group’s digital banks in Italy and Germany.
The U.S. dollar depreciated 11.6% against the euro as of December 31, 2025 compared to December 31, 2024, adversely affecting the business activity of the Rest of Business operating segment as of December 31, 2025 expressed in euros. See “Item 5. Operating and Financial Review and Prospects―Operating Results―Factors Affecting the Comparability of our Results of Operations and Financial Condition―Trends in Exchange Rates”.
Cash, cash balances at central banks and other demand deposits as of December 31, 2025 amounted to €11,564 million, a 38.5% increase compared with the €8,348 million recorded as of December 31, 2024, mainly driven by the increase in cash balances held at central banks through repurchase agreements within this operating segment, in particular, at the Federal Reserve System, due in part to the shift towards liquid trading assets, which typically offer higher short-term yields and, to a lesser extent increases in other demand deposits, partially offset by the depreciation of the U.S. dollar against the euro.
Financial assets at fair value for this operating segment (which includes the following portfolios: “Financial assets held for trading”, “Non-trading financial assets mandatorily at fair value through profit or loss”, “Financial assets designated at fair value through profit or loss” and “Financial assets at fair value through other comprehensive income”) as of December 31, 2025 amounted to €2,032 million, a 24.9% increase compared with the €1,627 million recorded as of December 31, 2024, mainly due to the increase in loans and advances in Europe, partially offset by the depreciation of the U.S. dollar against the euro.
Financial assets at amortized cost of this operating segment as of December 31, 2025 amounted to €74,448 million, a 32.9% increase compared with the €56,013 million recorded as of December 31, 2024. Within this heading, loans and advances to customers of this operating segment as of December 31, 2025 amounted to €66,502 million, a 32.0% increase compared with the €50,392 million recorded as of December 31, 2024, mainly due to increased wholesale loans in the branches located in New York, Europe and Asia driven by increased activity amid a lower interest rate environment, partially offset by the depreciation of the U.S. dollar against the euro.
Financial liabilities held for trading and designated at fair value through profit or loss of this operating segment as of December 31, 2025 amounted to €766 million, a 19.3% increase compared with the €642 million recorded as of December 31, 2024, mainly due to the increase in deposits (through repurchase agreements) in BBVA Securities Inc., our broker-dealer in the United States, partially offset by the depreciation of the U.S. dollar against the euro.
Customer deposits at amortized cost of this operating segment as of December 31, 2025 amounted to €40,932 million, a 49.2% increase compared with the €27,432 million recorded as of December 31, 2024, mainly as a result of the growth in household demand deposits through our digital banking offerings in Europe and the increase in wholesale demand deposits in Asia and Europe.
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Off-balance sheet funds of this operating segment as of December 31, 2025 amounted to €736 million, a 14.2% increase compared with the €645 million recorded as of December 31, 2024, mainly due to increases in the balance of pension funds in the branches located in Europe, as declining interest rates reduced deposit yields and boosted the performance of fixed-income and equity funds.
The non-performing loan ratio (as defined herein) of this operating segment as of December 31, 2025 decreased to 0.2% from 0.3% as of December 31, 2024, mainly due to the increased wholesale loans in the branches located in New York, Europe and Asia (which led to an increase in the denominator) driven by increased activity amid a lower interest rate environment and decreases in non-performing loans. This operating segment’s non-performing loan coverage ratio (as defined herein) increased to 173% as of December 31, 2025 from 102% as of December 31, 2024 mainly as a result of the decrease in non-performing loans, in particular in Europe and increases in the coverage level of certain corporate loans.
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Insurance Activity
The Group has insurance subsidiaries mainly in Spain, Latin America (mostly in Mexico) and Turkey. The insurance entities located in Spain and Mexico together accounted for approximately 95% of total liabilities under insurance and reinsurance contracts as of December 31, 2025. The main products offered by the insurance subsidiaries are life insurance to cover the risk of death and life-savings insurance. Within life insurance, a distinction is made between freely sold products and those offered to customers who have taken mortgage or consumer loans, which cover the principal of those loans in the event of the customer’s death.
The Group offers, in general, two types of savings products: individual insurance, which seeks to provide the customer with savings for retirement or other events, and collective insurance, which is taken out by employers to cover their commitments to their employees.
See Note 23 to the Consolidated Financial Statements for additional information on our insurance activity, including its risk management.
Monetary Policy
The integration of Spain into the European Monetary Union (“EMU”) on January 1, 1999 implied the yielding of monetary policy sovereignty to the Eurosystem. The “Eurosystem” is composed of the ECB and the national central banks of the 20 member countries that form the EMU.
The Eurosystem determines and executes the policy for the single monetary union of the 21 member countries of the EMU. The Eurosystem collaborates with the central banks of member countries to take advantage of the experience of the central banks in each of its national markets. The basic tasks carried out by the Eurosystem include:
•defining and implementing the single monetary policy of the EMU;
•conducting foreign exchange operations in accordance with the set exchange policy;
•lending to national monetary financial institutions in collateralized operations;
•holding and managing the official foreign reserves of the member states; and
•promoting the smooth operation of the payment systems.
In addition, the Treaty on the EU (“EU Treaty”) establishes a series of rules designed to safeguard the independence of the system, in its institutional as well as its administrative functions.
Supervision and Regulation
This section discusses the most significant supervision and regulatory matters applicable to us as a bank organized under the laws of Spain, our principal market, and as a result of activities we undertake in the European Union. Further below, this section also includes information regarding supervision and regulatory matters applicable to our operations in Mexico, Turkey and the United States.
The Bank’s “home” supervisor is the ECB at the European level and the Bank of Spain at the national level, both authorities being part of the Single Supervisory Mechanism (“SSM”). The BBVA Group is also subject to supervision by a wide variety of other local authorities given the Bank’s global presence, which are considered to be “host” supervisors given the Bank’s foreign origin. These include authorities in countries such as the United States (the Federal Reserve Bank of New York (“FRBNY”) has the primary supervisory responsibility for the Bank’s New York branch, with input from other Federal and State authorities that have supervisory responsibilities for various BBVA entities operating in the United States), Mexico, Turkey and the whole of BBVA’s footprint in South America.
Following the 2008 financial crisis, European politicians took action to stabilize the region’s banking sector, due to a period of turbulence and doubts regarding its sustainability. This action culminated in the launch of the European Banking Union (“EBU”).
In 2024, the EU approved the transposition into domestic law of a final set of rules forming part of the Basel III framework Regulation (EU) 2024/1623, which constitutes a reform of the prudential regulatory framework (Capital Requirements Regulation and Directive). These new rules came into force on January 1, 2025, and their main objective is to make capital ratios more comparable among banks by imposing restrictions on banks that use their own internal models to calculate capital requirements.
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The first pillar of the EBU relates to supervision and includes the SSM, which unified banking supervision in the European Union. This responsibility was placed under the ECB, which follows a strict policy of separation and confidentiality in order to ensure the independence of banking supervision and monetary policy. The SSM works in very close coordination with the national competent authorities (“NCAs”). As a result, the joint supervisory teams (“JSTs”) that are responsible for the daily supervision of the most significant banks (one JST per bank) are composed of employees from the ECB and, in the case of BBVA, mainly from the Bank of Spain, who rotate periodically.
The second pillar of the EBU relates to resolution mechanisms and includes the Single Resolution Mechanism (“SRM”), for which the Single Resolution Board (“SRB”) was created. The SRB, located in Brussels, works closely with the National Resolution Authorities (“NRAs”), and, in the case of Spain, the Bank of Spain and the Spanish Executive Resolution Authority (“FROB”), to ensure the orderly resolution of failing banks.
The role of the SRB is proactive and focuses on resolution planning and preparation with a forward-looking mindset to avoid the negative impacts of a bank failure on the economy and financial stability of the participating EU member states and other countries. Accordingly, one of the key tasks of the SRB and NRAs is to draft resolution plans for the banks under its remit. These plans are prepared jointly by the SRB and NRAs through internal resolution teams (“IRTs”). The IRTs are composed of staff from the SRB and the NRAs and are headed by coordinators appointed from the SRB’s senior staff.
Bank resolution regulation was adopted following the 2008 financial crisis to minimize the extent to which taxpayer funds would be used to rescue failing financial institutions. The idea that underlies bank resolution regulation is that a “bail-in” is preferable to a “bail-out”. A “bail-out” occurs when a government rescues a bank by providing capital and/or liquidity support. On the other hand, a “bail-in” occurs when a bank’s creditors (in addition to its shareholders) are forced to bear some of the burden by having some or all of their debt written off. See “—Capital Requirements, MREL and Resolution” below.
Within the framework of the SRM, the Single Resolution Fund (“SRF”) was also developed. This is a fund composed of contributions from credit institutions and certain investment firms in the 21 participating countries within the EBU and may be used only under specific circumstances in banking resolution, such as to guarantee the assets or liabilities of an institution under resolution or make contributions to a bridge institution or asset management vehicle. The SRF can be used only to ensure the effective application of resolution tools but not to absorb the losses of an institution or for a recapitalization.
The first and second pillars of the EBU are highly interlinked. Prior to entering into a resolution process, a bank must be considered by the SSM as failing or likely to fail, which occurs when there is no other option to restore its viability (such as applying the bank’s recovery plan) within the available time frame.
The third and final pillar of the EBU, which is still under discussion, is the European Deposit Insurance Scheme (“EDIS”). The EDIS would provide the same level of insurance for deposits regardless of the country of origin of the bank, thus creating a fully harmonized banking union. Furthermore, it would enhance risk sharing mechanisms within the EBU. In May 2024, the Committee of Economic and Monetary Affairs (ECON) approved the EDIS Proposal; however, the plenary scheduled vote was postponed indefinitely.
At the national level, BBVA is required to make contributions to the Deposit Guarantee Fund of Credit Institutions.
Banks in the EBU face increasingly intense supervisory scrutiny, in particular with respect to asset quality and capital and liquidity levels. The Supervisory Review and Examination Process (“SREP”) is an annual exercise that determines a bank’s capital requirements, on a “Pillar 2” basis, as well as the qualitative requirements that the bank must address in the following year. This exercise takes four different elements of a bank into account: (a) business model and profitability, (b) capital, (c) liquidity and (d) governance and risk management.
In addition, any work done during the year related to on-site inspections, deep dives, thematic reviews, internal model investigations and other ad hoc requests (e.g., targeted review) feeds into the SREP. The SREP culminates with a supervisory dialogue at the end of the year, where a preliminary review of the bank is presented. In addition, prior to the beginning of each year, the SSM presents a Supervisory Examination Program (“SEP”) which details the inspections, high-level meetings and potential visits to group subsidiaries that are forecasted to occur throughout the year.
Another important tool that the SSM possesses to supervise large European banking groups is the Supervisory Colleges. For those banks for which the SSM acts as the consolidated “home” supervisor, the SSM together with the relevant NCA organizes an event where all of the banking group’s “host” supervisors are gathered at a roundtable and where they discuss the current state of affairs of the bank in the different relevant jurisdictions. The SRB follows a similar approach, organizing Resolution Colleges with the banking group’s “host” resolution authorities.
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Furthermore, the EBA organizes and performs an EU-wide stress test in coordination with the ECB. This test, which occurs every two years, does not confer a pass or fail result but instead contributes to determining “Pillar 2” guidance. While “Pillar 2” guidance is a non-binding capital requirement, the EBA nonetheless expects compliance with it. In those years in which there is no EBA stress test, the SSM organizes a more specific stress test concerning a particular topic, such as the impact of interest rate risk on the banking book or liquidity or cyber resilience.
In 2025, the EBA conducted an EU-wide stress test in cooperation with the ECB and the European Systemic Risk Board (“ESRB”). The aim of the EU-wide stress test is to assess EU banks’ resilience to a common set of adverse economic developments in order to identify potential risks, inform supervisory decisions and increase market discipline. The banks participating in the 2025 exercise included the Group.
The macro-prudential aspect of supervision is also increasingly gaining relevance, including through specific thematic reviews undertaken by the SSM on certain portfolios (e.g., commercial real estate or non-banking financial institutions) and the creation of new authorities and review boards. At the European level, these include the ESRB, which is responsible for monitoring macro-risks at the European level. The ESRB also develops the adverse scenarios to be used in the EU-wide stress test. In addition, in 2019 the Spanish Government created the Macro-prudential Authority Financial Stability Council, which is chaired by the Minister of Economy and Business and vice-chaired by the Governor of the Bank of Spain. In 2025, the Bank of Spain set a positive neutral counter-cyclical capital buffer of 0.5% (applicable from October 1, 2025) and announced its intention to gradually increase it to 1% if cyclical systemic risk remained at an intermediate level. However, following a public consultation process carried out in July 2025, the Bank of Spain decided to raise the countercyclical capital buffer to 1% effective from October 1, 2026.
The foregoing illustrates how much the regulatory and supervisory landscape has changed since the 2008 financial crisis, due in large part to the Basel Committee on Banking Supervision (the “Basel Committee”), an international, standard-setting forum, which established important reforms at a global level. Some of these reforms have been adopted in regulations at the European level.
The following is a discussion of certain of these and other regulations that are applicable to BBVA and certain related requirements.
Liquidity Requirements – Minimum Reserve Ratio
The legal framework for the minimum reserve ratio is set out in Regulation (EU) No. 2021/378 of the ECB of January 2021 on the application of minimum reserves requirements (ECB/2021/1).
According to the Delegated Regulation (EU) 2015/61 issued by the European Commission (EC) of October 10, 2014, the liquidity coverage ratio came into force in Europe on October 1, 2015, with an initial 60% minimum requirement, which was progressively increased (phased-in) up to 100% in 2018.
Capital Requirements, MREL and Resolution
As a Spanish credit institution, the Bank is subject to Directive 2013/36/EU of the European Parliament and of the Council of June 26, 2013 on access to the activity of credit institutions and the prudential supervision of credit institutions, amending Directive 2002/87/EC, and repealing Directives 2006/48/EC and 2006/49/EC (as amended, replaced or supplemented from time to time, the “CRD Directive”). The core regulation regarding the solvency of credit institutions is Regulation (EU) No. 575/2013 of the European Parliament and of the Council of June 26, 2013 on prudential requirements for credit institutions, and amending Regulation (EU) No. 648/2012 (as amended, replaced or supplemented from time to time, the “CRR” and, together with the CRD Directive and any measures implementing the CRD Directive or CRR which may from time to time be applicable in Spain, “CRD”), which is complemented by several binding regulatory technical standards, all of which are directly applicable in all EU Member States, without the need for national implementation measures. The implementation of the CRD Directive into Spanish law has taken place, primarily, through Royal Decree-Law 14/2013, of November 29, Law 10/2014, of June 26, on the organization, supervision and solvency of credit institutions (“Law 10/2014”), Royal Decree 84/2015, of February 13 (“Royal Decree 84/2015”), Bank of Spain Circular 2/2014, of January 31, Bank of Spain Circular 2/2016, of February 2 (“Bank of Spain Circular 2/2016”), Bank of Spain Circular 3/2022, of March 30 and the Bank of Spain Circular 3/2023, of October 31, each as amended, supplemented or otherwise modified from time to time.
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The final legal texts of Directive (EU) 2024/1619 of the European Parliament and of the Council of May 31, 2024 amending CRD Directive as regards supervisory powers, sanctions, third-country branches, and environmental, social and governance risks (“CRD VI”) and Regulation (EU) 2024/1623 of the European Parliament and of the Council of May 31, 2024 amending the CRR as regards requirements for credit risk, credit valuation adjustment risk, operational risk, market risk and the output floor (“CRR III”) have been published in the Official Journal of the European Union. CRR III became generally applicable from January 1, 2025 (with some exceptions). CRD VI should have been transposed into national law by member states by January 11, 2026, and implementation may vary among Member States. CRD VI and CRR III introduce, among other things, amendments to the output floor in the calculation of capital requirements, amendments to the input floors in respect of the calculation of risk exposure amounts, a revision of the standardized approaches for capital requirements for credit, market and operational risk and strengthened requirements for ESG risks management and reporting. As of the date of this Annual Report, the transposition of CRD VI into Spanish law and the adaptation of the Spanish regulatory framework to CRR III has not taken place within the prescribed deadline. Moreover, no draft bill or other formal legislative initiative has been published or announced to date. Accordingly, there is no certainty as to the timing or content of the transposition of CRD VI into Spanish law, and no such transposition is currently expected to occur in the upcoming months.
CRD, among other things, established a “Pillar 1” minimum capital requirement and increased the level of capital required through the “combined capital buffer requirement” that institutions must comply with from 2016 onwards. The “combined capital buffer requirement” introduced five new capital buffers: (i) the capital conservation buffer, (ii) the Global Systemically Important Banks (“G-SIB”) buffer, (iii) the institution-specific countercyclical capital buffer, (iv) the Domestic Systemically Important Banks (“D-SIB”) buffer and (v) the systemic risk buffer (a buffer to prevent systemic or macroprudential risks). The “combined capital buffer requirement” (broadly, the combination of the capital conservation buffer, the institution-specific countercyclical buffer, the systemic risk buffer and the higher of (depending on the institution) the G-SIB buffer and the D-SIB buffer, in each case as applicable to the institution) applies in addition to the minimum “Pillar 1” capital requirements and must be satisfied with additional CET1 capital to that provided to meet the “Pillar 1” minimum capital requirement.
As of the date of this Annual Report, the Bank of Spain considers the Bank to be a D-SIB at a consolidated level. The Bank is required to maintain a fully-loaded D-SIB buffer of a CET1 ratio of 1% on a consolidated basis in 2025 and 0.75% on a consolidated basis in 2026.
The countercyclical capital buffer applicable to the Group’s credit exposures in Spain is reviewed quarterly by the Bank of Spain. The countercyclical capital buffer applicable to the Group’s credit exposures in Spain stands at 0.25% as from September 30, 2025. On October 1, 2025, the Bank of Spain announced its decision to increase the counter-cyclical capital buffer applicable to credit exposures in Spain to 1% which will be applicable from October 1, 2026 given that, according to their analysis, in the year ended December 31, 2025 the cyclical systemic risk remained at an intermediate level.
Additionally, Article 104 of the CRD Directive, as implemented by Article 68 of Law 10/2014, and similarly Article 16 of Council Regulation (EU) No. 1024/2013 of October 15, 2013, conferring specific tasks on the ECB concerning policies relating to the prudential supervision of credit institutions (the “SSM Regulation”), also contemplates the possibility that the supervisory authorities may require credit institutions to meet capital requirements exceeding the “Pillar 1” minimum capital requirements and the “combined capital buffer requirement” by establishing “Pillar 2” capital requirements (which, with respect to other requirements, are above the “Pillar 1” requirements and below the “combined capital buffer requirement”).
In response to the COVID-19 pandemic, the ECB announced on March 12, 2020 that it would allow banks to partially use AT1 and Tier 2 instruments to meet the “Pillar 2” requirement, being this measure introduced by Directive 2019/878/EU of the European Parliament and of the Council of May 20, 2019 (as amended, replaced or supplemented from time to time (“CRD V”). In particular, the composition of the capital instruments to meet the “Pillar 2” requirement, shall include 56.25% of CET1 capital and 75% of Tier 1 capital, at a minimum.
Consequently, all additional “Pillar 2” own funds requirements that the ECB may impose on the Bank and/or the Group under the SREP will require the Bank and/or the Group to maintain capital levels higher than the “Pillar 1” minimum capital requirement.
