BBVA will request authorization from the European Central Bank (ECB) to repurchase shares for a total import of 1,000 million euros. The entity has announced this decision after presenting a result for the first half of the year that exceeded the estimates of the market consensus. Specifically, BBVA has obtained a net profit of 3,878 million euros, which represents an improvement of 31% compared to the same period in 2022, as reported by the bank to the National Securities Market Commission (CNMV).
The bank benefited from the rise in the Euribor, which continues to rise, and the interest margin for the first six months reached 11,410 million euros in the first half, 39.2% more than in the same period last year, thanks to improvements in the customer differential and increased activity, highlighting the good evolution in Mexico, South America and Spain.
Net commission income amounted to 2,909 million euros, 12.9% more, with a particularly favorable performance in Mexico and, to a lesser extent, in South America and Turkey. In short, net interest income and commissions, which represent the recurring income of the banking business, registered a year-on-year increase of 32.9%, reaching 14,319 million euros.
Overall, the gross margin amounted to 14,148 million euros, 35.2% more than in the first half of 2022. Operating expenses grew by 21.6% year-on-year, to 5,938 million euros, largely due to the high rates of in the countries where BBVA is present (19.1% on average in the last 12 months).
By region, in Spain, credit investment fell by 1.4% in the interannual rate, mainly due to the repayment of the mortgage portfolio, in a context of rising interest rates. However, the dynamism of consumer credit and cards and financing for medium-sized companies stands out positively. The attributable result reached 1,231 million euros in the first semester, 53.6% more than year-on-year pesos after accounting for the extraordinary tax on banks in the first quarter. In Mexico, it grew by 30.1% in the interannual rate, up to 2,614 million euros, thanks to credit investment that grew by 11.1%. In Turkey the result was 525 million euros, compared to 59 million a year earlier and in South America it improved by 22.4%.
Repurchase of shares for 1,000 million euros
BBVA has asked the European Central Bank for authorization to carry out a new 1,000 million euro share reward program for imports. This repurchase is considered extraordinary remuneration and is added to the ordinary dividend policy. Between 2021 and 2022, BBVA distributed another 8.2 billion euros to its shareholders between dividends and share repurchases.
The CET1 ‘Fully Loaded’ ratio stood at 12.99% in the first six months of the year, while ROTE, which measures the bank’s profitability, closed at 16.9%. ROTE at 16.2%. Regarding the efficiency ratio, it stood at 42.
