Good times for Spain’s second-biggest bank. BBVA enjoyed record profits in 2024, raking in an annual net income of more than €10 billion ($11 billion) for the first time. Thanks to that, it can boast 82 employees who earned north of €1 million that year – a 28% increase on the 2023 tally.
Some of the highlights that may have contributed to BBVA’s bonanza year were a €993 million shares buyback program and what it described as a “significant increase of shareholder distributions” that topped €5 billion in 2024. BBVA boasted in the same report that it had paid its shareholders more than €18.2 billion total since 2021.
Despite that, the Financial Stability Board (FSB) and Basel Committee on Banking Supervision have yet to readmit BBVA to the elite club of Global Systemically Important Banks (G-SIBs). And as we’ll see, BBVA’s millionaires are not likely to be found in its retail division – despite the latter making considerable strides in growth banking areas like Latin America.
Does BBVA care?
BBVA was included in the G-SIBs list between 2011, its inception date, and 2015. In November that year, the FSB laconically remarked in an update that BBVA had been “removed from the list,” though it did not elaborate as to why.
The Basel Committee was similarly poker-faced in its report published the following year, noting: “In November 2014, BBVA was identified as a G-SIB with a 1% higher loss absorbency requirement. BBVA was not identified as a G-SIB in November 2015.”
Why the G-SIBs List Matters
Loss absorbency refers to the surplus capital an institution must hold in order to qualify for G-SIBs membership. What that means is having enough money in the kitty to absorb any losses incurred during financial crisis – without having to be bailed out by taxpayers. Essentially, it’s a requirement designed to try and avoid the debacle that engulfed the finance world after the sub-prime mortgage crisis of 2007.
Because G-SIBs are crucial to the global banking system, these requirements must perforce be stringent to avoid a catastrophic ‘domino effect’ that might result from a major globally interconnected bank failing.
The Basel Committee report suggests that BBVA may have been dropped from the G-SIBs list because it no longer met these requirements – although given the lack of circumstantial details, it’s very difficult to prove that.
Put This on Your Bucket List!
That may not necessarily be a bad thing for BBVA, however. As at the time of writing, the G-SIBs list is 29 strong, including major players such as JP Morgan Chase, Citigroup, and HSBC. Financial institutions are split across five different buckets – a higher bucket number means that a bank needs to have a larger proportion of its risk-weighted assets (RWA) set aside in the form of a capital surcharge.
The idea behind this is essentially quite simple: the bigger the bank, the bigger the buffer it should have to withstand any shocks or other nasty surprises the financial system might throw at it.
This means JP Morgan, the G-SIBs high-flier in Bucket 4, needs to have 2.5% of its assets set aside. Given that the banking giant reported RWA of $1.8 trillion in the last quarter of 2024, that means it is required by international banking law to earmark a cool $45 billion. It may also be worth noting that at the time of writing no bank resides in the top-tier Bucket 5.
A Blessing in Disguise?
Since the end of 2016, when its previous G-SIBs obligations expired, BBVA has had no such requirements. And while there is no direct evidence linking this expiry to its recent successes, being moved off the list certainly doesn’t appear to have hurt BBVA.
BBVA posted corporate and investment banking (CIB) revenues of €1.71 billion in the first quarter of 2025, up 36% year on year. It managed to score second place in Spain’s LSEG syndicated loan ranking metric, with total volumes of €5.16 billion. Core business units all experienced double-digit growth year on year – global markets (52%), global transaction banking (19%), and investment banking and finance (33%).
But Who Benefits From the Windfall?
Of course, most BBVA employees can only dream of the seven-figure payouts secured by less than a hundred of their fellow workers. Its total employee count was measured at 125,916 as at the end of 2024. In other words, windfall year or not, even if you were in the top 1% of BBVA earners last year you still only had about a one in 15 chance of earning a million or more.
Take the rank and file of all BBVA employees, and your chances of being a millionaire courtesy of hard work for Spain’s second-biggest bank was more like 0.0651%.
Retail Banking: a Thankless Job?
It may not be where most of its millionaires are to be found, but BBVA’s retail banking arm looks pretty healthy too. In 2023 alone, BBVA attracted more than 11 million new customers, part of a “staggering” 117% growth over the past five years. This is partly due to its partnership with Accenture, which has pushed digital banking right up to the forefront of BBVA’s business model, particularly in traditionally unbanked areas like Latin America.
Unfortunately for retail employees, there is little evidence to suggest that many of BBVA’s millionaires will be found away from its CIB operation. And even if you are in the CIB wing, you aren’t likely to earn anything like a million.
Glassdoor places the average CIB banking salary for BBVA at between €30,000 and €35,000, with an average bonus of €8,000 a year. The retail average is likely to be even lower. The estimated salary for banking in Spain across all sectors ranges from €23,000 to €50,000.
No Lost Sleep For BBVA
Certainly, when you’re operating on tight margins and trying to make returns for your shareholders, no longer having a regulatory capital burden like G-SIBs thrust upon you won’t hurt. Not if you’re in the high-risk, high-earning side of banking anyway. But what about the downside?
Going ‘off regs’ certainly does mean a bank is considered more of a risky investment by other financial institutions, with Fitch Ratings noting in 2012 that any banks leaving the G-SIBs list would need to “maintain good levels of capitalisation […] to improve their credit ratings and maintain access to the funding markets.”
But to date, there seems to have been little public criticism of BBVA’s strategy since it left G-SIBs. Its 82 millionaires will doubtless be losing no sleep over that.
Author: Damien Black
The editorial team at #DisruptionBanking has taken all precautions to ensure that no persons or organizations have been adversely affected or offered any sort of financial advice in this article. This article is most definitely not financial advice.
#BBVA #GSIB #CapitalMarkets
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