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As a result of the most recent SREP carried out by the ECB, BBVA must maintain, at a consolidated level, from January 1, 2026, a CET1 capital ratio of 8.98% and a total capital ratio of 13.13%. The consolidated total capital requirement includes: (i) the “Pillar 1” capital requirement of 8.00%, of which a minimum of 4.50% must be met with CET1 capital, 1.50% could be met with AT1 instruments and 2.00% could be met with Tier 2 instruments; (ii) the “Pillar 2” capital requirement of 1.62%, of which a minimum of 0.96% must be met with CET1 capital (of which 0.12% is determined on the basis of the ECB’s prudential provisioning expectation), 0.28% could be met with AT1 instruments and 0.38% could be met with Tier 2 instruments; (iii) the capital conservation buffer (2.50% that must be met exclusively with CET1 capital); (iv) the D-SIB capital buffer (0.75% that must be met exclusively with CET1 capital); (v) the capital buffer for Countercyclical Risk (0.25% that must be met exclusively with CET1 capital); and (vi) the capital buffer for Systemic Risk (0.01% that must be met exclusively with CET1 capital).
In addition, as from January 1, 2026, BBVA must maintain, at an individual level, a CET1 ratio of 7.47% and a total capital ratio of 10.97%. These ratios include a 0.02% capital buffer for Systemic Risk and 0.45% capital buffer for Countercyclical Risk2 applicable to the Bank at an individual level that shall be met with CET1.
For further information on the countercyclical capital buffer and the total capital requirements applicable to the BBVA Group, see Note 32 to the Consolidated Financial Statements.
In accordance with Article 48 of Law 10/2014, Article 73 of Royal Decree 84/2015 and Rule 24 of Bank of Spain Circular 2/2016, any institution not meeting its “combined capital buffer requirement” is required to calculate its MDA as stipulated in such legislation. Should that requirement not be met and until the MDA has been calculated and communicated to the Bank of Spain, the relevant institution shall not make any: (i) distributions relating to CET1 capital; (ii) payments related to variable remuneration or discretionary pension benefits; and (iii) distributions linked to AT1 instruments (“discretionary payments”), and once the MDA has been calculated and communicated to the Bank of Spain, the discretionary payments will be subject to the limit of the calculated MDA. Accordingly, restrictions on discretionary payments will be scaled based on the degree of breach of the “combined buffer requirement” and calculated as a percentage of the profit of the institution generated since the last annual decision on the distribution of profit. Such calculation will result in a MDA in each relevant period. As an example, the scaling is such that in the bottom quartile of the “combined buffer requirement”, no discretionary payments will be permitted to be made.
Additionally, pursuant to Article 48 of Law 10/2014, the adoption by the Bank of Spain of the measures provided by Articles 68.2.h) and 68.2.i) of Law 10/2014, aimed at strengthening own funds and limiting or prohibiting the distribution of dividends, respectively, will also entail the requirement to determine the MDA and to restrict discretionary payments to such MDA. In accordance with the EU legislative and regulatory framework governing capital, liquidity, loss-absorbing capacity, recovery and resolution of credit institutions and investment firms, including CRD V, CRR II (EU Regulation (EU) 2019/876 amending the Capital Requirements Regulation (CRR), introducing enhanced prudential requirements for EU credit institutions and investment firms), BRRD II (as defined below) and SRM Regulation II (as defined below), each as amended, replaced or supplemented from time to time (the “EU Banking Reforms”), the calculation of the MDA and the restrictions described in the preceding paragraph while such calculation is pending, may also be triggered by a breach of the combined buffer requirement when considered in addition to its MREL requirement (see “Item 3. Key Information—Risk Factors—Regulatory, Tax, Compliance and Reporting Risks—Increasingly onerous capital and liquidity requirements may have a material adverse effect on the Group’s business, financial condition and results of operations”).
CRD also distinguishes between “Pillar 2” capital requirements and “Pillar 2” capital guidance, with only the former being regarded as mandatory requirements. Notwithstanding the foregoing, CRD provides that, besides other measures, supervisory authorities are entitled to impose further “Pillar 2” capital requirements when an institution repeatedly fails to follow the “Pillar 2” capital guidance previously imposed.
Additionally, CRR sets a binding leverage ratio requirement of 3% of Tier 1 capital that is added to the own funds requirements and to the requirements based on an entity’s RWAs. In particular, any breach of this leverage ratio would also entail the need to determine the MDA and the related consequences.
Furthermore, on December 7, 2017 the Basel Committee on Banking Supervision announced the end of the Basel III reforms (informally referred to as Basel IV), which entered into force on January 1, 2025. These reforms mainly include changes to the risk weightings applied to the different assets and measures to enhance the sensitivity to risk in those weightings and impose limits on the use of internal ratings-based approaches to ensure a minimum level of conservatism in the use of such approaches and enhance comparability among banks in which such internal ratings-based approaches are used.
2 The countercyclical buffer is estimated as of December 2025, using the outstanding exposures as of December 2025.
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Resolution
The Directive 2014/59/EU, establishing a framework for the recovery and resolution of credit institutions and investment firms, as amended, replaced or supplemented from time to time (the “BRRD”) (which has been implemented in Spain through Law 11/2015 and Royal Decree 1012/2015, each as amended, replaced or supplemented from time to time) and the Regulation (EU) No. 806/2014 of the European Parliament and of the Council, establishing a framework for the resolution of credit institutions and certain investment firms within the Single Resolution Mechanism, as amended by Regulation (EU) 2019/877, and as further amended, replaced or supplemented from time to time (the “SRM Regulation”), are designed to provide the authorities with mechanisms and instruments to intervene sufficiently early and rapidly in failing or likely to fail credit institutions or investment firms (each, an “Entity”) in order to ensure the continuity of the Entity’s critical financial and economic functions, while minimizing the impact of its non-feasibility on the economic and financial system. The BRRD further provides that a Member State may only use additional financial stabilization instruments to provide extraordinary public financial support as a last resort, once the following resolution instruments have been evaluated and used to the fullest extent possible while maintaining financial stability.
In accordance with the provisions of Article 20 of Law 11/2015, an Entity will be considered as failing or likely to fail in any of the following situations: (i) when the Entity significantly fails, or may reasonably be expected to significantly fail in the near future, to comply with the solvency requirements or other requirements necessary to maintain its authorization; (ii) when the Entity’s enforceable liabilities exceeds its assets, or it is reasonably foreseeable that they will exceed them in the near future; (iii) when the Entity is unable, or it is reasonably foreseeable that it will not be able, to meet its enforceable obligations in a timely manner; or (iv) when the Entity needs extraordinary public financial support (except in limited circumstances). The decision as to whether the Entity is failing or likely to fail may depend on a number of factors which may be outside of that Entity’s control.
In line with the provisions of the BRRD, Law 11/2015 contains four resolution tools which may be used individually or in any combination, when the Relevant Spanish Resolution Authority considers that (a) an Entity is non-viable or is failing or likely to fail, (b) there is no reasonable prospect of any other measures that would prevent the failure of such Entity within a reasonable period of time and (c) resolution is necessary or advisable, rather than the winding up of the Entity through ordinary insolvency proceedings, for reasons of public interest.
The four resolution instruments are (i) the sale of the Entity’s business, which enables the resolution authorities to transfer, under market conditions, all or part of the business of the Entity being resolved; (ii) bridge institution, which enables resolution authorities to transfer all or part of the business of the Entity to a “bridge institution” (an entity created for this purpose that is wholly or partially in public control); (iii) asset separation, which enables resolution authorities to transfer certain categories of assets (normally impaired or otherwise problematic) to one or more asset management vehicles to allow them to be managed with a view to maximizing their value through eventual sale or orderly wind-down (this can be used together with another resolution tool only); and (iv) the “Bail-in Tool”. Any exercise of the Bail-in Tool by the Relevant Spanish Resolution Authority may include the write down and/or conversion into equity or other securities or obligations (which equity, securities and obligations could also be subject to any future application of the Bail-in Tool) of certain unsecured debt claims of an institution.
In the event that an Entity is in a resolution situation, the Bail-in Tool is understood to mean any write-down, conversion, transfer, modification, or suspension power existing from time to time under: (i) any law, regulation, rule or requirement applicable from time to time in Spain, relating to the transposition or development of the BRRD (as amended, replaced or supplemented from time to time), including, but not limited to Law 11/2015, RD 1012/2015; and the SRM Regulation, each as amended, replaced or supplemented from time to time; or (ii) any other law, regulation, rule or requirement applicable from time to time in Spain pursuant to which (a) obligations or liabilities of banks, investment firms or other financial institutions or their affiliates can be reduced, cancelled, modified, transferred or converted into shares, other securities, or other obligations of such persons or any other person (or suspended for a temporary period or permanently) or (b) any right in a contract governing such obligations may be deemed to have been exercised.
In accordance with the provisions of Article 48 of Law 11/2015 (without prejudice to any exclusions that may be applied by the Relevant Spanish Resolution Authority in accordance with Article 43 of Law 11/2015), in the event of any application of the Bail-in Tool, any resulting write-down or conversion by the Relevant Spanish Resolution Authority will be carried out in the following sequence: (i) CET1 items; (ii) the principal amount of AT1 instruments; (iii) the principal amount of Tier 2 instruments; (iv) the principal amount of other subordinated claims other than AT1 or Tier 2 capital; and (v) the principal or outstanding amount of the remaining eligible liabilities in the order of the hierarchy of claims in normal insolvency proceedings (with senior non-preferred claims (créditos ordinarios no preferentes) subject to the Bail-in Tool after any subordinated claims (créditos subordinados) of the Bank but before the other senior claims of the Bank).
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In addition to the Bail-in Tool, the BRRD, Law 11/2015 and the SRM Regulation provide for resolution authorities to have the further power to permanently write-down or convert into equity capital instruments (and, pursuant to Directive (EU) 2019/879 of the European Parliament and of the Council, amending Directive 2014/59/EU to establish enhanced requirements for the recovery and resolution of credit institutions and investment firms, as amended, replaced or supplemented from time to time (the “BRRD II”) and the Regulation (EU) 2019/877 of the European Parliament and of the Council, amending Regulation (EU) No. 806/2014 to enhance the loss-absorbing and recapitalization capacity and the resolution framework of credit institutions and certain investment firms within the Single Resolution Mechanism, as amended, replaced or supplemented from time to time (the “SRM Regulation II”), certain internal eligible liabilities and instruments) at the point of non-viability (“Non-Viability Loss Absorption” and, together with the Bail-in Tool, the “Spanish Bail-in Power”) of an Entity. Any write-down or conversion must follow the same insolvency hierarchy as described above. The point of non-viability of an Entity is the point at which the Relevant Spanish Resolution Authority determines that the Entity meets the conditions for resolution or will no longer be viable unless the relevant capital instruments are written down or converted into equity or extraordinary public support is to be provided and without such support the Relevant Spanish Resolution Authority determines that the institution would no longer be viable. The point of non-viability of a group is the point at which the group infringes or there are objective elements to support a determination that the group, in the near future, will infringe its consolidated solvency requirements in a way that would justify action by the Relevant Spanish Resolution Authority in accordance with article 38.3 of Law 11/2015. Non-Viability Loss Absorption may be imposed prior to or in combination with any exercise of the Bail-in Tool or any other resolution tool or power (where the conditions for resolution referred to above are met) or in combination with such exercise in respect of all eligible liabilities.
In addition, the EBA has published certain technical regulation standards and technical implementation standards to be adopted by the European Commission, in addition to other guidelines. These standards and guidelines could potentially be relevant in determining when or how a Relevant Spanish Resolution Authority may exercise the Bail-in Tool and/or impose a Non-Viability Loss Absorption. These include guidelines on the treatment of shareholders when applying the Bail-in Tool or Non-Viability Loss Absorption, as well as on the rate for converting debt into shares or other securities or debentures in the application of the Bail-in Tool and/or Non-Viability Loss Absorption.
To the extent that any resulting treatment of a holder of the Bank’s securities pursuant to the exercise of the Bail-in Tool is less favorable than would have been the case under such hierarchy in normal insolvency proceedings, a holder of such affected securities would have a right to compensation under the BRRD and the SRM Regulation based on an independent valuation of the institution, in accordance with Article 10 of RD 1012/2015 and the SRM Regulation, together with any other compensation provided for in any Applicable Banking Regulations (as defined below) including, inter alia, compensation in accordance with Article 36.5 of Law 11/2015. However, if the treatment of a creditor following a Non-Viability Loss Absorption is less favorable than it would have been under ordinary insolvency proceedings, it is uncertain whether said creditor would be entitled to the compensation provided for in the BRRD and the SRM Regulation.
Finally, on April 18, 2023, the European Commission published a proposal for the further amendment of the BRRD, including, among other things, the amendment of the ranking of claims in insolvency to provide for a general depositor preference, pursuant to which the insolvency laws of Members States would be required by the BRRD to extend the legal preference of claims in respect of deposits relative to ordinary unsecured claims to all deposits, as well as a proposal amending the SRM Regulation as regards early intervention measures, conditions for resolution and funding of resolution actions and the Deposit Guarantee Schemes Directive (Directive 2014/49/EU of the European Parliament and of the European Council of April 16, 2014 on deposit guarantee schemes) as regards the scope of deposit protection, use of deposit guarantee schemes funds, cross-border co-operation, and transparency.
The implementation of the BRRD proposal is subject to further legislative procedures but if it is implemented in its current form, this would mean that senior preferred claims (créditos ordinarios preferentes) of the Bank would rank junior to the claims of all depositors, including deposits of large corporates and other deposits that are currently excluded from the above privileged claims.
Any such general depositor preference would also affect any application of the Bail-In Tool, as such application is to be carried out in the order of the hierarchy of claims in normal insolvency proceedings. Accordingly, this would mean that following any such amendment of the insolvency laws of Spain to establish a general depositor preference, any resulting write-down or conversion of senior preferred claims (créditos ordinarios preferentes) by the Relevant Spanish Resolution Authority would be carried out before any write-down or conversion of the claims of depositors such as those of large corporates that previously would have been written-down or converted alongside such senior preferred claims (créditos ordinarios preferentes). By removing the requirement for such deposits to be written-down or converted in this manner, one of the stated objectives of this proposed amendment is to reduce the likelihood of deposits generally needing to be included in any such write-down or conversion upon any application of the Bail-In Tool and improve the process for the application of the Bail-In Tool.
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“Applicable Banking Regulations” means at any time the laws, regulations, requirements, guidelines and policies relating to capital adequacy, resolution and/or solvency then applicable to the Bank and/or the Group including, inter alia, the CRD Directive, CRR, BRRD, the SRM Regulation and those laws, regulations, requirements, guidelines and policies relating to capital adequacy, resolution and/or solvency then in effect in Spain (whether or not such regulations, requirements, guidelines or policies have the force of law and whether or not they are applied generally or specifically to the Bank and/or the Group).
“Relevant Spanish Resolution Authority” means the FROB, the SRB, the Bank of Spain, the Spanish Securities Market Commission or any other entity with the authority to exercise any of the resolution tools and powers contained in Law 11/2015 and the SRM Regulation from time to time.
“Law 11/2015” means Law 11/2015, of June 18, on the recovery and resolution of credit institutions and investment firms, as amended, replaced or supplemented from time to time, including as amended by Royal Decree Law 7/2021 of 27 April on the transposition of European Union directives in matters of credit institutions, among others.
MREL
The BRRD prescribes that banks shall hold a minimum level of own funds and eligible liabilities in relation to RWAs known as MREL. According to the Commission Delegated Regulation (EU) 2016/1450 of May 23, 2016, supplementing Directive 2014/59/EU of the European Parliament and of the Council, establishing a framework for the recovery and resolution of credit institutions and investment firms, as amended, replaced or supplemented from time to time (the “BRRD I”) with regard to regulatory technical standards specifying the criteria relating to the methodology for setting the minimum requirement for own funds and eligible liabilities, the level of own funds and eligible liabilities required under MREL will be set by the resolution authority, in agreement with the competent authority, for each bank (and/or group) based on, among other things, the criteria set forth in Article 45 of the BRRD, including the systemic importance of the institution. Eligible liabilities may be senior or subordinated, provided that, among other requirements, they have a remaining maturity of at least one year and, if governed by a non-EU law, they must be able to be written down or converted by the resolution authority of a member state under that law or through contractual provisions.
If the Relevant Spanish Resolution Authority considers that there may be any obstacles to resolvability by the Bank and/or the Group, a higher MREL could be imposed.
The EU Banking Reforms provide that the breach by a bank of its MREL should be addressed by the competent authorities through their powers to address or remove obstacles to resolution, the exercise of their supervisory powers and their power to impose early intervention measures, administrative sanctions and other administrative measures. If there were a deficit in the level of an entity’s eligible own funds and liabilities, and that entity’s own funds were contributing to meeting the “combined capital buffer requirement,” these own funds would automatically be deemed to count toward meeting the MREL of said entity and would cease to count for purposes of meeting the “combined capital buffer requirement”, which could lead the entity to fail to comply with its “combined capital buffer requirement”. This could result in the need to calculate the MDA and the resolution authority would have the power (but not the obligation) to impose restrictions on the making of discretionary payments. Therefore, the Bank will have to fully comply with its “combined capital buffer requirement”, in addition to its MREL, to ensure that it can make discretionary payments.
In addition, in accordance with the EBA guidelines on the assumptions of triggering the use of early intervention measures of May 8, 2015, a significant deterioration in the amount of eligible liabilities and own funds held by an entity in order to comply with its MREL could place an entity in a situation where the conditions for early intervention are met, which could entail the application of early intervention measures by the competent resolution authority, which in the Spanish case are detailed in Articles 9 and 10 of Law 11/2015, including the intervention or provisional replacement of administrators.
The EU Banking Reforms further include, as part of MREL, a new subordination requirement of eligible instruments for G-SIBs and “top tier” banks (including the Bank) that is determined according to their systemic importance, involving a minimum “Pillar 1” subordination requirement. This “Pillar 1” subordination requirement must be satisfied with own funds and other eligible MREL instruments (which MREL instruments may not for these purposes be senior debt instruments and only MREL instruments constituting “non-preferred” senior debt and other subordinated liabilities will be eligible for compliance with the subordination requirement). For “top tier” banks such as the Bank, this “Pillar 1” subordination requirement has been determined as the highest of 13.5% of the Bank’s RWAs and 5% of its leverage exposure. Resolution authorities may also impose further “Pillar 2” subordination requirements, which would be determined on a case-by-case basis but at a minimum level equal to the lower of 8% of a bank’s total liabilities and own funds and 27% of its RWAs (both including MREL Pillar 1 and Pillar 2).
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On June 12, 2025, BBVA announced that it had received a communication from the Bank of Spain regarding its MREL (Minimum Requirement for own funds and Eligible Liabilities) requirement, established by the SRB, which was calculated taking into account the financial and supervisory information as of December 31, 2023, which communication repeals and supersedes the previous MREL requirement communicated in March 2024. In accordance with this MREL communication, BBVA must maintain, as from June 12, 2025, an amount of own funds and eligible liabilities equal to 23.13% of the total RWAs of its resolution group, on a sub-consolidated level (the “MREL in RWAs”) (compared to the MREL in RWAs requirement of at least 22.79% which was applicable from March 27, 2024 which was calculated taking into account the financial and supervisory information as of December 31, 2022). Within this MREL in RWAs, an amount equal to 13.50% of the total RWAs of BBVA’s resolution group must be met with subordinated instruments (the “subordination requirement in RWAs”). The MREL in RWAs and the subordination requirement in RWAs do not include the combined capital buffer requirement which, according to applicable regulations and supervisory criteria, was 3.97% as of December 31, 2025 and 3.65% as of December 31, 2024.
