6-K 1 d116409d6k.htm FORM 6-K Form 6-K
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FORM 6-K

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Report of Foreign Issuer

Pursuant to Rule 13a-16 or 15d-16

of the Securities Exchange Act of 1934

For the month of March 2021

Commission File Number: 001-12568

 

 

BBVA Argentina Bank S.A.

(Translation of registrant’s name into English)

 

 

111 Córdoba Av, C1054AAA

Buenos Aires, Argentina

(Address of principal executive offices)

 

 

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:

Form 20-F  ☒             Form 40-F  ☐

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):

Yes  ☐             No  ☒

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):

Yes  ☐             No  ☒

Indicate by check mark whether by furnishing the information contained in this Form, the Registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934:

Yes  ☐             No  ☒

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): N/A

 

 

 


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Banco BBVA Argentina S.A.

TABLE OF CONTENTS

 

Item

    
1.    Banco BBVA Argentina S.A. reports consolidated fourth quarter earnings for fiscal year 2020.

 


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Banco BBVA Argentina S.A. announces 2020 annual results

Buenos Aires, March 9 2021 – Banco BBVA Argentina S.A (NYSE; BYMA; MAE: BBAR; LATIBEX: XBBAR) (“BBVA Argentina” or “BBVA” or “the Bank”) announced today its consolidated results for the fourth quarter (4Q20) and fiscal year ended on December 31, 2020.

As of January 1, 2020, the Bank started to inform its inflation adjusted results pursuant to IAS 29 reporting. To facilitate comparison, figures of comparable quarters of 2019 have been updated according to IAS 29 reporting to reflect the accumulated effect of inflation adjustment for each period up to December 31, 2020.

2020 Highlights

 

   

BBVA Argentina’s inflation adjusted net income in 2020 was $12.0 billion, 38.9% lower than the $19.7 billion reported in 2019.

 

   

In 2020, BBVA Argentina posted an accumulated inflation adjusted average return on assets (ROAA) of 1.8% and an inflation adjusted average return on equity (ROAE) of 11.8%.

 

   

In terms of activity, total consolidated financing to the private sector in 2020 totaled $290.3 billion, increasing in real terms 5.9% compared to 2019. Growth was driven by the increase in other loans, credit cards and discounted instruments by 46.4%, 16.6% and 7.9% respectively. BBVA’s consolidated market share of private sector loans was 8.49% as of 4Q20.

 

   

Total deposits totaled $478.2 billion in 2020, growing in real terms 19.5% year-over-year (YoY), promoted by private deposits in pesos, mainly checking accounts and the incorporation of investment accounts. The Bank’s consolidated market share of private deposits was 7.13% as of 4Q20.

 

   

As of 2020, the non-performing loan ratio (NPL) reached 1.42%, with a 324.43% coverage ratio.

 

   

The accumulated efficiency ratio in 2020 was 56.8%, above 2019’s 43.7%.

 

   

As of 4Q20, BBVA Argentina reached a regulatory capital ratio of 20.2%, entailing a $57.1 billion or 147.1% excess over minimum regulatory requirement. Tier I ratio was 19.6%. Total liquid assets represented 67.5% of the Bank’s total deposits as of 4Q20.

Message from the CFO

“BBVA Argentina has been able to keep a solid position within a high uncertainty context throughout 2020. While signs of economic recovery start to emerge, much remains to be defined facing 2021, subject to the final development of the global sanitary crisis, and the resolution of internal conflicts related to fiscal deficit financing, the agreement the National Government could reach with the International Monetary Fund, and the results of 2021 mid-term elections.

The global sanitary crisis in 2020 confirmed that of which we were convinced for years: the significance of technology in the delivery of financial services. In virtue of our vision of the future, we could rapidly adapt to the new normality and continue offering our services to clients during the pandemic. These unexpected circumstances ratified that the path we have taken in terms of digital transformation, internal process adaptation and personnel training, is most adequate.

In line with this, the digitalization of our service offering has evolved in such way that as of December 2020, digital client penetration reached 72% from 67% the previous year, and mobile client penetration reached 60% from 54% in the same period. Moreover, during 2020, together with other banking financial institutions, we have launched MODO, a fintech that will transform wire transfers and payments in Argentina, and which already counts with more than a million users.

BBVA Argentina keeps a solid balance sheet. With respect to its loan portfolio credit performance, the Bank reached an NPL ratio of 1.42% as of December 2020. Concerning its liquidity and solvency indicators, BBVA Argentina ends 2020 with ratios of 67.5% and 20.2% respectively. Thus, the Bank preserves a strong position to face a year in which economic recovery is expected.

 

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Meanwhile, the Bank closely monitors its business, financial conditions and operating results, in the aim of anticipating possible effects of the gradual removal of regulation implemented by the Government during the pandemic, especially over asset quality and profitability ratios.

In terms of responsible banking, during 2020, BBVA’s purpose of “bringing the age of opportunity to everyone” gained momentum. In line with our compromise with sustainable development and assuming our role as a leading financial institution in this subject, we launched a new line of consumer “eco loans”, and a line of “green loans” for companies. Furthermore, we were the first Bank to deliver sustainable cards made of recyclable materials. BBVA Argentina keeps working towards its sustainability model, supporting responsible business actions regarding inclusion, financial education and environmental protection, as part of its compromise with the country.”

Ernesto R. Gallardo, CFO of BBVA Argentina

4Q20 Conference Call

Wednesday, March 10, 12:00 p.m. Buenos Aires time – (10:00 a.m. EST)

To participate, please dial in:

+1-844-450-3851 (US Toll-Free)

+1-412-317-6373 (International)

+54-11-3984-5677 (Argentina)

Web Phone: click here

Conference ID: BBVA

Webcast & Replay: click here

 

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Safe Harbor Statement

This press release contains certain forward-looking statements that reflect the current views and/or expectations of Banco BBVA Argentina and its management with respect to its performance, business and future events. We use words such as “believe,” “anticipate,” “plan,” “expect,” “intend,” “target,” “estimate,” “project,” “predict,” “forecast,” “guideline,” “seek,” “future,” “should” and other similar expressions to identify forward-looking statements, but they are not the only way we identify such statements. Such statements are subject to a number of risks, uncertainties and assumptions. We caution you that a number of important factors could cause actual results to differ materially from the plans, objectives, expectations, estimates and intentions expressed in this release. Actual results, performance or events may differ materially from those in such statements due to, without limitation, (i) changes in general economic, financial, business, political, legal, social or other conditions in Argentina or elsewhere in Latin America or changes in either developed or emerging markets, (ii) changes in regional, national and international business and economic conditions, including inflation, (iii) changes in interest rates and the cost of deposits, which may, among other things, affect margins, (iv) unanticipated increases in financing or other costs or the inability to obtain additional debt or equity financing on attractive terms, which may limit our ability to fund existing operations and to finance new activities, (v) changes in government regulation, including tax and banking regulations, (vi) changes in the policies of Argentine authorities, (vii) adverse legal or regulatory disputes or proceedings, (viii) competition in banking and financial services, (ix) changes in the financial condition, creditworthiness or solvency of the customers, debtors or counterparties of Banco BBVA Argentina, (x) increase in the allowances for loan losses, (xi) technological changes or an inability to implement new technologies, (xii) changes in consumer spending and saving habits, (xiii) the ability to implement our business strategy and (xiv) fluctuations in the exchange rate of the Peso. The matters discussed herein may also be affected by risks and uncertainties described from time to time in Banco BBVA Argentina’s filings with the U.S. Securities and Exchange Commission (SEC) and Comisión Nacional de Valores (CNV). Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as the date of this document. Banco BBVA Argentina is under no obligation and expressly disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Information

This earnings release has been prepared in accordance with the accounting framework established by the Central Bank of Argentina (“BCRA”), based on International Financial Reporting Standards (“I.F.R.S.”) and the resolutions adopted by the International Accounting Standards Board (“I.A.S.B”) and by the Federación Argentina de Consejos Profesionales de Ciencias Económicas (“F.A.C.P.E.”), with the transitory exceptions: (i) the record of a prevision for contingencies referred to uncertain fiscal positions required by the BCRA, (ii) the adjustment in valuation established by the B.C.R.A. applied to the valuation of the remaining investment the Bank keeps of Prisma Medios de Pago S.A. (“Prisma”), and (iii) the temporary exclusion of the application of the IFRS 9 impairment model for non-financial public sector debt instruments.

As of 1Q20, the Bank started to inform its inflation adjusted results pursuant to IAS 29 reporting. To facilitate comparison, figures of comparable quarters of 2019 have been updated according to IAS 29 reporting to reflect the accumulated effect of inflation adjustment for each period up to December 31, 2020.

The information in this press release contains unaudited financial information that consolidates, line item by line item, all of the banking activities of BBVA Argentina, including: BBVA Asset Management Argentina S.A., Consolidar AFJP-undergoing liquidation proceeding, and as of July 1, 2019, PSA Finance Argentina Compañía Financiera S.A. (“PSA”) and Volkswagen Financial Services Compañía Financiera S.A (“VWFS”).

BBVA Consolidar Seguros S.A. is disclosed on a consolidated basis recorded as Investments in associates (reported under the proportional consolidation method), and the corresponding results are reported as “Income from associates”), same as Rombo Compañía Financiera S.A. (“Rombo”), Play Digital S.A. and Interbanking S.A.

Financial statements of subsidiaries have been elaborated as of the same dates and periods as Banco BBVA Argentina S.A.’s. In the case of consolidated companies PSA and VWFS, financial statements were prepared considering the B.C.R.A. accounting framework for institutions belonging to “Group B”, without considering the model established by the IFRS 9 5.5. “Impairment” section for periods starting as of January 1, 2022. As of October 2020, PSA and VWFS will belong to “Group C” institutions, keeping the same accounting framework as for “Group B” institutions.

