Good morning, and thank you for joining us for BBVA's fourth quarter results presentation. As every quarter, I'm pleased to be joined by our CEO, Onur Genç, and the Group CFO, Luisa Gómez Bravo.

We will begin with Onur reviewing the group's performance and key strategic developments during the year, followed by Luisa, who will walk you through the business unit results. After their remarks, we will open the call to take your questions.

With that, I now turn the call over to Onur.

Thank you. Thank you, Patricia.

Good morning to everyone. Welcome, and thank you for joining BBVA's 2025 full-year results audio webcast.

I will start with page three right away. I'm happy to say that in 2025, we achieved outstanding results across critical dimensions: value creation, as you see on the page, growth, profitability, strategic execution, and shareholder remuneration.

First, I would like to highlight the excellent value creation achieved during the year, which is rooted in our outstanding profit evolution. Despite falling interest rates in our core markets, we still managed to increase our net attributable profit, which reached a record €10.5 billion, 4.5% higher than last year in current euros.

Secondly, as we have emphasized in previous results presentations, BBVA offers a unique combination of profitability and growth, which was further reinforced in 2025. Our loan portfolio increased by an exceptional 16.2% at constant euros and 11.7% in current euros, an exceptional figure, while our return on tangible equity remained at industry-leading 19.3%.

Third, in the page, we are advancing consistently in the execution of our strategy. We are transforming the bank with a radical customer perspective, leveraging the power of AI and innovation, and also growing the bank, especially in areas where we believe we have an opportunity of superior return.

Finally, all of this is enabling us to significantly increase distributions to our shareholders with a regular payout of €5.2 billion from 2025 results, while at the same time, our CET1 ratio remains comfortably above our target. As you can see on the page, the regular payout against 2025 results will be paid entirely in cash through a total cash dividend of 92 cents per share, being the highest cash dividend ever by BBVA.

Additionally, we continue with the execution of the first €1.5 billion tranche of the extraordinary share buyback program amounting to €4 billion. These are the key highlights that I will expand on in the following pages, but as you see, in my humble view, 2025 has been a remarkable year for BBVA, and we are on track to achieve our ambitious 2025-2028 long-term goals.

Moving to slide number four. On the left-hand side, our tangible book value per share plus dividends continue to show an excellent performance, with a growth rate of 12.8% at face value.

It is worth highlighting, however, here, the number excluding the impact of share buybacks, that is 15.2%. As you all know, through the share buyback programs launched in 2025, the €993 million already executed and the existing tranche of €1.5 billion currently in execution, we have been buying our shares at higher value than the book value, which then leads to some negative impact on tangible book value per share creation.

On the right-hand side of the page, you can see the very positive evolution of our net attributable profit, which continues its upward trend, reaching a new record, as we discussed, exceeding €10.5 billion. Again, despite the negative impact of falling interest rates in our core markets, especially in Spain and Mexico.

At the same time, our earnings per share, it reached €1.78, representing a 5.8% year-over-year increase. If you look into a larger timeframe, a compounded annual growth rate of 26% in the last five years.

Slide number five, I want to underscore the truly unique positioning of BBVA within the European banking sector, combining growth and profitability at the same time. You have seen this page before in other presentations of ours, but the situation has improved even further, in our view, in 2025.

The page, just to explain the page, on the x-axis, we show the return on tangible equity as a profitability metric, while on the y-axis, we present loan growth in current euros for equal footing of all large European players. As an indicator of future value creation, in our view, because growth and profitability, those are the two core dimensions of future value, BBVA clearly stands out, positioned in the top right quadrant, by far the highest loan growth in current euros, and best profitability metrics among our peers.

On return on tangible equity as the measure of profitability, we should also underscore the fact that this number is partially negatively influenced by the excess capital that we have held throughout the year, because at the denominator of this ratio, as you all know, it's the average equity throughout the year. Moving to page number six, new customer acquisition, as we have reiterated consistently—again, we put this page also in every single analyst presentation—expanding our customer base is a key driver of healthy and profitable growth.

In 2025, we reached a new record in customer acquisitions, with 11.5 million gross new customers. Maintaining this pace year after year is particularly remarkable in our view, because we are already one of the largest banks in the markets in which we operate, and it's always a smaller pool to look for new clients, but despite that, a record number in 2025.

The value of this growth, on the right-hand side of the page, that there are two factoids there, but they're very important in our view: the value of this growth becomes clear when we look at the monetization of new clients over time. For example, in Spain, revenue per customer increases by 3.7 times between the first and the fifth year of that relationship.

In Mexico, it's very important this number, 75% of the new credit cards sold in 2025 are to the customers acquired in the last five years. With such focus on cross-sell in place, we believe our future business in the coming years is already hatched with the customer acquisition activity of the past few years.

Moving to page number seven, all the great results of the past few pages are due to our relentless focus on executing our strategy. You all know our new strategic plan announced in 2025 has outlined few critical priorities to sustain and improve our delivery.

The plan foresees the continued need for the transformation of our business. That transformation, in our view, has to start with the customer, which we call radical customer perspective, putting ourselves in the shoes of our customers.

We are adopting a radical approach to understand and analyze every single customer interaction with the bank, so that we act on these insights to improve customer service and eliminate frictions with agility and empathy. This is reinforcing our NPS leading positions in most of our geographies and is leading to a significant reduction of negative experiences with our customers related to events like fraud, claims, or service waiting times, improving obviously quality of service across geographies, as you see on the left-hand side of the page.

As part of this new wave of transformation, we also have started to maximize the potential of AI and innovation within BBVA. We will pursue this across eight initiatives listed there in the page, including our digital advisor, the Blue, the AI assistant for bankers, and injecting efficiency and effectiveness in different processes across the bank in different areas like the software development.

In addition, AI is increasingly being embedded across our organization. Our 127,000 employees all around the world, they have now access to OpenAI and Gemini.

We are still at early innings on this, but we are already starting to see the positive impact from all of our AI work, and we will update you on this further in the coming quarters. On page eight, as part of our strategic plan also, you see certain businesses that we have prioritized to grow faster than average.

We have achieved that superior growth in 2025 in all selected areas: enterprises, sustainability, and capital-light businesses. On the left-hand side of the page, you see the levers through which we grow our enterprise business: cross-border, a natural lever for a global bank like us to serve our multinational enterprise clients beyond their home geography, and sustainability, also mainly on the enterprise side, a strategic priority for us to accompany our clients in their transition, all yielding excellent results in 2025, again, as you see in the growth rates.

If you can compare those growth rates with the rest of the bank, which is on the right-hand side. In middle and the right-hand side of the page also, you see the prioritized capital-light, fee-generating businesses, again displaying excellent growth performance in insurance, in payments, in wealth management, where, again, we grew much better than the average of the bank in all of those areas.

Slide number nine, from this slide on, I'm going to walk you through the financials, but and also to save time, let me not spend too much time on this page as it is a summary of the following pages. Let's jump into page number 10.

In the annual P&L, a similar story as in the recent years, but I would like to highlight the very strong performance of core revenues, which drove gross income growth to 16.3% year-over-year in constant euros, with 13.9% in NII growth and 14.6% in fee income. This solid growth in gross income, together with positive jaws, as you see on the page, contained impairment charges, it resulted, again, in the record net attributable profit of €10.5 billion.

Slide 11, the P&L for the quarter, for the fourth quarter. Again, I will not stop long here but just to remark on the strong quarterly performance with a net attributable profit above €2.5 billion once again, despite some negative one-offs like a tax code change in Turkey at the final days of the year—you might have seen it on Christmas Day, actually.

The continued and accelerating delivery at the core revenue lines, net interest income and fee income, is worth highlighting, again, on this page. Core revenue, especially in Spain, in Mexico, is behaving exceptionally well.

Talking about that, maybe on page number 12, talking about Spain and Mexico, our two core geographies, first of all, before the countries, at the group level, on the left-hand side of the page, one of the clear highlights of the quarter was the growth in activity. Loan growth maintained an excellent pace, increasing 16.2% year-over-year, which is translating into that strong net interest income performance.

