Redaccion
DBRS Morningstar has decided to maintain Banco Bilbao Vizcaya Argentaria’s (BBVA) long-term issuer rating at ‘A (high)’, while also keeping the outlook at ‘stable’, as reported by the agency in a statement on Monday.
The agency is maintaining BBVA’s rating due to the «solid and resilient» results of the bank in recent years thanks to its diversified franchise in Spain, Mexico, and, to a lesser extent, Turkey, and its well-controlled operating costs, leading to solid levels of efficiency compared to its peer group of large banks.
However, Morningstar DBRS believes that the bank’s profitability peaked in 2024 and is aware of the current geopolitical risks and increased political uncertainty resulting from policy changes in the U.S., particularly tariffs, «which could create volatility and impact the operational environment of banks, especially in Mexico and South American countries in the case of BBVA.»
Furthermore, Morningstar DBRS expects profitability in Spain, the major contributor to the year-over-year increase in BBVA’s attributed net profit in 2024, to slightly decrease as the net interest margin (NII) shrinks in a low-interest-rate environment.
The rating also takes into account the bank’s strong funding and liquidity profile, supported by its broad and stable deposit base, as well as its solid capital position, with strong buffers against regulatory requirements and a «robust» ability to generate capital.
Morningstar DBRS would upgrade the credit rating if BBVA significantly increases its share of income from international countries with higher sovereign credit ratings than Spain. Conversely, it would downgrade the entity if BBVA’s risk profile, profitability, or capital position materially deteriorate.
