General Shareholders’ Meeting Bilbao, March 17, 2017 Francisco González Group Executive Chairman
Index 01 An uncertain global environment 02 2016 Results 03 Setting milestones in our transformation GSM / 2
2016: a complex environment % GDP Growth 2001-2007 2016 2017 World 4.4 3.0 3.2 Eurozone 2.0 1.7 1.6 Spain 3.6 3.2 2.7 GSM / 3 … with major political uncertainties
2017 macro outlook: BBVA’s footprint 2017 growth USA Turkey +2.3% (2.1%), +2.5% Mexico similar +1.0% to that of Spain South America +2.7% 2016 Footprint* +2.6% (*) Ex-Venezuela (**) Weighting based on the countries contribution to our business GSM / 4
… High geopolitic risk Global structural problems Negative impacts on “Technological” “Fake and unilateral growth in the short unemployment (transition) short- term solutions” and long term Inequalities Migrations Increasing conflicts Demography GSM / 5 Structural reforms and global agreements are needed
02 2016 Results GSM / 6
2016: A very strong set of results Attributable Profit (€m) Key points +31.5% Revenue growth 3,475 +61.2% in constant € Cost control 2,642 Drop in loan-loss provisions 2015 2016 GSM / 7
Revenue growth and cost management … Gross Income (€ m) Total Op. Exp. (€ m) Efficiency ratio (%) -1.4% +4.1% -51 bps 24,653 23,680 12,975 12,791 52.4% 51.9% 2015 2016 2015 2016 12M15 12M16 GSM / 8 … lead to an improvement in efficiency
Improved risk indicators, and …. Main risk indicators (%) CET1 Fully-Loaded (YoY trend, %) +58 pbs 74 70 Coverage Ratio 10.90% 10.32% 5.4 4.9 NPL Ratio 1.1 0.8 Cost of Risk dec-15 dec-16 2015 2016 Note: 2015 includes the additional participation of Garanti consolidated by the global integration method since 01/01/2015 vs. acquisition closing date 07/01/15 (Garanti homogeneous). GSM / 9 …. Strong capital base
Shareholder remuneration policy The last scrip dividend in April 2017 Going forward , 100% of the dividend in cash Pay-out in cash: between 35% and 40% of the results Two dividend payments per year GSM / 10 A clear, sustainable and predictable dividend policy, in line with best market practices
03 Setting milestones in our transformation GSM / 11
Reshaping the financial industry New entrants Exponential Technologies Loans Payments Cloud Computing Mobile Open Innovation Big Data Biometry Wealth Distributed ledgers management Artificial Intelligence GSM / 12
Banking of the future Technological Zero conflicts of Transparency excellence interest Customer Trust experience GSM / 13
BBVA’s digital journey STEP (Turkey) Strategic Plan Organization simplif. Purpose Strategic Priorities Degree of progress New organization Selfie online onboarding 63 % NPS mobile app Spain 18.4 m digital clients DC. Lago Esmeralda Innovation 90 m Center (ampl.) transac./day DC. Tres Cantos 1 billion transac./day SFO Office 1,550 people in scrums Digital Vision 2 nd Gen. Banking platform Dallas Creation Center 1 st Gen. SFO Office extension platform Torre Bancomer La Vela 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019… GSM / 14
BBVA’s transformation milestones Vision Construction Execution Deployment Degree of Strategic plan progress Organization simplif. Purpose Strategic Priorities New organization Digital Vision 2 nd Gen. Banking platform 1 st Gen. platform 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019… GSM / 15
A new culture Vision Construction Execution Deployment Degree of progress (ampl.) 1,550 people in scrums DC. Lago Esmeralda Innovation Center DC. Tres Cantos SFO Office Dallas Creation Center SFO Office extension Torre Bancomer La Vela 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019… GSM / 16
New products, businesses and results Vision Construction Execution Deployment Degree of 18.4 m digital customers progress 12.4 m mobile customers One Click Loans 1 billion transac./day STEP 12.5 m digital customers (Turkey) 5.9 m mobile customers 90 Mll transac./day 63 % NPS mobile App Spain Selfie online onboarding 1 st Mobile App 225 m transac./day 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019… GSM / 17
1 … BBVA: the best customer experience BBVA’s Change vs. position 2 2015 NPS 3 Entity / Channel 13 % Entity 1º +10 pp 43 % Online Banking 1º +2 pp 63 % Mobile App 1º +20 pp 39 % ATM +10 pp 1º 32 % Branch 1º +14 pp (1) Ranking between peer group entities in Spain: BKIA, CABK, POP, SAB and SAN. (2) According to a survey conducted by Accenture on individual commercial banking customers in Spain, excluding CX. (3) Net Promoter Score (NPS) of individual customers (for Entity and Online Banking), individual digital customers (for Mobile app) and hybrid individual customers (for the rest). GSM / 18
BBVA’s digital journey: the deployment STEP (Turkey) Strategic Plan Organization simplif. Vision Construction Execution Deployment Purpose Strategic priorities Degree of progress New organization Selfie online onboarding 63 % NPS mobile App Spain 18.4 m digital customers DC. Lago Esmeralda Innovation 90 m Center (ampl.) transac./day DC. Tres Cantos 1 billion transac./day SFO Office 1,550 people in scrums Digital Vision 2 nd Gen. Banking Platform Dallas Creation Center 1 st Gen. SFO Office extension Platform Torre Bancomer La Vela 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019… GSM / 19
BBVA, building the best reputation Improving our customers’ experience Principles based strategy Corporate Responsibility Supporting knowledge GSM / 20
2016: a very good year for BBVA Strong results growth Transformation advances: execution phase Qualitative leap in our strategy The most relevant project in the industry JGA / 21
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