Then talking about the countries within that, in Spain, loan growth further accelerated to 8% year-over-year, while Mexico maintained a solid 7.5% year-over-year growth. In the case of Mexico, excluding the impact of the US dollar affecting the value of our US dollar-denominated loan book in Mexico, if you isolate for that impact, loan growth would have reached 9.9%, fully in line with our 2025 guidance.

On the right-hand side of the page also, you see how all of this supported by strong loan growth and proactive price management in a declining rate environment, how we translated this into growth in core revenues in both Spain and Mexico year-over-year, but also look into the quarterly evolution, with an acceleration in the last quarter if you annualize those quarterly figures. Moving now to slide number 13, again talking about growth, our strong activity growth is not only due to the overall industry growth, but also due to our clear outperformance versus competitors.

As shown on the page, we have been gaining loan market share in all of our markets in the past few years. In 2020- 2025 specifically, we continued that trend in practically all of our markets, again with meaningful gains across the board.

We have to be careful here. Market share by itself is not an isolated goal for the bank, as the underlying growth has to be profitable.

We are not here for the sake of growth. As we monitor and manage the profitability of any granted loan in any country of the bank, we take pride in the consistent track record of market share gains across the board.

Moving to slide number 14 on costs, I would first highlight that once again and in line with our DNA, we closed the year with positive jaws, with gross income growing by 16%, clearly outpacing the growth in costs. As a result, on the right-hand side of the page, our efficiency ratio continues to be one of the best among European peers, and it improved to a 38.8%.

Again picking up some speed, slide number 15, the evolution of our asset quality. It remains in line with our expectations even in a context of strong activity growth in our most profitable segments.

Starting on the left-hand side, at the bottom of the page, our cost of risk stands at 139 basis points year-to-date, improving versus 2024 and delivering a better performance versus guidance in most of the countries. At the same time, on the bottom right-hand side, both our non-performing loan ratio and coverage ratio, they continue to improve year-over-year and quarter-over-quarter.

Slide number 16 on capital, quarter-over-quarter evolution clearly illustrates both the underlying growth dynamics of the business that I just talked to you about and the one-off timing effects at year-end. First, results remain at the core driver of capital generation: strong earnings contributed 64 basis points to CET1, then with the accrual of the dividends and AT1 coupons deducting 34 basis points.

Then turning to RWAs, activity-driven growth implied an impact of around 57 basis points. Overall, we saw a higher pace of RWA consumption compared with previous quarters.

Again, this reflects very strong and exceptional business dynamics across all geographies, with an acceleration in the loan portfolio growth explaining the majority of the increase in RWAs. In addition, the thing that I mentioned about the fourth quarter exceptional number, the quarter includes also the year-end operational risk calculation, which, in the context of higher revenues and higher activity, also came slightly higher than usual.

Importantly, this capital consumption for the right reason, as it is driven by profitable growth. We would like to underscore this.

It's 57 basis points, much higher than usual, because we have grown much higher than usual, and that's good, as long as the growth is a profitable growth. On that one, again, we remain highly disciplined in the use of capital, as it is a scarce resource.

I've shared with you before, we have developed this concept of micro capital management framework, which ensures that at the most granular level, at the level of every single loan, again, I'm repeating, but it's important, granted at any part of the world, capital is deployed profitably above the respective cost of equity in that respective market. In the page, other impacts: marginally positive, adding around four basis points, as negative market-related impacts were more than offset by the positive credit in OCI from hyperinflationary countries and higher minority interests.

Regulatory impacts: we have basically advanced this to you I think two quarters ago, but we added a 56 basis points, somewhat above the original expectations that we shared with you during the, again, July presentation, I think it was. These effects are technical in nature and mainly reflect the reversion of some portfolios to standard and to foundation in Spain and in Mexico.

As a result, CET1 reached 13.75% in December 2025 before capital distributions, then you deduct the €4 billion of extraordinary share buyback program—a clear demonstration of our commitment to shareholder returns and to get back to our capital target—but this reduced the CET1 by 105 basis points, taking us to 12.70%. Slide 17 on shareholder distributions, in line with our payout policy, I'm very pleased to announce that the proposal to be submitted to the governing bodies contemplates a total regular distribution of €5.2 billion for 2025, equivalent to a 50% payout, the upper end of our distribution policy.

The distribution will be fully paid in cash amounting to 92 cents per share, which represents a 31% increase versus the 2024 cash dividend. This implies a final dividend of €0.60 per share to be paid in April 2026, complementing the €0.32 per share that we have distributed back in November.

In short, by far the highest dividend of our history. In addition, we continue to execute the extraordinary share buyback program, €4 billion, announced last December, of which the first tranche of €1.5 billion is already being executed again as a share buyback program.

Then page number 19, as in 20- in the second quarter of 2025, in July, we set our ambitious financial goals for the 2025-2028 period. We are completely in track of those numbers.

We are still in the first year of the program, but as compared to the numbers we had in the plan for 2025, we are performing in line with our original expectations, in some better, but overall in line with our original expectations in all of the metrics that you see on the page. With this, I pass over to Luisa for the business areas.

Thank you very much, Onur, and good morning, everyone. Let's start with Spain, which has delivered outstanding results in 2025.

Net profit grew at a double-digit number, reaching €4.1 billion for the year, driven by strong business dynamics, with loans up 8% year-on-year, more than offsetting some margin pressure in a declining rate environment. This was further supported by robust fees, contained costs, and improving asset quality trends.

The fourth quarter was particularly solid, with net profit exceeding the €1 billion mark. Looking to quarterly dynamics, net interest income remained highly resilient, supported by continued commercial momentum.

Loan growth remained very solid, supported by strong new production up 9% quarter-on-quarter. Loan balances evolved positively across the board, with particularly strength in consumer and across the enterprise segments.

This translated into further market share gains in the most profitable segments, to highlight the evolution in the enterprise segment, where we have successfully closed the gap with the overall loan market share, gaining 60 basis points of market share in the year. Robust fee income, driven by sustained growth in asset management and insurance fees, along with the recognition in the quarter of asset management success fees.

On costs, expenses remained well contained, growing by 1.9% if we exclude the positive one-off related to VAT calculations recorded in the second quarter. The quarterly increase mainly reflects year-end adjustments of variable compensation accrual according to the strong performance in the year.

Overall, efficiency remained best-in-class, with cost-to-income ratio at 33.1%. Finally, we continue to see positive trends in asset quality: the NPL ratio declined, coverage increased, and the cost of risk improved to 34 basis points in line with guidance.

Turning to Mexico, 2025 was a remarkable year for Mexico, with a very strong performance despite a challenging macro environment. On a full-year basis, earnings were supported by robust core revenue growth, up by 8% year-over-year, driven by strong activity momentum outpacing peers, leading to continued market share gains.

Total market share reached 25.6%, increasing by close to 30 basis points over the year, while total deposit market share also increased by close to 70 basis points. Looking into the fourth quarter, net profit reached €1.4 billion, up close to 5% quarter-on-quarter, supported by very solid activity dynamics.

Loan book growth accelerated in the final quarter, increasing by 4% excluding the FX impact, with sound performance both in the retail and enterprise segments. Total deposits grew by 5.4% quarter-on-quarter, outpacing loan growth, driven by strong inflows in retail deposits, particularly demand deposits.

Cost of deposits declined further in the quarter, supported by lower interest rates and an improved deposit mix. All in, this translated into strong gross income growth of close to 6% quarter-on-quarter.

Turning to costs, the increase in expenses during the quarter, as in Spain and by the way, in the other geographies as well, mainly reflects year-end adjustments in the variable compensation accrual. Efficiency levels remained outstanding, with a cost-to-income ratio stable at 30% in the year and in line with guidance.

Finally, asset quality remained solid, with a flattish NPL ratio in the year, higher coverage levels, and broadly stable cost of risk. Moving now to Turkey.

The franchise delivered a net profit of €805 million in the year, representing a significant improvement compared to 2024. The improvement in earnings is mainly supported by a strong increase in net interest income, underpinned by higher activity levels and a significant recovery in the TL customer spread in Turkish lira in a context of declining interest rates.

Fee income remained robust, supported by growing activity. In addition, the negative impact from hyperinflation adjustment continued to decline, reflecting the ongoing disinflation process in the country.

