{"id":67126,"date":"2026-08-07T10:29:50","date_gmt":"2026-08-07T10:29:50","guid":{"rendered":"https:\/\/www.europesays.com\/spain\/67126\/"},"modified":"2026-08-07T10:29:50","modified_gmt":"2026-08-07T10:29:50","slug":"banco-bilbao-vizcaya-argentaria-sa-bbva-q2-2026-earnings-call-highlights-record-profit-and-2","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/spain\/67126\/","title":{"rendered":"Banco Bilbao Vizcaya Argentaria SA (BBVA) (Q2 2026) Earnings Call Highlights: Record Profit and …"},"content":{"rendered":"\n

This article first appeared on GuruFocus<\/a>. <\/p>\n

Release Date: July 30, 2026 <\/p>\n

For the complete transcript of the earnings call, please refer to the full earnings call transcript<\/a>. <\/p>\n

Positive Points <\/p>\n

Banco Bilbao Vizcaya Argentaria SA (NYSE:BBVA<\/a>) delivered record net attributable profit of 3.062 billion in Q2 2026, up 11.4% year-over-year, driven by strong core revenue growth. <\/p>\n

Return on tangible equity (ROTE) improved to 22.2% for the first half of 2026, positioning BBVA as one of the most profitable large banks in Europe. <\/p>\n

Loan growth remained robust at 17.7% year-over-year in constant euros, with strong performance in key markets like Spain (7.4%) and Mexico (close to 10%), supported by profitable segments like consumer and credit cards. <\/p>\n

The bank announced a new 2 billion extraordinary share buyback program, reflecting strong capital generation and a commitment to returning excess capital to shareholders. <\/p>\n

Asset quality remained sound with a stable cost of risk at 143 basis points for the first half, and the bank upgraded its 2026 guidance for Mexico and South America due to better-than-expected performance. <\/p>\n

Negative Points <\/p>\n

Cost growth in the first half was impacted by non-recurring items like voluntary redundancies in Spain and VAT regularization, leading to a 17.9% increase in expenses year-over-year. <\/p>\n

In Turkey, net interest income declined quarter-over-quarter due to tighter customer spreads in a high-interest-rate environment, and the cost of risk guidance was downgraded to around 220 basis points. <\/p>\n

The net trading income decreased quarter-over-quarter due to a more normalized contribution from global markets and losses from FX hedges related to Mexican peso appreciation. <\/p>\n

The hyperinflationary accounting in Turkey remains a risk, with the possibility of exiting hyperinflation by 2028 being uncertain due to persistent inflation stickiness. <\/p>\n

The bank’s CIB business (Rest of Business) saw a 52% year-over-year loan growth, which may raise concerns about sustainability and risk, though management emphasized it is focused on existing clients and cross-border opportunities. <\/p>\n

Q & A Highlights <\/p>\n

Here are the key highlights from the Q&A session of Banco Bilbao Vizcaya Argentaria SA (NYSE:BBVA<\/a>)s Q2 2026 earnings call. <\/p>\n

Q: On capital allocation, after the new share buyback, your CET1 falls to 12.4%. Is the commitment to distribute any excess above 12% still valid, and should we expect more buybacks by the end of the year? A: (CEO) Yes, the commitment is firm. Our target is the upper end of the 11.5-12% range, which is 12%. We have excess capital and will distribute it back to shareholders. The new 2 billion buyback announced today will start on August 5th and is expected to take until the end of the year. We are generating capital despite strong growth, and our commitment to distribute excess capital is a clear and firm part of our strategy. <\/p>\n

Q: On the management changes, should we infer any change in financial strategy, capital return priorities, or guidance philosophy from the CFO transition? A: (CEO) No, you should not expect any changes. This is a natural transition, and our strategic thinking and financial management principles remain the same. <\/p>\n

Q: On Spain, cost of deposits was flat quarter-on-quarter despite faster growth in term accounts. What are you doing to manage this, and what should we expect? A: (CEO) The key is our strong deposit growth, with demand deposits up 5% year-over-year. This is driven by two factors: 1) We are adding many new customers (490,000 in H1), 70% of whom become target customers within six months. 2) We have a strong focus on transactionality (payrolls, cash management, acquiring), where we have higher market share than in lending. This allows us to manage the cost of funding effectively. <\/p>\n

