Company: BBVXF
Filing Date: 2025-09-09
Form Type: 424B3
Source: 0001193125-25-198517
Chunk: 375

Company: BANCO BILBAO VIZCAYA ARGENTARIA, S.A.
Filing Date: 2025-09-09
Form: 424B3
Chunk 375
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 the area of credit risk management, in 2024 the Bank continued to reinforce the control environment by reviewing and updating credit risk frameworks, as well as annually reviewing the Sector Guidance Strategy, in which the Institution sets its positioning (asset allocation) at the sub-sectorallevel, this aspect being particularly important given the current macroeconomic environment. In addition, credit risk management activities focused on healthily growing the loan book. For instance, it is worth noting the evolution seen in the retail consumer loan portfolio in recent years, on which, prior to the growth in terms of volumes, improvements to credit risk valuation models, procedures and workflows were made to ensure the quality of new lending items. As a result, the Institution has significantly grown the amount of new loans of this portfolio, also underpinned by an improvement in its risk profile, with granting focused on pre-approvals.This same process is being replicated with some adaptations, and it is expected to have positive impacts on the other segments, and the Bank can already see growth in this regard in 2024 in the retail mortgage book. As for business loans, the Institution also continued to strengthen the origination and monitoring processes. For smaller segments, the probability of default gains more relevance, and the risk granting and rollover process is more closely linked to provisions and the credit cost of risk of this segment. These actions are already yielding positive results in asset quality, but the Bank expects that these results will gradually and progressively lead to a continuous improvement of the loan book’s risk profile. The Credit Risk Control unit paid special attention to strengthening the framework of RAS metrics, risk frameworks were revised and the risk exposure to the sectors most severely impacted by the current environment was assessed, proactively managing the counterparties could potentially be hit the hardest. The measures adopted to support companies and individuals over the last few years to help mitigate the effects of the various events that have occurred (pandemic, rising energy prices with a big impact on some industries, inflation, rapid increase in interest rates, and the DANA emergency at the end of 2024, among others) proved effective. Exposure to the support lines granted in previous years, especially the ICO lines to deal with the effects of the pandemic, continued to mature in 2024 (an annual drop of 34% to 3.1 billion euros). A-148

In the United Kingdom, despite the interest rate cuts implemented by the Bank of England during 2024, interest rates are expected to remain high for longer than initially anticipated by the market.