Cost of risk stood at 194 basis points in 2025, reflecting still elevated provisioning needs in the retail portfolios following a long period of negative real interest rates. Finally, the effective tax rate increased significantly in the fourth quarter by the full-year impact of the recently announced tax code change, which Onur already mentioned, and weighed on Garanti BBVA earnings at the end of the year.

Let's turn now to South America. The region delivered a strong performance in 2025: net profit reached €726 million, growing by 14.3% year-on-year, mainly supported by earnings improvement in both Peru and Colombia, as well as lower negative impact of hyperinflation adjustment in Argentina as disinflation process continues.

Core revenues dynamics were very positive in Peru and Colombia, growing at mid-single-digit year-on-year in current euros, supported by solid loan growth and wider spreads. Net interest income in the year is affected by Argentina, reflecting a lower contribution from the securities portfolio and some compression in customer spread over the year, despite the recovery observed in the fourth quarter.

Robust fee income across the region, supported by the roll-out of new initiatives aimed at reinforcing fee generation and improving efficiency, the cost-to-income ratio improved to 43.9% in 2025. Turning to asset quality, trends continued to improve in Peru and Colombia, while in Argentina, provisioning requirements in the retail portfolio remained high, leading to adjustments in the risk appetite for this segment.

Overall, risk indicators improved across the region, with the NPL ratio declining to 4%, coverage increasing to above 90%, and the cost of risk improving to 250 basis points. All in all, South America continues to show increasingly positive dynamics, reinforcing our confidence in the region's outlook going forward.

Going now to Rest of Business. In 2025, Rest of Business delivered strong net profit of €627 million compared to €485 million in 2024.

The strong performance was driven by solid activity across geographies. Loan growth remained healthy, with important contributions: corporate lending, transactional banking, project finance.

Funding dynamics were also positive across the board. This strong momentum translated into robust revenue growth.

Net interest income increased by 15.9% year-over-year, supported by higher volumes and disciplined price management. Fee income also showed remarkable growth, with positive trends across countries driven by both investment banking and global transactional banking.

On costs, expense evolution reflects the rollout of our strategic growth plans, including continued investments to reinforce our capabilities and growth plans going forward. Risk metrics remain very solid.

Cost of risk stood at 16 basis points in 2025, broadly stable year-on-year. Overall, Rest of Business continues to show very positive momentum.

Back to you,

Onur. Thank you, Luisa.

Let me finish with the takeaways and the outlook and the guidance. We have a commitment to you that we always finish by the hour, on the takeaways, let me not go through all the bullet points that you have on page number 26.

In short, I do think we have had one of our best years ever in 2025. Then guidance, page number 27, completely aligned with the mid-term goals of our strategic plan.

We are expecting strong business momentum to continue, solid loan growth across the board, supporting net interest income and overall revenue growth. On expenses, we maintain our clear commitment to cost discipline.

The expected evolution in Spain and Corporate Center is impacted by some, as you remember in the second quarter, there were some VAT-related topics there, some base effects, but if you exclude the base effects, completely in line with our also original plan. Cost of risk is expected to remain broadly aligned with the 2025 levels.

Overall, as a result of all of this, our expectation across the different business units, it translates into a group return on tangible equity goal of around 20%—better than 2025 is our expectation—and a cost-to-income ratio of below 40%. Finally, on page 28, to deliver on our ambitious long-term objectives and the 2026 guidance that I just talked to you about, we will continue to focus and execute on our strategic priorities.

We again announced them at the beginning of 2025. We will devote time in 2026 to further discussing these strategic priorities with you through a series of what we call BBVA Strategic Talks.

Obviously with the involvement of our senior management, these sessions would include country and certain business deep dives, and they're going to start them in March the 10th with Mexico and the enterprises segment. With this, I conclude the presentation.

Now I give the floor to Patricia for the Q&A. We are at 9:58 in Spain, 2 minutes.

Perfect, we are right on time.

Thank you very much, Onur and Luisa. We are ready to start the Q&A session, so, operator, please, the first question.

Hello. Good morning.

Thank you very much for the presentation and taking our questions. Two questions from me, please.

The first is on Spain: you target above mid-single-digit growth in loans, and you grew 8% in 2025, but the NII guidance is low to mid-single-digit. Can you walk us through the key assumptions there on rates?

Then the second is on Mexico. Looking at sector data, and please correct me if I'm wrong, but it looks like the gap in deposit costs you had historically is reducing.

You also seem to be growing faster in term deposits. Can you please discuss competition in deposits and how do you see your customer spread evolving in the coming quarters?

Thank you.

Thank you, Max. On Spain, our Euribor expectation that we have, for example Euribor 12-month, is basically flat, but the average spreads that we would be having, average 2025, average 2026, shows a slight decline.

As a result, you see a different guidance between the activity growth and also the overall NII and revenue growth. That's the core reason.

The Euribor levels, we do think, today we are at 2.22% 12-month Euribor, it's going to be around these levels. The average that we expect for the year is at 2.25%.

On Mexico, the deposit pricing, we discuss this every quarter. Our Mexican peso funding is at 2.5 at the end of November for comparison reasons.

In the backup, you also see the end of December, but comparison, the markets authority announces these numbers. When our competitors, they are at 4.11.

Two five 2.5 for us, 4.11 for the industry. We maintain that very positive gap with the rest in terms of cost of funding and deposits, going back to the same dynamics that we repeat every quarter here, but they are important.

We are in transactional deposits. I did mention this to you before, but I would repeat it: given our very high market share in payrolls, 1/3 of our deposits 1/3 is in this bucket of €0 to €30,000, the lowest bucket, and the average of that bucket, 1/3 is in that bucket, €0 to €30,000, and the average of that bucket is €790.

We have millions of customers, and their transactional relationship is with BBVA. That's the best insurance policy against any cost of funding challenges or deposit challenging.

You have seen that our loan-to-deposit ratio is basically flat throughout the year also in Mexico. I did mention to you in the last call that we would be a bit more aggressive in deposits now that the prices are lower.

We didn't want to be very aggressive in deposits, and we have chosen to do wholesale funding when interest rates were very high, because we didn't want to trigger that market too much. Now that the interest rates are relatively low levels, we are also gaining market share in the last quarter, and it's mainly coming from the enterprise segment, which is then leading to those dynamics.

Overall, we feel very comfortable with our deposit positioning and cost of funding positioning in Mexico.

Just to add on to Onur's comment also on the rate side in Mexico, we do expect Banxico to continue to lower rates this year. We're expecting Banxico rates to be at around 6.5% in around mid of the year.

That is also implying somewhat a compression of spreads in 2026 in Mexico on average versus also 2025, just as in Spain.

When we announced our long-term strategic plan, we said that the core driver of the strategic plan numbers that we announced, again, in July was the fact that the rates would stabilize, and once rates stabilize, the activity growth will translate into bottom line right away into profits, and that stabilization has already happened in Spain and is very close to be happening, finalizing in Mexico.

Yes, thank you very much, Max. Next question, please.

Thank you for the presentation. Have two questions.

First one is: Spain customer spread fell 50 basis points in '25. Local peers are reporting falls of just 20, 30 bps.

You are growing faster in loans, 8%, however. How can you reassure that market share gains are not coming at the expense of profitability?

If you can comment on customer spread dynamics that we should expect in '26 and '27. My second question is on capital generation.

Results in '25 and '26 guidance is in line with expectations, but you are getting there more capital-intensive that I thought in view of the negative organic generation in Q4. I wonder if you can update on the goals of the '28 plans.

If you feel that the €49 billion of CET1 generation is still achievable, how much through SRTs, and the mix, how much you plan to devote between growth and distributions that you guided at the time? Thank you.

Thank you, Paco. Luisa, do you want to take the first one, customer spread dynamics?

Yes, I think the customer spread dynamics have been quite positive in the quarter, to be honest. I think that we need to also remember that the repricing of our mortgage loan portfolio is faster than our peers.

We reprice 2/3 of our mortgage book in every six months and 1/3 every year. This pricing dynamics, obviously you see it eating into the loan yields quarter-on-quarter.

