Company: BBVXF
Filing Date: 2025-09-09
Form Type: 424B3
Source: 0001193125-25-198517
Chunk: 337

Company: BANCO BILBAO VIZCAYA ARGENTARIA, S.A.
Filing Date: 2025-09-09
Form: 424B3
Chunk 337
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 in use. The Group determines the value in use of each interest held based on its net asset value, or based on estimates of the companies’ profit or loss, pooling them into activity sectors (real estate, renewables, industrial, financial, etc.) and evaluating the macroeconomic factors specific to that sector which could affect the performance of those companies. In particular, interests held in insurance investees are valued by applying the market consistent embedded value methodology, those held in companies involved in real estate are valued based on their net asset value, while those held in financial investees are valued using multiples of their carrying amount and/or the profit of other comparable listed companies. Impairment losses are recognised in the consolidated income statement for the year in which they materialise and subsequent recoveries are recognised in the consolidated income statement for the year in which they are recovered. 1.3.5 Hedging transactions The Group has elected to continue applying IAS 39 for its hedge accounting until the IFRS 9 macro hedge accounting project has been finalised, as permitted by IFRS 9. The Group uses financial derivatives to (i) provide these instruments to customers that request them, (ii) manage risks associated with the Group’s proprietary positions (hedging derivatives), and (iii) realise gains as a result of their price fluctuations. To that end, it uses both financial derivatives traded in organised markets and those traded bilaterally with counterparties outside organised markets (Over The Counter, or OTC). A-125

Financial derivatives that do not qualify for designation as hedging instruments are classified as derivatives held for trading. To be designated as a hedging instrument, a financial derivative must meet the following conditions:

| – | The financial derivative must hedge against the exposure to changes in the value of assets and liabilities caused by                                                                                                                                 
 interest rate and/or exchange rate fluctuations (fair value hedge), the exposure to variability in estimated cash flows that is attributable to a particular risk of financial assets and financial liabilities, firm commitments or highly probable 
 forecast transactions (cash flow hedge), or the exposure associated with net investments in foreign operations (hedge of net investments in foreign operations).                                                                                     |

| – | The financial derivative must effectively eliminate some portion of the risk inherent in the hedged item or position                                                                                                                                    
 throughout the entire expected life of the hedge. This effectiveness should be measured both prospectively and retrospectively. To that end, the Group analyses whether, at the time of its inception, a hedge is expected to operate with a high level 
 of effectiveness