In addition, BBVA must maintain, as from June 12, 2025, an amount of own funds and eligible liabilities in terms of the total exposure considered for calculating the leverage ratio equal to 8.59% (the “MREL in LR”) of which 5.66% in terms of the total exposure considered for calculating the leverage ratio shall be satisfied with subordinated instruments (the “subordination requirement in LR”).
As of the date of this Annual Report, no MREL Pillar 2 requirement has been imposed on BBVA. Given the own funds and eligible liabilities structure of BBVA’s resolution group as of December 31, 2025, the amount of own funds and eligible liabilities stood at 28.89% of the RWAs of its resolution group, at the sub-consolidated level, complying with the aforementioned MREL in RWAs requirement, and the amount of subordinated instruments was equal to 24.67% of the RWAs of it resolution group, at the sub-consolidated level, complying with the subordination requirement in RWAs.
In addition, as of December 31, 2025, the amount of own funds and eligible liabilities of BBVA in terms of the total exposure considered for calculating the leverage ratio stood at 10.21% and the amount of subordination instruments in terms of the total exposure considered for calculating the leverage ratio stood at 8.72%, complying with the MREL in LR and the subordination requirement in LR, respectively.
The resolution group consists of BBVA and its subsidiaries belonging to the same European resolution group and, as of December 31, 2023 (the currently applicable reference date), the RWAs of the resolution group amounted to €205,154 million and the total exposure considered for calculating the leverage ratio amounted to €580,788 million.
Single Resolution Fund
The SRF was established by Regulation (EU) No 806/2014 (“SRM Regulation”) as a key element of the Single Resolution Mechanism (SRM). Where necessary, the SRF may be used to ensure the efficient application of resolution tools and the exercise of the resolution powers conferred to the SRB by the SRM Regulation.
As stated above, the SRF is composed of contributions from credit institutions and certain investment firms in the participating Member States within the EBU and was gradually built during the course of eight years (from 2016 to 2023, when the SRF reached its target level of 1% of covered deposits).
Within the resolution scheme, the SRF may be used only to the extent necessary to ensure the effective application of the resolution tools, as last resort, in particular:
•To guarantee the assets or the liabilities of the institution under resolution;
•To make loans to or to purchase assets of the institution under resolution;
•To make contributions to a bridge institution and an asset management vehicle;
•To make a contribution to the institution under resolution in lieu of the write-down or conversion of liabilities of certain creditors under specific conditions;
•To pay compensation to shareholders or creditors who incurred greater losses than under normal insolvency proceedings.
The Intergovernmental Agreement (“IGA”) acknowledges that situations may exist where the means available in the SRF are not sufficient to undertake a particular resolution action, and where the ex-post contributions that should be raised in order to cover the necessary additional amounts are not immediately accessible.
In December 2013, ECOFIN Ministers agreed to put in place a system by which bridge financing would be available as a last resort. The arrangements for the transitional period should be operational by the time the Fund was established.
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In this scenario, the Eurogroup decided in 2017 to expand the European Stability Mechanism (“ESM”) role to serve as a backstop for the SRF. While the new features of the expanded role for the ESM were agreed by 2019, it was not until late 2020 that the euro area finance ministers agreed to proceed with the reform of the ESM, and related treaty amendments (the “ESM Treaty amendments”) were later signed by Member States (represented by their ambassadors to the EU) on January 27, 2021. The backstop to the SRF was expected to be operational at the beginning of 2022, but the ratification process was not completed. As of the date of this Annual Report, the ESM Treaty amendments are pending ratification by Italy. On December 21, 2023, the Italian Parliament voted against the ratification of the ESM Treaty amendments.
When the ratification process is completed, the ESM will be able to provide support for up to €68 billion (in the form of credit lines). If this financial assistance is requested, the SRF will pay back the ESM loan with funds obtained from banks’ contributions (in a period of three years, with the possibility to extend it to five years).
Capital Management
Basel Capital Accord - Economic Capital
The Group’s capital management is performed at both the regulatory and economic levels. Regulatory capital management is based on the analysis of the capital base and the capital ratios (CET1, Tier 1, etc.) using the BIS Framework rules and the CRR. See Note 32 to the Consolidated Financial Statements.
The aim of our capital management is to achieve a capital structure that is as efficient as possible in terms of both cost and compliance with the requirements of regulators, ratings agencies and investors. Active capital management includes securitizations, sales of assets, and preferred and subordinated issues of equity and hybrid instruments. Various actions have been taken during the last years in connection with our capital management and in order to comply with various capital requirements applicable to us related to various actions regarding asset sales. In addition, we may make securities issuances or undertake new asset sales in the future, which could involve outright sales of businesses or reductions in interests held by us, which could be material and could be undertaken at less than their respective book values, resulting in material losses thereon, in connection with our capital management and in order to comply with capital requirements or otherwise. The Bank has obtained the Bank of Spain’s and ECB’s approvals with respect to its internal model of capital estimation concerning certain portfolios.
Following the European supervisory and regulatory focus on reducing the variability of own funds requirements (via the TRIM and EBA Repair Programme respectively), the Bank is currently reviewing its IRB models to ensure adherence to the evolving regulatory requirements. Although the final impact of this review is not yet known, it could result in an increase in the capital needs of BBVA.
From an economic standpoint, capital management seeks to optimize value creation for the Group and its different business units. The Group allocates economic capital (“CER”) commensurate with the risks incurred by each business. This is based on the concept of unexpected loss at a certain level of statistical confidence, depending on the Group’s targets in terms of capital adequacy. The CER calculation combines credit risk, market risk (including structural risk associated with the balance sheet and equity positions), operational risk, model risk, business risk, reputational risk and technical risks in the case of insurance companies.
Shareholders’ equity, as calculated under the BIS Framework rules, is an important metric for the Group. For the purpose of allocating capital to operating segments, the Group focuses on both economic and regulatory capital. The purpose is to ensure that the businesses are run considering both the risk-sensitive perspective and the regulation requirement. These are designed to provide an equitable basis for assigning capital and ensure adequate capital management across the Group.
Concentration of Risk
In accordance with Article 392 of CRR III, an institution’s exposure to a client or a group of connected clients shall be considered a large exposure where the value of the exposure is equal to or exceeds 10% of the institution’s eligible capital.
Additionally, according to Article 395 of CRR III an institution shall not incur an exposure, after taking into account the effect of the credit risk mitigation in accordance with Articles 399 to 403, to a client or a group of connected clients the value of which exceeds 25% of its eligible capital. Where that client is an institution or where a group of connected clients includes one or more institutions, that value shall not exceed 25% of the institution’s eligible capital or €150 million, whichever is higher, provided that the sum of exposure values, after taking into account the effect of the credit risk mitigation in accordance with Articles 399 to 403, to all connected clients that are not institutions does not exceed 25% of the institution’s eligible capital.
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Where the amount of €150 million is higher than 25% of the institution’s eligible capital, the value of the exposure, after having taken into account the effect of credit risk mitigation in accordance with Articles 399 to 403 of this Regulation, shall not exceed a reasonable limit in terms of that institution’s eligible capital. That limit shall be determined by the institution in accordance with the policies and procedures referred to in Article 81 of Directive 2013/36/EU in order to address and control concentration risk. That limit shall not exceed 100% of the institution’s eligible capital.
Legal and Other Restricted Reserves
We are subject to the legal and other restricted reserves requirements applicable to Spanish companies. Please see “—Capital Requirements, MREL and Resolution”.
Dividends
A bank may generally dedicate all of its net profits and its distributable reserves to the payment of dividends. In no event may dividends be paid from non-distributable reserves. For additional information see “Item 8. Financial Information—Consolidated Statements and Other Financial Information—Dividends”.
Since January 1, 2016, according to CRD, those credit entities required to calculate their MDA are subject to restrictions on discretionary payments, which include, among others, dividend payments. See “—Capital Requirements, MREL and Resolution”.
Although banks are not legally required to seek prior approval from the Bank of Spain or the ECB before declaring dividends (despite distributions from the share premium account, which are subject to prior approval), we inform each of them on a voluntary basis upon the declaration of a dividend.
Our Bylaws allow for dividends to be paid in cash or in kind as determined by shareholders’ resolution.
Principal Markets
The following is a summary of certain additional laws and regulations applicable to BBVA’s operations in Spain, Mexico, Turkey and the United States.
Spain
BBVA’s operations in Spain are subject to European Union-wide and Spanish national regulations. Spain has a broad regulatory framework designed to ensure consumer protection and enhance transparency. Finance and deposits products are subject to both general consumer and product-specific laws which, in certain circumstances, differentiate between consumers and non-consumers.
Payments accounts
The provision of payment accounts and services in Spain is subject to various regulations, most of which transpose European legislation, such as Directive (EU) 2015/2366 (“PSD 2”) (transposed by means of Royal Decree-Law 19/2018, of November 23, on Payment Services) and Directive (EU) 2014/92 (transposed by means Royal Decree-Law 19/2017, of November 24, on basic payment accounts, transfer of payment accounts and comparability of fees). Such regulations lay down minimum information requirements for providers of payment accounts and services as well as certain transparency provisions with regard to fees. A significant development in relation to PSD 2 is a requirement to allow third parties access to accounts to provide account information and payment initiation services, provided they have a customer’s consent.
Finance
Regarding loans, there are separate regulations applying to consumer loans and residential loans which are, in both cases, mainly derived from European legislation, including Directive (EU) 2008/48 (relating to credit agreements for consumers) (transposed by means of Law 16/2011, of June 24, on Consumer Credit Contracts) and Directive (EU) 2014/17 (relating to credit agreements for residential immovable property). In 2019, Law 5/2019, of March 15, regulating real estate credit agreements (“Law 5/2019”) was passed, transposing Directive 2014/17. It applies to individuals, whether or not they are consumers, and sets limits on default interest, early maturity and early repayment fees, and provides a comprehensive framework of pre-contractual information provisions. Law 5/2019 also requires that a notarial act shall be granted prior to signing a residential credit agreement in which the notary verifies that the bank has fulfilled all of its legal pre-contractual information obligations and that the borrower has understood all the clauses.
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Additionally, specific regulations applicable to mortgage loans for vulnerable consumers are in effect. Royal Decree-Law 6/2012 (“CGP 6/2012”) establishes a Code of Good Practices to support debtors facing severe financial difficulties. Measures include a five-year grace period for principal repayment, reduced interest rates during this period, and loan term extensions of up to 40 years. If refinancing is not viable, debt reduction or dation in payment (handing over) of the mortgaged home to cancel the debt is possible.
Royal Decree-Law 19/2022 expanded CGP 6/2012 to include more types of debtors but reduced the grace period to two years and allowed loan term extensions of up to seven years. It also introduced a new Code of Good Practices (“CGP 19/2022”) to mitigate rising interest rates. Eligible debtors can extend the loan term by up to seven years (not exceeding 40 years) with options such as freezing installments for 12 months or converting to a fixed interest rate.
CGP 19/2022 was extended until December 31, 2025, nationwide, and until June 30, 2026, for residents in areas affected by the late 2024 floods (DANA).
Instant Payments Regulation
Regulation (EU) 2024/886 or the European Parliament and of the Council of March 13, 2024 amending Regulations (EU) No 260/2012 and (EU) 2021/1230 and Directives 98/26/EC and (EU) 2015/2366 as regards instant credit transfers in euro requires all payment service providers that offer regular transfer services to offer consumers and businesses in the European Economic Area (EEA)—the 27 EU member states plus Iceland, Liechtenstein, and Norway—the ability to transfer money within a maximum of 10 seconds, at any time of day, every day of the week.
Additionally, if there is a fee, such fee cannot be higher than the fee applied to regular transfers. Furthermore, in order to prevent sending money to fraudulent accounts, payment service providers must offer users the possibility of verifying that the IBAN number of the account to which the money is being sent matches the name of the recipient.
The Regulation establishes a transitional period for its implementation, granting entities in the eurozone until January 9, 2025 to receive transfers and to apply fees for this service, which must not exceed those for standard transfers. Furthermore, entities will have until October 9, 2025, to implement the capability to send instant transfers, incorporate the verification service to ensure that the beneficiary’s name matches the IBAN, and offer customers the possibility to set limits on transferred amounts.
New Draft Bill on Financial Customer Defense Authority
The Congress of Deputies is currently debating the draft bill for the creation of the Financial Customer Defense Authority (the “Authority”). The final approval could take place during the year 2025. The below discussion is based on the latest proposal as of the date of this Annual Report, and any final resolution (if passed) may include additional or different provisions.
Based on the current proposal, the Authority will have faculties to hear and adopt binding resolutions, with respect to financial entities only, in connection with claims of financial customers or potential customers (i) not exceeding 20,000 euros, regarding breaches of conduct regulations (included voluntary codes of good practices) and abusive clauses; or (ii) with an undetermined amount (this will need to be further developed by subsequent regulation). The Authority’s resolution will not be binding when the amount of the claim is equal to or greater than 20,000 euros or is related to good practices. In relation to abusive clauses, the Authority will decide on the existence of abusive clauses if these have been previously declared as such by the Supreme Court and the Court of Justice of the European Union and a final ruling has been registered with the Spanish registry of general terms and conditions of contracting.
The Authority shall resolve complaints from individuals and companies, including potential customers. Resolutions may be appealed, regardless of whether they are binding or not, before the civil courts in Spain.
With respect to claims of an economic nature, the resolution may order the refund of amounts determined to be unduly charged, plus interest for late payment.
The Authority may impose penalties for non-compliance with its resolutions (from 500,000 to 2,000,000 euros). Additionally, sanctions could be imposed on managers and directors (from 250,000 to 1,000,000 euros).
The Authority will be entirely financed by financial entities, which will be required to pay a varying annual fee based on the number of complaints filed against them, and the number of complaints resolved against them, in the preceding year. In particular, 40% of the costs incurred by the Authority in a given year will be distributed among institutions on a pro rata basis based on their respective weight within the absolute number of complaints brought in such year, while 60% of the costs will be distributed on a pro rata basis based on their respective weight within the absolute number of complaints resolved in favor of customers brought in such year.
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Insolvency Law
In 2022 Law 16/2022 of September 5 on the reform of the consolidated text of the Insolvency Law (Law 16/2022) was passed. Law 16/2022 transposes Directive (EU) 2019/1023 of the European Parliament and of the Council of June 20, 2019 on frameworks for preventive restructuring, debt waivers and disqualifications, and on measures to increase the efficiency of restructuring, insolvency and debt waiver procedures. The new insolvency legal framework provides for (i) the creation of a new state of insolvency (“the likelihood of insolvency”), prior to imminent and actual insolvency, which enables access to certain pre-bankruptcy institutions, (ii) the removal of out-of-court payment agreements and refinancing agreements, introducing instead “Restructuring Plans” and (iii) the new “Special procedure for micro-enterprises” applicable to debtors, whether natural or legal persons, that meet certain characteristics.
Organic Law 1/2025, of January 2, on Measures to Improve the Efficiency of the Public Justice Service
This Law introduces the following changes:
(i) New Regime for Late Payment Interest
In consumer actions, if companies fail to cooperate in reaching an agreement on disputes related to either clauses that are declared null and void by the Supreme Court, resolutions registered in the General Register of Contract Terms, or judgments of the Court of Justice of the European Union (CJEU), courts may impose compensation for late payment. This compensation will consist of an annual interest equal to the legal interest rate in effect at the time, increased by 50%. If more than two years have passed since the judgment ordering the restitution of amounts, the annual interest shall not be less than 20%. Interest will accrue daily from the date the consumer paid the amounts claimed (e.g., in cases of expenses related to a mortgage loan, from the time of signing of such mortgage loan).
(ii) Mandatory Pre-Claim Process
Before filing a lawsuit, in most civil disputes, it will be mandatory to attempt to resolve the dispute through alternative dispute resolution mechanisms. For disputes filed by consumers against financial institutions related to unfair terms in mortgages, this requirement will involve submitting a prior claim to the lender, who must respond and include, as the case may be, a calculation of the amount to be reimbursed. If the lender fails to resolve the claim, it cannot introduce new arguments in court beyond those included in its response.
In the case of judicial debt claims where no enforcement proceedings are initiated, the financial institution shall also resort to alternative dispute resolution mechanisms. In addition, at any stage of enforcement proceedings, the parties may submit to mediation or any other appropriate dispute resolution mechanisms, in which case the enforcement proceeding shall be suspended.
(iii) Modification of the Valuation of Unquantifiable Claims
Courts have generally considered that a declaratory claim for the nullity of a clause is of indeterminate value. When the value of a lawsuit is indeterminate, the regulation provides that, for the purposes of cost assessment, claims are estimated at €18,000, unless the complexity of the case dictates otherwise.
The new law provides for increasing the valuation of unquantifiable claims from €18,000 to €24,000. If a party is found to have committed a “misuse of judicial resources”, procedural costs and fines of up to €6,000 may be imposed on such a party. This may increase the costs of litigation.
Additionally, certain articles of procedural law were amended, including, among others, those related to the judicial auction of assets.
Investment Services
Several sustainability initiatives within the European Union are expected to significantly impact the asset management and investment services sectors during 2026.
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•The European Commission, the European Parliament and the European Council have agreed on certain amendments to be made to MIFID II and Regulation (EU) No 600/2014 on markets in financial instruments (MiFIR). The vast majority of the changes relate to MiFIR, where some existing obligations are removed or alleviated. In particular, the pre-transparency obligation is limited to equity products and products subject to the clearing obligation. The systematic internalized figure is also reduced in its scope and, as an alternative, the figure of the designated publishing entity is created to facilitate the buy-side compliance with post-transparency rules. Most of these changes entered into force on March 28, 2024, although (i) a some of them will need to be further developed by level 2 legislation; and (ii) ESMA and the European Commission published two statements to clarify that certain obligations will not enter into force until a later date.
•The European Commission has published a regulatory package called Retail Investment Strategy (“RIS”) which aims to increase the participation of retail investors in European capital markets. Directive 2014/65/EU on markets in financial instruments (MiFID) is included among the different EU directives to be reviewed, with relevant changes proposed in retail investor protection. The European Parliament and European Council have recently announced an agreement on the general framework to be included in the RIS. Technical work will now continue to finalize the legal texts. Once published in the EU’s official journal, member states will have to transpose the new rules within 24 months. They will start applying 30 months following their publication, with the exception of the new rules under PRIIPs which would start applying 18 months following their publication.
•The regulatory package amending, among others, Regulation (EU) 648/2012 of the European Parliament and Council on over-the-counter derivatives, central counterparties and trade repositories (EMIR 3.0) was published in the Official Journal and most of the changes apply from December 24, 2024. The main changes aim to increase clearing at EU central counterparties and reduce reliance on certain UK central counterparties through the so-called “active accounts”. The European Commission has recently approved some of the level 2 legislation (with the legislation dealing with active accounts being the most relevant) without relevant deviations from the reports issued by ESMA.
In addition, as part of the RIS, the European Commission has published a proposal to amend the Regulations for packaged retail investment products (PRIIPs). The proposed changes are mainly focused on providing alternatives for the use of digital channels and the inclusion of a new ESG section within the Key Information Document (KID). The new rules under PRIIPs will start applying 18 months following their publication in the EU’s official journal.
The European Union has also been very active in terms of adopting legislation to preserve financial stability. In this regard, the BBVA Group has been subject to initial margin requirements under Regulation (EU) 648/2012, regarding OTC derivatives, central counterparties and trade repositories, since September 2019, as well as similar legislation in other geographical areas. In addition, BBVA Group entities classified as financial counterparties are required to post and receive initial margins when dealing with other in-scope entities.