In the cost of deposits, this quarter, we had a slight uptick of two basis points of cost of funds, and this was driven primarily by a mix effect, because in the quarter, we gained market share in transactional banking deposits and in the corporate side, and that's what affected a little bit the cost of deposits. Going forward, as we mentioned, we think that we will see quarter-on-quarter pretty stable customer spreads in the first half of the year, and perhaps slightly ticking up at the end of the year, depending on that Euribor rate performance that Onur mentioned.

All in all, I think that we are quite comfortable with the evolution of the spreads going forward. Going to profitability, I think that our profitability, as you can see, by the dynamics of core revenues in BBVA this year in Spain, which have been quite positive, with over 3% year-on-year in NII and 3% over 3% year-on-year in fees compared to our peers, I think showcase the profitability outlook of our growth.

Just to add on this one, Paco, on page 38, you see the customer spreads, average customer spreads by geography in the appendix. The average spread has declined by 41 basis points, just to be very precise on the figure.

That 41 basis points, as you mentioned, is slightly higher than the competition. For a good reason: if you look into the growth of our lending book, you would see that we are growing very profitably, to be fair, but still at a different margin or a different spread level versus retail in the enterprise segment.

We are growing very nicely in the enterprise segment. That has an implication, obviously.

The mix effect comes into that play. That 41 basis points, again, is excellent in our view.

Finally, I would say that the final spread that you see in Spain in the fourth quarter, but at the end of the quarter as well, 2.80%, we have touched bottom, basically, in short. We expect that number not to go any further down, slight maybe changes, but not too much.

From here on, if the rate policy evolves as we are expecting, it's going to be going up. Then the second question, the broader question on the growth being capital-intensive and the implications of that, you were asking about implications of that in terms of goals.

We do have our, again, mid-term strategic plan and the associated figures. There are two numbers there that are very important to us and that are very easy to remember: €48 billion profits and €36 billion capital distribution back to our shareholders, okay?

Those two numbers, and then there are many others underneath, but I am giving you the two figures that I put them into a post-it note and I put them next to my bed so that I look into them when I wake up in the morning. They are important numbers.

We are a very confident team. If things happen that are beyond our control and if it doesn't happen, fine.

At the moment, we are completely on track to reach those figures. The thing that you mentioned, being growing in capital-intensive areas, as long as it's above your cost of equity, that growth, we love it.

We want to do more of it, because we are going to be creating capital more than our cost of equity. The thing that you mentioned might create a bit more different dynamics in terms of some of the buckets underneath the capital flow, but at the moment, it's completely in line with our plan.

If it continues like this, meaning we grow a lot in, as you say, capital-heavy areas, then we have an opportunity to do more SRTs, for example. I'll give you the growth dynamics here, because you mentioned it's capital-intensive.

If you look into the quarter-over-quarter growth, you see that in Spain, in the quarter, we grew 2.5% in loans, when the annual growth was 8%. If you annualize the quarterly growth, we have grown much more in the fourth quarter versus the rest of the year.

If you look into Mexico, the fourth quarter number growth is 3.7%, when the overall annual growth was 7.5%. Again, if you annualize Mexico, 3.7%, it was a much stronger quarterly growth than the previous quarters.

Rest of Business, as also Luisa explained, Rest of Business is basically CIB business, we also delivered amazing growth in that area. All of this growth, again, is happening above cost of equity.

If we grow like this, again, we will have a higher pool, for example, to do more SRTs. There will be different dimensions, but in short, coming back to your simple question, we are fully committed, and we are completely on track of our mid-term goals.

Thank you very much, Paco. Next question, please.

Good morning, both, and thank you for taking my questions. The first one's on costs.

At a group level, costs grew 10.5% in 2025 above weighted average inflation of 9.6%. I roughly calculate the weighted average inflation is expected to be 7% in 2026.

Is that 7% roughly in line with your expectations and is 7% the right way to think about group cost growth for this year? I appreciate you have a cost-to-income ratio.

Secondly, one of the reasons that Mexico is a great geography to operate in is because the population is young and underbanked. From a strategic point of view, I'm interested that when we're talking about new entrants coming to the market and coming to a market like Mexico and disturbing the status quo, does that young and underbanked population actually represent a disadvantage?

I imagine younger customers are less sticky, and if your parents never had a bank account, you'll have no brand aspiration or allegiance. Basically, conceptually, do you think that it's easier for a new entrant to come to a market like Mexico relative to a market like Spain?

Thank you.

Perfect. On costs, Luisa, do you want to take?

Yes. I think on costs, what we see is that this year, the performance in costs has been basically affected as well by the VAT one-offs in Spain and Corporate Center, in line in Mexico, in Turkey affected by inflation, and in Rest of Business in line with our expectations according to our investment plan.

All in all, I think, as I mentioned, very much with what we expected. Going forward, I think the guidance is very clear that we continue and remain investing in our footprint.

Guidance for Spain and the Corporate Center is affected by the one-offs on the base case. I think that in both cases, if you strip out the one-offs, we will be growing in Spain around between 3% and 4% on the average of the both years, which is in line with the growth that we see for Spain.

In Mexico, again, very consistent growth in Mexico, a market where we continue to believe that investment gives a lot of return going forward. I think that the group costs this year are going to be, in that sense, higher than inflation because of these one-off trends and the continued investments in the growth franchises that we see in the group.

As you mentioned, profitability is very relevant for us, and as long as we see cost-to-income trends performing the way that we expect below 40% for the group in 2026 and with our mid-term goals going into the 35% aim, which is what we still stand by, I think we're perfectly fine investing in our footprint at these return levels.

On your second question, Benjamin, which is a very good question, our experience in banking, Benjamin, is that different segments of the society and population, young, middle-aged, old, or different segments, whatever dimension that you pick as a segmentation dimension, they really don't care whether it's the neobank or the incumbent bank and so on. What they care about is the service.

They want to get the best from their bank. Very simple concept, but very important.

Different segments prioritize different areas of the service. As you say, the young segment, for example, the digital experience has to be really good, because that's the piece that they care about.

If that digital experience is being provided by an incumbent bank versus a neobank, they don't care about the tag, about that label. They go for the service.

In that context, our claim, and there are many numbers that we can take offline and feed you with, but there are many numbers that tell us that our digital experience in Mexico is amazing. Cuz as compared to those neobanks as well, I'm personally involved in those exercises.

We look into: what do they have in digital experiences, what do we have? Do we have a gap?

If it's positive, perfect, we further build on that. If it's negative, we close that gap right away.

If you do that, why would the young segment prefer a certain bank versus another? In that context, again, the numbers speak for themselves.

Those neobanks that you are mentioning, and some of them have been there for many years now, they are newcomers, but they are also very entrenched now players in Mexico on the neobank side, they have been there for quite a long time, but despite that, we have 4.7 million new customer acquisition in Mexico in 2025. 4.7 million.

A good part of them are very young customers. 81% of this acquisition are done through pure digital channels, they don't go to a branch, they don't go anywhere, and they basically become a customer through pure end-to-end digital channels, which is one of our core competitive advantages in Mexico and beyond.

That's why we are providing that service to them, that's why we are getting those numbers. On top, we have certain things that, in our view, neobanks cannot replicate that easily.

We can do what they do, because the digital channel, we are really focused on that, but the things that we have, our infrastructure in the country, Mexico is still a very cash-heavy country: more than 90% of the population says they deal with cash on a daily basis. We have by far the largest ATM infrastructure, we have the branch network if the customer needs it for a problem for the young segment, it's only for problem areas, but it does happen.

They care about that infrastructure as well. Also, even if you are young, if you are working in a place, we do have a relationship with your company so that your payroll comes to BBVA, which is not very easy for, again, neobanks to replicate.

In short, I think the numbers are very clear that we see that challenge, but we are matching that challenge, and we're going to compete really hard.

Thank you very much, Benjamin. Next question, please.

Luisa, thank you very much for taking my questions. The first one is on Spain.

Spain volumes are strong, and you're gaining market share in SME and corporates while deliberately giving up share in mortgages. Is this pushing the cost of deposits up as you compete for clients that you're not gaining through mortgages?

As you mentioned before, Onur, risk-weighted asset growth was larger than expected this quarter. Could you clarify whether any large SRT transactions have slipped into Q1 and how we should think about risk-weighted asset growth and further SRT benefits for next year?