The information published by the BBVA Group for Argentina is prepared according to IFRS, without considering the temporary exceptions established by BCRA.

 

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Annual Results

 

Income Statement    BBVA ARG Consolidated  

In millions AR$ except EPS and ADS - Inflation adjusted

   2020      2019      Var (%)  

Net Interest Income

     77,857        90,677        (14.1 %) 

Net Fee Income

     12,240        11,134        9.9

Net income from measurement of financial instruments at fair value through P&L

     9,348        12,574        (25.7 %) 

Net lincome from write-down of assets at amortized cost and at fair value through OCI

     (2,310      (82      n.m  

Foreign exchange and gold gains

     6,228        14,700        (57.6 %) 

Other operating income

     6,278        17,613        (64.4 %) 

Loan loss allowances

     (9,930      (18,401      46.0

Net operating income

     99,710        128,214        (22.2 %) 

Personnel benefits

     (20,319      (22,676      10.4

Adminsitrative expenses

     (18,820      (19,052      1.2

Depreciation and amortization

     (4,066      (5,729      29.0

Other operating expenses

     (16,421      (29,922      45.1

Operating income

     40,085        50,836        (21.1 %) 

Income from associates

     273        (29      n.m  

Income from net monetary position

     (19,696      (21,116      6.7

Net income before income tax

     20,662        29,691        (30.4 %) 

Income tax

     (8,629      (9,983      13.6

Income for the period

     12,032        19,708        (38.9 %) 

Other Comprehensive Income (OCI)(4)

     4,995        (4,916      201.6

Number of common shares outstanding (in thousands)

     612,710        612,660        0.0

Weighted average number of common shares outstanding (2)(3)

     612,710        612,660        0.0

Earnings per Share (EPS)

     19.66        32.17        (38.9 %) 

Earnings per ADS (1)

     58.97        96.52        (38.9 %) 

 

(1)

One ADS represents three ordinary shares.

(2)

In thousands of shares.

(3)

On October 9, 2019, the CNV issued Resolution No. 20484/2019 concerning the merger of BBVA Francés Valores S.A. into the Bank. As such, the Bank was authorized to issue 50,441 ordinary shares, with a nominal value of $ 1 and entitling to one (1) vote each for to be delivered to BBVA Francés Valores S.A.’s minority shareholders. The merger and the ensuing capital stock increase are still in the process of being registered with the Argentine Supervisory Board of Companies (IGJ).

(4)

Net of Income Tax.

BBVA Argentina 2020 net income was $12.03 billion, which represents an accumulated ROAE of 11.8% and a ROAA of 1.8%.

Yearly contraction of genuine bank revenues is mainly explained by (i) the fall in income, as a consequence of reduced economic activity due to the pandemic, (ii) lower monetary policy rates, and regulation of active and passive rates by the BCRA, and (iii) strong restrictions on the foreign exchange markets.

Another factor which has affected results in 2020 has been the partial cash-in and voluntary swap of National Treasury U.S. dollar linked notes (LELINK), which had been restructured on August 28, 2019.

Regarding expenses, lower operating expenses can be seen related to a better efficiency management, as well as lower client acquisition costs (on the fee expenses side).

It is worth mentioning that during the second quarter of 2019, an adjustment had been recorded in Other operating income as a consequence of the impact of inflation on income tax corresponding to 2018 fiscal year, offset by an allowance by the same amount in Other operating expenses line in the same period.

On February 9, 2021, through Communication “A” 7222, the BCRA informed that it admitted the retroactive application of modifications on exposure of monetary results exposed in Communication “A” 7211, for the December 31, 2020 financial statements. The latter explained that the monetary result accrued from monetary concepts at fair value through Other Comprehensive Income (OCI), should be recorded in the corresponding accounts in the income statement of the period, thus retained earnings from previous periods should be adjusted to include monetary results that were accumulated in OCI as of the date of application.

 

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It is important to mention that this measure is optional to implement as of December 2020, but through Communication “A” 7211, this will be compulsory for all banks as of January 2021.

These changes have been applied to the accumulated financial statements as of December 2020 pursuant to the regulation, reason for which quarters have not been restated for the income statement in this earnings release, but will be restated during 2021.

Net interest income

 

Net Interest Income    BBVA ARG Consolidated      Chg (%)               

In millions AR$ - Inflation adjusted

   4Q20      3Q20      4Q19      QoQ     YoY     2020      2019  

Net Interest Income

     19,528        18,538        23,799        5.3     (17.9 %)      77,857        90,677  

Interest Income

     32,023        29,072        36,544        10.2     (12.4 %)      118,955        156,367  

From government securities

     9,187        9,501        9,522        (3.3 %)      (3.5 %)      33,664        49,098  

From private securities

     18        0        3        n.m       n.m       23        15  

Interest from loans and other financing

     15,608        16,454        21,544        (5.1 %)      (27.6 %)      68,099        90,000  

Financial Sector

     202        283        404        (28.5 %)      (49.9 %)      1,207        3,816  

Overdrafts

     1,833        2,281        4,371        (19.7 %)      (58.1 %)      10,814        13,838  

Discounted Instruments

     2,519        2,296        4,232        9.7     (40.5 %)      10,183        15,051  

Mortgage loans

     295        352        422        (16.2 %)      (30.1 %)      1,382        1,891  

Pledge loans

     851        719        111        18.3     n.m       3,002        1,973  

Consumer Loans

     2,334        2,295        2,681        1.7     (12.9 %)      9,563        12,301  

Credit Cards

     4,033        4,575        6,938        (11.9 %)      (41.9 %)      18,707        28,656  

Financial leases

     151        128        163        18.1     (7.3 %)      541        801  

Loans for the prefinancing and financing of exports

     256        325        529        (21.0 %)      (51.5 %)      1,429        4,295  

Other loans

     3,133        3,200        1,692        (2.1 %)      85.1     11,269        7,377  

CER/UVA clause adjustment

     4,257        2,312        4,707        84.1     (9.6 %)      11,779        14,781  

Other interest income

     2,953        806        768        266.4     284.5     5,390        2,474  

Interest expenses

     12,495        10,535        12,745        18.6     (2.0 %)      41,098        65,690  

Deposits

     11,452        9,582        11,283        19.5     1.5     35,936        56,584  

Checking accounts

     1,519        433        104        250.5     n.m       2,437        3,415  

Savings accounts

     72        48        104        48.2     (30.7 %)      264        335  

Time deposits

     9,861        9,100        11,075        8.4     (11.0 %)      33,236        52,834  

CER/UVA clause adjustment

     263        193        360        36.3     (27.1 %)      1,011        2,096  

Other liabilities from financial transactions

     326        434        821        (24.9 %)      (60.4 %)      2,662        5,727  

Other

     455        327        281        39.4     62.1     1,489        1,284  

Net interest income for 4Q20 was $19.5 billion, increasing 5.3% or $990 million quarter-over-quarter (QoQ), and decreasing 17.9% or $4.3 billion YoY. In 4Q20, growth in interest income does not make up for the greater increase in expenses, mainly explained by regulation of both active and passive rates, as well as lower rates in credit card financing.

In 4Q20, interest income totaled $32.0 billion, 10.2% or $3.0 billion greater than 3Q20 and 12.4% or $4.5 billion lower than 4Q19. The quarterly increase is mainly explained by the 266.4% growth in the Other interest income line item, due to a greater income from REPO transactions, considering that the central bank reverse REPO rate climbed from 19% (1-day REPOs at September end) up to 36.5% (7-day REPOs at December end). Income was also positively affected by income from UVA/CER clause adjustments, mostly explained by the increase in consumer prices during the quarter.

Income from government securities fell 3.3% or $314 million compared to 3Q20, and contracted 3.5% or $334 million compared to 4Q19. This is explained by a lower volume invested in Central Bank liquidity instruments (LELIQ) and a lower average nominal rate of return. 82% of results is explained by financial instruments at fair value through Other Comprehensive Income (OCI), mainly LELIQ.

Interest income from loans and other financing totaled $15.6 billion, decreasing 5.1% or $846 million QoQ. This is mainly explained by the 19.7% decrease in overdrafts due to lower volume, and a 11.9% decrease in credit cards, the latter affected by the Ahora programs. Part of the productive investment credit lines are included in the Other loans line item, implemented by the BCRA through Communication “A” 7140, which states maximum limits to active rates of such loans. This fall is partially offset by the 9.7% increase in discounted instruments, derived from a greater seasonal activity at year-end, with greater volume and average rates.

 

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Income from CER/UVA adjustments was 84.1% higher QoQ, and 9.6% lower YoY, mainly explained by an acceleration in inflation rates during the fourth quarter (11.3% in 4Q20 versus 7.7% in 3Q201).

Interest expenses totaled $12.5 billion, increasing 18.6% QoQ and decreasing 2.0% YoY. The quarterly increase is a consequence of the increment in the average minimum rate of time deposits2 and interest-bearing checking accounts.

Interest expenses from time deposits explain 78.9% of total interest expenses versus 86.4% the prior quarter. These grew 8.4% QoQ and contracted 11.0% YoY. The lower share within expenses is explained by a higher participation of checking-account expenses, which climbed from 4.1% to 12.2% of total interest expenses QoQ.

Net interest margin (NIM)

As of 4Q20, total net interest margin (NIM) was 18.2%, slightly above than 3Q20’s 16.2%. The accumulated NIM for 2020 was 21.7%.

