Onur Genç has stressed that the commitment to value creation is reflected in the metrics that the bank closely follows to measure its performance, such as the return on regulatory capital or the growth of tangible value per share plus dividends.
Genç has referred first to the return on regulatory capital, an indicator that relates the profitability of each business line to the capital it consumes. This decision framework is incorporated into pricing policies, ensuring an adequate return on regulatory capital in all business decisions.
Next, the CEO recalled that BBVA has shown better performance in terms of growth in tangible value per share plus dividends than comparable European banks. This value creation has been transferred to shareholders through a consistent increase in the cash dividend (+28% in 2023) and the distribution of 13.2 billion euros among shareholders from 2021, through the payment of cash dividends and the successive share buybacks. All of this is being recognized by the market and has translated into a total shareholder return of 202% from the beginning of 2019 to the beginning of May 2024.
Onur Genç recalled that BBVA has a ROTE higher than the sector average in the geographies in which it is present, thanks to leading franchises in each country and sufficient scale to be able to offset the costs derived from investment in technology, which represents 26 % of the Group’s fixed costs. Likewise, he has stressed that BBVA’s strategy, based on digitalization and sustainability, will be decisive in differentiating BBVA from its competitors. “BBVA’s position is unique,” thanks to the combination of growth and profitability, in the opinion of the CEO.
Onur Genç has also referred to the main business areas. About Spain, predicts a positive performance of the economy, better than the average for the rest of the eurozone countries. Likewise, he has stated that, in his opinion, in a scenario in which rates could be around 2.5%, it is a good scenario for banks. Despite the narrowing of the interest margin that it implies, it will be compensated by better credit performance. Likewise, it will improve the cost of risk. Genç has highlighted that the group has a leading franchise in Spain in terms of profitability and efficiency in a highly competitive market. The executive believes that BBVA Spain will continue to offer good levels of profitability in the coming years.
With respect to Mexico, has pointed out that the macroeconomic dynamics are very favorable for banks, favored by the proximity to the US and the effect of ‘nearshoring’. “We are very optimistic about Mexico,” she assured. The CEO recalled that BBVA México is the best bank in the country and operates in a very dynamic market, with low levels of banking penetration. Thanks to this, the credit granted by BBVA has grown at double-digit rates. The group has developed a highly admired business model in Mexico that “is neither easy nor quick to replicate,” thanks to a decade of transformation, strong investments and a culture of innovation and customer service, which places it in a good position to compete with new players such as neobanks. “We are the largest fintech in Mexico,” he said. According to him, BBVA México will continue to grow and provide outstanding results, backed by its undisputed leadership and structural strengths.
About Türkiye, highlighted that there are signs of improvement in the economic environment. In his opinion, the new economic team, appointed after the presidential elections in May last year, has demonstrated a clear commitment to combating imbalances in the economy and laying the foundations for a healthier and more sustainable economic growth model. In this context, Garanti BBVA is a great franchise, “the best bank in the country and a great value creation option for the BBVA Group.”