My final question, the final dividend was entirely in cash. Is this structural going forward, or are you planning to keep flexibility to do a final dividend in 2026 with a share buyback component?

Thank you.

Perfect. SRTs, the architect and the leader of the SRTs is Luisa, I'll give it to you on the second one.

On the first one, the cost of deposits maybe going up, if I understood you correctly, Cecilia, because we are less aggressive on mortgages, does it have an implication on deposits, was that the question? The deposit, you would see it in the numbers as well.

Again, in the appendix, you will see it: our loan-to-deposit ratio in Spain is now 87%. 87%, we do have so much liquidity and so much deposits that the tension that you might be implying that would be coming from not having that mortgage relationship with customer and hence lower deposits is not there at all, because we do have, again, abundant deposit space.

SRTs, Luisa,

well, on the SRTs, we generated 35 basis points of capital in this year, in 2025. It was around €11 billion of RWA release.

We did frontload the deals in the year, where they were more biased. We did 23 basis points in the first half.

We do see that the trend in the market is for deals to concentrate at the end of the year, and so we planned our SRTs in a different way. We expect this year to be able to deliver more or less in line with the guidance that we gave last year, of around 30 to 40 basis points, and pretty much in a similar fashion.

We are also expecting to start doing some deals in some of our other core geographies, such as Mexico and also potentially Turkey. We're working on those type of deals as well, in order to try and mobilize the balance sheet further.

In that context, we do expect RWA growth to be below the loan growth as we complete our SRT planning going ahead.

Okay. On the first answer that I gave on deposits in Spain, Patricia here is alerting me that I didn't give a proper answer, but I do think what I said was critical, which is the 87% is the number to look into, but she's also highlighting a very good number, which is one of the clear reasons of our deposits are growing in Spain is also the retail franchise that we are building.

Last year, we continued to acquire—I go back to the same topic, but it's very important—1 million new customers in Spain, 1 million new customers. Excluding the neobanks, we are number one among incumbent banks in terms of customer acquisition.

That brings a lot of deposits as well, huh? Patricia, I added your point as well, I think you should be happy.

Then the dividend topic, you said, I think, Cecilia, that 2026, can there be share buybacks instead of cash? Of course.

Of course, as we have done in the past, this year, it's 50% fully in cash because we are running a share buyback program already. There is an ongoing extraordinary share buyback program running in parallel, that's why we said, "Okay, let's go with cash on the other side."

You might remember, 2024, 2023, we did a piece of the payout, regular payout in share buyback, 40 last year in cash and 10 in share buyback, if you remember. We have that flexibility in our payout policy as we have announced to the market.

We typically tend to pay a good part of the regular payout in cash, because we do think it's important the cash dividends continue for our shareholders in a nice way. A good part of that will always be coming in cash dividends, but there is the possibility and the flexibility, obviously, to do the 2026 regular payout, also some of it in share buyback.

Thank you very much, Cecilia. Next question, please.

Hi. Good morning.

Can I ask a couple of questions around the guidance, first of all, in Mexico, and then I've got one on costs in Spain. In Mexico, the mid- to high-single-digit NII growth, if I look at the momentum you had in 2025, it was very good.

You had sort of in the second half of the year, you had 3% sequential growth in NII in pesos, and the mid- to high-single-digit NII growth implies very modest sequential growth over the fourth-quarter base. Luisa, you mentioned 50 basis points rate cut that you're putting in.

Are you being conservative? I don't want to go to the cliché of the deposit competition, but is there anything we're missing?

Are you being conservative? Just if you could qualify that guidance a bit, that would be very helpful.

Then on Spain, even the cost-income is 33%, which is obviously very good, that goes without saying. If I think about the 2026, you're discussing low- to mid-single-digit sort of NII fees and expenses underlying around four, I think, Luisa, you said, I'm just thinking that potentially implies negative jaws or stable jaws.

How are you thinking about costs from here on given this good starting point in cost-income? Should we expect with more investment, maybe some negative jaws at some point?

Is this the best you can do, which is very good? I don't mean it in a bad way.

33% is obviously best in class. Thanks.

Maybe you take the second one, Luisa. On the first one, Alvaro, congratulations, because in that chart of outlook and guidance, there are many bullet points on the page.

The one that we discussed extensively and we said, "Are we being too conservative on this number or on this line?" was the one that you picked.

Our style. That page, again, is very important to us.

When we say a number that we want to deliver, we deliver. Maybe a bit on the conservative side, that number, we are very positive in Mexico, huh?

Very positive. If we have delivered what we delivered in 2025 despite all the complexities of the year in Mexico, in 2026, based on what we also see at the beginning of the year, we are quite positive, but we put a number and we always deliver, and maybe that's one of the reasons why you have that guidance in there.

Luisa, on the cost?

Yes. On the cost side, I think that with the current guidance and in this year, we do expect a slight negative jaws in Spain if factoring for that circa 4% on average for the last 2 years.

That would still leave us with a very positive cost-to-income ratio for the year in Spain as we guide it for. Again, we continue to, by the way, invest a lot in efficiency and productivity, and by no means are we standing still.

Part of the investments and the growth in investments and expenses are to achieve further productivity gains throughout the year, in '27 and '28 primarily. We are very committed to ensuring that we have very good, solid cost discipline in Spain and the rest of geographies, but Spain is, I think, a poster child of cost discipline in the past, and we will continue to do so throughout the year and going forward.

Yes, slightly negative jaws this year, but again, very positive growth for Spain, going forward in NII.

Luisa, maybe we also quantify it a bit, in terms of the number that you see on the page for 2025, Alvaro, you see that the costs in Spain have decreased by 0.7%, decreased, huh? It was because of that one-off that Luisa also mentioned in previous calls and also today, this VAT one-off.

If you exclude that one-off, the growth in 2025 would have been around 3%, and the guidance for next year would have been around that as well. It's not any different.

It's the base effect mainly affecting that figure. We are going to be in the first quarter running an efficiency initiative, a voluntary efficiency initiative in Spain, and that might have a little impact on that number also, especially in the first quarter, but the guidance is there in that sense mainly because of the base effect.

Thank you very much, Alvaro. Next question, please.

Hi, Marta, can you please check if you're on mute?

Oh, sorry for that. My first question is a follow-up on cost.

We've seen some slippage in the Corporate Center. Is there space to do something more ambitious in terms of restructurings?

It's been a number of years since you did anything meaningful in terms of early retirements. Could we see some capital allocated there?

My second question is also on capital allocation. Some may say that your buyback, your current extraordinary buyback was somewhat stingy, and at the current execution pace, you'll be done and dusted by July.

Is there a chance that you reload that buyback, or we're not going to see anything in terms of capital returns beyond the interim dividend this year in 2026? Just a quick question on the Rest of Business, your loan book there is growing like a weed, €16 billion this year, almost €30 billion over the past 2 years.

We're seeing market investors a bit jittery about underwriting, generally, private markets, etc. Can you give us some sense of the quality of your underwriting, what you're doing?

Thank you.

Perfect. Maybe the last one you take, Luisa, if you like.

On the first question, Marta, thank you for the questions. On the Corporate Center, as I just mentioned to Alvaro's question in Spain and in Corporate Center, it's not a restructuring program at all, it's something that we do in an ongoing basis.

In the first quarter of this year, we will have an efficiency initiative as we call it, which is a voluntary initiative for some of our colleagues to benefit from if they want. It's a targeted voluntary initiative that we would be doing.

I would highlight to you that if you go back to the Corporate Center expenses in the last 5 years, 5 years, you would see that those expenses are always growing less than inflation, always. Except the one-offs, and we can talk about the one-offs, but has been a commitment that we have had, even in these calls we have voiced those commitments, and we are on track with those commitments.

The buyback strategy, and you're saying should we expect something more or less or nothing, we have been very clear, very vocal, and I do think we have built the credibility around this fully. We do have this commitment that we have a capital target, 11.5% to 12%, that we will distribute all the excess capital above 12%.

Our commitment on that is full. If you look into our capital number and the evolution of the capital, you would see that we would have excess capital.

Obviously, you should expect something more. When the time comes, we will announce it: additional extraordinary distribution back to our shareholders.

Then Rest of Business, Luisa?