 

     BBVA ARG Consolidated                      

Assets & Liabilities Performance - AR$

In millions AR$. Rates and spreads in annualized %

   4Q20     3Q20     2020  
   Average
Balance
     Interest
Earned/Paid
     Average
Real
Rate
    Average
Balance
     Interest
Earned/Paid
     Average
Real
Rate
    Average
Balance
     Interest
Earned/
Paid
     Average
Real
Rate
 

Total interest-earning assets

     391,417        31,573        32.0     366,151        25,635        27.8     317,323        116,273        36.6

Debt securities

     111,408        13,900        49.5     117,299        9,797        33.1     92,347        41,289        44.7

Loans to customers/financial institutions

     238,266        17,670        29.4     231,403        15,827        27.1     208,185        74,953        36.0

Other assets

     41,742        3        0.0     17,449        11        0.3     16,791        31        0.2

Total non interest-earning assets

     102,734        —          0.0     104,078        —          0.0     95,435        —          0.0

Total Assets

     494,151        31,573          470,229        25,635          412,758        116,273     

Total interest-bearing liabilities

     204,929        12,463        24.1     204,229        9,429        18.3     173,099        40,844        23.6

Savings accounts

     72,868        1,590        8.7     77,761        431        2.2     64,816        2,694        4.2

Time deposits

     121,318        10,293        33.7     120,248        8,510        28.1     94,796        34,883        36.8

Debt securities issued

     2,600        270        41.1     3,007        136        17.9     5,312        2,617        49.3

Other liabilities

     8,143        311        15.1     3,214        352        43.5     8,174        650        8.0

Total non-interest-bearing liabilities

     290,320        —          0.0     270,448        —          0.0     243,873           0.0

Total liabilities and equity

     495,249        12,463        10.0     474,678        9,429        7.9     416,972        40,844        9.8

NIM - AR$

           19.4           17.6           23.8

Spread - AR$

           7.9           9.5           13.0

 

     BBVA ARG Consolidated                      

Assets & Liabilities Performance - Foreign Currency

In millions AR$. Rates and spreads in annualized %

   4Q20     3Q20     2020  
   Average
Balance
     Interest
Earned/Paid
     Average
Real
Rate
    Average
Balance
     Interest
Earned/Paid
    Average
Real
Rate
    Average
Balance
     Interest
Earned/

Paid
     Average
Real
Rate
 

Total interest-earning assets

     33,766        447        5.3     41,987        479       4.6     41,614        2,682        6.4

Debt securities

     0        0        257.3     1,308        —         —         3,557        301        8.5

Loans to customers/financial institutions

     28,881        446        6.2     34,966        479       5.5     34,291        2,379        6.9

Other assets

     4,885        1        0.1     5,714        0       0.0     3,766        3        0.1

Total non interest-earning assets

     94,135           —         109,885        —         —         91,106           —    

Total Assets

     127,901        447          151,872        479         132,720        2,682     

Total interest-bearing liabilities

     87,384        29        0.1     105,809        34       0.1     92,018        254        0.3

Savings accounts

     71,926        1        0.0     86,380        1       0.0     74,875        7        0.0

Time deposits and Investment accounts

     14,357        23        0.7     18,786        40       0.9     16,168        203        1.3

Other liabilities

     1,101        4        1.6     642        (8     (4.9 %)      975        45        4.6

Total non-interest-bearing liabilities

     39,419             41,615          —         36,488           —    

Total liabilities and equity

     126,803        29        0.1     147,424        34       0.1     128,506        254        0.2

NIM - Foreign currency

           5.0          4.3           5.8

Spread - Foreign currency

           5.2          4.4           6.2

 

1 

Source: Instituto Nacional de Estadística y Censos (INDEC) – Consumer Price Index.

2 

Communications “A” 7160 and “A” 7173, through which minimum time deposit rates have been increased, the latest being 97.37% of LELIQ rate for time deposits below one million pesos.

 

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Net fee income

 

Net Fee Income    BBVA ARG Consolidated      Chg (%)               

In millions AR$ - Inflation adjusted

   4Q20      3Q20      4Q19      QoQ     YoY     2020      2019  

Net Fee Income

     2,800        3,345        2,313        (16.3 %)      21.1     12,240        11,134  

Fee Income

     7,531        6,979        7,281        7.9     3.4     28,647        29,931  

Linked to liabilities

     2,669        2,827        3,868        (5.6 %)      (31.0 %)      12,013        15,626  

From credit cards

     3,610        2,967        2,506        21.6     44.0     12,245        9,871  

Linked to loans

     393        364        140        8.1     181.7     1,314        1,246  

From insurance

     371        353        364        5.1     1.9     1,438        1,545  

From foreign trade and foreign currency transactions

     382        376        364        1.5     5.0     1,312        1,474  

Other fee income

     107        92        41        15.6     162.3     325        169  

Fee expenses

     4,730        3,634        4,969        30.2     (4.8 %)      16,407        18,796  

In 4Q20 net fee income fell 16.3% or $545 million compared to 3Q20, and grew 21.1% or $488 million compared to 4Q19.

Fee income in 4Q20 totaled $7.5 billion, increasing 7.9% QoQ and 3.4% YoY. Quarterly increase is mainly promoted by a 21.6% growth in fees from credit cards derived from greater activity, which more than offsets the 5.6% fall in fees linked to liabilities (which decline mostly due to lower income from account maintenance and bundle fees)

Fee expenses increased 30.2% QoQ and fell 4.8% YoY. Quarterly increase is partially explained by greater expenses in client acquisition, processing expenses and higher fees related to credit card benefits (the last two including expenses denominated in U.S. dollars).

Net income from measurement of financial instruments at fair value and foreign exchange and gold gains/losses

 

Net Income from financial instruments at fair value (FV) through P&L    BBVA ARG Consolidated     Chg (%)               

In millions AR$ - Inflation adjusted

   4Q20     3Q20     4Q19     QoQ     YoY     2020      2019  

Net Income from financial instruments at FV through P&L

     5,585       986       1,515       466.2     268.5     9,348        12,574  

Income from government securities

     286       904       1,491       (68.4 %)      (80.8 %)      3,657        6,161  

Income from private securities

     2,107       (63     (483     n.m       n.m       1,968        3,935  

Interest rate swaps

     (1     20       (402     (106.8 %)      99.7     73        (696

Gains from foreign currency forward transactions

     2,659       110       (85     n.m       n.m       3,062        2,169  

Income from put options taken - Prisma Medios de Pago S.A.

     497       —         933       N/A       (46.7 %)      497        933  

Income from debt and equity instruments

     27       12       63       125.8     (56.5 %)      80        72  

Other

     10       4       (0     184.2     n.m       11        (0

In 4Q20, net income from financial instruments at Fair Value (FV) through P&L was $5.6 billion, increasing 466.2% or $4.6 billion QoQ.

Main impacts on these results are partially explained by the update in valuation of the remaining investment held in Prisma, equivalent to $2.0 billion in the Income from private securities line item. In addition, the put option valuation on Prisma has also been updated to $497 million.

A positive effect is seen by $2.7 billion from gains from foreign currency forward transactions, obtained as result from transactions on derivative securities and contracts.

The 68.4% quarterly decrease in income from government securities is in part explained by a migration of the LELIQ holdings into REPOs, promoted by BCRA’s Communication “A” 7122 which caps LELIQ net excess position.

 

Differences in quoted prices of gold and foreign currency    BBVA ARG Consolidated     Chg (%)               

In millions AR$ - Inflation adjusted

   4Q20     3Q20     4Q19     QoQ     YoY     2020      2019  

Foreign exchange and gold gains/(losses) (1)

     1,073       1,801       3,916       (40.4 %)      (72.6 %)      6,228        14,700  

From foreign exchange position

     (327     (217     182       (50.7 %)      (279.9 %)      178        (316

Income from purchase-sale of foreign currency

     1,400       2,018       3,735       (30.6 %)      (62.5 %)      6,050        15,016  

Net income from financial instruments at FV through P&L (2)

     2,659       110       (85     n.m       n.m       3,062        2,169  

Income from foreign currency forward transactions

     2,659       110       (85     n.m       n.m       3,062        2,169  

Total differences in quoted prices of gold & foreign currency (1) + (2)

     3,732       1,911       3,831       95.3     (2.6 %)      9,289        16,869  

 

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In 4Q20, the total differences in quoted prices of gold and foreign currency showed profit for $3.7 billion, growing 95.3% or $1.8 billion compared with 3Q20, mainly due to transactions on foreign currency future contracts, which more than offset the 40.4% negative effect produced by a lower activity pursuant to stricter controls on foreign exchange markets.

Other operating income

 

Other operating income    BBVA ARG Consolidated      Chg (%)               

In millions AR$ - Inflation adjusted

   4Q20      3Q20      4Q19      QoQ     YoY     2020      2019  

Operating Income

     1,927        1,670        1,490        15.4     29.3     6,278        17,612  

Rental of safe deposit boxes (1)

     262        289        237        (9.2 %)      10.5     1,122        962  

Adjustments and interest on miscellaneous receivables (1)

     613        580        390        5.7     57.4     1,882        1,730  

Punitive interest (1)

     12        1        65        n.m       (82.3 %)      104        290  

Loans recovered

     279        266        253        4.8     10.4     948        872  

Fee income from credit and debit cards (1)

     59        65        207        (8.8 %)      (71.4 %)      267        1,001  

Other Operating Income(2)

     702        468        338        49.8     107.4     1,954        7,832  

 

(1)

Included in the efficiency ratio calculation    

(2)

Includes some of the concepts used in the efficiency ratio calculation    

In 4Q20 other operating income totaled $1.9 billion, growing 15.4% or $258 million QoQ, mainly explained by a 49.8% increase in the Other Operating Income line item, due to the reversal of a provision for $505.7 million, related to the reorganization provision recorded on the fourth quarter of 2019. The increase is also explained to a lesser extent by the Adjustments and interest on miscellaneous receivables line item, where interests received from the Government in compensation for zero rate credit lines are recorded.