In Spain, the Ministry of Economy has launched a public consultation regarding the regulatory framework for a new Savings and Investment Account and the “Finance Europe” label. Its key points are the creation and design of a simple national regulatory framework for a Savings and Investment Account, aligning with a European Commission Recommendation from September 30, 2025 and the implementation of the “Finance Europe” label in Spain.
EU Market Integration Package
The European Commission published on December 4, 2025 the so-called Market Integration Package, an initiative seeking to constitute a fundamental pillar of the Savings and Investments Union (SIU) Strategy. Its primary objective is to remove the barriers that fragment the Union’s capital markets in the areas of trading, post-trading, asset management and crypto-asset services, while at the same time strengthening integrated supervision.
Overall, the package aims to achieve: (i) greater integration and economies of scale, (ii) more coherent supervision, partly centralized within ESMA, (iii) facilitation of innovation (DLT, tokenization), and (iv) simplification through the removal of redundant rules and the consolidation of the “single rulebook.” On top of that, it proposes a new modification of the UCITS (Undertakings for Collective Investment in Transferable Securities) and AIFM (Alternative Investment Fund Manager) Directive, which affects both the management companies and the funds under management of the BBVA Group, and BBVA as a depositary bank.
Transposition of the Consumer Credit Directive into the Spanish market
At its meeting on January 7, 2026, the Spanish Council of Ministers initiated the legislative procedure for the transposition of the Consumer Credit Directive 2023/2225, which repeals and updates the former Directive 2008/48/EC, thereby modernizing the European regulatory framework for consumer credit.
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As part of the transposition process, which is expected to enter into force on November 20, 2026, a law-ranking regulation and an accompanying Royal Decree will be adopted. One of the most relevant aspects is that the aforementioned Royal Decree could introduce certain limitations on the applicable interest rates, as well as mechanisms for monitoring and publishing the interest rates normally applied in the market, under the terms to be set out in the implementing legislation.
In general terms, the scope of transactions and entities supervised by the competent authorities will be expanded, measures will be introduced to ensure borrowers’ creditworthiness for the repayment of the loans requested, and transparency in the marketing of credit products will be strengthened.
Pension Funds
The European Commission has published its regulatory package on supplementary pensions, a key initiative framed within the Savings and Investment Union (SIU). The European Commission’s proposal is designed to supplement public pensions, rather than replace them, and its main objective is to strengthen both the demand and supply of occupational and personal pension plans to improve financial security and mobilize long-term savings towards productive investments across the EU.
Sustainability
In November 2025, the European Commission published a proposal to amend Regulation (EU) 2019/2088 on sustainability-related disclosures in the financial services sector (SFDR), following a comprehensive assessment process initiated in 2023. The review aims to address implementation challenges identified since the SFDR entered into application in 2021, including regulatory complexity, compliance costs and risks of greenwashing, and forms part of the Commission’s broader simplification agenda within the EU sustainable finance framework.
The proposal introduces a harmonized categorization system for financial products making sustainability-related claims —sustainable, transition and ESG basics— alongside a significant streamlining of disclosure requirements, notably through the reduction of entity-level obligations and more proportionate product-level disclosures. The revised framework is intended to improve investor understanding and comparability of ESG products, strengthen investor protection and enhance coherence with other EU sustainability legislation, including the EU Taxonomy Regulation, the Corporate Sustainability Reporting Directive and recent ESMA ESG fund naming guidelines. As of the date of this Annual Report, the proposal remains subject to the ordinary legislative procedure and its final content and timing of application remain uncertain.
Digital Operational Resilience Act (DORA)
Regulation 2022/2554, on digital operational resilience for the financial sector (DORA), is an EU regulation aimed at ensuring the operational resilience of financial entities against digital and cybersecurity risks, which entered into force in January 2025.
Enacted as part of the EU’s broader Digital Finance Package, it establishes a uniform framework for financial institutions, including banks, investment firm, and asset managers, to manage and mitigate technological risks. DORA mandates stringent requirements for risk management, incident reporting, oversight of third-party information and communication technology (ICT) service providers and testing of operational resilience. Its impact on financial entities is significant, as it drives the need for enhanced IT systems, stronger governance structures and robust third-party risk management. As a result, DORA is already affecting financial entities and its relationship with counterparties and providers.
Interest Margin and Commission Tax (IMIC)
On December 21, 2024, Law 7/2024 was published in the Official State Gazette, the ninth Final Provision of which regulates a new tax on the net interest margin and commissions of certain financial entities, including Banco Bilbao Vizcaya Argentaria, S.A. The tax is levied on the net interest margin and commissions obtained by credit institutions from the activity they carry out in Spain and is applicable to the first three consecutive tax periods that begin on January 1, 2024.
During 2025, the Group made a payment corresponding to the IMIC for the 2024 financial year. However, since this payment was not required under the legal framework in place as of December 31, 2025, an asset for the amount paid (€295 million) was recorded under the heading “General Governments” of the item “Financial assets at amortized cost - Loans and advances to customers” in the balance sheet.
In addition, as of December 31, 2025, current tax liabilities include approximately €318 million corresponding to the accrual of the IMIC for the 2025 financial year in respect of certain Group financial entities, and the related expense was recognized under the heading of “Tax expense or income related to profit or loss from continuing operations”.
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No impact associated with the IMIC has been recorded in the Consolidated Financial Statements for the year ended December 31, 2024. See Note 19.6 to the Consolidated Financial Statements for additional information on certain other contributions and taxes.
Temporary Tax on Credit Institutions in Spain
On December 28, 2022, the Law for the establishment of the temporary tax on credit entities and financial credit establishments was published in the Official State Gazette.
This law established a temporary tax on extraordinary profits applicable to credit institutions operating in Spain during the years 2023 and 2024 whose aggregate interest income and fee and commission income in 2019 was €800 million or more.
The amount to be paid under such temporary tax on extraordinary profits was the result of applying the percentage of 4.8% to the sum of the net interest income and fee and commission income and expense derived from the activity carried out in Spain, as shown in the income statement of the tax consolidation group to which the credit institutions belonged, corresponding to the calendar year prior to the year in which the obligation to make such a payment arose. The payment obligation arose on the first day of the calendar year of fiscal years 2023 and 2024.
The impact of the payment required to be made by BBVA on account of this temporary tax in 2024 and 2023 amounted to €285 million and €215 million, respectively, which amounts were recorded under “Other operating expense” in the consolidated income statements (see Note 42 to the Consolidated Financial Statements). This temporary tax had no impact on the Consolidated Financial Statements for the year ended December 31, 2025.
See Note 19.6 to the Consolidated Financial Statements for additional information on certain other contributions and taxes.
Prevention of Money Laundering and Terrorist Financing
Directive (EU) 2015/849 of the European Parliament and of the Council of May 20 on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing aims to prevent the use of the EU’s financial system for the purposes of money laundering and terrorist financing.
Spanish Law 10/2010 of April 28 transposes Directive (EU) 2015/849 and establishes obligations in respect of preventing money laundering and terrorist financing, including applicable due diligence, internal controls and reporting obligations to obliged entities. Credit institutions, including BBVA, are part of the entities that are subject to such regulation.
On July 20, 2021, the European Commission presented an ambitious package of legislative proposals to strengthen EU rules against money laundering and terrorist financing. This legislative package consisted of four texts: (i) a regulation governing the creation of an EU Authority for Anti-Money Laundering and Countering the Financing of Terrorism (the “AMLA Regulation”); (ii) a new regulation on the prevention of money laundering and terrorist financing (“AML/CFT” and the “AML/CFT Regulation”, respectively); (iii) the 6th Directive on the prevention of money laundering and terrorist financing (the “6th AML/CFT Directive”); and (iv) the revision of a 2015 regulation on transfers of funds related to tracing transfers of certain crypto-assets (the “Travel Rule Regulation”).
The Travel Rule Regulation was adopted in May 2023. The remaining proposals were approved by the Parliament on April 24, 2024 and by the Council on April 30, 2024 (with publication in the Official Journal of the European Union on June 19, 2024).
The new Authority for Anti-Money Laundering and Countering the Financing of Terrorism (AMLA) will have direct and indirect supervisory powers over high-risk obliged entities in the financial sector and will establish an integrated mechanism with national supervisors to ensure that obliged entities comply with AML/CFT-related obligations. The AMLA Regulation applies since July 1, 2025.
The AML/CFT Regulation harmonizes anti-money laundering rules across the EU and extends anti-money laundering rules to new obliged entities. The AML/CFT Regulation also establishes stricter due diligence requirements and regulates beneficial ownership. It will apply from July 10, 2027.
The 6th AML/CFT Directive sets out clear rules on how Financial Intelligence Units (“FIUs”) and supervisors work together, requires EU Member States to provide information from centralized bank account registers through a single access point and includes harmonization of the format of bank statements. The deadline for transposition is July 10, 2027.
Finally, the Travel Rule Regulation, which regulates measures to detect and manage transfers of funds or crypto-assets, began to apply on December 30, 2024.
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Data Protection Regulation
Regulation (EU) 2016/679 of the European Parliament and of the Council of April 27, 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data (“GDPR”) aims to achieve effective protection of personal data by providing natural persons in all EU member states with the same level of legally enforceable rights and obligations regarding personal data and imposing responsibilities on data controllers and processors to ensure consistent monitoring of the processing of personal data. Organic Law 3/2018, of December 5, on the protection of personal data and guarantee of digital rights implemented the GDPR into law in Spain. The regulatory body primarily responsible for oversight in Spain is the Spanish Data Protection Agency (“AEPD”).
The GDPR’s strengthened accountability requirements have led to the revision and improvement of our privacy management processes, including processes to obtain consents from clients, enable clients to exercise their rights, and manage cross-border data transfers.
The GDPR introduces a risk-based approach to data processing (the higher the risk associated with the data processing, the higher the standard for the evidence to be submitted in order to prove compliance with the GDPR), including the preparation of Data Protection Impact Assessments for each high-risk data processing activity, “privacy by design” and “privacy by default” requirements (where data protection is integrated in the technology from the outset) and the legitimate interest assessment (to weigh the reasons a business holds personal data against the data rights of an individual). This seeks to ensure appropriate risk-based prioritization of mitigations and controls and a significantly effective data management program based on assessed risk. Furthermore, subsequent guidance from the European Data Protection Board and the AEPD has further refined expectations regarding topics such as lawful bases for processing in marketing and the use of complex profiling techniques.
Furthermore, GDPR obligations and requirements to notify breaches to authorities and individuals under different circumstances led BBVA to review and enhance its data security measures and programs and to update its breach response plans and notification procedures, while ensuring continuous staff training and leadership buy-in. In the years following the initial implementation of the GDPR, the focus has shifted from initial compliance efforts to ensuring the maturity and operational embedding of these controls.
Mexico
BBVA’s operations in Mexico are highly regulated. The Mexican regulatory framework for financial and banking activities aims to ensure the stability of the financial system and combat money laundering, as well as to provide consumer protection and transparency in the provision of financial services.
Constitutional and Institutional Reform
On September 15, 2024, a constitutional reform regarding the Judiciary System was published in Mexico’s Federal Official Gazette. The reform, which took effect the day after its publication, primarily establishes the popular election of federal judges, including the Supreme Court Justice (“SCJN”). Furthermore, it reduces the number of SCJN justices from 11 to 9.
Additionally, on December 20, 2024, a further constitutional reform was published in Mexico’s Federal Official Gazette to eliminate several Constitutionally Autonomous Bodies, transferring their functions to other entities of the federal government. Among others, the reform provides for the redistribution of the responsibilities of the National Institute of Transparency (“INAI”) to government agencies, and the replacement of the Federal Economic Competition Commission (“COFECE”) by a decentralized body stemming from the Federal Executive, which will also be in charge of telecommunications’ antitrust matters.
As a result of the aforementioned reform, on March 20, 2025, a decree was published in the Federal Official Gazette enacting new legislation on transparency and personal data protection. The new legal framework includes: (i) the General Law on Transparency and Access to Public Information; (ii) the General Law on Personal Data Protection Held by Obligated Subjects; and (iii) the Federal Law on Personal Data Protection Held by Private Parties. These new laws reassign transparency-related responsibilities from INAI to various entities including the Secretariat of Anti-Corruption and Good Governance and the Federal Judiciary. They also mandate the establishment of the National Information Access System and the creation of specialized courts and tribunals to address these matters. The enactment of secondary regulation is still pending.
Furthermore, on July 9, 2025, the Mexican Congress approved a reform to the Federal Economic Competition Law (“LFCE”), which was subsequently published in the Federal Official Gazette on July 16. This amendment introduces significant changes –such as the creation of a new National Antitrust Commission (“CNA”), enhanced enforcement powers, and an expanded sanctions framework–and will affect various sectors, including banking, by increasing scrutiny over market behavior and dominant positions. On October 17, 2025, the new LFCE came into effect, COFECE was officially dissolved and the CNA began operations.
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COFECE Investigation into Card Payments Market
In 2018, the Investigative Authority (IA) of the COFECE launched an investigation into the card payments market. In July 2023, the COFECE’s Board issued a final resolution recommending that regulators implement regulatory changes and mandating clearing houses to establish a compliance program and appoint an antitrust compliance officer. In February 2025, COFECE formally confirmed that BBVA Mexico, as an investor in E-Global, a clearing house, has complied with the resolution.
Separately, in October 2022, COFECE announced that it had initiated an investigation in April 2022 into potential collusion in credit card transactions involving deferred monthly payments at zero interest. Although not under investigation, in July 2024, BBVA was requested to assist the authority by providing information related to the case. The request was fulfilled in December 2024. On December 18, 2024, COFECE concluded the investigation phase. In April 2025, the Investigative Authority of COFECE presented its findings to the Board of Commissioners. As a result of the investigation, COFECE issued a Statement of Probable Responsibility and notified the involved parties, thereby initiating the trial-like stage of the proceeding. BBVA is not an involved party and did not receive any notification.
Financial, Deposit and Credit Services
The provision of financial and deposit products is mainly regulated in the Banking Law and provisions issued by the National Banking and Securities Commission (Comisión Nacional Bancaria y de Valores or “CNBV”) and the Mexican Central Bank (“BANXICO”), where CNBV issues prudential regulation and BANXICO regulates banking transactions, including financial and deposit products. In addition, the Financial Services Transparency and Regulation Law contains provisions regarding transparency and consumer protection.
Furthermore, Banking Deposit Insurance Law (IPAB Law) governs the creation, organization, and functions of IPAB, the Mexican bank deposit protection agency. The IPAB provides financial support to banks to safeguard customer deposits. Deposit insurance is paid upon a bank’s liquidation.
Finally, the Law for the Protection and Defense of Financial Services Users aims to protect and defend the rights and interests of users of financial services. It establishes the CONDUSEF, an autonomous agency with broad authority to safeguard user rights, including the power to impose fines. Banks are required to maintain an internal unit dedicated to resolving disputes submitted by clients.
Capital Markets
The regulatory framework for capital markets includes specific regulations designed to develop the stock market in an equitable, efficient and transparent manner, protect the interests of investors and promote competition, and minimize systemic risk.
Asset Management
Regarding asset management, regulation encourages the creation and development of investment companies and promotes the strengthening and the decentralization of the stock market by facilitating the access of small and medium investors. It also establishes the rules for the organization and operation of investment funds, the intermediation of their shares in the stock market, and the organization and operation of the people who provide asset management services.
Anti-Money Laundering (AML) Regulations
The primary AML regulations applicable to credit institutions are issued by the Ministry of Finance and Public Credit (Secretaría de Hacienda y Crédito Público or “SHCP”) and are set forth in the general provisions referred to in Article 115 of the Mexican Banking Law. These provisions impose obligations on financial institutions, including customer due diligence, transaction monitoring, suspicious activity reporting, and risk-based compliance programs. The CNBV and SHCP enforce AML regulations and impose severe penalties for non-compliance.
On June 26, 2025, the Mexican Congress approved a reform to the Anti-Money Laundering Law (the Federal Law for the Prevention and Identification of Operations with Illicit Proceeds), which was subsequently published in the Federal Official Gazette on July 16, 2025. This amendment introduces expanded definitions (including “beneficial owner” and “politically exposed person”), enhances the Ministry of Finance’s oversight powers, and strengthens coordination with public and national security authorities. It is expected that these changes will have legal and operational impacts, including increased due diligence requirements, stricter reporting obligations, and updates to internal AML systems.
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Turkey
BBVA’s operations in Turkey are subject to substantial regulation. Apart from fundamental legal rules and product/service-specific legal regulations, the most basic regulation for the sector is the Banking Law No. 5411. The purpose of this law is to regulate the principles and procedures for ensuring confidence and stability in financial markets, the efficient functioning of the credit system and the protection of the rights and interests of depositors.
In general, the rules applicable to products and services that banks in Turkey offer to consumers are more stringent than rules applicable with respect to commercial and corporate banking customers. Besides general consumer protection regulations, there are specific regulations of the Banking Regulation and Supervision Agency (“BRSA”) on banking consumers.
Below is a brief summary of certain regulations that are relevant to our activity. For additional information on certain recent legal and market developments, see “—Competition—Turkey”.
Regulation on Loans and Reserve Requirements
Since 2020, the BRSA and the CBRT have issued recommendations to protect the value of the Turkish lira by ensuring that customers who are granted cash loans do not use the loan amounts for buying foreign currency or gold, and introduced and regulated the Foreign Currency Protected Turkish Lira Deposit Account, an instrument designed to protect Turkish lira-denominated deposits from volatility in exchange rates. Several Communiqués were issued since then, establishing maximum limits with respect to loan allocation and loan disbursement fees, revising applicable rates, and implementing policies to strengthen the monetary policy transmission mechanisms and to balance domestic demand.
On September 23, 2022, the Procedures and Principles Regarding Fees to be Collected by Banks from Commercial Customers entered into force (through Communiqué No. 2020/4 and further amendments), establishing maximum limits with respect to loan allocation and loan disbursement fees. According to such Communiqué, starting on January 4, 2024, monetary limits and maximum fees which are stated as fixed rates will be revised annually at the rate of increase in the annual consumer price index, as announced by the Turkish Statistical Institute at the end of the year. The Communiqué was amended on June 28, 2024 to introduce a change in the calculation method of the prepayment fee for fixed-rate and floating-rate commercial loans and subsequently further amended on November 1, 2025, when a simplified reduced limit of 0.20% was introduced.
On the other hand, policies were implemented in 2024 to strengthen the monetary policy transmission mechanism and balance domestic demand. In order to enhance the effectiveness of loan growth limits, a reserve requirement (funds to be held at the CBRT as a percentage of loans or deposits, as the case may be) based on loan growth was introduced in 2024. During 2024, the monthly growth limit was reduced from 2.5% to 2.0% for Turkish lira commercial loans and from 3.0% to 2.0% for general purpose loans. On January 4, 2025, the growth limit was revised to 2.5% for SME loans and 1.5% for commercial loans. These measures were implemented in order to control the growth in Turkish lira denominated loans within a lower interest rate environment.
On June 21, 2025, the Communiqué on Deposit and Loan Interest Rates and Participation Account Profit and Loss Participation Rates lowered the additional reserve requirement to 2.5%, from 4.0%.
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Regulation on Deposits
Since 2020, BRSA has issued recommendations to protect the value of the Turkish lira by ensuring that customers who are granted cash loans do not use the loan amounts for buying foreign currency or gold, and introduced the Foreign Currency Protected Deposit Account (KKM). While the scheme initially allowed individuals and legal entities to convert foreign currency and gold into protected Turkish lira-denominated deposits (with eligibility dates updated periodically, such as the September 2024 amendment referencing balances as of August 31, 2024), the CBRT began phasing out the program in 2025.