Yes. No, I think that the growth that we are seeing is a strong growth, but this is on the back of plans that have been developed over quite a number of years already, and they have gained momentum now.

These are very thought-out plans that basically are trying to gear and leverage the global footprint that we have. We put our clients in connection to our emerging markets, and we're doing business with large corporates that are growing the strategy in traditional corporate banking with that growth of 21% that we saw in the year in cross-border business.

I think that in terms of underwriting criteria, we are quite conservative as in the rest of the group, and 40% of our business is booked in the US, and we are, I think, overall very focused in growth in corporates. That's where we're seeing the main growth mark, we're seeing growth, but not as relevant growth as in the corporate book.

Again, corporate banking, transactional banking, a regional banking model across the footprint, this is what we are focusing on developing.

I would double down on this comment, and I'm glad that Luisa has picked up on that dimension. It's on page eight of the presentation, on the left-hand side at the top.

It says, "Enterprise cross-border." Our growth in Rest of Business in general, but our growth in CIB is based on a model that we want to accompany our clients wherever they are.

We have this global footprint. Many of our clients do exist in our footprint with different subsidiaries and so on.

It's more trade finance, multinational client, corporate banking focused growth that we are after. In that one, you see the evolution in that page, on page eight, that the growth is coming from there, from those clients.

It's basically a cross-sell to our clients that we have in Spain, for example, who have a business in Mexico, we go after that. Our big clients in Spain who have a business in the US, we go after that.

That's the focus of our growth in CIB.

The capital allocation that we do in these clients in the Rest of Business, we see that profitability going into our subsidiaries in Mexico, in Latin America, in Spain. That capital that gets allocated there has the profitability driven by the growth that you're seeing in our business in fees and margins across the group.

Perfect. Okay.

Thank you very much, Marta. Next question, please.

Next question is from Carlos Peixoto from CaixaBank. Please go ahead.

Hello, good morning. Thank you for taking my questions.

The first one would be a bit on the medium-term targets. Basically the 14% the 42%, 22% return on tangible equity average that you had guided to for 2025-28, well, considering that 2025 was slightly below 20%, that this year you're guiding towards 20%, this basically means that over the coming years the average ROTE would actually have to be around 22% or more, whether you stick to that or you see some downside.

The same rationale, more or less, would apply to net profit, whereas to looking at what is implied in the guidance this year, it seems as though in 2027 and in 2028, you need to post a net profit above €13 million to fulfill those goals. What will be the drivers for this improvement in the net profit?

Then the second question would actually be on Mexico, just the cost of risk guidance of 30 of 340 basis points implies a small deterioration vis-à-vis 2025. Are you just being cautious on this, or do you see here any kinds of concerns?

Is it related with loan mix? Just trying to understand a bit there the rationale.

Thank you.

Very good. Thank you, Carlos.

Maybe on the cost of risk, Luisa, you help me out. On the first one, the mid-term goals, Carlos, what I can confirm to you, or let me say it first in a very clear way: we are fully committed, and we are still on track, as we have highlighted on page 18 of the presentation, to those goals.

You are asking a very fair and very good question, saying that, "You did 19.3% in 2025, how come you can get to 22%?" You have to look into the plan, and in the plan, the only thing I can guarantee you or I can tell you is the year for 2025, what we had in the plan, we delivered above that.

The 2026, our guidance that we are giving to you, if we deliver the guidance, we are going to be delivering above what we have in the plan. In the third and fourth year, it's obviously a bit better years than the first two.

You're asking, this is related to profits as well, what is the driver of that? I do think we talked about this in the past, but it's a very important, relatively simple, but very important dynamic, as we have talked to you about.

We are growing very nicely in our core geographies especially, everywhere, but in Spain and Mexico as well. That activity growth in 2025 and at the beginning of 2026 also, that activity growth is being consumed by the decline in the customer spreads.

Why? Because in those two geographies, we are very rate-sensitive.

When rates come down, we lose in customer spread. We grew very nicely in 2025, and this compensated the negative coming from the customer spread decline.

Starting from 2026, our expectation, again, it's based on a macro assumption that the rates will not go down any further in Europe and in Spain, and Mexico, it's going to go down to 6.5%. Today, we are at 7%, but then stay at 6.5%.

If those assumptions are correct, if those macro assumptions are delivered, the driver of the better profits in the coming years is the fact that the activity growth will not be anymore consuming the decline in the customer spreads and will be flowing directly to the bottom line. With those assumptions, again, our mid-term goals, we are on track, and we feel very comfortable with the numbers that we have put forward some time ago.

On the Mexico cost of risk, Luisa?

Yes, well, I think as you mentioned, it's more driven by a mix effect. As we have been growing in the past years our retail portfolios faster than our wholesale portfolios.

This year, our retail portfolio has grown close to 12%, our wholesale portfolio is growing at 3% at the end of the year, factored by the US dollar also depreciation. In general, that mix effect is driving that guidance in terms of cost of risk.

Remember that we're growing 14% credit cards, 14% consumer loans, 14% SMEs, it's a mix effect. The underlying quality trends are supportive and we don't see any issues other than the mix effect feeding into that cost of risk guidance for Mexico this year.

Thank you very much, Carlos. Next question, please.

Thank you. Hi, here is Sofie from Goldman Sachs.

My first question would be on AI and tech. You guide for below 40% cost-income ratio in '26 and around 35% in 2028.

How do you think about kind of AI and tech and kind of cost-income ratio in the longer term? How much cost reduction do you expect AI potentially could help BBVA?

Then my second question would be on Turkey. Revenues strong, but net income was a little bit lower than expected.

Also guidance for 2026 is slightly lower than expected by consensus. How should we think about the kind of upside risk to Turkey, but also Argentina from potentially exiting hyperinflation in 2028 and what that could mean for BBVA?

Thank you.

Very good. Thank you, Sofie.

In the AI, we are still at the early innings, we don't know exactly how the efficiency savings that we see, and they are really promising, and we are quite positive on what we have been seeing in the areas that we are applying it at the moment, but we need time to measure and see the direct impact and so on. In the plan, we have given you this 35% in 2028 with the idea that in 2027, 2028, there will be some efficiency savings coming from AI that will be reflected into the figures.

Exactly AI or other things, we haven't disclosed it, we haven't broken it down, and I think it is too early to quantify it at the moment, but we do have that intention to have some efficiency savings in those two years due to the programs that we are executing at the moment. On Turkey, how should we evaluate the upside risk, as you say, first of all, on the 2025 figure you said that it came a bit lower than the consensus.

Actually, that's the miss consensus versus the group numbers in Turkey for two reasons: number one, and as I mentioned, there was a change in the tax code. I'm not sure whether you all have followed it, but there was a change in the tax code in the final days of December, which has created around €50 million, €42 million to be precise, impact in the tax number, that has created a bit of a dent in the, again, final days.

Then the impairments are coming a bit higher in Turkey, because in Turkey, the minimum wage increase happens only once in a year at the beginning of the year, and towards the end of the year, basically the minimum wage is not adjusted, but inflation is there, and you see a bit higher inflows in retail in credit cards and the consumer lending books. That's what we have seen.

When we look into the vintages, we see nothing extraordinary, nothing different than what we expect. By the way, what we have seen in 2025 is more or less in line with the guidance that we have given to you.

Given the vintages are already improving actually, maybe in the first quarter or so, similar to fourth quarter numbers, you would see some provisioning, but beyond that, we are not worried about the provisioning levels. You were asking in general about the upside, both Argentina and Turkey as well.

On that one, what we can tell you, as you also look into the guidance, I need to highlight that thing in the guidance page, there's a footnote to the Turkish guidance, which is based on inflation, interest rates, and depreciation of the currency. Those three things drive the guidance.

We do think we have some fair assumptions in the footnote. As a result, we are guiding accordingly.

Sofie, your question of, "Do we have upside in those two countries?" In our view, yes, but it depends on whether the countries improve on inflation and interest rates come down or not.

If in Turkey, for example, inflation improves and interest rates come down, we do have a very high upside if that happens. At some point we have raised it in these calls as well.

The fair value that we should have in Turkey is more than €2 billion in profits. Today, we are less than €1 billion.

That upside is there, but it depends on the macro evolution of the country. Finally, you asked about also hyperinflation.

