Company: BBVXF
Filing Date: 2025-08-12
Form Type: DRS
Source: 0000950123-25-007520
Chunk: 317

Company: BANCO BILBAO VIZCAYA ARGENTARIA, S.A.
Filing Date: 2025-08-12
Form: DRS
Chunk 317
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 To determine the key variables (basically net interest income, fees and commissions, expenses, cost of risk and solvency levels) that underpin the financial projections, Management has used microeconomic variables, such as the existing balance sheet structure, market positioning and strategic decisions made, as well as macroeconomic variables, such as the expected evolution of GDP and the forecast evolution of interest rates and unemployment. The macroeconomic variables used for the baseline macroeconomic scenario, described in Note 4.2.2, were estimated by the Group’s Research Service. The approach used to determine the values of the assumptions is based both on the projections and on past experience. Those values are compared against external information sources, where available. In June 2025, to calculate the terminal value, 2029 was taken as the reference year, using a growth rate in perpetuity of 2.1% (same percentage as in 2024), which does not exceed the long-term average growth rate of the market in which the operating segment is active. The discount rate used was 9.6% (9.8% in 2024), determined using the Capital Asset Pricing Model (CAPM); it therefore comprises a risk-free rate plus a premium that reflects the inherent risk of the operating segment being evaluated. The recoverable amount obtained is higher than the carrying amount; therefore, no impairment has been recognised. In addition, the Group carried out a sensitivity analysis, making reasonable adjustments to the main assumptions used to calculate the recoverable amount. This analysis consisted of adjusting the following:

| – | Discount rate +/- 0.5%. |

| – | Growth rate in perpetuity +/- 0.5%. |

| – | Minimum capital requirement +/- 0.75%. |

| – | Net Interest Margin (NIM)/ Average Total Assets (ATAs) in perpetuity +/- 5 basis points. |

| – | Cost of risk in perpetuity +/- 10 basis points. |

The sensitivity analysis does not alter the conclusions drawn from the impairment test. In all scenarios defined in that analysis, the recoverable amount obtained is greater than the carrying amount. The impairment of the Group’s computer software, which mainly provides services to the Bank and to TSB, is evaluated by reviewing the recoverable amounts of Banking Business Spain and Banking Business UK. In the case of Banking Business UK, the valuation method used in the analysis was that of discounting future distributable net profit associated with the activity carried out up to 2029. To calculate the terminal