On July 20, 2024, the Communiqué on Amendments to the Communiqué on the Deposit and Participation Scheme for Non-Resident Turkish Citizens was adopted, setting forth certain regulation applicable to time deposit and participation accounts (“YUVAM”) that are the result of converting foreign currency deposit accounts and participation funds of certain non-resident persons that were denominated in foreign currency into Turkish lira deposits or accounts, and which provide additional returns according to the procedures determined by the CBRT. YUVAM accounts are a subset of foreign currency-protected deposit accounts (KKM), specifically tailored for non-resident individuals and legal entities, offering both exchange rate protection and an additional yield. As per the latest amendments, Turkish authorities are to gradually phase out the broader KKM scheme, specifically by excluding domestic legal entities from its scope for new openings and renewals, while maintaining YUVAM accounts as a distinct, regulated mechanism to attract foreign currency from non-resident individuals and legal entities. As of February 15, 2025, account openings and renewals for legal entities were terminated. On August 23, 2025, the opening and renewal of standard KKM accounts for individuals were also terminated, effectively ending the scheme for domestic residents.
Pursuant to CBRT legislation, banks are free to determine the interest rates on deposits and loans. However, between 2020 and 2024, the yearly interest rate on current deposit accounts was capped at low levels (around 0.25%), significantly below the annual inflation rate (30.9% as of late 2025).
Further amendments introduced an additional reserve requirement, which was set at 5% as of September 2024, and which requires Garanti BBVA to make Turkish lira-denominated deposits with the CBRT in such proportion with respect to all foreign currency-denominated deposits and participation funds (excluding those obtained from banks abroad) held by Garanti BBVA, regardless of their maturities. Further amendments reduced this requirement in November 2024 (4.0%) and June 2025 (2.5%). The reserve requirement framework was significantly revised throughout 2025 to simplify macroprudential tools. While a 5% additional reserve requirement was temporarily in force following the September 2024 amendments, the CBRT overhauled these regulations effective December 2025 (Communiqué No. 2025/61).
Under the updated regime in 2025, effective as of January 2, 2026, reserve requirement ratios for foreign currency-denominated deposits and participation funds were unified and set at 30% for short-term (up to 1 month) and 26% for long-term maturities. These amendments also eliminated previous divergences between foreign currency and gold deposit ratios, effectively superseding the specific 5% additional tranche mechanism previously in place. In addition, the reserve requirement for precious metal deposit accounts has been removed. For other liabilities (including foreign bank deposits/participation funds), the reserve requirement ratios have been changed for various maturity profiles. The rates for up to 2 years (including 2 years) decreased from 16% to 10%, for up to 3 years (including 3 years) from 11% to 8%, for up to 5 years (including 5 years) from 7% to 3% and for longer than 5 years from 5% to 0%. The 25% reserve requirement for foreign currency deposits/participation funds from repo transactions with domestic residents, with maturities up to 1 year, remains unchanged.
The Regulation on the Maintenance of Securities, pursuant to which each bank in Turkey (including Garanti BBVA) was required to hold certain amounts of Turkish lira-denominated long-term government debt securities and lease certificates issued by the Leasing Company of Under secretariat of Treasury based on their respective balances of foreign currency deposits, participation funds and precious metals held by customers and Turkish lira deposits, among other assets and liabilities, was amended on December 22, 2023. The relevant requirement for foreign currency deposits, participation funds and precious metals accounts held by customers and funds from foreign exchange-denominated repo transactions was set at 4%. The CBRT repealed the Regulation on the Maintenance of Securities on May 9, 2024 with immediate effect and, therefore, the rules requiring banks to hold long-term Turkish lira-denominated securities issued by the Turkish government with the CBRT have been abolished.
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Pursuant to the Communiqué on Deposit and Loan Interest Rates and Participation Account Profit and Loss Participation Rate of June 21, 2025, the following amendments were implemented with respect to Turkish lira-denominated deposits: (i) new reserve requirement ratios were set for accounts with variable interest rates linked to the consumer price index (CPI), producer price index (PPI), and Turkish lira Overnight Reference Rate (“TLREF”) Index, set at 10%; (ii) for accounts with maturities up to 6 months benefiting from CBRT exchange rate/price protection, the ratio increased from 33% to 40%, while demand deposits/participation funds in foreign banks belonging to parent companies were set at 0%; and (iii) variable interest rates may be applied to Turkish lira deposits with maturities longer than 1 month (previously, 3 months or longer).
Other Regulations
The Communiqué Regarding Maximum Interest Rates Applicable to Credit Card Transactions, published on and effective as of March 13, 2025, has altered both the amounts of period debt and interest rates applicable to credit card transactions in Turkish lira (excluding cash withdrawals or usage transactions and corporate credit card transactions). The updated period debt rates are calculated by adding 14 basis points (reduced from 39) for credit cards with a period debt below thirty thousand Turkish lira (previously twenty-five thousand); 64 basis points (reduced from 89) for credit cards with a period debt between thirty thousand and one hundred and eighty thousand Turkish lira (previously between twenty five and fifty thousand) 64 basis points (reduced from 89) and 114 basis points (reduced from 139) for credit cards with a period debt above one hundred and eighty thousand (previously above fifty thousand).
For corporate credit card transactions in Turkish lira (excluding cash withdrawals or purchase transactions) the monthly maximum contractual interest rate is determined by adding 114 basis points to the monthly reference rate, reduced from 139 basis points. For cash withdrawals or purchase transactions in Turkish lira, the monthly maximum contractual interest rate is determined by adding 114 basis points to the monthly reference rate, reduced from 139 basis points.
In addition, in September 2024, the BRSA introduced regulations regarding the restructuring of retail credit card debts, including the possibility of adding the installment amount for each month to the minimum payment of the relevant month, limited to a maximum of 60 months. The credit card limit allocated to the cardholder cannot be increased until 50% of the restructured debt is paid off. If the restructured amount exceeds the credit card limit, the excess amount will not be considered an overdraft (debit). The interest rate applicable to restructured credit card debts must not exceed the reference rate specified in the regulation updates of September 2024, and was amended on November 1, 2025, by establishing a limit of 3.11%.
New regulations in Turkey, effective June 2025, have significantly tightened anti-money laundering (AML) protocols for crypto asset service providers (“CSP”). The Financial Crimes Investigation Board (“FCIB”) now requires CSP to conduct remote Know Your Customer (“KYC”) checks, verifying customer identity and address through government databases for ongoing business relationships. This move integrates crypto services into the broader AML framework, aiming to increase transparency and accountability within the digital asset space. Further updates from the FCIB introduce specific restrictions on crypto asset transfers.
The CBRT, via the Communiqué Regarding the Determination of Interest Rates to be Applied in Rediscount and Advance Transactions, published on and effective as of 20 December 2025, has set the discount rate applicable to rediscount transactions for bills with a remaining maturity of up to 3 months at 38.75% per annum, and the interest rate applicable to advance transactions at 39.75% per annum.
United States
BBVA’s activities and operations in the United States are subject to extensive U.S. federal and state supervision and regulation, and in some cases, U.S. requirements may impose restrictions on BBVA’s global activities.
U.S. Bank Regulation
Because BBVA maintains a branch in the United States, BBVA is a foreign banking organization and a bank holding company within the meaning of the U.S. Bank Holding Company Act of 1956, as amended (the “BHC Act”) and the International Banking Act of 1978, as amended (the “IBA”), and as a result, BBVA is subject to regulation and supervision by the Board of Governors of the Federal Reserve System (the “Federal Reserve”). BBVA has also elected to be treated as a financial holding company. To continue to be treated as a financial holding company, each of BBVA and BBVA Bancomer, S.A. and BBVA Mexico, S.A. must maintain certain regulatory capital ratios above minimum requirements and must be deemed to be “well-managed” for U.S. bank regulatory purposes.
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As a bank holding company, BBVA’s direct and indirect activities and investments in the United States are limited to banking activities and certain non-banking activities that are “closely related to banking”, as determined by the Federal Reserve, and certain other activities permitted under the BHC Act and IBA. As a bank holding company that has elected to be treated as a financial holding company, BBVA can also engage in direct and indirect activities and investments in the United States that are “financial in nature”, as determined by the Federal Reserve, and certain other activities permitted under the BHC Act and IBA. BBVA is required to obtain the prior approval of the Federal Reserve before acquiring, directly or indirectly, the ownership or control of more than 5% of any class of voting securities of any U.S. bank or bank holding company.
BBVA’s non-FDIC insured New York branch is supervised by the Federal Reserve through the Federal Reserve Bank of New York, as well as licensed and supervised by the New York State Department of Financial Services. BBVA’s Houston representative office is supervised by the Federal Reserve through the Federal Reserve Bank of Dallas, as well as licensed and supervised by the Texas Department of Banking. BBVA Mexico, S.A.’s agency office in Houston, Texas is a non-FDIC insured agency office of BBVA Mexico, S.A., an indirect subsidiary of BBVA, which is licensed under the laws of the State of Texas and supervised by the Texas Department of Banking and the Federal Reserve Bank of Dallas. BBVA’s U.S. branch and agency are subject to liquidity requirements.
Sections 23A and 23B of Federal Reserve Act and Regulation W place various qualitative and quantitative restrictions on transactions between BBVA’s U.S. branch and agency and BBVA’s U.S. broker-dealer subsidiary with regard to extensions of credit, credit exposures arising from derivative transactions, and securities borrowing and lending transactions or engaging in certain other transactions involving the U.S. branch and agency. Such transactions must be on terms that would ordinarily be offered to unaffiliated entities, must be secured by designated amounts of specified collateral, and are subject to quantitative limitations.
BBVA is subject to certain Federal Reserve regulations under Regulation YY related to its compliance with Spanish capital adequacy standards, risk management and governance requirements, and liquidity and capital stress testing requirements based on its worldwide total assets. Because BBVA does not have $100 billion or more in combined U.S. assets, it is not subject to the enhanced prudential standards under Regulation YY applicable to foreign banking organizations with combined U.S. assets of $100 billion or more.
BBVA is subject to certain U.S. resolution planning requirements. Under Title I of the Dodd-Frank Act and implementing regulations issued by the Federal Reserve and the FDIC, BBVA must prepare and submit a plan for the orderly resolution of its U.S. subsidiaries and U.S. operations in the event of future material financial distress or failure (the “Title I Resolution Plan”). Based on its worldwide total assets, BBVA is required to file a reduced Title I Resolution Plan once every three years, filing its most recent Title I Resolution Plan in 2025.
BBVA is subject to the Volcker Rule. The Volcker Rule prohibits a foreign bank that maintains a branch or agency in the United States, such as BBVA, and its affiliates from (1) engaging in “proprietary trading” and (2) investing in or sponsoring certain types of funds (covered funds) subject to certain limited exceptions. The Volcker Rule regulations contain certain exemptions, including for market-making, hedging, underwriting, trading in U.S. government and agency obligations, and permit certain ownership interests in certain types of funds to be retained. They also permit the offering and sponsoring of funds under certain conditions. In the case of non-U.S. banking entities, such as BBVA, there is also an exemption permitting activities conducted solely outside of the United States, provided that certain criteria are satisfied. While the Volcker Rule regulations impose significant compliance and reporting obligations on banking entities, BBVA is of the view that the impact of the Volcker Rule is not material to its business operations.
Derivatives
BBVA is registered as a “swap dealer” as defined in the Commodity Exchange Act and the regulations promulgated thereunder with the U.S. Commodity Futures Trading Commission (the “CFTC”), which subjects BBVA to regulation and supervision by the CFTC and the National Futures Association with respect to its activities involving “swaps” (as defined in the Commodity Exchange Act), which include many types of over-the-counter derivatives, such as interest rate swaps and certain foreign exchange derivatives. In general, as a non-U.S. swap dealer, BBVA is not subject to all CFTC requirements applicable to U.S. swap dealers, including certain business conduct standards, when entering into swaps with non-U.S. counterparties. In addition, subject to certain conditions, BBVA may comply with EU OTC derivatives requirements in lieu of certain CFTC requirements, including portfolio reconciliation, portfolio compression and trade confirmation requirements, pursuant to substituted compliance determinations issued by the CFTC.
BBVA’s worldwide swap activities are also subject to regulations adopted by the European Commission pursuant to the European Market Infrastructure Regulation (“EMIR”) and the EU’s Markets in Financial Instruments Directive (“MiFID”) and other European regulations and directives.
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BBVA is conditionally registered as a security-based swap dealer with the SEC, which subjects BBVA to regulation and supervision by the SEC with respect to its activities involving “security-based swaps” (as defined in the Securities Exchange Act of 1934), which include many types of over-the-counter derivatives referencing single securities or loans or narrow-based indexes of securities, such as credit default swaps and equity total return swaps. In general, as a non-U.S. security-based swap dealer, BBVA is not subject to all SEC requirements applicable to U.S. security-based swap dealers, including certain business conduct standards, when entering into security-based swaps with non-U.S. counterparties. In addition, subject to certain conditions, BBVA may comply with EU OTC derivatives requirements in lieu of certain SEC requirements, pursuant to a substituted compliance determination issued by the SEC.
Anti-Money Laundering; Office of Foreign Assets Control
A major focus of U.S. governmental policy relating to financial institutions in recent years has been aimed at combatting money laundering and terrorist financing. Laws and regulations applicable to BBVA and certain of its affiliates impose obligations to maintain appropriate policies, procedures, and controls to detect, prevent, and report money laundering and terrorist financing. In particular, the Bank Secrecy Act, as amended by Title III of the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (the “USA PATRIOT Act”), and its implementing regulations require financial institutions operating in the United States to, among other things, (a) conduct due diligence and collect certain information related to correspondent and payable-through bank accounts; (b) implement enhanced due diligence for private banking and correspondent banking relationships; (c) scrutinize the beneficial ownership and activity of certain non-U.S., private banking and other high-risk customers (e.g., senior foreign political figures); and (d) develop and maintain anti-money laundering programs that include a Customer Identification Program; compliance policies, procedures, and internal controls designed to ensure the detection and reporting of money laundering and terrorist financing; the designation of a Bank Secrecy Act compliance officer; as well as training and audit functions. Financial institutions are also expected to maintain compliance programs designed to comply with economic sanctions administered by the United States Department of the Treasury’s Office of Foreign Assets Control. Failure of a financial institution to maintain and implement adequate anti-money laundering and sanctions compliance programs could have serious legal and reputational consequences for the institution.
Other Regulated U.S. Entities
BBVA’s direct U.S. broker-dealer subsidiary, BBVA Securities Inc. (“BSI”), is subject to regulation and supervision by the Securities and Exchange Commission (“SEC”) and the Financial Industry Regulatory Authority (“FINRA”) with respect to its securities activities, as well as various U.S. state regulatory authorities. In addition, the securities underwriting and dealing activities of BSI are subject to regulation and supervision by the Federal Reserve.
The activities of BBVA’s U.S. investment adviser affiliate are regulated and supervised by the SEC. In August 2025, BBVA established an insurance agency subsidiary, BBVA Global Wealth Insurance Agency, Inc., which is subject to regulation and supervision by various U.S. state regulatory authorities pending applications and state regulatory approval of applicable insurance licenses.
Disclosure of Iranian Activities under Section 13(r) of the Exchange Act
The BBVA Group discloses the following information pursuant to Section 13(r) of the Exchange Act, which requires an issuer to disclose whether it or any of its affiliates knowingly engaged in certain activities, transactions or dealings relating to Iran or with natural persons or entities designated by the U.S. government under specified executive orders, including activities not prohibited by U.S. law and conducted outside the United States by non-U.S. affiliates in compliance with local law. In order to comply with this requirement, the Company has requested relevant information from its affiliates globally.
To the BBVA Group’s knowledge, neither the Company nor any of the Company’s affiliates have knowingly engaged in any activities, transactions, or dealings during the period covered by this Annual Report, that are required to be disclosed under Section 13(r) of the Exchange Act.
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C. Organizational Structure
For information on the composition of the BBVA Group as of December 31, 2025, see Note 1.1 to the Consolidated Financial Statements.
The companies comprising the BBVA Group are principally domiciled in the following countries: Argentina, Belgium, Chile, Colombia, France, Germany, Italy, Mexico, Netherlands, Peru, Portugal, Romania, Spain, Switzerland, Turkey, United Kingdom, the United States of America and Uruguay. In addition, BBVA has an active presence in Asia.
Below is a simplified organizational chart of BBVA’s most significant subsidiaries as of December 31, 2025.
Subsidiary Country of Incorporation Activity BBVA Voting Power BBVA Ownership Total Assets (1)
(In Percentages) (In Millions of Euros)
BBVA MEXICO MEXICO Bank 100.00 100.00 155,059
GARANTI BBVA TURKEY Bank 85.97 85.97 72,157
BBVA PERÚ PERU Bank 94.26 (2) 47.13 28,019
BBVA COLOMBIA S.A. COLOMBIA Bank 96.35 96.35 23,027
BBVA SEGUROS S.A. DE SEGUROS Y REASEGUROS SPAIN Insurance 99.96 99.96 13,879
BANCO BBVA ARGENTINA S.A. ARGENTINA Bank 67.00 66.55 14,085
BBVA SEGUROS MÉXICO, S.A. DE CV GRUPO FINANCIERO BBVA MEXICO MEXICO Insurance 99.98 100.00 13,366
GARANTIBANK BBVA INTERNATIONAL N.V. (3) THE NETHERLANDS Bank 85.97 100.00 10,746
BBVA PENSIONES MEXICO, S.A. DE C.V., GRUPO FINANCIERO BBVA MEXICO MEXICO Insurance 100.00 100.00 8,754
BANCO BILBAO VIZCAYA ARGENTARIA URUGUAY S.A. URUGUAY Bank 100.00 100.00 4,016
(1)Information for non-EU subsidiaries has been calculated using the prevailing exchange rates on December 31, 2025.
(2)Subject to certain exceptions.
(3)BBVA owns 85.97% of Garanti BBVA, which in turn owns 100% of GarantiBank BBVA International N.V.
D. Property, Plants and Equipment
We own or rent a substantial network of properties in Spain and abroad, including 1,871 branch offices in Spain and, principally through our various subsidiaries, 3,771 branch offices abroad as of December 31, 2025 (1,881 and 3,868, respectively, as of December 31, 2024). As of December 31, 2025, approximately 46% of our branches in Spain and 71% of our branches abroad were rented from third parties pursuant to leases that may be renewed by mutual agreement (48% and 72%, respectively, as of December 31, 2024). For additional information on property, plants and equipment, see Note 17 to the Consolidated Financial Statements.
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E. Selected Statistical Information
The following is a presentation of selected statistical information for the periods indicated. Where required under subpart 1400 of Regulation S-K, we have provided such selected statistical information separately for our domestic and foreign activities, pursuant to our determination, where applicable, that our foreign operations are significant according to Rule 9-05 of Regulation S-X. The allocation of assets and liabilities between “domestic” and “foreign” is based on the domicile of the Group entity at which the relevant asset or liability is accounted for, with “domestic” referring to the assets and liabilities of the BBVA Group entities domiciled in Spain.
Interest income figures, when used, do not include interest income on non-accruing loans to the extent that cash payments have been received, as a result of the application of the interpretation issued by the International Financial Reporting Interpretations Committee (IFRIC) in its “IFRIC Update” of March 2019 regarding the collection of interest on impaired financial assets under IFRS 9 (Collection of interest on impaired financial assets). Loan fees are included in the computation of interest revenue. Interest income figures include “other income”, which amounted to €233 million, €214 million and €231 million for the years ended December 31, 2025, 2024 and 2023, respectively. For additional information on “interest and other income” see Note 37.1 to the Consolidated Financial Statements.