As the rule there is relatively clear. It's not the only rule, it's not sufficient, but if the last three-year inflation cumulative number is less than 100, you get out of hyperinflation.

That's why in our strategic plan, we put in 2028 for the two countries get out of hyperinflation, but again, it depends on the macro evolution of those geographies.

Thank you very much, Sofie. Next question, please.

Thank you for taking my questions. Sorry for drilling down on capital and its implications, but they are just one-number answers.

First, how much capital generation can you absorb if you push volume growth further? How much was the op risk revision in Q4 impacting your risk-weighted assets?

You refer repeatedly to internal cost of equity reference as your Northern Star for new loan generation. Can you share with us the cost of equity you're applying to your networks in Spain and Mexico for the different loan categories, please?

Finally, digital euro, given the geopolitical evolutions, do you agree that the digital euro is likely to be a reality at this point? How are you preparing to deal with it and turn it to your advantage?

Thank you.

Thank you, Andrea. Very specific questions.

I appreciate all the questions, and I'm going to be very specific to you too. In the volume growth and the capital generation, the thing I can guide you, or tell you is that we still expect in the coming years that every year, this year we created 31 basis points pure organic capital generation even after growth, after regulation, after growth, after any others of extraordinary thing, we created 31 basis points.

In the capital plan, we expect every year to create 30 to 40 basis points. The operational risk, in the fourth quarter, operational risk consumption was 16 basis points.

Typically, it's 4 to 5 basis points in a quarter. We do this calculation, as at the end of the year, fourth quarter always has an adjustment.

That number was 16 basis points for operational risk in the final quarter of the year. Cost of equity of the bank for different franchises: we never disclose it.

Thank you for asking the question. Digital euro: it has pros and cons.

It has to be done in a proper way in our view. I do think for the sovereignty topic that many people talk about, it can be helpful.

There's a pro there. We see that angle, we see that point and appreciate it.

It has to be done in the proper way in our view, and there are certain dimensions that we hope that we can continue to dialogue with the regulators and the politicians on this topic, given the fact that we are pushing private solutions as the banking sector in Europe. You might have seen this, the solution of Bizum, Spain, Italy, and Portugal, we are now in the same umbrella.

We just concluded an agreement with EPI, which is basically Netherlands, Belgium, Germany, and so on. All of these countries, we will have already a private solution developed.

We hope that in the digital euro discussions, that politicians and supervisors and regulators understand the complexity, the costs, and everything else required for the payment solution to be developed. In that context, we hope that the existing private solutions are integrated into that dialogue and discussion.

Thank you very much, Andrea. Next question, please.

Hi. Good morning, and thank you for taking my questions.

I've got three. The first one is on distribution and capital.

You can confirm that this is the year where the CET1 goes much closer to the 12% threshold, or that's going to be a multi-year process? The second one is in Mexico, we're seeing a significant slowdown of remittances in the country.

Does that have any impact in terms of deposit growth and asset quality, you think? Then third, if you can give us a few numbers in terms of balance sheet and P&L for the two digital banks in Italy and Germany, how have they been evolving, basically, in 2025?

Thank you.

Very good. I'll do it very quick, if that's okay, Luisa.

I mentioned multiple times, but our commitment to go back to the upper end of our capital target is absolute. In that sense, you should expect this year also that we get close to 12 as well, exactly, which implies that extraordinary distributions in the year.

In the remittances question, Nacho, we have also reported this back to authorities also in Mexico, cuz there are channels that are not fully captured in our view in that number, there's a 5% decline in remittances, but you don't see that in many other geographies where there's a remittance flow between US and Honduras and Guatemala and so on. You don't see that in other countries and only in Mexico, because we do think it doesn't fully capture the figure.

The reliability of that number, we have some doubts. We do think that including those informal channels that are not included in the figure, the number has not come down, actually.

In any case, we are quite positive for the Mexican franchise and Mexican economy, better than 2025 we do think next year. Remesas, the remittances is an important part of this.

Even in the official numbers that are being published, you would see a pickup in our view in 2026. The balance sheet and P&L of digital banks, we started reporting this to you, if you can see in the Rest of Business line item.

Rest of Business is basically CIB beyond the geographies that we report a geographical account, US, UK, and so on, all in there, plus the digital banks. You do see that in that page of 24, customer funds, the digital bank deposits is €12.2 billion at the moment.

It's basically roughly a bit more than half coming from Italy and the other part coming from Germany. We will continue to report on the balance sheet numbers, as you would see in this page, you will keep seeing the update in the figure.

The P&L numbers will be published when we see the maturity of those businesses. At the moment, we're not publishing them separately.

Thank you very much, Nacho. Next question, please.

Hello. Good morning.

Thank you very much for taking my questions. I have two.

Firstly, on Mexico, I understand that recent macro indicators show improving GDP growth trends, I would like to ask if you could provide some details. Then also your view into the appreciation in the Mexican peso versus the euro in recent weeks, I think is around 4 4% appreciation.

Then my second question would be on Spain NII. If I take your Q4 NII for Spain and I analyze and I add a bit of growth, I get towards the upper end of your guidance for NII.

It seems your guidance is conservative for Spain. Also, I saw that you had a very strong deposit growth in Spain, it seems you're gaining market share there.

I think it's also thanks to your stronger digital capability, if you could kindly provide some details there, please.

Thank you for Borja for the questions. Maybe Spain question you take, Luisa.

On the Mexican side, again, I mentioned the overall positivity that we have for 2026 for Mexico, but you're asking about the depreciation effect. In the plan that we have and in the guidance that we have, we are basically expecting a depreciation of Mexican peso versus euro, depreciation.

In the first days of the year, it's the other way around, which is amazing news for us, which is very good news, which is a positive upside potential, but we live with this currency topic day in and day out everywhere. We wouldn't jump into conclusions too quickly.

If it turns out to be as such, perfect. Again, our plan basically foresees a depreciation of the Mexican currency versus euro.

On the Spain NII number, we have to pick up some speed, that's why.

No, I think on the Spain NII number, as we mentioned before, we expect activity growth to feed into NII with average customer spreads slightly lower than last year, but stable from quarter-on-quarter numbers, and with continued positive contribution from the ALCO portfolios, because we did increase ALCO portfolios in the end of the quarter by €3 billion, and that should be also supportive to NII dynamics, which are all embedded into our guidance. With deposit growth, I think it's primarily a strong growth in the fourth quarter driven by demand deposits, obviously seasonal effects go into play in the retail side with Christmas salary bonus and so on and so forth, public sector.

Also a strong growth, again, as I mentioned before, in global transactional banking and with specific clients that have supported that growth in the quarter, and we hope to see that going into next year as well on the back of, again, that growth of almost 1 million clients retail that will also help support deposit dynamics going forward. Deposit dynamics in the market overall are going to be also quite supportive as well.

Thank you very much, Borja. Next question, please.

Morning. Thank you for taking my questions.

I've got three fairly quick ones. Could you remind us what the cost-income ratio in 2025 would have been excluding the one-offs?

Maybe comment on how much of the expected cost growth this year above inflation is, let's say, upfront investment versus ongoing cost drivers. The second one would be on macro assumptions in Turkey.

The rate and inflation assumptions do look a little bit conservative. Maybe you can expand on why that is and perhaps also give us a bit of a sensitivity of the fee income to lower rates.

Then thirdly, just on capital, your SREP benefits from the fact that there's no countercyclical or systemic buffer in Mexico primarily. How do you think about the simplification suggestions that the ECB has put forward with potentially how they think about releasable buffers?

Is that a potential risk to your SREP requirements in the long term? Thank you.

Very good. The cost-to-income number, Luisa?

In the group, it would have been 39.3% excluding the VAT topic from the 38.8% published in 2025.

The Spain number would be rather than 33, 34?

34%.

Yeah. On Turkey, I didn't get the full question.

Turkey, are we conservative?

On the macro assumptions.

On the macro assumptions. We have to see.

Maybe we are taking it a bit with a grain of salt, Britta, really, because in 2025, if you go back to our first quarter 2025 presentation, we were expecting better macro in Turkey in 2025, but the rates didn't come down as much, and inflation didn't come down as much. You have seen the number in January, the inflation came 4.84%, monthly inflation, we want to be a bit on the safe side, to be fair.

