Company: BBVXF
Filing Date: 2025-09-05
Form Type: F-4/A
Source: 0001193125-25-196513
Chunk: 452

Company: BANCO BILBAO VIZCAYA ARGENTARIA, S.A.
Filing Date: 2025-09-05
Form: F-4/A
Chunk 452
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 minimum requirement for own funds and eligible liabilities (MREL) that institutions must comply with at all times in order to ensure their loss-absorbing capacity is sufficient to guarantee the effective implementation of the resolution tools and that, in the current regulatory environment, would be the amount of own funds and eligible liabilities expressed as a percentage of the Institution’s total liabilities and own funds. Similarly, in 2015 the FSB defined the Total Loss-Absorbing Capacity (TLAC) requirement, also designed to ensure that institutions have sufficient capacity to absorb losses and execute a bail-inin the event of resolution. It should be noted that this requirement only applies to Global Systemically Important Banks (G-SIBs);therefore, it does not apply to Banco Sabadell Group. In June 2019, after more than two and a half years of negotiations, a reform of the bank resolution framework was agreed with the approval of the new resolution directive, BRRD II (Directive 2019/879), which implements the international TLAC standard in the EU. BRRD II was transposed into Spanish law by Royal Decree-Law7/2021 of 27 April 2021. Responsibility for determining MREL falls to the Single Resolution Board (SRB), pursuant to that set forth in Regulation (EU) No 806/2014, also revised in 2019 and replaced by Regulation (EU) 2019/877. Thus, the SRB, after consulting with the competent authorities, including the ECB, will establish the MREL for each bank, taking into consideration aspects such as the size, funding model, risk profile and the risk of contagion to the financial system, among others. In May 2024, the SRB published the MREL Policy under the Banking Package, which integrates the regulatory changes of the aforesaid resolution framework reform. On 17 December 2024, Banco Sabadell received a communication from the Bank of Spain regarding the decision made by the Single Resolution Board (SRB) concerning the minimum requirement for own funds and eligible liabilities (MREL) and of the subordination requirement applicable to the Institution on a consolidated basis. These new requirements are based on balance sheet data as at December 2023. The new requirements that must be met as from 17 December 2024 are as follows:

| – | The MREL requirement is 22.14% of the Total Risk Exposure Amount (TREA) and 6.39% of the Leverage Ratio