Average Balances and Rates
The tables below set forth selected statistical information on our average balance sheets, which are based on the beginning and month-end balances in each year. We do not believe that monthly averages present trends materially different from those that would be presented by daily averages. We have not recalculated tax-exempt income on a tax-equivalent basis because the effect of doing so would not be significant.
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Average Balance Sheet - Assets and Interest from Interest Earning Assets
Year ended December 31, 2025 Year ended December 31, 2024 Year ended December 31, 2023
Average Balance Interest Average Yield Average Balance Interest Average Yield Average Balance Interest Average Yield
(In Millions of Euros, Except Percentages)
Total Assets (1) 817,040 58,345 7.14 % 777,997 61,659 7.93 % 748,459 47,850 6.39 %
Interest-earning assets 753,424 58,345 7.74 % 716,824 61,659 8.60 % 694,361 47,850 6.89 %
Cash and balances with central banks and other demand deposits 48,161 1,621 3.36 % 57,589 2,283 3.96 % 70,177 2,482 3.54 %
Domestic 12,954 232 1.79 % 28,603 972 3.40 % 42,535 1,394 3.28 %
Foreign 35,208 1,389 3.94 % 28,986 1,311 4.52 % 27,642 1,088 3.94 %
Financial assets held for trading 87,855 4,525 5.15 % 90,479 5,664 6.26 % 85,279 4,870 5.71 %
Domestic 69,448 2,693 3.88 % 68,451 3,092 4.52 % 66,812 2,482 3.72 %
Foreign 18,407 1,832 9.95 % 22,029 2,572 11.68 % 18,467 2,387 12.93 %
Financial assets at fair value through other comprehensive income 56,559 3,342 5.91 % 59,061 4,108 6.96 % 62,677 3,791 6.05 %
Domestic 25,129 710 2.82 % 27,744 805 2.90 % 32,682 777 2.38 %
Foreign 31,429 2,632 8.37 % 31,317 3,303 10.55 % 29,995 3,014 10.05 %
Financial assets at amortized cost 525,020 47,074 8.97 % 472,827 48,109 10.17 % 434,214 36,063 8.31 %
Domestic 251,632 8,608 3.42 % 228,751 9,505 4.16 % 211,019 8,142 3.86 %
Foreign 273,388 38,467 14.07 % 244,076 38,604 15.82 % 223,195 27,921 12.51 %
Debt securities 65,530 2,277 3.48 % 55,967 2,307 4.12 % 44,609 1,415 3.17 %
Domestic 51,166 1,373 2.68 % 40,606 1,096 2.70 % 29,407 748 2.54 %
Foreign 14,364 904 6.29 % 15,361 1,210 7.88 % 15,202 667 4.38 %
Loans and advances 459,489 44,797 9.75 % 416,861 45,803 10.99 % 389,605 34,648 8.89 %
Central banks 8,918 2,164 24.26 % 7,710 2,053 26.62 % 5,720 508 8.88 %
Domestic 40 1 2.10 % 15 — 3.00 % 30 1 3.33 %
Foreign 8,878 2,163 24.36 % 7,695 2,052 26.67 % 5,690 507 8.91 %
Credit institutions 23,616 1,142 4.84 % 20,939 1,568 7.49 % 16,595 1,451 8.75 %
Domestic 14,708 638 4.34 % 13,822 916 6.63 % 9,472 828 8.74 %
Foreign 8,908 504 5.66 % 7,117 652 9.16 % 7,123 623 8.75 %
Government 24,848 1,316 5.30 % 22,665 1,530 6.75 % 22,478 1,427 6.35 %
Domestic 14,534 373 2.57 % 12,369 379 3.06 % 12,541 323 2.58 %
Foreign 10,314 943 9.15 % 10,295 1,151 11.18 % 9,937 1,104 11.11 %
Other financial corporations 19,913 1,434 7.20 % 14,638 1,265 8.64 % 12,822 987 7.70 %
Domestic 6,723 307 4.57 % 5,176 411 7.95 % 5,224 375 7.18 %
Foreign 13,191 1,127 8.55 % 9,461 854 9.02 % 7,598 612 8.05 %
Individuals 184,055 19,458 10.57 % 174,309 19,057 10.93 % 165,941 15,244 9.19 %
Domestic 95,736 3,367 3.52 % 93,466 3,774 4.04 % 92,119 3,391 3.68 %
Mortgages 71,776 1,995 2.78 % 70,678 2,488 3.52 % 70,392 2,217 3.15 %
Other 23,960 1,372 5.73 % 22,788 1,287 5.65 % 21,727 1,174 5.40 %
Foreign 88,318 16,091 18.22 % 80,842 15,283 18.90 % 73,822 11,852 16.05 %
Mortgages 29,806 2,992 10.04 % 26,356 2,845 10.80 % 25,835 2,440 9.45 %
Other 58,512 13,099 22.39 % 54,487 12,437 22.83 % 47,987 9,412 19.61 %
Non-financial corporations 198,139 19,283 9.73 % 176,601 20,330 11.51 % 166,049 15,032 9.05 %
Domestic 68,725 2,549 3.71 % 63,296 2,928 4.63 % 62,226 2,475 3.98 %
Foreign 129,414 16,733 12.93 % 113,304 17,402 15.36 % 103,824 12,556 12.09 %
Derivatives and other financial assets (2) 35,830 1,784 4.98 % 36,868 1,494 4.05 % 42,014 645 1.53 %
Domestic 28,573 432 1.51 % 28,199 429 1.52 % 30,670 (121) (0.39) %
Foreign 7,256 1,353 18.64 % 8,669 1,066 12.29 % 11,344 765 6.75 %
Non interest earning assets (3) 63,616 — — 61,172 — — 54,098 — —
(1)Foreign activity represented 48.57% of the average total assets for the year ended December 31, 2025, 47.03% for the year ended December 31, 2024 and 44.12% for the year ended December 31, 2023.
(2)Includes “Derivatives - Hedge accounting”, “Derivatives - Held for trading” and “Financial assets designated at fair value through profit or loss”.
(3)Includes “Insurance and reinsurance assets”, “Joint ventures and associates”, “Tangible assets”, “Intangible assets”, “Tax assets”, “Non-current assets and disposal groups classified as held for sale”, “Non-trading financial assets mandatorily at fair value through profit or loss” and “Other assets”.
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Average Balance Sheet - Liabilities and Interest Paid on Interest Bearing Liabilities
Year ended December 31, 2025 Year ended December 31, 2024 Year ended December 31, 2023
Average Balance Interest Average Rate Paid Average Balance Interest Average Rate Paid Average Balance Interest Average Rate Paid
(In Millions of Euros, Except Percentages)
Total Liabilities (1) 817,040 32,065 3.92 % 777,997 36,392 4.68 % 748,459 24,761 3.31 %
Interest-bearing liabilities 715,347 32,065 4.48 % 684,200 36,392 5.32 % 662,856 24,761 3.74 %
Financial liabilities held for trading 70,915 3,054 4.31 % 73,448 4,104 5.59 % 76,280 3,424 4.49 %
Domestic 61,017 2,297 3.76 % 56,326 2,529 4.49 % 60,308 2,087 3.46 %
Foreign 9,897 757 7.65 % 17,122 1,575 9.20 % 15,972 1,337 8.37 %
Financial liabilities at amortized cost 590,520 26,107 4.42 % 555,981 28,429 5.11 % 526,650 19,215 3.65 %
Domestic 315,958 4,777 1.51 % 306,852 6,115 1.99 % 304,574 5,209 1.71 %
Foreign 274,562 21,330 7.77 % 249,130 22,314 8.96 % 222,076 14,007 6.31 %
Debt certificates 74,870 3,373 4.51 % 69,098 3,114 4.51 % 61,289 2,349 3.83 %
Domestic 46,367 1,481 3.19 % 46,700 1,616 3.46 % 43,453 1,248 2.87 %
Foreign 28,502 1,892 6.64 % 22,398 1,499 6.69 % 17,836 1,101 6.17 %
Deposits 515,650 22,734 4.41 % 486,884 25,315 5.20 % 465,360 16,867 3.62 %
Central banks 16,809 896 5.33 % 17,756 1,264 7.12 % 26,864 1,574 5.86 %
Domestic 8,296 337 4.07 % 8,163 399 4.89 % 16,215 600 3.70 %
Foreign 8,513 558 6.56 % 9,593 865 9.02 % 10,649 973 9.14 %
Credit institutions 34,354 2,854 8.31 % 34,614 2,923 8.44 % 39,695 2,424 6.11 %
Domestic 24,416 950 3.89 % 26,230 1,436 5.47 % 32,493 1,610 4.95 %
Foreign 9,937 1,903 19.15 % 8,384 1,487 17.74 % 7,202 814 11.31 %
Government 48,970 1,376 2.81 % 44,245 1,750 3.96 % 26,919 1,027 3.82 %
Domestic 33,684 606 1.80 % 30,554 932 3.05 % 14,836 277 1.87 %
Foreign 15,285 769 5.03 % 13,691 818 5.98 % 12,083 750 6.21 %
Other financial corporations 33,499 1,858 5.55 % 28,928 1,749 6.05 % 26,665 1,418 5.32 %
Domestic 12,278 483 3.93 % 11,473 624 5.44 % 13,192 716 5.43 %
Foreign 21,220 1,376 6.48 % 17,455 1,125 6.44 % 13,473 703 5.21 %
Individuals 252,020 8,773 3.48 % 242,236 10,509 4.34 % 236,151 5,461 2.31 %
Domestic 145,559 459 0.32 % 142,664 524 0.37 % 143,506 294 0.20 %
Foreign 106,461 8,314 7.81 % 99,572 9,984 10.03 % 92,645 5,168 5.58 %
Non-financial corporations 129,998 6,976 5.37 % 119,105 7,120 5.98 % 109,066 4,962 4.55 %
Domestic 45,356 460 1.02 % 41,068 584 1.42 % 40,880 464 1.13 %
Foreign 84,642 6,516 7.70 % 78,037 6,536 8.38 % 68,187 4,498 6.60 %
Provisions 2,264 234 10.35 % 2,422 228 9.40 % 2,494 174 6.97 %
Domestic 1,810 67 3.68 % 2,066 81 3.91 % 2,217 100 4.51 %
Foreign 454 168 36.94 % 356 147 41.32 % 277 74 26.63 %
Derivatives and other financial liabilities (2) 51,649 2,670 5.17 % 52,348 3,631 6.94 % 57,433 1,948 3.39 %
Domestic 32,476 200 0.62 % 32,424 1,041 3.21 % 36,007 844 2.34 %
Foreign 19,173 2,470 12.88 % 19,924 2,591 13.00 % 21,425 1,104 5.15 %
Non-interest bearing liabilities and Equity (3) 101,692 — — 93,797 — — 85,602 — —
(1)Foreign activity represented 43.20% of the total average liabilities for the year ended December 31, 2025, 42.63% for the year ended December 31, 2024 and 40.05% for the year ended December 31, 2023.
(2)Includes “Insurance and reinsurance liabilities”, “Derivatives - Hedge accounting”, “Financial liabilities held for trading” and “Financial liabilities designated at fair value through profit or loss”.
(3)Includes “Tax liabilities”, “Liabilities included in disposal groups classified as held for sale” and “Other liabilities”.
Changes in Net Interest Income-Volume and Rate Analysis
The following tables allocate changes in our net interest income between changes in volume and changes in rate for the year ended December 31, 2025 compared with the year ended December 31, 2024, and the year ended December 31, 2024 compared with the year ended December 31, 2023. Volume and rate variance have been calculated based on movements in average balances over the period and changes in interest rates on average interest-earning assets and average interest-bearing liabilities. The only out-of-period items and adjustments excluded from such table are interest payments on loans which are made in a period other than the period in which they are due.
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2025/2024
Increase (Decrease) Due to Changes in
Volume (1) Rate (2) Net Change
(In Millions of Euros)
Interest income
Cash and balances with central banks and other demand deposits (374) (289) (663)
Domestic (532) (208) (740)
Foreign 281 (204) 77
Financial assets held for trading (164) (975) (1,139)
Domestic 45 (444) (399)
Foreign (423) (317) (740)
Financial assets at fair value through other comprehensive income (174) (593) (767)
Domestic (76) (20) (96)
Foreign 12 (683) (671)
Financial assets at amortized cost 5,311 (6,346) (1,035)
Domestic 951 (1,848) (897)
Foreign 4,636 (4,774) (138)
Debt securities 394 (423) (29)
Domestic 285 (8) 277
Foreign (79) (228) (306)
Loans and advances 4,684 (5,690) (1,006)
Central banks 322 (211) 111
Domestic 1 — —
Foreign 316 (205) 111
Credit institutions 200 (626) (426)
Domestic 59 (337) (279)
Foreign 164 (311) (147)
Government 147 (361) (214)
Domestic 66 (72) (6)
Foreign 2 (210) (208)
Other financial corporations 456 (287) 169
Domestic 123 (227) (104)
Foreign 337 (63) 273
Individuals 1,066 (665) 400
Domestic 92 (499) (408)
Mortgages 39 (532) (493)
Other 66 19 85
Foreign 1,413 (605) 808
Mortgages 373 (226) 147
Other 919 (258) 661
Non-financial corporations 2,479 (3,527) (1,047)
Domestic 251 (630) (378)
Foreign 2,474 (3,143) (669)
Derivatives and other financial assets (42) 332 290
Domestic 6 (3) 3
Foreign (174) 461 287
Total income 3,094 (6,408) (3,314)
(1)The volume effect is calculated as the result of the average interest rate of the earlier period multiplied by the difference between the average balances of both periods.
(2)The rate effect is calculated as the result of the average balance of the earlier period multiplied by the difference between the average interest rates of both periods.
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2025/2024
Increase (Decrease) Due to Changes in
Volume (1) Rate (2) Net Change
(In Millions of Euros)
Interest expense
Financial liabilities held for trading (142) (909) (1,050)
Domestic 211 (443) (233)
Foreign (665) (153) (818)
Financial liabilities at amortized cost 1,766 (4,088) (2,322)
Domestic 181 (1,519) (1,338)
Foreign 2,278 (3,262) (984)
Debt certificates 260 (1) 259
Domestic (11) (123) (135)
Foreign 408 (15) 394
Deposits 1,496 (4,077) (2,581)
Central banks (67) (301) (368)
Domestic 7 (68) (62)
Foreign (97) (209) (307)
Credit institutions (22) (47) (69)
Domestic (99) (386) (485)
Foreign 276 140 416
Government 187 (561) (374)
Domestic 95 (421) (325)
Foreign 95 (144) (49)
Other financial corporations 276 (167) 110
Domestic 44 (186) (142)
Foreign 243 9 251
Individuals 424 (2,160) (1,735)
Domestic 11 (76) (65)
Foreign 691 (2,361) (1,670)
Non-financial corporations 651 (795) (143)
Domestic 61 (185) (124)
Foreign 553 (573) (20)
Provisions (15) 22 7
Domestic (10) (4) (14)
Foreign 41 (20) 21
Derivatives and other financial liabilities (3) (48) (913) (962)
Domestic 2 (842) (841)
Foreign (98) (23) (121)
Total expense 1,826 (6,153) (4,327)
Net interest income 1,013
(1)The volume effect is calculated as the result of the average interest rate of the earlier period multiplied by the difference between the average balances of both periods.
(2)The rate effect is calculated as the result of the average balance of the earlier period multiplied by the difference between the average interest rates of both periods.
(3)Includes “Insurance and reinsurance liabilities”, “Derivatives - Hedge accounting”, “Financial liabilities held for trading” and “Financial liabilities designated at fair value through profit or loss”.
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2024/2023
Increase (Decrease) Due to Changes in
Volume (1) Rate (2) Net Change
(In Millions of Euros)
Interest income
Cash and balances with central banks and other demand deposits (445) 247 (198)
Domestic (457) 35 (422)
Foreign 53 171 224
Financial assets held for trading 297 497 794
Domestic 61 549 609
Foreign 460 (276) 185
Financial assets at fair value through other comprehensive income (219) 536 318
Domestic (117) 146 28
Foreign 133 157 289
Financial assets at amortized cost 3,207 8,839 12,046
Domestic 684 679 1,363
Foreign 2,612 8,071 10,683
Debt securities 360 531 892
Domestic 285 63 348
Foreign 7 537 544
Loans and advances 2,424 8,731 11,155
Central banks 177 1,368 1,545
Domestic — — —
Foreign 179 1,366 1,545
Credit institutions 380 (263) 117
Domestic 380 (292) 89
Foreign (1) 29 28
Government 12 92 103
Domestic (4) 60 56
Foreign 40 8 48
Other financial corporations 140 138 278
Domestic (3) 40 36
Foreign 150 92 242
Individuals 769 3,045 3,814
Domestic 50 333 383
Mortgages 9 261 270
Other 57 55 112
Foreign 1,127 2,304 3,431
Mortgages 49 356 405
Other 1,275 1,751 3,026
Non-financial corporations 955 4,343 5,298
Domestic 43 410 453
Foreign 1,147 3,699 4,846
Derivatives and other financial assets (79) 929 850
Domestic 10 539 549
Foreign (180) 481 300
Total income 1,888 11,921 13,809
(1)The volume effect is calculated as the result of the average interest rate of the earlier period multiplied by the difference between the average balances of both periods.
(2)The rate effect is calculated as the result of the average balance of the earlier period multiplied by the difference between the average interest rates of both periods.
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2024/2023
Increase (Decrease) Due to Changes in
Volume (1) Rate (2) Net Change
(In Millions of Euros)
Interest expense
Financial liabilities held for trading (127) 808 680
Domestic (138) 580 442
Foreign 96 142 238
Financial liabilities at amortized cost 1,070 8,143 9,214
Domestic 39 867 906
Foreign 1,706 6,601 8,307
Debt certificates 299 466 766
Domestic 93 274 368
Foreign 282 116 398
Deposits 780 7,668 8,448
Central banks (534) 224 (309)
Domestic (298) 97 (201)
Foreign (97) (12) (108)
Credit institutions (310) 809 498
Domestic (310) 136 (174)
Foreign 134 539 673
Government 661 62 723
Domestic 294 361 655
Foreign 100 (32) 68
Other financial corporations 120 210 331
Domestic (93) 2 (91)
Foreign 208 214 422
Individuals 141 4,907 5,048
Domestic (2) 233 231
Foreign 386 4,430 4,817
Non-financial corporations 457 1,701 2,158
Domestic 2 118 120
Foreign 650 1,388 2,038
Provisions (5) 59 54
Domestic (7) (13) (19)
Foreign 21 52 73
Derivatives and other financial liabilities (3) (172) 1,856 1,684
Domestic (84) 280 196
Foreign (77) 1,564 1,487
Total expense 977 10,654 11,631
Net interest income 2,178
(1)The volume effect is calculated as the result of the average interest rate of the earlier period multiplied by the difference between the average balances of both periods.
(2)The rate effect is calculated as the result of the average balance of the earlier period multiplied by the difference between the average interest rates of both periods.
(3)Includes “Insurance and reinsurance liabilities”, “Derivatives - Hedge accounting”, “Financial liabilities held for trading” and “Financial liabilities designated at fair value through profit or loss”.
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Interest Earning Assets—Margin and Spread
The following table analyzes the levels of our average interest earning assets and illustrates the comparative gross and net yields and spread obtained for each of the years indicated.