Operating expenses

Personnel benefits and Administrative expenses

 

Personnel Benefits and Adminsitrative Expenses    BBVA ARG Consolidated     Chg (%)              

In millions AR$ - Inflation adjusted

   4Q20     3Q20      4Q19     QoQ     YoY     2020     2019  

Total Personnel Benefits and Adminsitrative Expenses

     9,698       9,956        11,152       (2.6 %)      (13.0 %)      39,139       41,728  

Personnel Benefits (1)

     4,858       5,102        5,826       (4.8 %)      (16.6 %)      20,319       22,676  

Administrative expenses (1)

     4,840       4,854        5,326       (0.3 %)      (9.1 %)      18,820       19,052  

Travel expenses

     33       31        68       8.2     (51.3 %)      119       227  

Administrative expenses

     374       365        610       2.5     (38.7 %)      1,622       1,726  

Security services

     193       184        166       4.6     16.2     768       659  

Fees to Bank Directors and Supervisory Committee

     8       18        4       (54.5 %)      122.2     60       22  

Other fees

     223       257        231       (13.5 %)      (3.6 %)      966       944  

Insurance

     59       65        47       (9.7 %)      25.1     222       195  

Rent

     507       456        341       11.1     48.9     1,876       1,335  

Stationery and supplies

     13       10        32       33.3     (59.5 %)      69       98  

Electricity and communications

     241       259        267       (6.8 %)      (9.4 %)      1,024       967  

Advertising

     135       206        221       (34.5 %)      (39.0 %)      719       861  

Taxes

     1,157       1,104        1,051       4.7     10.1     4,490       4,434  

Maintenance costs

     549       562        585       (2.2 %)      (6.1 %)      2,226       2,035  

Armored transportation services

     829       647        1,124       28.2     (26.2 %)      2,205       3,448  

Other administrative expenses

     519       689        581       (24.7 %)      (10.6 %)      2,453       2,101  

Headcount*

     6,019       6108        6405       (89     (386     6,019       6405  

BBVA (Bank)

     5,920       6,008        6,300       (88     (380     5,920       6,300  

Associates (2)*

     99       100        105       (1     (6     99       105  

Total branches

     247       247        251       —         (4     247       251  
Efficiency ratio    N/A     N/A      N/A     N/A     N/A     N/A     N/A  

Accumulated Efficiency Ratio

     56.8     N/A        43.7     N/A       1,315 bps       56.8     43.7
Efficiency ratio - Excl. Inflation adjustment    N/A     N/A      N/A     N/A     N/A     N/A     N/A  

Accumulated Efficiency Ratio - Excl. Inflation adjustment

     45.1     N/A        40.2     N/A       492 bps       45.1     40.2

 

(1)

Concept included in the efficiency ratio calculation

(2)

Includes BBVA Asset Management Argentina S.A. and PSA & VWFS as of 3Q19

*

Total active employees at the end of the period, includes effective and temporary employees. Excludes expatriates.

During 4Q20, personnel benefits and administrative expenses totaled $9.7 billion, decreasing 2.6% or $258 million QoQ, and 13.0% or $1.5 billion YoY.

 

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Personnel benefits decreased 4.8% or $244 million compared to 3Q20, and meant a 16.6% or $968 reduction compared to 4Q19. This is partially explained by a smaller structure, and a higher quarterly and annual inflation that has not been compensated by the wage increments agreed through collective bargaining agreements with labor unions during the year (annual inflation reached 36% while wage increases implied a total increment of 34%).

In 4Q20, administrative expenses fell 0.3% or $14 million QoQ, and 9.1% or $486 YoY. This decrease is mainly due to savings in Other administrative expenses (lower expenses in services provided to third parties, and lower expenses in card printing), which more than offset the higher seasonal expenditure in armored transportation due to an increased activity.

The accumulated efficiency ratio as of 4Q20 was 56.8%, above the 43.7% reported in 4Q19. The increase is explained by a lower percentage decline of the numerator (expenses) than the denominator (income), which has been mainly affected by a decrease in financial income.

Excluding inflation adjustments included in the lines “Income from the monetary position”, the accumulated efficiency ratio as of 4Q20 would reach 45.1%.

Other operating expenses

 

Other Operating Expenses    BBVA ARG Consolidated      Chg (%)               

In millions AR$ - Inflation adjusted

   4Q20      3Q20      4Q19      QoQ     YoY     2020      2019  

Other Operating Expenses

     6,085        3,013        7,911        102.0     (23.1 %)      16,420        29,922  

Turnover tax

     2,185        1,738        2,709        25.7     (19.3 %)      8,117        10,867  

Initial loss of loans below market rate

     632        120        378        427.5     67.0     1,084        2,070  

Contribution to the Deposit Guarantee Fund (SEDESA)

     185        184        183        0.3     0.8     697        825  

Interest on liabilities from financial lease

     86        100        107        (14.2 %)      (20.3 %)      374        433  

Other allowances

     457        295        1,264        54.9     (63.8 %)      1,543        10,345  

Other operating expenses

     2,540        575        3,269        341.4     (22.3 %)      4,607        5,383  

In 4Q20, other operating expenses totaled $6.1 billion, increasing 102.0% or $3.1 billion QoQ, and contracting 23.1% or $1.8 billion YoY.

The main factor explaining the quarterly increase relies on the Other operating expenses line item, where a provision for $2.1 billion are recorded. These are in line with the continuity of the digital transformation process the Bank has decided to launch in 2019, which aims to generate higher efficiency and agility in decision-making processes.

Further factors impacting over the increment in expenses are recorded in the Initial loss of loans below market rate line item, and partly caused by the normalization of the Turnover tax payment (related to advance payments recognized on the prior quarter)

Income from associates

This line reflects the results from non-consolidated associate companies. During 2020, profit of $273 million has been reported, mainly due to the participation in BBVA Consolidar Seguros S.A., Rombo Compañía Financiera S.A., Interbanking S.A. and Play Digital S.A.

Income tax

Income tax expenses accumulated in 2020 totaled $8.6 billion, representing an annual effective rate of 42%, compared to an annual effective rate of 34% as of 2019. The increment in such rate compared to the regulatory 30% is based on differences between inflation adjustment regulations and BCRA regulations, changing the taxable base.

 

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Balance sheet and activity

Loans and other financing

 

Loans and other financing    BBVA ARG Consolidated     Chg (%)  

In millions AR$ - Inflation adjusted

   4Q20     3Q20     4Q19     QoQ     YoY  

To the public sector

     7       0       25       n.m       (74.3 %) 

To the financial sector

     2,338       3,548       7,099       (34.1 %)      (67.1 %) 

Non-financial private sector and residents abroad

     290,301       287,943       274,238       0.8     5.9

Non-financial private sector and residents abroad - AR$

     259,362       255,277       224,310       1.6     15.6

Overdrafts

     17,409       21,992       19,597       (20.8 %)      (11.2 %) 

Discounted instruments

     33,118       33,183       27,962       (0.2 %)      18.4

Mortgage loans

     17,100       17,687       19,044       (3.3 %)      (10.2 %) 

Pledge loans

     11,620       10,818       11,830       7.4     (1.8 %) 

Consumer loans

     28,233       29,078       32,207       (2.9 %)      (12.3 %) 

Credit cards

     112,964       100,584       94,180       12.3     19.9

Receivables from financial leases

     1,743       1,678       2,166       3.9     (19.5 %) 

Other loans (1)

     37,175       40,257       17,324       (7.7 %)      114.6

Non-financial private sector and residents abroad - Foreign Currency

     30,939       32,666       49,928       (5.3 %)      (38.0 %) 

Overdrafts

     2       3       4       (27.7 %)      (37.9 %) 

Discounted instruments

     1,691       2       4,298       n.m       (60.7 %) 

Mortgage loans

     —         —         226       N/A       (100.0 %) 

Credit cards

     1,676       1,723       4,180       (2.7 %)      (59.9 %) 

Receivables from financial leases

     124       184       406       (32.8 %)      (69.5 %) 

Loans for the prefinancing and financing of exports

     15,980       18,919       24,908       (15.5 %)      (35.8 %) 

Other loans (1)

     11,465       11,834       15,904       (3.1 %)      (27.9 %) 

% of total loans to Private sector in AR$

     89.3     88.7     81.8     69 bps       755 bps  

% of total loans to Private sector in Foreign Currency

     10.7     11.3     18.2     (69 )bps      (755 )bps 

% of mortgage loans with UVA adjustments (2)

     84.0     85.9     85.1     (191 )bps      (116 )bps 

% of pledge loans with UVA adjustments (2)

     12.3     15.7     21.9     (345 )bps      (965 )bps 

% of personal loans with UVA adjustments (2)

     16.1     21.3     41.5     (512 )bps      (2,540 )bps 

% of loans with UVA adjustments over Total loans(2)

     3.6     4.3     6.7     (70 )bps      (308 )bps 

Total loans and other financing

     292,645       291,492       281,362       0.4     4.0

Allowances

     (13,126     (12,150     (15,512     (8.0 %)      15.4

Total net loans and other financing

     279,519       279,342       265,850       0.1     5.1

 

(1)

Includes IFRS adjustment.

