Strong increase in BBVA bank profits thanks to Spain and Mexico

The net profit of the Spanish bank BBVA rose 19% in the first quarter of 2024 thanks above all to good operating results in Spain and Mexico, which offset the impact of an exceptional tax introduced by Madrid.

The second Spanish banking group, behind Santander, obtained total profits of 2,200 million euros (US$ 2,358 million) in the first three months of the year, compared to 1,840 million in the same period of the previous year, according to published results. by the company on Monday.

This figure, higher than that of the fourth quarter of 2023 (2,060 million euros), is also higher than the expectations of the analysts surveyed by Factset, who were betting on an average profit of 2,010 million euros.

These “excellent results“are the fruit of”dynamism of activity and income growth, especially in Mexico and Spain”, stressed the general director of BBVA, Onur Genç, quoted in a statement.

Its banking net profit (BNB), equivalent to the turnover of the banking sector, increased by 15.4% year-on-year, up to 6,510 million euros, of which 1,340 million corresponded to Spain and 2,780 million to Mexico, its largest world market.

This figure was achieved thanks to the arrival of 2.8 million new clients in three months, which raised the bank’s total number of clients worldwide to 74.1 million and allowed a significant increase in its bank deposits (+5.6%).

This allows BBVA, which last year obtained a record profit of 8.02 billion euros, to be optimistic about its 2024 results.

“These results clearly reinforce our expectation of generating a higher result this year than in 2023.″Onur Genç argued.

The increase in profits should offset the impact of the exceptional tax on large banking groups established at the beginning of 2023 by the Spanish government, for which BBVA says it has provisioned 285 million euros.

This tax, intended to finance measures to support purchasing power, and against which banks have constantly fought, was initially due to end in 2024. However, the government decided to make the tax permanent, without ruling out a review of its scope.