The BBVA obtained a net profit of 5,324 million euros in 2018, 51.3% more than a year before, thanks to the capital gains from the sale of its business in Chile (663 million euros) and despite the fall of results of your bank in Turkey, whose profit has decreased by 31%. This profit figure means returning to the level of 2007, before the crisis, and they are the second best in the history of BBVA.
The boost of recurring revenues, the containment of expenses and, above all, the lower write-downs also contributed to the rise in profits, in line with market forecasts, according to the information sent to the National Securities Market Commission (CNMV).
By geography, Mexico contributed 41% of the result, with 2,384 million (up 9%), while Spain accounted for 25%, with 1,522 million (10.8% more), the United States 12.6%, with 735 million (51% more), South America 10.2%, 591 million (31% less) and Turkey 9.8%, 569 million, (31% less). The crisis in Argentina has resulted in losses of 266 million in the BBVA subsidiary in that country.
BBVA benefits from the 2018 account, which did not have to record large losses like 2017, when its stake in Telefónica entailed a charge of 1,123 million euros, which caused profits to only rise that year by 1% .
In the 2018 fiscal year, the depreciation of the Turkish lira caused the BBVA to impair the value of its stake in its Garanti subsidiary by 1,517 million euros, which has been charged to the equity of the individual accounts, the bank points out. It also stresses that this accounting impact will not be passed on to the consolidated group "neither in the attributable profit, nor in equity or in the capital ratios, so it will not affect the distribution of the dividend".
BBVA affirms that it is planned to submit to the next meeting of shareholders "a cash payment of 0.16 euros gross per share in April as a supplementary dividend for the year 2018."
In terms of solvency, the BBVA has a CET 1 ratio fully-loaded of 11.3% at the end of 2018. "To be better prepared in the face of future regulatory requirements, BBVA has considered reasonable to increase the capital target to a range between 11.5% and 12%," explains the bank . "The bank expects to be in that range at the end of 2019, maintaining its current shareholder remuneration policy, with a pay-out (the percentage of the benefit given to the shareholders) in cash between 35% and 40%. The ECB highlighted, after the past solvency examinations, that BBVA and other banks that had a similar rating should improve their capital ratios in the future.
The profitability ratio reached double digits: the ROE (return on equity) rose to 11.6% in the year or up to 10.2% without considering the surplus value of Chile.
During 2018, BBVA claims to have "reached a milestone in the digitization of its business". 51% of its linked clients used digital channels to interact with the bank, "mobile customers have reached 43% of the total and, in 2019, the goal is that they also exceed the 50% threshold. sold by digital channels represent 41% of the total, compared to only 16% two years ago ".
The president of the entity, considers in a statement that in a complex environment, BBVA has obtained "very good results and double-digit profitability", while has achieved "significant progress in the transformation process."