Company: BBVXF
Filing Date: 2025-02-27
Form Type: F-4/A
Source: 0001193125-25-037317
Chunk: 232

Company: BANCO BILBAO VIZCAYA ARGENTARIA, S.A.
Filing Date: 2025-02-27
Form: F-4/A
Chunk 232
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 cash flows of the hybrid instrument varying in a similar way to the cash flows that
would exist if the derivative were considered separately.

Generally, where the host contract of a hybrid financial instrument is a financial
asset, the embedded derivative is not separated and the measurement rules are applied to the hybrid financial instrument as a whole.

Where the
host contract of a hybrid financial instrument is a financial liability, the embedded derivatives of that contract are accounted for separately if the economic characteristics and risks of the embedded derivative are not closely related to those of
the host contract, if a separate financial instrument with the same terms as the embedded derivative would meet the definition of a derivative instrument, and if the hybrid contract is not fully measured at fair value through profit or loss.

Most of the hybrid financial liabilities issued by the Group are instruments whose payments of principal and/ or interest are indexed to specific
equity instruments (generally, shares of listed companies), to a basket of shares, to stock market indices (such as IBEX and NYSE), or to a basket of stock market indices.

The fair value of the Group’s financial instruments as at 31 December 2024 and 2023 is indicated in Note 6.

A-25

1.3.4 Impairment of financial assets A financial asset or a credit exposure is considered to be impaired when there is objective evidence that one or more events have occurred whose direct or combined effect gives rise to:

| – | In the case of debt instruments, including loans and debt securities, a negative impact on future cash flows 
 estimated at the time the transaction was executed, due to the materialisation of credit risk.               |

| – | In the case of off-balance sheet exposures that carry credit risk, expected                                                                                                                                                     
 inflows that are lower than the contractual cash flows due if the holder of a loan commitment draws down the loan or, in the case of financial guarantees given, inflows that are lower than the payments scheduled to be made. |

| – | In the case of investments in joint ventures and associates, a situation in which their carrying amount cannot be 
 recovered.                                                                                                        |

1.3.4.1 Debt instruments and off-balancesheet exposures Impairment losses on debt instruments and other off-balancesheet credit exposures are recognised as an expense in the consolidated income statement for the year in which the impairment is estimated. The recoveries of any previously recognised losses are also recognised in the consolidated income statement for the year in which the impairment is eliminated or reduced. The impairment of financial