BILBAO (dpa-AFX) - Spanish financial services firm Banco Bilbao Vizcaya Argentaria SA or BBVA (BBVA) on Tuesday said that it would comfortably comply with the new requirements of Spain's financial reform with its strategy of anticipation in respect of risk management. BBVA said it will comfortably meet the requirement of a 9 percent core capital ratio in June without selling any strategic asset. BBVA added that it would maintain its dividend policy as well as its plans to comply with the recommendations of the European Banking Authority or EBA, without the need to sell any strategic asset. The company estimates the overall net final impact of the financial reform to be 1.36 billion euros, which would be comfortably absorbed in 2012 thanks to the recurrent revenues and the resilience of its earnings. The impact is reduced with the help of Spanish generic provisions coupled with the planned provisions for 2012 set before the new regulation. BBVA noted that the impact due to larger provisions in 2012 anticipates possible future losses but in no way reduces its economic value. Regarding its capital strength, BBVA said it has sufficient capital to comply with the new requirement. Also, the reform will not hinder BBVA's plans to meet the EBA recommendations with ease. BBVA said its additional gross amount of provisions and capital before mitigating items and taxes comes to 4 billion euros, 8 percent of the 50 billion euros estimated for the entire Spanish banking sector. Of the 4 billion euros impact, 2.8 billion euros is related to earnings while the rest is related to capital. The company noted that the given percentage is less than its average market share of 12 percent, providing evidence of its lower exposure to real estate. 'BBVA is currently selling real estate assets with capital gains, providing evidence of the quality of our real estate assets. The measure does not take into account the quality of underlying assets; it simply applies uniform provisions across the entire financial sector,' the company said in its statement. According to BBVA, the Spanish financial reform is a decisive and needed step in the right direction to dispel concerns over the country's financial system. 'The new regulation, together with recent decisions of the European Central Bank and other structural reforms in Spain, will help accelerate consolidation in the Spanish financial sector, increase the demand for credit and normalize margins,' it said. Banco Bilbao are currently trading at 7.14 euros, down 0.08 euros or 1.08 percent in Madrid.
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