(2)

Excludes effect of accrued adjustments.

Private sector loans in 4Q20 totaled $290.3 billion, moderately increasing 0.8% or $2.4 billion QoQ, and 5.9% or $16.1 billion YoY.

Loans to the financial sector fell 34.1% QoQ, mainly because of the maturity of a loan.

Loans to the private sector in pesos increased 1.6% in 4Q20, and grew 15.6% in the year. Loans to the private sector denominated in foreign currency fell 5.3% QoQ and 38.0% YoY, mainly driven by the contraction in demand of loans in foreign currency. These loans, measured in U.S. dollars, fell 14.3% and 55.9% QoQ and YoY respectively. The increase in the currency exchange rate versus the U.S. dollar was 10.5% QoQ and 40.4% YoY3.

In 2020, total loans totaled $292.6 billion and grew 4.0%. Private sector loans grew 5.9% reaching $290.3 billion in the same period. Growth is mainly explained by loans denominated in pesos, which more than offset the fall in foreign currency denominated ones.

 

3 

Taking into consideration wholesale U.S. dollar foreign exchange rates on BCRA’s Communication A 3500

 

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Loans and other financing    BBVA ARG Consolidated      Chg (%)  

In millions AR$ - Inflation adjusted

   4Q20      3Q20      4Q19      QoQ     YoY  

Non-financial private sector and residents abroad - Retail

     171,593        159,890        161,667        7.3%       6.1%  

Mortgage loans

     17,100        17,687        19,271        (3.3%     (11.3%

Pledge loans

     11,620        10,818        11,830        7.4%       (1.8%

Consumer loans

     28,233        29,078        32,207        (2.9%     (12.3%

Credit cards

     114,640        102,307        98,360        12.1%       16.6%  

Non-financial private sector and residents abroad - Commercial

     118,708        128,053        112,571        (7.3%     5.5%  

Overdrafts

     17,411        21,995        19,601        (20.8%     (11.2%

Discounted instruments

     34,809        33,185        32,261        4.9%       7.9%  

Receivables from financial leases

     1,867        1,862        2,573        0.3%       (27.4%

Loans for the prefinancing and financing of exports

     15,980        18,919        24,908        (15.5%     (35.8%

Other loans (1)

     48,640        52,092        33,228        (6.6%     46.4%  

% of total loans to Retail sector

     59.1%        55.5%        59.0%        358  bps      16  bps 

% of total loans to Commercial sector

     40.9%        44.5%        41.0%        (358 )bps      (16) bps 

 

(1)

Includes IFRS adjustment

Considering retail loans (mortgage, pledge, consumer and credit card loans), these have increased 7.3% QoQ and 6.1% YoY. In the quarter, the greatest increases are reflected in pledge loans and credit cards (7.4% and 12.1% respectively), the latter boosted by Ahora 12 and Ahora 18 programs, and a greater activity promoted by year-end seasonality.

Commercial loans (including overdrafts, discounted instruments, receivables from financial leases, loans for the prefinancing and financing of exports, and other loans) contracted 7.3% QoQ and increased 5.5% YoY. Quarterly decline is explained by a 20.8% fall in overdrafts, and a 15.5% fall in prefinancing and financing of exports. This was partially offset by a 4.9% growth in discounted instruments, partly promoted by a greater commercial activity.

In 2020, both retail and commercial loans grew by $171.6 billion and $118.7 billion respectively. Within retail loans, a strong credit card growth offset the fall in mortgage and consumer loans. In commercial loans, growth is fostered by Other loans, specially company loans (or “PIV”) and discounted instruments.

In the 4Q20 the gross loans-to-deposits ratio was 61% compared to 70% a year ago.

 

Market share - Private sector Loans    BBVA ARG      Chg (bps)  

In %

   4Q20      3Q20      4Q19      QoQ      YoY  

Private sector loans - Bank

     7.66%        7.46%        6.94%        20 bps        72 bps  

Private sector loans - Consolidated*

     8.49%        8.27%        7.71%        22 bps        78 bps  

Based on daily BCRA information. Capital balance as of the last day of each quarter.

 

*

Consolidates PSA, VWFS & Rombo

Asset quality

 

Asset Quality    BBVA ARG Consolidated      Chg (%)  

In millions AR$ - Inflation adjusted

   4Q20      3Q20      4Q19      QoQ     YoY  

Commercial non-performing portfolio (1)

     2,206        524        5,461        320.9%       (59.6%

Total commercial portfolio

     97,535        100,091        104,083        (2.6%     (6.3%

Commercial non-performing portfolio / Total commercial portfolio

     2.26%        0.52%        5.25%        174  bps      (298 )bps 

Retail non-performing portfolio (1)

     1,842        2,896        4,327        (36.4%     (57.4%

Total retail portfolio

     188,336        193,648        165,178        (2.7%     14.0%  

Retail non-performing portfolio / Total retail portfolio

     0.98%        1.50%        2.62%        (52 )bps      (164 )bps 

Total non-performing portfolio (1)

     4,048        3,420        9,788        18.4%       (58.6%

Total portfolio

     285,872        293,739        269,261        (2.7%     6.2%  

Total non-performing portfolio / Total portfolio

     1.42%        1.16%        3.64%        25 bps      (222 )bps 

Allowances

     13,133        12,150        15,512        8.1%       (15.3%

Allowances /Total non-performing portfolio

     324.43%        355.26%        158.49%        (3,083 )bps      16,594  bps 

Write offs

     7,298        6,567        5,058        11.1%       44.3%  

Write offs / Total portfolio

     2.55%        2.24%        1.88%        32 bps      67 bps 

Cost of Risk (CoR)

     4.85%        4.61%        7.80%        24 bps      (295 )bps 

 

(1)

Non-performing loans include: all loans to borrowers classified as “Deficient Servicing (Stage 3)”, “High Insolvency Risk (Stage 4)”, “Irrecoverable” and/or “Irrecoverable for Technical Decision” (Stage 5) according to BCRA debtor classification system

 

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In 4Q20, asset quality ratio or NPL (total non-performing portfolio / total portfolio) was 1.42%, which increased 25 basis points QoQ and fell 222 basis points YoY. The quarterly increase is mainly explained by an increase in the commercial non-performing portfolio. This ratio was positively affected by the temporary flexibility in BCRA regulation regarding debtor classification during the COVID-19 pandemic, which extends grace periods in 60 days before a loan is classified as non-performing, and suspends the mandatory reclassification of clients that have an irregular performance with other institutions but a regular performance with the Bank.

The coverage ratio (allowances / total non-performing portfolio) decreased to 324.43% in 4Q20, from 355.26% in 3Q20. This is explained by an increase in non-performing loans, which is greater than the increase in allowances, due to factors previously mentioned, as well as the implementation of impairment models and the continuing effect of waivers enforced though BCRA regulation regarding debtor classification.

Cost of risk (loan loss allowances / average total loans) reached 4.85%, above than the 4.61% recorded in 3Q20. This is mainly explained by a deterioration in the evolution in credit quality, especially in the commercial portfolio.

 

     BBVA ARG        

Analysis for the allowance of loan losses

In millions AR$

   Balance at
12/31/2019
     Stage 1     Stage 2      Stage 3     Monetary result
generated by
allowances
    Balance at
12/31/2020
 

Other financial assets

     308        30       —          15       (89     264  

Loans and other financing

     15,270        1,547       2,490        (2,297     (4,209     12,802  

Other debt securities

     1        (1     —          —         (0     0  

Eventual commitments

     1,233        484       40        (20     (373     1,365  

Total allowances

     16,804        2,065       2,530        (2,302     (4,669     14,428  

 

*

ECL: Expected credit loss

Note: to be consistent with Financial Statements, it must be recorded from the beginning of the year instead of the quarter

Allowances for the Bank in 4Q20 reflect expected losses driven by the adoption of the IFRS 9 standards as of January 1, 2020, except for debt instruments issued by the nonfinancial government sector which were temporarily excluded from the scope of such standard.

The financial statements of consolidated subsidiaries PSA and VWFS were prepared considering the financial reporting framework set forth by the BCRA for Group “B” financial institutions, without considering the model established in paragraph 5.5. “Impairment” of IFRS 9 for fiscal years commencing on and after January 1, 2022. As of October 2020, PSA and VWFS will be part of Group “C” financial institutions, keeping the accounting framework of Group “B” financial institutions.

 

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Public sector exposure

 

Net Public Debt Exposure    BBVA ARG Consolidated      Chg (%)  

In millions AR$ - Inflation adjusted

   4Q20      3Q20      4Q19      QoQ     YoY  

Treasury and Government securities

     38,308        27,959        21,943        37.0%       74.6%  

Treasury and National Government

     38,308        27,959        21,872        37.0%       75.1%  

National Treasury Public Debt in AR$

     38,308        27,956        11,873        37.0%       222.6%  

National Treasury Public Debt in dollars

     0        3        264        (97.9%     (100.0%

National Treasury Public Debt USD-Linked

     —          —          9,735        N/A       (100.0%

Provinces

     —          —          70        N/A       (100.0%

Loans to the Public Sector

     7        0        25        n.m       (72.0%
REPOs    —        —        —        N/A     N/A  

AR$ Subtotal

     38,315        27,956        21,968        37.1%       74.4%  

USD Subtotal*

     0        3        9,999        (97.9%     (100.0%

Total Public Debt Exposure

     38,315        27,959        31,967        37.0%       19.9%  

B.C.R.A. Exposure

     139,078        124,539        45,010        11.7%       209.0%  

Instruments

     89,890        103,389        45,010        (13.1%     99.7%  

LELIQs

     89,890        103,389        45,010        (13.1%     99.7%  

Loans to the B.C.R.A.