December 31,
2025 2024 2023
(In Millions of Euros, Except Percentages)
Average interest earning assets 753,424 716,824 694,361
Gross yield (1) 7.7% 8.6% 6.9%
Net yield (2) 3.5% 3.5% 3.3%
Average effective rate paid on interest-bearing liabilities 4.5% 5.3% 3.7%
Spread (3) 3.3% 3.3% 3.2%
(1)“Gross yield” represents interest income divided by average interest-earning assets.
(2)“Net yield” represents net interest income divided by average interest-earning assets.
(3)“Spread” is the difference between “Gross yield” and the “Average effective rate paid on interest-bearing liabilities”.
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ASSETS
Interest-Bearing Deposits in Other Banks
As of December 31, 2025, interbank deposits (excluding deposits with central banks) (which are recorded under “Loans and advances to credit institutions” in the “Financial assets held for trading”, “Financial assets at amortized cost” and “Financial assets at fair value through other comprehensive income” portfolios), represented 4.9% of our total assets (compared to 5.7% of our total assets as of December 31, 2024). Of such interbank deposits, 14.8% were held outside of Spain and 85.2% in Spain. We believe that our deposits are generally placed with highly rated banks and have a lower risk than many loans we could make in Spain. However, such deposits are subject to the risk that the deposit banks may fail or that such banks or the banking system of certain of the countries in which a portion of our deposits are made may face liquidity or other problems.
Securities Portfolio
As of December 31, 2025, our securities portfolio, consisting of investment securities and loans and advances recorded under “Financial assets held for trading” and “Financial assets at fair value through other comprehensive income” portfolios, was carried on our consolidated balance sheet at a carrying amount (equivalent to its market or appraised value as of such date) of €149,443 million, representing 17.4% of our total assets, a 13.3% increase compared to our securities portfolio as of December 31, 2024, mainly due to increases in the trading portfolio in Spain, as a result of the increase in loans and advances through reverse repurchase agreements in the corporate portfolio in Spain, the increase in holdings of sovereign debt securities of European countries and equity instruments in Spain and the increase in loans and advances through reverse repurchase agreements in Mexico, partially offset by the decrease in derivatives in Spain. €14,047 million, or 9.4%, of our securities portfolio as of December 31, 2025 consisted of Spanish Treasury bonds and Treasury bills. The average yield during 2025 on the investment securities that BBVA held was 6.2%, compared with an average yield of approximately 4.5% earned on loans and advances in the portfolios “Financial assets held for trading” and “Financial assets at fair value through other comprehensive income” during 2025. See Notes 10 and 13 to the Consolidated Financial Statements for additional information.
The tables in Note 8.1 and the first table in Note 13.3 to the Consolidated Financial Statements set forth the fair value and the book value of our debt securities and equity instruments recorded under “Financial assets at fair value through other comprehensive income” as of December 31, 2025, 2024 and 2023.
Notes 8.2 and 14.2 to the Consolidated Financial Statements set forth the fair value and the book value of our debt securities recorded under “Financial assets at amortized cost” as of December 31, 2025, 2024 and 2023.
This information is not provided for debt securities recorded under “Financial assets held for trading”, “Non-trading financial assets mandatorily at fair value through profit or loss” and “Financial assets designated at fair value through profit or loss” since the amortized costs and fair values of these items are the same. See Note 8 to the Consolidated Financial Statements.
The second table in Note 13.3 to the Consolidated Financial Statements shows the fair value of debt securities recorded, as of December 31, 2025, 2024 and 2023, under “Financial assets at fair value through other comprehensive income” by rating categories.
The second table in Note 14.2 to the Consolidated Financial Statements shows the fair value of debt securities recorded, as of December 31, 2025, 2024 and 2023, under “Financial assets at amortized cost”, by rating categories.
Readers are directed to the tables and Notes referred to above for information regarding our securities portfolio.
For a discussion of our investments in joint ventures and associates, see Note 16 to the Consolidated Financial Statements. For a discussion of the manner in which we value our securities, see Notes 2.2.1 and 8 to the Consolidated Financial Statements.
The following table analyzes the maturities of our debt securities recorded under “Financial assets at fair value through other comprehensive income” and “Financial assets at amortized cost”, by type and geographical area, as of December 31, 2025.
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Maturity at One Year or Less Maturity After One Year to Five Years Maturity after Five Years to Ten Years Maturity after Ten Years Total
Amount Yield % (1) Amount Yield % (1) Amount Yield % (1) Amount Yield % (1) Amount
(Millions of Euros, Except Percentages)
DEBT SECURITIES
AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME PORTFOLIO
Domestic
Spanish government and other government agencies debt securities 838 2.98 2,703 4.02 3,975 1.27 2,573 3.82 10,090
Other debt securities 391 2.52 326 3.68 157 3.29 33 5.16 907
Total Domestic 1,230 2.83 3,029 3.99 4,132 1.35 2,606 3.84 10,997
Foreign — — — — — — — — —
Mexico 1,443 5.55 7,278 4.87 5,427 5.50 6,848 4.74 20,995
Mexican government and other government agency debt securities 1,343 5.50 6,970 4.89 4,941 5.43 6,499 4.78 19,752
Other debt securities 100 6.22 307 4.25 486 6.18 349 4.05 1,243
The United States 2,434 3.20 1,487 3.22 1,547 2.57 746 2.90 6,214
U.S. Treasury and other government agencies debt securities 2,299 3.28 577 3.12 746 1.32 — — 3,621
Other debt securities 136 1.92 910 3.28 801 3.74 746 2.90 2,593
Turkey 376 32.58 1,793 35.61 738 20.44 — — 2,907
Turkey government and other government agencies debt securities 376 32.58 1,793 35.61 738 20.44 — — 2,907
Other debt securities — — — — — — — — —
Other countries 4,919 13.81 4,809 3.73 4,356 3.03 1,803 3.94 15,888
Securities of other foreign governments (2) 3,251 18.92 2,979 3.71 3,560 2.87 507 4.78 10,298
Other debt securities of other countries 1,668 3.84 1,830 3.77 796 3.78 1,296 3.61 5,590
Total Foreign 9,173 10.46 15,366 7.94 12,068 5.15 9,397 4.44 46,004
TOTAL AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME PORTFOLIO 10,402 9.56 18,396 7.29 16,200 4.18 12,004 4.31 57,001
AT AMORTIZED COST PORTFOLIO
Domestic
Spanish government and other government agencies debt securities 10,349 2.19 19,395 2.03 9,404 1.98 104 3.40 39,252
Other debt securities 693 3.18 630 2.47 177 3.60 13 2.26 1,512
Total Domestic 11,042 2.25 20,025 2.04 9,581 2.01 117 3.27 40,764
Foreign — — — — — — — — —
Mexico 1,093 4.38 2,104 3.89 3,462 5.36 42 4.00 6,701
Mexican government and other government agency debt securities 1,093 4.38 2,064 3.78 1,943 4.06 42 4.00 5,142
Other debt securities — — 40 9.45 1,519 7.03 — — 1,559
The United States 1,849 4.59 432 4.24 — — — — 2,282
U.S. Treasury and other government agencies debt securities 1,849 4.59 395 4.20 — — — — 2,244
Other debt securities — — 38 4.66 — — — — 38
Turkey 553 23.34 2,719 24.29 1,990 23.37 — — 5,262
Turkey government and other government agencies debt securities 524 21.87 2,719 24.29 1,990 23.37 — — 5,233
Other debt securities 29 49.72 — — — — — — 29
Other countries 3,086 8.36 5,344 2.62 9,870 1.84 71 4.84 18,370
Securities of other foreign governments (2) 1,967 11.21 3,142 2.68 8,841 1.73 47 5.28 13,997
Other debt securities of other countries 1,118 3.34 2,202 2.53 1,029 2.77 23 3.95 4,373
Total Foreign 6,581 7.90 10,599 8.50 15,323 5.43 112 4.53 32,615
TOTAL AT AMORTIZED COST PORTFOLIO 17,623 4.36 30,624 4.28 24,904 4.12 229 3.89 73,379
TOTAL DEBT SECURITIES 28,025 6.29 49,019 5.41 41,103 4.14 12,233 4.30 130,380
(1)The weighted average yield for each range of maturity is calculated by dividing the annual interest income by the book value of the debt securities. Yields on tax-exempts obligations have not been computed on a tax-equivalent basis.
(2)Securities of other foreign governments mainly include investments made by our subsidiaries in securities issued by the governments of the countries where they operate.
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Loans and Advances
Diversification in our loan portfolio is our principal means of reducing the risk of loan losses. We also carefully monitor our loans to borrowers in sectors or countries experiencing liquidity problems. Our exposure to our five largest borrowers as of December 31, 2025 excluding government-related loans amounted to €5,497 million or approximately 1.1% of our total outstanding loans and advances to customers.
During the year ended December 31, 2025, the Group’s loan activity has been affected by geopolitical and other challenges and uncertainties globally. See “Item 5. Operating and Financial Review and Prospects―Operating Results―Factors Affecting the Comparability of our Results of Operations and Financial Condition―Macroeconomic and geopolitical conditions” and Note 7.2 to the Consolidated Financial Statements for information on the impact of these challenges and uncertainties on our financial condition and results of operations.
Loans and Advances to Customers
As of December 31, 2025, our total loans and advances to customers amounted to €504,876 million, or 58.7% of total assets. Net of our loss allowances, total loans and advances to customers amounted to €492,514 million as of December 31, 2025, or 57.3% of our total assets, an increase from 55.6% of our total assets as of December 31, 2024. As of December 31, 2025 our total loans and advances to customers in Spain amounted to €187,039 million, up from €174,854 million as of December 31, 2024, mainly due to the increases in corporate loans, public sector loans and consumer loans. Our total loans and advances to customers outside Spain amounted to €317,837 million as of December 31, 2025, up from €266,288 million as of December 31, 2024, mainly as a result of increases in the volume of mortgages and consumer loans within the retail loan portfolio in Mexico, the increase in the volume of Turkish lira-denominated consumer and wholesale loans, due, in part, to the measures adopted by the Turkish authorities (e.g., the lessening of loan reserve requirements) to encourage Turkish lira-denominated loans in Turkey, and increased wholesale loans in the branches located in New York, Europe and Asia driven by increased activity amid a lower interest rate environment, partially offset by the depreciation of the Turkish lira and the U.S. dollar against the euro.
Loans by Geographical Area
The following table shows our loans and advances to customers by geographical area as of the dates indicated:
As of December 31,
2025 2024 2023
(In Millions of Euros)
Domestic 187,039 174,854 169,140
Foreign
Western Europe 51,515 41,907 36,978
Mexico 104,358 93,016 92,802
Turkey 49,269 45,314 34,876
South America 60,203 54,544 48,150
Other (1) 52,491 31,507 21,439
Total foreign 317,837 266,288 234,244
Total loans and advances (2) 504,876 441,142 403,384
Loss allowances (12,362) (11,611) (11,269)
Total net lending (2) 492,514 429,532 392,115
(1)Balances correspond, in part, to the entities in the United States that were not included within the scope of the USA Sale.
(2)Includes loans and advances to customers included in the following headings: “Financial assets held for trading”, “Non-trading financial assets mandatorily at fair value through profit or loss”, “Financial assets designated at fair value through profit or loss” and “Financial assets at amortized cost”, net of loss allowances.
Loans and Advances to Credit Institutions and Central Banks
As of December 31, 2025, our total loans and advances to credit institutions and central banks amounted to €53,850 million, or 6.3% of total assets (compared to €52,467 million, or 6.8% of total assets as of December 31, 2024), of which total loans and advances to credit institutions and central banks at amortized cost amounted to €35,113 million, or 4.1% of total assets. Loans and advances to credit institutions as of December 31, 2025 decreased by 3.0% compared to December 31, 2024, mainly as a result of decreases in loans and advances to credit institutions (through reverse repurchase agreements) in Spain.
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Loans and Advances to Spanish Government and its Agencies
Loans and advances outstanding to the Spanish government and its agencies amounted to €14,490 million, or 3.1% of our total loans and advances to customers as of December 31, 2025, compared with the €12,001 million, or 2.8% of our total loans and advances to customers as of December 31, 2024, in each case, excluding loans to companies controlled by the Spanish government.
Loans to Associates and Jointly Controlled Companies
As of December 31, 2025, total loans and advances by BBVA and its subsidiaries to associates and jointly controlled companies amounted to €632 million, a 1.1% decrease compared with €639 million as of December 31, 2024.
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Maturity and Interest Sensitivity
The following table sets forth a breakdown by maturity of our total loans and advances to customers, including their fixed and variable rates, by type of customer as of December 31, 2025. The determination of maturities is based on contract terms.
Maturity Maturity After One Year
Due In One Year or Less Due After One Year Through Five Years Due After Five Years Through Fifteen Years Due After Fifteen Years Total Fixed Rate Variable Rate
(In Millions of Euros)
Domestic
Agriculture, forestry and fishing 670 668 177 12 1,526 460 396
Manufacturing, mining and quarrying, and other industrial activities 9,144 7,015 1,243 150 17,551 3,195 5,212
Of which: manufacturing 7,926 5,397 729 123 14,175 2,902 3,347
Construction 2,257 1,801 1,161 134 5,354 724 2,373
Wholesale and retail trade, transportation and storage, accommodation and food service activities 10,285 8,301 2,884 316 21,787 5,352 6,150
Information and communication 1,561 929 207 12 2,708 239 909
Financial and insurance activities 3,371 4,979 693 224 9,266 2,363 3,532
Real estate activities 858 2,666 1,319 63 4,905 1,607 2,441
Professional, scientific, technical, administrative and support service activities 2,008 2,482 649 47 5,186 1,448 1,730
Public administration and defense, education, human health and social work activities 4,074 5,165 6,413 56 15,707 7,070 4,563
Other service activities 13,703 25,412 35,865 25,416 100,395 54,413 32,279
Of which:
Households 13,089 24,988 35,756 25,409 99,243 54,085 32,069
For House Purchase 3,736 14,131 29,887 25,140 72,894 38,330 30,829
Credit for consumption 5,726 8,523 4,499 36 18,784 12,876 182
Other purposes 3,628 2,333 1,371 233 7,565 2,879 1,058
Total Domestic 47,932 59,416 50,610 26,428 184,386 76,871 59,584
Foreign
Agriculture, forestry and fishing 2,031 1,484 528 13 4,057 1,363 662
Manufacturing, mining and quarrying, and other industrial activities 30,748 22,652 5,074 778 59,252 7,861 20,642
Of which: manufacturing 22,711 13,873 2,285 116 38,984 5,569 10,704
Construction 2,845 2,800 596 4 6,246 825 2,576
Wholesale and retail trade, transportation and storage, accommodation and food service activities 22,072 16,824 4,592 221 43,708 10,021 11,616
Information and communication 4,939 5,558 193 12 10,702 1,316 4,447
Financial and insurance activities 15,194 9,920 837 59 26,011 2,573 8,243
Real estate activities 1,381 5,341 1,675 1 8,399 1,093 5,925
Professional, scientific, technical, administrative and support service activities 2,053 3,522 706 4 6,286 1,868 2,364
Public administration and defense, education, human health and social work activities 1,445 3,657 7,406 3,102 15,610 2,092 12,074
Other service activities 28,311 41,859 19,884 18,453 108,507 66,794 13,403
Of which:
Households 23,428 41,010 19,651 18,392 102,480 65,890 13,162
For House Purchase 125 2,234 13,545 16,092 31,996 30,487 1,384
Credit for consumption 18,694 34,978 5,659 2,205 61,536 31,705 11,136
Other purposes 4,609 3,798 448 95 8,949 3,698 642
Total Foreign 111,019 113,618 41,492 22,647 288,776 95,806 81,950
Total loans and advances (1) 158,951 173,034 92,102 49,075 473,162 172,677 141,534
(1)Includes mainly loans and advances to customers included in “Financial assets at amortized cost”.
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Loss Allowances on Loans and Advances
The following table provides information regarding the ratios of allowances for credit losses to total loans and net charge-offs to average loans for the periods indicated, in each case. For a discussion of accounting standards related to loss allowances on financial assets, see Note 2.2.1 to the Consolidated Financial Statements.
As of and for the year ended December 31,
2025 2024 2023
(In Millions of Euros)
Allowance for credit losses to total loans and advances at amortized cost outstanding 2.43 % 2.56 % 2.75 %
Allowance for credit losses 12,329 11,630 11,356
Domestic 4,490 4,495 4,373
Foreign 7,839 7,135 6,983
Total loans outstanding 508,023 455,016 412,916
Domestic 211,332 197,937 186,938
Foreign 296,691 257,079 225,978
Net loan charge-offs as a percentage of average loans and advances at amortized cost during the period
Domestic 0.15 % 0.18 % 0.26 %
Non-financial corporations 0.14 % 0.18 % 0.37 %
Net charge-offs during the period 151 177 334
Average loans outstanding 109,935 95,956 90,520
Individuals 0.23 % 0.26 % 0.24 %
Net charge-offs during the period 225 248 226
Average loans outstanding 97,377 94,984 93,737
Other — % 0.01 % 0.01 %
Foreign 1.87 % 1.72 % 1.70 %
Non-financial corporations 0.45 % 0.49 % 0.52 %
Net charge-offs during the period 394 392 391
Average loans outstanding 88,204 80,645 75,530
Individuals 3.91 % 3.52 % 3.49 %
Net charge-offs during the period 3,387 2,793 2,520
Average loans outstanding 86,678 79,325 72,204
Other — — —
Total loan charge-offs as a percentage of average loans and advances at amortized cost during the period 0.91 % 0.87 % 0.89 %
Net charge-offs during the period 4,158 3,612 3,473
Average total loans and advances at amortized cost outstanding 459,497 416,861 389,605
When the recovery of any recognized amount is considered to be remote, this amount is removed from the consolidated balance sheet, without prejudice to any actions taken by the consolidated entities in order to collect the amount until their rights extinguish in full through expiry, forgiveness or for other reasons.
Our total net charge-offs to average loans at amortized cost ratio increased to 0.91% for the year ended December 31, 2025, compared with 0.87% for the year ended December 31, 2024 mainly as a result of the increase in charge-offs in “Individuals” in Mexico, in a context of growing retail lending activity and, to a lesser extent, the increase in charge-offs in Argentina. The increase was partially offset by decreases in charge-offs in the non-financial corporations portfolio in Spain and in the retail portfolio in Peru. Total net loan charge-offs increased during 2025, while average loans and advances at amortized cost also grew across all geographies. However, charge-offs increased at a faster pace than the average loan portfolio, resulting in a higher ratio.
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Our allowance for credit losses to total loans and advances at amortized cost decreased to 2.43% as of December 31, 2025 compared with 2.56% as of December 31, 2024, mainly as a result of the increase in total loans outstanding, in particular, the increases in corporate loans, public sector loans and consumer loans in Spain, and the increase in the volume of Turkish lira-denominated consumer and wholesale loans, due, in part, to the measures adopted by the Turkish authorities (e.g., the lessening of loan reserve requirements) to encourage Turkish lira-denominated loans in Turkey, and increased wholesale loans in the branches located in New York, Europe and Asia driven by increased activity amid a lower interest rate environment, partially offset by the depreciation of the Turkish lira and the U.S. dollar against the euro.
Impaired Loans
Loans are considered to be credit-impaired under IFRS 9 if one or more events have occurred and they have a detrimental impact on the estimated future cash flows of the loan.
Amounts collected in relation to impaired financial assets at amortized cost are first applied to the outstanding interest and any excess amount is used to reduce the unpaid principal. The approximate amount of interest on our impaired loans which was included in profit attributable to parent company in 2025, 2024 and 2023 was €560.4 million, €415.6 million, €314.7 million, respectively.
