Company: BBVXF
Filing Date: 2025-09-05
Form Type: F-4/A
Source: 0001193125-25-196513
Chunk: 769

Company: BANCO BILBAO VIZCAYA ARGENTARIA, S.A.
Filing Date: 2025-09-05
Form: F-4/A
Chunk 769
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 rise to significant credit losses in the event of an adverse economic situation. Exposures can be concentrated within a single customer or economic group, or within a given sector or geography. Concentration risk can be caused by two risk subtypes:

| – | Individual concentration risk: this refers to the possibility of incurring significant credit losses as a result of 
 maintaining large exposures to specific customers, either to a single customer or to an economic group.             |

| – | Sector concentration risk: imperfect diversification of systematic components of risk within the portfolio, which can 
 be sector-based factors, geographical factors, etc.                                                                   |

Banco Sabadell has a series of specific tools and policies in place to ensure its concentration risk is managed efficiently:

| – | Quantitative metrics from the Risk Appetite Statement and their subsequent monitoring, including both first-tier 
 (Board) metrics and second-tier (Executive) metrics.                                                             |

| – | Individual limits for risks and customers considered to be significant, which are set by the Delegated Credit 
 Committee.                                                                                                    |

| – | A structure of conferred powers which requires transactions with significant customers to be approved by the Credit 
 Operations Committee, or even by the Delegated Credit Committee.                                                    |

In order to control its concentration risk, Banco Sabadell Group has deployed the following critical control parameters: Consistency with the Global Risk Framework The Group ensures that its concentration risk exposures are consistent with its concentration risk tolerance defined in the RAS. Overall concentration risk limits and adequate internal controls are in place to ensure that concentration risk exposures do not go beyond the risk appetite levels established by the Group. Establishment of limits and metrics for concentration risk control Given the nature of the Group’s activity and its business model, concentration risk is primarily linked to credit risk, and various metrics are in place, along with their associated limits. Credit risk exposure limits are set based on the Institution’s past loss experience, seeking to ensure that exposures are in line with the Group’s level of capitalisation as well as the expected level of profitability under different scenarios. The metrics used to measure such levels, as well as appetite limits and tolerance thresholds for the identified risks, are described in the RAS metrics. Risk control monitoring and regular reporting Banco Sabadell Group ensures that concentration risk is monitored on a regular basis, in order to enable any weaknesses in the mechanisms implemented to manage this risk to be quickly identified and resolved. This information is also reported to the Board of Directors on a recurring basis in accordance with the established risk governance arrangements. Action