     —          —          —          N/A       N/A  

Repo

     49,188        21,151        —          132.6%       N/A  

B.C.R.A. - AR$

     49,188        21,151        —          132.6%       N/A  

%Public sector exposure (Excl. B.C.R.A.) / Total assets

     5.6%        4.3%        5.2%        130  bps      36  bps 

 

*

Includes USD-linked Treasury public debt in AR$

Public sector exposure (excluding BCRA) totaled $38.3 billion, growing 37.0% or $10.4 billion QoQ, and 19.9% or $6.3 billion YoY.

Short-term liquidity is allocated in BCRA instruments, which grew 11.7% or $14.5 billion compared to 3Q20, and 209.0% or $94.1 billion compared to 4Q19. The quarterly increase is a consequence of the increase in REPO transactions with the BCRA, which more than offsets the reduction in LELIQ position.

Exposure to the public sector (excluding BCRA) represents 5.6% of total assets.

Deposits

 

Total Deposits    BBVA ARG Consolidated      Chg (%)  

In millions AR$ - Inflation adjusted

   4Q20      3Q20      4Q19      QoQ     YoY  

Total deposits

     478,223        444,870        400,237        7.5%       19.5%  

Non-financial Public Sector

     5,628        6,600        4,000        (14.7%     40.7%  

Financial Sector

     862        612        243        40.8%       254.7%  

Non-financial private sector and residents abroad

     471,733        437,658        395,994        7.8%       19.1%  

Non-financial private sector and residents abroad - AR$

     336,691        311,057        238,470        8.2%       41.2%  

Checking accounts

     112,544        93,849        73,523        19.9%       53.1%  

Savings accounts

     88,508        80,383        68,279        10.1%       29.6%  

Time deposits

     104,626        113,044        92,356        (7.4%     13.3%  

Investment accounts

     27,905        20,165        —          38.4%       N/A  

Other

     3,108        3,616        4,311        (14.0%     (27.9%

Non-financial private sector and res. abroad - Foreign Currency

     135,042        126,601        157,524        6.7%       (14.3%

Checking accounts

     40        26        28        54.6%       44.0%  

Savings accounts

     117,419        106,477        132,936        10.3%       (11.7%

Time deposits

     15,442        17,380        22,239        (11.2%     (30.6%

Other

     2,141        2,718        2,321        (21.2%     (7.7%

% of total portfolio in the private sector in AR$

     71.4%        71.1%        60.2%        30  bps      1,115  bps 

% of total portfolio in the private sector in Foregin Currency

     28.6%        28.9%        39.8%        (30 )bps      (1,115 )bps 

% of time deposits with UVA adjustments

     1.7%        1.0%        2.1%        63  bps      (44 )bps 

% of sight deposits over total deposits

     68.6%        65.6%        71.1%        304  bps      (243 )bps 

% of time deposits over total deposits

     31.4%        34.4%        28.9%        (304 )bps      243  bps 

During 4Q20, total deposits were $478.2 billion, recording an increase of 7.5% or $33.4 billion QoQ, and 19.5% or $78.0 billion YoY.

Private sector deposits in 4Q20 were $471.7 billion, growing 7.8% or $34.1 billion QoQ, and 19.1% or $75.7 billion YoY.

 

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Private non-financial sector deposits in pesos totaled $336.7 billion, growing 8.2% or $25.6 billion QoQ, and 41.2% or $98.2 billion YoY. This is mainly explained by a growth in Investment accounts (transferable investment certificates with early withdrawal option), and to a lesser extent, by the growth in interest-bearing checking accounts. This offsets the quarterly fall in time deposits.

Private non-financial sector deposits in foreign currency expressed in pesos grew 6.7% or $8.4 billion QoQ and contracted 14.3% or $22.5 billion YoY. Measured in U.S. dollars, these deposits fell 3.4% QoQ and 39.0% YoY.

In 2020, total deposits grew 19.5%, totaling $478.2. Private deposits totaled $471.7 billion, increasing 19.1% YoY. Annual growth is mainly explained by peso deposits which more than offset the fall in foreign currency deposits, mostly due to checking accounts and the implementation of investment accounts.

 

Private Deposits    BBVA ARG Consolidated      Chg (%)  

In millions AR$ - Inflation adjusted

   4Q20      3Q20      4Q19      QoQ     YoY  

Non-financial private sector and residents abroad

     471,733        437,658        395,994        7.8%       19.1%  

Sight deposits

     323,760        287,069        281,398        12.8%       15.1%  

Checking accounts

     112,584        93,875        73,551        19.9%       53.1%  

Savings accounts

     205,927        186,860        201,215        10.2%       2.3%  

Other

     5,249        6,334        6,632        (17.1%     (20.8%

Time deposits

     147,973        150,589        114,595        (1.7%     29.1%  

Time deposits

     120,068        130,424        114,595        (7.9%     4.8%  

Investment accounts

     27,905        20,165        —          38.4%       N/A  

% of sight deposits over total deposits

     69.1%        66.1%        71.4%        291  bps      (231 )bps 

% of time deposits over total deposits

     30.9%        33.9%        28.6%        (291 )bps      231  bps 

As of 4Q20, the Bank’s transactional deposits (checking accounts and savings accounts) represented 66.6% of total non-financial private deposits, totaling $318.5 billion, versus 63.1% in 3Q20.

 

Market Share - Private sector Deposits    BBVA ARG      Chg (%)  

In %

   4Q20      3Q20      4Q19      QoQ     YoY  

Private sector Deposits - Consolidated*

     7.13%        6.46%        7.14%        64  bps      (1 )bps 

Based on daily BCRA information. Capital balance as of the last day of each quarter.

 

*

Consolidates PSA, VWFS & Rombo

Other sources of funds

 

Other sources of funds    BBVA ARG Consolidated      Chg (%)  

In millions AR$ - Inflation adjusted

   4Q20      3Q20      4Q19      QoQ     YoY  

Other sources of funds

     113,414        124,837        119,459        (9.2%     (5.1%

Central Bank

     28        33        23        (13.8%     24.9%  

Banks and international organizations

     1,691        —          3,457        N/A       N/A  

Financing received from local financial institutions

     7,907        3,704        4,891        113.5%       61.6%  

Corporate bonds

     1,169        4,566        9,964        (74.4%     (88.3%

Equity

     102,619        116,534        101,124        (11.9%     1.5%  

In 4Q20, other sources of funds totaled $113.4 billion, decreasing 9.2% or $11.4 billion QoQ, and 5.1% or $6.0 billion YoY.

4Q19 equity evolution can be observed in the table below, going from historical values to current values through the implementation of IAS 29 rule.

 

Equity - Evolution       

In millions AR$

   4Q19  

Equity before IAS 29 application

     63,893  

Total impact of IAS 29 application (1)

     11,963  

Equity in terms of 12/31/2019 units

     75,856  

Adjustment from reexpression of equity at current units 12/31/2020 (2)

     27,415  

Equity in terms of 12/31/2020 units

     103,271  

Total recognized in Retained Earnings (1)+(2)

     39,378  

 

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Liquid Assets

 

Total Liquid Assets    BBVA ARG Consolidated     Chg (%)  

In millions AR$ - Inflation adjusted

   4Q20     3Q20     4Q19     QoQ     YoY  

Total liquid assets

     322,816       293,808       279,734       9.9     15.4

Cash and deposits in banks

     152,109       148,264       212,733       2.6     (28.5 %) 

Debt securities at fair value through profit or loss

     915       6,593       5,495       (86.1 %)      (83.3 %) 

Government securities

     915       184       71       396.2     n.m  

Liquidity bills of B. C. R. A.

     —         6,408       5,425       (100.0 %)      (100.0 %) 

Net REPO transactions

     49,188       21,151       —         132.6     N/A  

Other debt securities

     120,604       117,801       61,505       2.4     96.1

Government securities

     30,453       20,820       21,826       46.3     39.5

Private securities

     261       —         95       N/A       175.6

Liquidity bills of B. C. R. A.

     89,890       96,981       39,585       (7.3 %)      127.1

Liquid assets / Total Deposits

     67.5     66.0     69.9     146 pbs       (239 )pbs 

In 4Q20, liquid assets were $322.8 billion, increasing 9.9% or $29.0 billion compared to 3Q20, and 15.4% or $43.1 billion compared to 4Q19.

In 4Q20, the liquidity ratio (liquid assets / total deposits) reached 67.5%. Liquidity ratio in local and foreign currency reached 60.6% and 85.1% respectively.

Solvency

 

Minimum capital requirement    BBVA ARG Consolidated     Chg (%)  

In millions AR$ - Inflation adjusted

   4Q20     3Q20     4Q19     QoQ     YoY  

Minimum capital requirement

     38,795       37,347       35,388       3.9     9.6

Credit risk

     29,523       27,618       26,262       6.9     12.4

Market risk

     246       309       413       (20.5 %)      (40.4 %) 

Operational risk

     9,026       9,419       8,713       (4.2 %)      3.6

Integrated Capital - RPC (1)*

     95,868       106,242       88,410       (9.8 %)      8.4

Ordinary Capital Level 1 ( COn1)

     108,249       120,068       101,529       (9.8 %)      6.6

Deductible items COn1

     (15,348     (16,679     (15,785     (8.0 %)      (2.8 %) 

Additional Capital Level 2 (COn2)

     2,967       2,852       2,666       4.0     11.3

Excess Capital

          

Integration excess

     57,073       68,895       53,022       (17.2 %)      7.6

Excess as % of minimum capital requirement

     147.1     184.5     149.83     (3,736 )pbs      (272 )pbs 

Risk-weighted assets (RWA, according to B.C.R.A. regulation) (2)

     474,190       456,795       432,787       3.8     9.6

Regulatory Capital Ratio (1)/(2)

     20.2     23.3     20.4     (304 )pbs      (21 )pbs 

TIER I Capital Ratio (Ordinary Capital Level 1/ RWA)

     19.6     22.6     19.8     (304 )pbs      (22 )pbs 

 

*

RPC includes 100% of quarterly results

BBVA Argentina continues to show strong solvency indicators on 4Q20. Capital ratio reached 20.2%. Tier 1 ratio was 19.6% and capital excess over regulatory requirement was $57.1 billion.