Q: On the Rest of Business (CIB), earnings are running far above consensus. How should we think about the run rate, and can you provide color on AI-related exposures? A: (CEO) The growth is sustainable and profitable. The business is cross-border focused, mainly corporate banking for existing clients. The RORWA for the CIB business, excluding Argentina and Turkey, is around 24%, clearly above the cost of equity. On AI exposure, we have a transition risk indicator to assess client vulnerability. Direct lending to software and IT services is less than 800 million and consists of top-quality names. (CFO) Data center exposure is very small at 0.7% of EAD, and technology exposure is 0.5%. The growth is diversified and supports our corporate client relationships. <\/p>\n

Q: On the ALCO strategy in Mexico, you are increasing the size and duration of the bond portfolio. Are you positioning for lower rates or supporting short-term NII because you are struggling to reduce deposit costs? A: (CEO) The ALCO portfolio is not an alternative to client business. We focus on client lending first. ALCO is used to manage excess liquidity and interest rate sensitivity. We like the slope of the curve but are careful with risk, maintaining an effective duration of around 3-3.5 years. In Mexico, we are positive on activity and spreads. We believe the spread situation has reached its bottom, and with rates at 6.5%, we are very rate-sensitive. (CFO) The ALCO strategy in Mexico involves anticipating maturities and locking in rate sensitivity. The duration has been extended to 3.2 years with a yield of 8.8%, which will support NII. <\/p>\n

Q: On the medium-term target of 48 billion net profit, it seems very achievable. How should we think about the upside risk? A: (CEO) We are not revising the plan at the moment. However, for the first 18 months of the plan, we are performing better than the trajectory implied by the 48 billion target. <\/p>\n

Q: On Spain, you expect customer spreads to have reached the bottom. Should we expect NII growth to align more with loan growth in the coming quarters? A: (CEO) The current gap between NII growth (4.1%) and loan growth (7.4%) is due to the average spread being lower in the first half of this year compared to last year. This average spread effect will disappear over time. The second half will be much better in this respect, and by next year, the comparison will normalize if rates develop as we forecast. <\/p>\n

Q: On Turkey, can you formalize your expectations for NII this year and the outlook for exiting hyperinflation accounting by 2028? A: (CEO) We maintain our guidance of around 1 billion NII with a slight downward bias. In H1 we did 532 million, implying a lower H2, but this depends on the rate situation. On hyperinflation, the 2028 target is at risk given inflation stickiness. The key is not the accounting itself but whether inflation comes down. We are optimistic the country is doing the right things to lower inflation. Regardless, we are committed to the 48 billion target independent of the hyperinflation status. <\/p>\n

Q: On the digital banks (Italy and Germany), what are your plans for deposit growth? A: (CEO) Our strategy is to be a universal bank in those markets, not just focused on deposits. Deposits are the first entry point to the customer franchise. We have 11.9 billion in deposits across the two franchises. Our plan is to consolidate our position in these two large markets before doing anything else. <\/p>\n

For the complete transcript of the earnings call, please refer to the full earnings call transcript<\/a>. <\/p>\n","protected":false},"excerpt":{"rendered":"This article first appeared on GuruFocus. Release Date: July 30, 2026 For the complete transcript of the earnings…\n","protected":false},"author":2,"featured_media":16148,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[123],"tags":[25312,148,25258,10552,247,4263,691],"class_list":["post-67126","post","type-post","status-publish","format-standard","has-post-thumbnail","category-bbva","tag-banco-bilbao-vizcaya-argentaria-sa","tag-bbva","tag-capital-generation","tag-loan-growth","tag-mexico","tag-net-interest-income","tag-revenue-growth"],"_links":{"self":[{"href":"https:\/\/www.europesays.com\/spain\/wp-json\/wp\/v2\/posts\/67126","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/spain\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/spain\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/spain\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/spain\/wp-json\/wp\/v2\/comments?post=67126"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/spain\/wp-json\/wp\/v2\/posts\/67126\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/spain\/wp-json\/wp\/v2\/media\/16148"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/spain\/wp-json\/wp\/v2\/media?parent=67126"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/spain\/wp-json\/wp\/v2\/categories?post=67126"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/spain\/wp-json\/wp\/v2\/tags?post=67126"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}