The following table provides information regarding our impaired loans to customers, central banks and credit institutions as of the dates indicated:
As of December 31,
2025 2024 2023
(In Millions of Euros)
Impaired loans
Domestic 6,431 7,319 7,682
Public sector 9 15 24
Other resident sector 6,423 7,304 7,658
Foreign 7,914 6,894 6,764
Public sector 10 11 1
Other non-resident sector 7,905 6,883 6,763
Total impaired loans 14,346 14,213 14,446
Allowance for credit losses (12,394) (11,630) (11,316)
Impaired loans net of allowance 1,952 2,583 3,130
Impaired loans as a percentage of loans and advances at amortized cost 2.82 % 3.12 % 3.49 %
Impaired loans (net of allowance) as a percentage of loans and advances at amortized cost 0.38 % 0.57 % 0.76 %
Our total impaired loans amounted to €14,346 million as of December 31, 2025, a 0.9% increase compared with €14,213 million as of December 31, 2024.
Our allowance for credit losses includes loss reserve for impaired assets and loss reserve for unimpaired assets which present an expected credit loss. As of December 31, 2025, the allowance for credit losses amounted to €12,394 million, a 6.6% increase compared with the €11,630 million recorded as of December 31, 2024. The allowance for credit losses increased year-on-year due to certain non-performing loan entries in the retail loan portfolio in Mexico, partially offset by higher write-offs in Mexico.
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LIABILITIES
Deposits
The principal components of our customer deposits recorded under “Financial liabilities at amortized cost” are domestic demand and time deposits and foreign demand and time deposits. The following tables provide information regarding the average amount of the following deposit categories recorded under “Financial liabilities at amortized cost” for the periods indicated:
Average Balance for the Year Ended December 31,
2025 2024 2023
(In Millions of Euros)
Demand deposits 341,196 323,940 318,212
Domestic 196,761 191,782 196,496
Foreign 144,436 132,157 121,716
Time deposits 139,021 122,951 115,889
Domestic 48,553 42,364 45,184
Foreign 90,468 80,586 70,706
Other 35,432 39,994 31,259
Domestic 24,277 26,006 19,441
Foreign 11,156 13,988 11,818
Total Domestic 269,590 260,152 261,121
Total Foreign 246,060 226,732 204,240
Total 515,650 486,884 465,360
The amount of uninsured deposits recorded under “Financial liabilities at amortized cost” as of December 31, 2025, 2024 and 2023 amounted to €292,540 million, €255,129 million and €226,832 million, respectively. Uninsured deposits are the portion of deposit accounts that exceed each local deposit insurance limit and amounts in any other uninsured investment or deposit accounts that are classified as deposits and are not subject to any state deposit insurance regimes.
As of December 31, 2025, the maturity of our time deposits in uninsured accounts recorded under “Financial liabilities at amortized cost” was as follows:
As of December 31, 2025
Domestic Foreign Total
(In Millions of Euros)
Portion in excess of local deposit insurance limit 15,708 50,936 66,644
Other uninsured time deposits 30,759 23,035 53,793
3 months or under 19,848 20,505 40,353
Over 3 to 6 months 3,776 1,071 4,847
Over 6 to 12 months 2,771 1,015 3,785
Over 12 months 4,363 444 4,807
Total 46,466 73,970 120,437
Large denomination deposits may be a less stable source of funds than demand and savings deposits because they are more sensitive to variations in interest rates and changes in perceptions of the credit or liquidity profile of the Bank. For additional information on our deposits recorded under “Financial liabilities at amortized cost” as of December 31, 2025, 2024 and 2023, see Note 22 to the Consolidated Financial Statements.
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Short-term Borrowings
Securities sold under agreements to repurchase and promissory notes issued by us constituted the only categories of short-term borrowings that equaled or exceeded 30% of stockholders’ equity as of December 31, 2025, 2024 and 2023.
The following table provides information about our total short-term borrowings for the years ended December 31, 2025, 2024 and 2023:
As of and for the year ended December 31, 2025 As of and for the year ended December 31, 2024 As of and for the year ended December 31, 2023
Amount Average rate Amount Average rate Amount Average rate
(In Millions of Euros, Except Percentages)
Securities sold under agreements to repurchase:
As of end of period 77,506 2.7 % 67,517 4.1 % 91,844 4.0 %
Average during period 69,274 2.8 % 83,001 4.1 % 90,329 3.9 %
Bank promissory notes:
As of end of period 8,145 2.8 % 4,267 4.4 % 5,567 4.2 %
Average during period 6,622 3.0 % 3,932 4.4 % 3,680 3.8 %
Bonds and subordinated debt:
As of end of period 18,741 3.1 % 12,969 3.3 % 15,361 3.2 %
Average during period 15,696 3.4 % 14,309 3.7 % 12,265 2.7 %
Total short-term borrowings as of end of period (1) 104,392 2.8 % 84,753 4.0 % 112,772 3.8 %
(1)Includes all repurchase agreements recorded under “Financial liabilities at amortized cost” and “Financial liabilities held for trading”.
As of December 31, 2025, 2024 and 2023, the securities sold under agreements to repurchase were mainly Mexican and Spanish treasury bills and such agreements were entered into with credit and other financial institutions.
Certain Ratios
The following table sets out certain ratios as of and for the years ended December 31, 2025, 2024 and 2023:
As of and for the year ended December 31,
2025 2024 2023
(In Percentages)
Net interest margin (1) 3.22 % 3.30 % 3.08 %
Return on average total assets (2) 1.4 % 1.4 % 1.1 %
Return on average shareholders’ funds (3) 18.4 % 18.9 % 16.2 %
Equity to assets ratio (4) 7.5 % 7.4 % 7.1 %
(1)Represents net interest income as a percentage of average total assets.
(2)Represents profit as a percentage of average total assets.
(3)Represents profit for the year as a percentage of average shareholders’ funds for the year.
(4)Represents average total equity (net assets) over average total assets.
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EQUITY
The majority of the balance not explained in the subsections below is related to the conversion to euros of the financial statements balances from consolidated entities whose functional currency is not the euro.
Total equity
As of December 31, 2025, total equity amounted to €61,798 million, a 3.0% increase compared to the €60,014 million recorded as of December 31, 2024, mainly as a result of the increase in shareholders’ funds, partially offset by higher negative exchange differences arising from the conversion to euros of balances in the functional currencies of the consolidated entities whose functional currency is not the euro, recorded under the line item “Foreign currency translation”.
Shareholders’ funds
As of December 31, 2025, shareholders’ funds amounted to €76,228 million, a 4.6% increase compared to the €72,875 million recorded as of December 31, 2024, primary due to the annual increase in profit, partially offset by the distribution of dividends and the share buyback programs.
Accumulated other comprehensive income (loss)
As of December 31, 2025, the accumulated other comprehensive loss amounted to €18,871 million, a 9.6% increase compared to the €17,220 million loss recorded as of December 31, 2024, mainly due to the depreciation of certain currencies against the euro, in particular, the Argentine peso and the Turkish lira.
Non-controlling interest
As of December 31, 2025, non-controlling interest amounted to €4,441 million, a 1.9% increase compared to the €4,359 million recorded as of December 31, 2024 mainly due to greater profit in Peru.
F. Competition
In recent years, the global financial services sector has undergone significant transformation in relation to the development of the Internet and mobile and other exponential technologies and the entrance of new players into activities previously provided by financial institutions. Whereas commercial banks were previously almost the sole providers of the whole range of financial products, from credit to deposits, or payments and investment services, today, a set of non-bank digital providers compete (and cooperate) among each other and with banks in the provision of financial services. These new fintech providers can be startup firms that are specialized in a specific service or niche of the financial services market, or large digital players (known as BigTechs). BigTech companies such as Amazon, Facebook and Apple have also started to offer financial services (mainly, in relation to payments and credit) ancillary to their core business.
In this new competitive environment, banks and other players are calling for a level playing field that ensures fair competition among the different financial services providers. Regulations on consumer protection and the integrity of the financial system (such as anti-money laundering regulations or regulations for combating the financing of terrorism) are generally activity-specific and, therefore, meet the principle of a level playing field. However, with regards to financial stability, banking groups are subject to prudential regulations that have implications for most of their activities, including those in which they compete with non-bank players that are only subject to activity-specific regulations, at best, or not regulated at all. Therefore, the scope of the perimeter of prudential consolidation to which the prudential regulation and supervision in the European Union and elsewhere applies compromises the level playing field principle by requiring banking groups to apply banking-level controls to all subsidiaries, no matter their activities and actual risks involved. Restrictions on the activity of bank players, for instance as regards internal governance requirements, leave EU banks at a competitive disadvantage as regards cost, time-to-market or talent attraction compared to their competitors.
Existing loopholes in the regulatory framework are another cause of an uneven playing field between banks and non-bank players. Some new services or business models are not yet subject to existing regulations. In such cases, not only are potential risks to financial stability, consumer protection and the integrity of the financial system unaddressed, but asymmetries may arise between players since regulated providers often face obstacles that unregulated providers do not. See also “Item 3. Key Information—Risk Factors—Business Risks—The Group faces increasing competition and is exposed to a changing business model”.
Another trend in the market is consolidation. Following the 2008 financial crisis, a number of banks disappeared or were absorbed by other banks. Going forward, there may be additional consolidation in the regions where the Group operates.
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Additional information on certain market dynamics affecting the three main countries where we operate is provided below.
Spain
The commercial banking sector in Spain has undergone significant consolidation since the 2008 financial crisis. Following the merger of Caixabank and Bankia in 2021, Caixabank is the largest bank in Spain in terms of total assets. In addition, the merger between Unicaja and Liberbank, completed in June 2021, created the sixth largest bank in terms of loans in Spain as of December 2022. Caixabank and Banco Santander are BBVA’s main competitors in the Spanish market. The aggregate market share in terms of loans of the five largest banks in Spain is approximately 75% according to the latest available data.
We face strong competition in all of our principal areas of operations. After the protracted period of low interest rates, which adversely impacted interest income, the sharp rise in official and market interest rates in 2022 and 2023 has resulted in a superior pricing environment for banks. However, Spanish banks have been generally cautious in increasing borrowing rates in order not to prompt any surge in default rates. Such an approach and the fact that Spain has a mature credit market contribute to the strong competitive environment in the Spanish banking system. In particular, in recent years, competition has been acutely intense in the credit market for lending to SMEs, where new credit interest rates fell from a weighted average of 5.5% between January 2012 and May 2014 to around 2.1% in 2021. Although interest rates on new loans to SMEs increased to approximately 6.0% as of December 2023 due to the sharp rise in official interest rates, they subsequently declined to around 4.3% as of October 2025 (latest available data).
Regarding the mortgage segment, the pandemic triggered changes in household preferences (larger houses, outside space, second houses) driving an increase in the demand for mortgages. As a result, after the long period of deleveraging that preceded the pandemic, the portfolio of mortgages in Spain grew by 1.1% in 2021, though the volume of mortgages declined by 0.1% and 3.2% in 2022 and 2023, respectively, in response to higher interest rates. Subsequently, mortgages loans grew by 0.3% in 2024 and 3.1% year-on-year in November 2025, supported by the stronger evolution of lending in recent years in Spain.
Competition has become increasingly asymmetric in the credit business. In addition to traditional banks, alternative financing providers—particularly private credit firms—have significantly increased their presence, competing with banks in the provision of credit to households and, above all, to corporates and SMEs. These players have gained market share due to their speed of execution, flexible structuring capabilities, and tailored solutions, especially in mid-market corporate lending and complex financing transactions. This trend has contributed to a partial disintermediation of traditional bank lending and has pushed banks toward greater specialization, traditional lending with origination, structuring, and risk distribution roles.
With respect to deposits, in the aftermath of the 2008 financial crisis, the necessity for a more balanced funding structure led to increased competition for deposits in Spain. Until 2022, the low interest rate environment depressed remuneration on deposits; however, there was an effective “zero lower bound” interest rate floor on deposit rates, which never entered negative territory, despite the Euribor being below 0% between 2016 and April 2022. As interest rates have risen, competition among Spanish entities and from other alternative savings financial products has led to higher deposit rates, especially time deposit rates. However, the excess liquidity of the Spanish banking system (as shown by the system’s loans-to-deposits ratio, which was approximately 82% as of October 2025), and the strong competition in the loan market, caused deposit rates in Spain to increase less than in other European countries.
The entry of “fintech companies” and online banks into the Spanish market for financial services has further increased competition, particularly in payment services. Insurance companies and other financial service firms also compete for customer funds. Insurance companies and other financial service firms are also expanding the services they offer to consumers in Spain, which have traditionally been the domain of commercial banks. We face competition from other commercial banks, former savings banks and, to a lesser extent, credit cooperatives across all types of loans and deposits.
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In Spain and in Europe, changes in banking regulation could have a significant potential impact on competition in the near future. The EU Directive on Investment Services permits all brokerage houses authorized to operate in other member states of the European Union to carry out investment services in Spain. Although the EU Directive is not specifically addressed to banks, it affects the activities of banks operating in Spain. Certain initiatives have also been implemented in order to facilitate the creation of a Pan-European financial market, such as the Single Euro Payments Area, which is a payment-integration initiative for the harmonization of payment services (bank transfers, direct debits and payment cards) mainly within the European Union, and MiFID, complemented with the introduction of MiFID II in January 2018, which aims to create a European framework for investment services. In addition, further steps have been taken towards achieving a banking and capital markets union in Europe, such as the Retail Investment Strategy (RIS). The ECB assumed responsibility as the unique supervisor of the Eurozone banking sector in November 2014, responsible for the supervision of over 100 entities (including BBVA). Moreover, the foundations of a single resolution mechanism were laid with, among others, the appointment of the SRB and the adoption of the Bail-in Tool. The year 2025 marks the operational launch of the Anti-Money Laundering and Counter-Terrorist Financing Authority (AMLA). The creation of this new authority is part of a broader regulatory package, known as the AML (Anti Money-Laundering) package, which was published in 2024 and includes the creation of AMLA, the publication of the new European AML Regulation, and the 6th AML Directive.
For additional information, see “―Business Overview―Supervision and Regulation”.
Mexico
As of December 31, 2025, the Mexican banking sector comprised 50 institutions, one fewer than the 51 banks that operated at the beginning of 2025. In addition, eight other entities are either waiting for the approval of their license or ready to start operations within the banking sector: Revolut, Nu Bank, Klar, Masari Casa de Bolsa, Finsus, Konfío, and Plata Card.
The seven largest banks of the system (the “G7 group”, that comprises BBVA Mexico, Santander, Banorte, Banamex, HSBC, Scotiabank and Inbursa) held 70.6% of the total assets of banks in Mexico as of October 30, 2025, less than the 71.1% in December 2024. All but two members of the G7 group decreased their share in total assets and BBVA Mexico led the way with a 0.6% drop. The two institutions with gains were Banamex (+0.3%) and Santander (+0.1%).
Regarding credit balances, the G7 group market share increased marginally from 77.45% in December 2024 to 77.47% in October 2025. In particular, BBVA Mexico increased its participation in total credit balances from 25.4% to 25.6% during such period. Banamex, Santander and Banorte also experienced an increase in their market share (0.4%, 0.2% and 0.1% respectively), while HSBC, Scotiabank and Inbursa lost market share. The pace of expansion of credit balances in 2026 is expected to remain weak as the recovery in employment and private investment is expected to take time to make an impact.
As for deposits, the G7 group market share declined marginally between December 2024 and October 2025 (from 73.16% to 73.04%), with four of the G7 banks losing share. BBVA Mexico was the institution with the greatest gain (+0.4%), while Scotiabank was the bank with the largest drop (-0.3%). A slow recovery of formal employment and the ongoing rate cutting cycle are expected to hinder the growth of deposits in 2026.
For information on COFECE’s investigation regarding competition in the card payments’ market, see “―Business Overview―Supervision and Regulation—Principal Markets—Mexico”.
Turkey
In Turkey, where we operate through Garanti BBVA, the three public banks that operate in the country accounted for 37% of the total loans of financial institutions as of December 26, 2025, whereas private deposit banks (including Garanti BBVA) accounted for 48%. Development banks and participation banks (banks that operate under the ethos of Islamic banking) together accounted for 15% of the total.
The CBRT cut the policy rate by a total of 500 basis points between January and March 2025, bringing it down to 42.5%. At the interim Monetary Policy Committee (MPC) meeting held on March 20, 2025, in order to contain the risks that financial market developments could pose to the inflation outlook, the MPC decided to raise the overnight lending rate to 46.0%, while keeping the policy rate and the overnight borrowing rate unchanged. Additionally, the CBRT suspended the one-week repo auctions temporarily, and provided funding at the overnight lending rate. In April 2025, in response to the effects of financial market developments on underlying inflation, the CBRT raised the policy rate, the overnight lending rate, and the overnight borrowing rate to 46%, 49%, and 44.5%, respectively, and also announced the resumption of the one-week repo auctions. The CBRT kept the policy rate unchanged in June 2025, and reduced it by a total amount of 800 basis points in the remainder of the year, eventually bringing it down to 38% by December 2025.
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The CBRT continued to implement macroprudential policies to support disinflation. In this regard, the CBRT started to publish interim targets in its Inflation Report which are defined as the headline inflation levels intended to be achieved in the short term, while progressing towards the medium-term inflation target. The CBRT also continued simplifying its monetary policy measures, in line with the path started in 2024. The most significant decision in this respect was the termination of the opening and renewal of KKM accounts and, accordingly, the abolition of all targets related to the renewal of KKM accounts and their transition to Turkish lira. The increase in the share of Turkish lira deposits within total deposits and the measures to phase out KKM accounts continued to reinforce the monetary policy stance in 2025. The introduction of limits on the share of Turkish-lira deposits held by companies, together with the revision of the existing limits on the share of Turkish-lira deposits held by households, strengthened the monetary policy transmission mechanism. KKM accounts balance declined to USD 0.2 billion as of December 26, 2025, and Turkish lira deposits accounted for 61% of the total.
Policies for loan growth continued to be implemented to strengthen the monetary policy transmission mechanism and rebalance domestic demand in 2025. With respect to the reserve requirement for loan growth, the 2% monthly growth limit for Turkish lira commercial loans was replaced with two limits: 2.5% for SME loans, and 1.5% for other commercial loans. Moreover, the monthly growth limit of 1.5% for FX loans was reduced to 1% and then 0.5%. The scope of loans exempted from growth limit for FX loans was narrowed. The calculation period for loan growth rates was later extended to eight weeks from four weeks, to provide greater flexibility in the management of loan growth limits. To restrain borrowing behavior and contribute to the moderation of domestic demand, there continues to be different maximum interest rates for personal credit card loans based on the amount of debt.
This policy framework is expected to be maintained throughout 2026 to ensure that loan growth and loan composition will be supportive of the disinflation process and the monetary transmission mechanism. The limits for loan growth and exceptions to be provided are expected to be revised throughout the year. The CBRT is also expected to maintain the policy framework designed to prioritize Turkish lira-denominated deposits and a long-term maturity structure for external funding.
Banks’ profitability, which had remained flat in the first half of 2025, recovered during the remainder of 2025 due to the policy rate cuts. Interest rates are expected to continue their downward trend in 2026. The pace of the downward trend in inflation and the associated change in the interest rate outlook is expected to affect banks’ net interest margin. The positive impact of the improving net interest margin on return on equity (“ROE”) is expected to be more pronounced in 2026. Furthermore, the strong course of banking fees, commissions and service revenues is expected to continue to support profitability, while the rise in credit risk costs will likely limit further improvement.