 

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Other events

Relevant Events

 

   

As of February 2, 2020, the court confirmed a favorable decision on the legal action the Bank had filed to declare unconstitutionality of the provisions that prevented the application of the inflation adjustment mechanism established by Law No. 20,628 for the 2016 fiscal period. This enabled the Bank to proceed to release the provision for $1.2 billion.

 

   

On March 9, 2021, BBVA Argentina has decided to schedule the Annual Ordinary and Extraordinary Shareholders’ Meeting for April 20, 2021. A $7 billion cash dividend distribution will be considered, corresponding to the partial write off of the optional reserve fund for future profit. This distribution is subject to BCRA’s prior approval.

Corporate bond payments and issuances during 4Q20

 

   

As of November 9, 2020, the Bank completed quarterly coupon and principal payments on corporate bond Class 25 for $40.5 million and $1.67 billion respectively.

 

   

As of December 28, 2020, the Bank completed quarterly coupon and principal payments on corporate bond Class 24 for $49.6 million and $546.5 million respectively.

Digital transformation

Digitalization continued to accelerate during the fourth quarter of 2020. Active digital clients reached 1.9 million with a 71.7% penetration over total active clients (2.7 million), versus a penetration of 66.5% in 4Q19. Active mobile clients were 1.6 million, representing a 59.9% penetration in 4Q20, versus a penetration of 53.8% in 4Q19. Digital and mobile transactions4 increased 57.8% in 4Q20 YoY.

On 4Q20, retail digital sales measured in units reached 80.8% of total sales (vs. 65.1% in 4Q19) and represent 70.2% of the Banks total sales measured in monetary value (vs. 54.5% in 4Q19).

Productive investment SMEs financing credit lines – December 2020

Pursuant to Central Bank’s Communication “A” 7140, as of December 31, 2020, the Bank has disbursed more than $13 billion in these lines, to more than 2.800 firms.

 

4 

Includes online and mobile banking, online and mobile Net Cash, and non-bank correspondents.

 

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Main Regulatory Changes

Extension on regulation on ATM fees, outstanding loan payments, debtor classification, dividend distribution. (Communication “A” 7181, 12/17/2020). The BCRA stated that ATM use will remain cost-free until April. Financial institutions cannot, until March 31, 2021, charge fees on transactions conducted through all ATMs.

It has also decided to extend until March 31, 2021, the possibility for creditors to defer unpaid instalments to credit maturity (except credit card financing), accruing only compensatory interests and no extra charges. This regulation also extends until March 31, 2020 60 day waiver on late-payment periods for stages 1, 2 and 3 (for retail and commercial creditors), and suspends compulsory reclassification for “Debtor classification”.

Moreover, it has decided to keep the suspension on dividend distribution of financial institutions until June 30, 2021.

It extends until January 1, 2022, for financial institutions belonging to groups B and C, the applicability of item 5.5 of IFRS 9 stated on Communication “A” 6430.

Productive investment credit lines (Communication “A” 7197, 01/06/2021). The BCRA stated that in regulation concerning “SMEs financing for productive investment”, financings assigned to item 4.2 (Working capital and discounted instruments and other documents), disbursed as of October 16, 2020, will be enabled to fulfill the requirements of the last paragraph in item 3.1. (30% assigned to long term investment projects), at 65% of their value.

Credit cards compensatory rate. (Communication “A” 7198, 01/06/2021). The BCRA decided, as of February 2021, that the limit to credit card financing compensatory nominal annual rate is 43% and applicable up to $200.000 of financing. When the loan is greater than this amount, the applicable rate on the surplus amount is that specified in art. 16 Law 25.065 on Credit Cards.

Productive investment credit lines (Communication “A” 7227, 02/25/2021). The BCRA incremented from 65% to 100% the value at which financings disbursed as of October 16, 2020, assigned to item 4.2 (Working capital and discounted instruments and other documents), can be allocated to fulfill the requirements of the last paragraph in item 3.1. (30% assigned to long term investment projects).

 

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Glossary

Active clients: holders of at least one active product. An active product is in most cases a product with at least “one movement” in the last 3 months, or a minimum balance.

Cost of Risk (accumulated): Year to date accumulated loan loss allowances / Average total loans.

Average total loans: average between previous year-end Total loans and other financing and current period Total loans and other financing.

Cost of Risk (quarterly): Current period Loan loss allowances / Average total loans. Average total loans: average between previous quarter-end Total loans and other financing and current period Total loans and other financing.

Coverage ratio: Quarterly allowances under the Expected Credit Loss model / total non-performing portfolio

Digital clients: we consider a customer to be an active user of online banking when they have been logged at least once within the last three months using the internet or a cell phone and SMS banking.

Efficiency ratio (excl. inflation adjustments, accumulated): Accumulated (Personnel benefits+ Administrative expenses + Depreciation & Amortization) / Accumulated (Net Interest Income + Net Fee Income + Net Income from measurement of Financial Instruments at Fair Value through P&L + Net income from write-down of assets at amortized cost and at fair value through OCI + Foreign exchange and gold gains + some concepts included in Other net operating income)

Efficiency ratio (excl. inflation adjustments, quarterly): (Personnel benefits+ Administrative expenses + Depreciation & Amortization) / (Net Interest Income + Net Fee Income + Net Income from measurement of Financial Instruments at Fair Value through P&L + Net income from write-down of assets at amortized cost and at fair value through OCI + Foreign exchange and gold gains + some concepts included in Other net operating income)

Efficiency ratio (accumulated): Accumulated (Personnel benefits+ Administrative expenses + Depreciation & Amortization) / Accumulated (Net Interest Income + Net Fee Income + Net Income from measurement of Financial Instruments at Fair Value through P&L + Net income from write-down of assets at amortized cost and at fair value through OCI + Foreign exchange and gold gains + some concepts included in Other net operating income+ Income from net monetary position)

Efficiency ratio (quarterly): (Personnel benefits+ Administrative expenses + Depreciation & Amortization) / (Net Interest Income + Net Fee Income + Net Income from measurement of Financial Instruments at Fair Value through P&L + Net income from write-down of assets at amortized cost and at fair value through OCI + Foreign exchange and gold gains + some concepts included in Other net operating income+ Income from net monetary position)

Liquidity Ratio: (Cash and deposits in banks + Debt securities at fair value through P&L (Excl. Private securities) + Net REPO transactions + Other debt securities (Excl. Private securities)) / Total Deposits

Mobile clients: customers who have been active in online banking at least once in the last three months using a mobile device.

Net Interest Margin (NIM) – (quarterly): Quarterly Net Interest Income / Average quarterly interest earning assets Public Sector Exposure (excl. BCRA): (National and Provincial Government public debt + Loans to the public sector + REPO transactions) / Total Assets

ROA (accumulated): Attributable Net Income of the period / Total Average Assets. Total Average Assets is calculated as the average between total assets on December of the previous year and total assets in the current period, expressed in local currency.

 

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ROA (quarterly): Attributable Net Income of the period / Total Average Assets. Total Average Assets is calculated as the average between total assets on the previous quarter-end and total assets in the current period, expressed in local currency

ROE (accumulated): Attributable Net Income of the period / Average Equity. Average Equity is calculated as the average between equity in December of the previous year and equity in the current period, expressed in local currency.

ROE (quarterly): Attributable Net Income of the period / Average Equity. Average Equity is calculated as the average between equity on the previous quarter end and equity in the current period, expressed in local currency.

Spread: (Quarterly Interest Income / Quarterly average Interest-earning Assets) – (Quarterly Interest Expenses / Quarterly average interest-bearing liabilities)

 

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Balance Sheet

 

Balance Sheet    BBVA ARG Consolidated  

In millions AR$ - Inflation adjusted

   2020     2019     Chg (%)  

Assets

      

Cash and deposits in banks

     152,109       212,733       (28.5 %) 

Cash

     62,233       63,610       (2.2 %) 

Financial institutions and correspondents

     89,876       149,123       (39.7 %) 

B.C.R.A

     86,184       146,353       (41.1 %) 

Other local and foreign financial institutions

     3,691       2,770       33.2

Debt securities at fair value through profit or loss

     943       5,623       (83.2 %) 

Derivatives

     3,878       4,148       (6.5 %) 

Repo transactions

     49,188       —         N/A  

Other financial assets

     10,045       6,386       57.3

Loans and other financing

     279,519       265,850       5.1

Non-financial public sector

     1       1       (18.1 %) 

B.C.R.A

     6       24       (74.7 %) 

Other financial institutions

     1,755       6,932       (74.7 %) 

Non-financial private sector and residents abroad

     277,757       258,893       7.3

Other debt securities

     120,604       61,505       96.1

Financial assets pledged as collateral

     17,913       8,064       122.1

Current income tax assets

     0       36       (98.6 %) 

Investments in equity instruments

     3,984       2,799       42.3

Investments in subsidiaries and associates

     1,442       1,410       2.3

Property and equipment

     33,768       35,494       (4.9 %) 

