BBVA beats forecasts to issue bonds
SPAIN’S second largest bank, BBVA, beat analyst forecasts yesterday with a 9.7 per cent drop in net profit for the first half of the year, and stepped back into the bond market for the first time since the crisis.
Net profit fell to €1.3bn (£1.1bn), beating forecasts of €2.45bn in a Reuters poll but dropping 19 per cent on the same period last year.
Total lending across the group grew four per cent, to €348.9bn, while income from loans also grew year-on-year, by 1.2 per cent to €6.9bn.
Bad loans fell to 4.2 per cent of the total loan book at the end of June from 4.3 per cent at the end of March, broadly in line with analyst forecasts. BBVA emerged as one of the most solvent European banks in last week’s stress test results.
BBVA placed its first senior unsecured bond since the start of the sovereign debt crisis yesterday, raising more than €1bn over five years at spreads of around 1.75 per cent.
The bank said it was confident it could profit from the restructuring of Spanish savings banks taking place in the wake of the crisis. “This restructuring could mean an increase in market share of over 200-300 basis points in the next two to three years,” BBVA’s director for Spain and Portugal Juan Asua said.