The macro assumption that we put into the guidance is in the footnote of that page. If you believe those macro assumptions would be better, perfect, you will have a better number in Turkey.

If you believe it's going to be worse, it's going to be slightly worse number. The sensitivity is also more or less clear: every 1% inflation has a €15 million to €20 million impact on net attributable profit, every 1% interest rate has a €40 million impact on the P&L, and every 1% additional depreciation has again another €20 million impact on the number.

That sensitivity is relatively clear. There are some overlap, it's not directly, but not that far away from what I just talked to you about.

If you have other macro assumptions, then the number would change. Then the simplification topic, Britta, it will take 2 hours to discuss this, really, because we spent a lot of time thinking about this.

At the moment, I think the proposals are still not clear or not finalized. We wouldn't want to comment on them until we see something more certain and more clear on the page.

Thank you very much, Britta. Next question, please.

Hi, thank you for the time. Two questions.

One on Mexico, perhaps you already gave the detail, but if you could remind us what guidance you expect for loan spreads and deposit spreads to evolve during the year. I think you gave a comment of ALCO should support the NII in Mexico.

What are the assumptions there? Is more like size of ALCO, is it repricing?

If you could give a bit more detail. Then the second question is, you said that buybacks are starting to slow down your tangible book value per share growth.

Related to that, I was curious if you think buybacks still have a return above your cost of equity, and basically I'm wondering if it makes sense at some point to stop the buybacks, because organic growth or M&A could have a better return. Thank you.

Very good, Hugo. Mexico question, Luisa?

On Mexico, well, we don't give guidance on specific customer spreads. What we've mentioned is that our guidance for NII is going to be mid- to high-single-digit.

We mentioned that we expect a compression of average spreads in the market this year versus last year, reflecting the strong decrease in rates in 2025, which is around 300 basis points in the TIIE reference rate and also in the Fed as well. That's what we mentioned in Mexico.

With regards to the ALCO book in Mexico, what we have primarily been doing is extending durations. We did some exchanges of short-term bonds for long-term bonds in the quarter, and we have extended that duration.

The book is right now at €16.8 billion, it's grown around €1.2 billion, pretty stable in the year. Again, the most relevant effect has been that extension of durations with yields at around 8.6%.

Very good. On the share buyback question, Hugo, maybe it's a repetition of some of the things that I always say and I also partially said today, but in terms of principles, very clear, huh?

We are value-focused. Any capital action that we do, it looks into the return of that capital deployment for our shareholders and compare that also to other alternative uses of that capital.

You mentioned, for example, the negative impact on tangible book value per share number, No, that's not how we look into it. We look into it from a value perspective.

If we create value for our shareholders, then it's still a good investment of that capital. That is why we always look into the intrinsic value of the share, not the tangible book value per share.

It might have a negative impact on the tangible book value per share, but that's not a criteria for the bank to decide on these. You have to look into the intrinsic value.

It is true that given the appreciation of the share price, the attractiveness of share buyback has come down, but in our view, as compared to the intrinsic value, still there is value, that's why the program continues. Then also I would once again highlight that our commitment to returning the excess capital above 12 is full.

When the time comes, when the capital distribution decisions are due, we will look into the situation, compare that with the intrinsic value, get the feedback of investors in general, and decide. Then we have to wrap up, no, Patricia, because you have to leave in 5 minutes, okay?

Yeah.

We have to leave it here.

No, let's do very quickly.

No, we can continue, yeah. Next question, please.

Thank you, Hugo.

Hi. I have just three questions, please, all on Turkey.

Can I just clarify one thing: the €40 million you mentioned on the sensitivity to lower rates, is that excluding the hyperinflation adjustment or is that including the hyperinflation adjustment? I just wanted to make sure I understand.

Is the impact 4% or 2% in general? Second question, clearly we're running positive real rates now in the region and we will get an uptick in NPLs, but I'm trying to understand the relative effect of both in your PBT.

I suppose the NII impact is obviously much more sensitive, given the fact the country has delevered by 50 points of GDP over the last 5 years and household loans are only 9% of GDP. I just want to try and understand obviously a lot of it is credit cards, just in terms of the relative effect of both that real rate policy.

Lastly, kind of more a strategic question, can you chat about what you would need to see to buy out the minorities in Garanti as soon as you can? Surely it's a perfect opportunity now to buy the balance, given the enormous return on invested capital that would be delivered to BBVA shareholders, assuming that the Turkish real rate policy persists, which obviously you do expect in your presentation.

I just want to try and understand how you're thinking about the buyout of the minorities. Thank you.

Very good. Very quickly, because we don't have time.

The number that I gave is including the hyperinflation adjustment, meaning it's the perspective of BBVA looking into it from here, consolidated in a hyperinflationary accounting included way. The cost of risk, again just to pick up some time, Seamus, it's in the guidance.

We are expecting 200 around 200 basis points of cost of risk in 2026, which is more or less in line with 2025. No more deterioration, not much deterioration.

In the first quarter, in the first half, what we have seen in the fourth quarter might continue a bit, but vintages have improved, that's why you have the guidance of around 200 basis points. About the minority shares, we are happy with what we have.

We have no plans at the moment, we have no plans to change that shareholding structure that we have there. Again, we continue with what we have.

Thank you very much. Next question, please.

Good morning, Onur. Good morning, Luisa.

Thank you very much for taking my questions. I just had a follow-up regarding some of your previous comments about the fact that in 2025 you delivered better than what you had budgeted for at 1H '25 in the strategic plan.

I just wanted to make sure that I get that right and that is a comment regarding profits rather than the return on tangible equity. I think at that point you were guiding for '25 ROTE to be around 20%, that came in slightly lower.

Is the reason behind that slight miss the excess of equity that you've been operating on versus what you were expecting back then? Then also, if '25 profits came in better, '26 is expected to come in better as well, why shouldn't we see some upside to your previous €48 billion euros guidance for profits cumulatively?

Then if I just can ask a more thematic one as well: just a few days ago, you joined the banking consortium to develop an Europe-pegged stablecoin. Could you please tell us what's your intentions and ambitions there and how you think about tokenized money more broadly in the coming years?

Very good. Thank you, Miruna.

Again, we are too late, I'm going to go very quickly. Apologies, and if you want to follow up with us, we are always open to the follow-up.

On the 2025 plan versus reality, as you exactly said, we delivered above plan in profits, but the average equity in the denominator of the return on tangible equity has been relatively high, because we only started the share buyback programs, because we have our commitment to go back to 12 all the time when we have excess, we started those share buybacks later in the year due to the Sabadell transaction and the fact that we weren't doing share buybacks throughout that process. You're right, it was a beat on the profits.

Then 2026, given what you see, shouldn't we update 48? Miruna, we are too early in the game, we are only in the first year.

I do think 48 is a very good number and we are on track to deliver that figure. Then the stablecoin consortium, we do think it's a technological topic that needs to be watched very closely.

There are certain use cases in our view that would benefit from those developments, and we are an innovation-focused bank. We always led the drive in digitalization, now in AI, and stablecoins is part of that dynamic as well.

That's why we wanted to be part of a consortium to walk through this and to basically stay up-to-date on all the developments around that. Then the final question we can take.

Yeah. Thank you very much.

This is the final question. Next question, please.

Thank you. A very quick one.

What has changed over this FX hedges in the Mexican peso? Because I am seeing higher volatility or expected in this presentation versus the previous one.

Thank you.

The RWAs, very quickly, Fernando. The RWAs has come down, because, again, we have done this have seen it in the capital chart.

We went to standard in some portfolios and we went to foundation in some other portfolios, which has led us into the sensitivity. The question was sensitivity?

The sensitivity. Yes, on hedges.

Sensitivity to currency as we have reduced the capital, the sensitivity.

Yeah.

Very good. You have the answer from Patricia, and if you want to follow up with her, she's always available for all of you.

Apologies for this, because we have an immediate program right after this in the same room with the press. Thank you so much for the questions.

For any follow-ups, the team is happy to help you out, no, Patricia?

Yes, absolutely. We are at your disposal for any further questions or clarifications.

Thank you very much.

Bye-bye.

Thank you.