Intangible assets

     1,554       1,062       46.3

Deferred income tax assets

     4,874       3,664       33.0

Other non-financial assets

     8,925       5,815       53.5

Non-current assets held for sale

     226       226       —    

Total Assets

     688,970       614,814       12.1

Liabilities

      

Deposits

     478,223       400,237       19.5

Non-financial public sector

     5,628       4,000       40.7

Financial sector

     862       243       254.7

Non-financial private sector and residents abroad

     471,733       395,994       19.1

Liabilities at fair value through profit or loss

     —         791       (100.0 %) 

Derivatives

     189       4,184       (95.5 %) 

Other financial liabilities

     39,227       39,243       (0.0 %) 

Financing received from the B.C.R.A. and other financial institutions

     9,626       8,371       15.0

Corporate bonds issued

     1,169       9,964       (88.3 %) 

Current income tax liabilities

     3,722       10,987       (66.1 %) 

Provisions

     11,475       14,632       (21.6 %) 

Deferred income tax liabilities

     39       —         N/A  

Other non-financial liabilities

     40,544       23,135       75.2

Total Liabilities

     584,213       511,543       14.2

Equity

      

Share Capital

     613       613       —    

Non-capitalized contributions

     26,387       26,387       —    

Capital adjustments

     18,641       18,641       —    

Reserves

     86,332       59,662       44.7

Retained earnings

     (41,476     (18,973     (118.6 %) 

Other accumulated comprehensive income

     78       (4,917     101.6

Income for the period

     12,045       19,711       (38.9 %) 

Equity attributable to owners of the Parent

     102,619       101,124       1.5

Equity attributable to non-controlling interests

     2,138       2,148       (0.4 %) 

Total Equity

     104,757       103,271       1.4

Total Liabilities and Equity

     688,970       614,814       12.1

 

(1)

Excludes consolidation with PSA and VWFS.

 

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LOGO

 

Balance Sheet – Foreign Currency Exposure

 

Foreign Currency Exposure    BBVA ARG Consolidated      Chg(%)  

In millions AR$ - Inflation adjusted

   4Q20     3Q20      4Q19      QoQ     YoY  

Assets

            

Cash and deposits in banks

     114,954       108,838        119,372        5.6     (3.7 %) 

Debt securities at fair value through profit or loss

     1       4        0        (84.3 %)      178.3

Derivatives

     —         —          —          N/A       N/A  

Repos

     —         —          —          N/A       N/A  

Other financial assets

     2,214       2,240        366        (1.1 %)      n.m  

Loans and other financing

     27,928       29,139        46,697        (4.2 %)      (40.2 %) 

Other financial institutions

     413       407        667        1.5     (38.0 %) 

Non-financial private sector and residents abroad

     27,515       28,732        46,030        (4.2 %)      (40.2 %) 

Other debt securities

     —         —          10,093        N/A       (100.0 %) 

Financial assets pledged as collateral

     4,717       4,695        3,096        0.5     52.4

Investments in equity instruments

     28       23        37        25.3     (23.5 %) 

Total foreign currency assets

     149,842       144,949        179,661        3.4     (16.6 %) 

Liabilities

       —          —         

Deposits

     137,442       130,006        159,599        5.7     (13.9 %) 

Non-Financial Public Sector

     2,312       3,309        1,983        (30.2 %)      16.5

Financial Sector

     51       58        57        (12.0 %)      (10.0 %) 

Non-financial private sector and residents abroad

     135,079       126,638        157,559        6.7     (14.3 %) 

Liabilities at fair value through profit or loss

     —         —          612        N/A       (100.0 %) 

Other financial liabilities

     10,386       11,798        10,466        (12.0 %)      (0.8 %) 

Financing received from the B.C.R.A. and other financial institutions

     2,261       616        4,153        267.0     (45.6 %) 

Other non financial liabilities

     1,143       1,246        1,691        (8.3 %)      (32.4 %) 

Total foreign currency liabilities

     151,232       143,666        176,521        5.3     (14.3 %) 

Foreign Currency Net Position - AR$

     (1,390     1,283        3,140        (208.3 %)      (144.3 %) 

Foreign Currency Net Position - USD

     (17     17        52        (198.1 %)      (131.5 %) 

 

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LOGO

 

P&L

 

Income Statement    BBVA ARG Consolidated  

In millions AR$ - Inflation adjusted

   2020     2019     Chg (%)  

Interest income

     118,955       156,367       (23.9 %) 

Interest expense

     (41,098     (65,690     37.4

Net interest income

     77,857       90,677       (14.1 %) 

Fee income

     28,647       29,931       (4.3 %) 

Fee expenses

     (16,407     (18,796     12.7

Net fee income

     12,240       11,134       9.9

Net income from financial instruments at fair value

     9,348       12,574       (25.7 %) 

Net loss from write-down of assets at amortized cost and fair value through OCI

     (2,310     (82     n.m  

Foreign exchange and gold gains

     6,228       14,700       (57.6 %) 

Other operating income

     6,278       17,613       (64.4 %) 

Loan loss allowances

     (9,930     (18,401     46.0

Net operating income

     99,710       128,214       (22.2 %) 

Personnel benefits

     (20,319     (22,676     10.4

Administrative expenses

     (18,820     (19,052     1.2

Depreciation and amortization

     (4,066     (5,729     29.0

Other operating expenses

     (16,421     (29,922     45.1

Operating income

     40,085       50,836       (21.1 %) 

Income from associates and joint ventures

     273       (29     n.m  

Income from net monetary position

     (19,696     (21,116     6.7

Income before income tax

     20,662       29,691       (30.4 %) 

Income tax

     (8,629     (9,983     13.6

Income for the period

     12,032       19,708       (38.9 %) 

Income for the period attributable to:

      

Owners of the parent

     12,045       19,712       (38.9 %) 

Non-controlling interests

     (12     (4     (229.6 %) 

Other comprehensive Income (1)

     4,995       (4,916     201.6

 

(2)

Neto of Income Tax.

Ratios

 

Quarterly Annualized Ratios    BBVA ARG consolidated     Chg (bps)  

In%

   4Q20     3Q20     4Q19     QoQ     YoY  

Profitability

          

Efficiency Ratio

     N/A       N/A       N/A       N/A       N/A  

Efficiency Ratio (excl. Inflation adjustments)

     N/A       N/A       N/A       N/A       N/A  

ROA

     N/A       N/A       N/A       N/A       N/A  

ROE

     N/A       N/A       N/A       N/A       N/A  

Liquidity

          

Liquid assets / Total Deposits

     67.5     66.0     69.9     146  bps      (239 )bps 

Capital

          

Regulatory Capital Ratio

     20.2     23.3     20.4     (304 )bps      (21 )bps 

TIER I Capital Ratio (Ordinary Capital Level 1/ RWA)

     19.6     22.6     19.8     (304 )bps      (22 )bps 

Asset Quality

          

Total non-performing portfolio / Total portfolio

     1.42     1.16     3.64     25  bps      (222 )bps 

Allowances /Total non-performing portfolio

     324.43     355.26     158.49     (3,083 )bps      16,594  bps 

Cost of Risk

     4.85     4.61     7.80     24  bps      (295 )bps 

 

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LOGO

 

Accumulated Annualized Ratios    BBVA ARG consolidated     Chg (bps)  

In %

   4Q20     3Q20     4Q19     QoQ     YoY  

Profitability

          

Efficiency Ratio

     56.8     N/A       43.7     N/A       1,315  bps 

Efficiency Ratio (excl. Inflation adjustments)

     45.1     N/A       40.2     N/A       492  bps 

ROA

     1.8     N/A       2.9     N/A       (110 )bps 

ROE

     11.8     N/A       20.5     N/A       (870 )bps 

Liquidity

          

Liquid assets / Total Deposits

     67.5     66.0     69.9     146  bps      (239 )bps 

Capital

          

Regulatory Capital Ratio

     20.2     23.3     20.4     (304 )bps      (21 )bps 

TIER I Capital Ratio (Ordinary Capital Level 1/ RWA)

     19.6     22.6     19.8     (304 )bps      (22 )bps 

Asset Quality

          

Total non-performing portfolio / Total portfolio

     1.42     1.16     3.64     25  bps      (222 )bps 

Allowances /Total non-performing portfolio

     324.43     355.26     158.49     (3,083 )bps      16,594  bps 

Cost of Risk

     4.85     4.61     7.80     24  bps      (295 )bps 

About BBVA Argentina

BBVA Argentina (NYSE; BYMA; MAE: BBAR; LATIBEX: XBBAR) is a subsidiary of the BBVA Group, the main shareholder since 1996. In Argentina, it is one of the leading private financial institutions since 1886. Nationwide, BBVA Argentina offers retail and corporate banking to a broad customer base, including: individuals, SME’s, and large-sized companies.

BBVA Argentina’s purpose is to bring the age of opportunities to everyone, based on our customers’ real needs, providing the best solutions, and helping them make the best financial decisions through an easy and convenient experience. The institution relies on solid values: “The customer comes first, We think big and We are one team”. At the same time, its responsible banking model aspires to achieve a more inclusive and sustainable society.

Investor Relations Contact

Ernesto Gallardo

Chief Financial Officer

Inés Lanusse

Investor Relations Officer

investorelations-arg@bbva.com

ir.bbva.com.ar

 

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

  Banco BBVA Argentina S.A.
Date: March 9, 2021   By:  

/s/ Ernesto Gallardo Jimenez

    Name:   Ernesto Gallardo Jimenez
    Title:   Chief Financial Officer