Banco Bilbao Vizcaya Argentaria, S.A. (BBVA) Earnings Call Transcript & Summary

Ladies and gentlemen, and shareholders, good morning. [Foreign Language] which is basically to say, welcome to this Extraordinary General Meeting of BBVA shareholders. And that's true for both of you who are actually here in the Euskalduna Palacio in Bilbao and those of you who are following us remotely. So firstly, the Secretary will explain the terms of the call to this general meeting.

Good morning. The Board of Directors of Banco Bilbao Vizcaya Argentaria have resolved to convene this Extraordinary General Meeting of Shareholders for the 4th of July 2024 at 10:00 a.m. on first summons, and at the same time, on the 5th of July on second summons. The announcement was published on the 31st of May in the daily papers, El Correo, El País, and El Mondo, and in the Official Gazette of the Mercantile Registry and in the website of the company and the National Markets Commission as established under Article 516 of the Corporate Enterprises Act. As indicated in the quarter meeting, the EGM will be held presently in the Palacio Euskalduna de Bilbao, although we've also offered shareholders the possibility of participating in the meeting and granting proxy and voting in advance remotely. According to the company bylaws, the meeting will be chaired by Carlos Torres Vila, and the Secretary will be the Board Secretary. And between them, they are going to set up the general meeting panel. And we can also tell you that the Board of Directors of the bank is here and present. As resolved by the Board of Directors, we've requested the attendance of the Bilbao notary, Ramón Múgica, here in order to minute the proceedings. And we hereby inform you of that fact. So now the Secretary will report on the number of shares and shareholders at this general meeting with voting rights.

The attendance list is formed using the computers to count everyone and the share capital of the bank is EUR 2,834,009,877.85, which is represented by 5,763,285,465 shares, with a face value of EUR 0.49 each. And all of them are from the same class and series, and fully subscribed and paid up. According to the attendance cards taken up before we started the general meeting, looking at the proxies and the remote votes, we have the following provisional quorum. So here at the meeting in the room and remotely, we've got 91,512 shareholders holding 770,413,402 shares, which represents EUR 377,502,566.98 of our share capital, which is 13.37% of that total share capital. With proxies, we have 61,702 shareholders, holding 3,306,611,521 shares representing EUR 1,620,239,645.29 of share capital, which is 57.37% of the share capital, which means that between those present and represented, we got a total of 153,214 shareholders with voting rights holding 4,077,024,923 shares, representing EUR 1,997,742,212.27 of share capital, which is 70.74% of that share capital. In light of the data facilitated by the Secretary and pursuant to the Corporate Enterprises Act, the corporate bylaws and the general meeting regulations, we have the necessary quorum for the valid holding of this general meeting on second summons in order to resolve on all the items on the agenda. Consequently, I can declare that this extraordinary general meeting of BBVA shareholders to be carried on second summons. Having closed the attendance list. During the session, we'll be able to inform you of the final quorum for this meeting. So I'll hand over to the Secretary to explain some housekeeping matters regarding this general meeting.

As we've already informed you, this meeting is a hybrid meeting, which means that apart from the people actually attending in the Palacio Euskalduna, those shareholders who have enrolled according to the instructions put out in the announcement in the quarter meeting and the website of the bank can participate remotely. In order to facilitate the Q&A for shareholders who wish to exercise their right to information, we would like to inform those shareholders who are here in the Palacio Euskalduna, if they wish to ask questions in the Q&A, and if they've not already done so, they should now go to the shareholders' desk, which is at the front of the hall, saying how many shares they have, their name, and then they will be informed of when they will be able to take their turn in the Q&A. If any speaker wishes to minute what they have to say verbatim, I'll remind you that under Article 18 of the general meeting regulations, they need, first of all, before they actually speak to give the notary a written copy of what they're going to say, so that he can follow what they say before he records it. And those shareholders attending remotely have been able to exercise their right to information over the telematic attendance portal up until the moment when the EGM started. And they will be able to exercise their right to vote over the same portal up until the moment when the panel declares the time is up. And this is according to the indications that you've already seen on the bank's website and in the announcement of the quarter meeting. Should there be any technical issue during the meeting in the remote media, you can go straight to the bank's website, where we'll indicate what you have to do in order to exercise your rights in such cases. So many thanks for participating in this event. And now the Secretary will report to the AGM on the agenda and the resolutions being proposed for approval.

The agenda of today's meeting was published in the quarter meeting as established under Article 5 of the General Meeting Regulations. So it can be deemed to have been read for all due effect. Available to the shareholders since the day that we called the meeting, you've had all the proposed resolutions filed by the Board regarding the different items on the agenda, which are subject to approval at this meeting, and the report from the Board of Directors regarding those proposals included in agenda Item 1. I can inform you that this documentation has also been published on the bank's website as of the date on which we put out the quarter the meeting, along with all the other information required under Article 518 of the Corporate Enterprises Act and the legal reports issued since the last AGM regarding the contingent convertible bonds issued by the bank. And now pursuant to Article 18 of the general meeting regulations, we will give you a summary reading of the proposed resolutions filed by the Board of Directors for this EGM. Although we can tell you that the full text has already been handed over to the notary to be included in the proceedings of this meeting. Under agenda Item 1, the Board of Directors is putting out to your approval, a capital increase of the bank share capital to a maximum amount of EUR 551,906,524.05, which means 1,126,339,845 ordinary shares with the same class and series as those currently outstanding. In order to cover the consideration in kind, under the voluntary tender of over up to 100% of the Sabadell Bank shares, which has been put out by the BBVA, these shares will be disbursed with non-monetary contributions, namely in Banco Sabadell shares. Thus, these shares are intended exclusively for Sabadell Bank shareholders who take up the offer, which means that there are no preemptive subscription rights for the current BBVA shareholders. The proposed resolution establishes that the capital increase will be totally or partially executed on one or several locations depending on the outcome of the offer. And therefore, we accept the possibility of incomplete subscription for the capital increase. We also propose the delegation of powers necessary in order to totally or partially execute on one or several occasions, the resolution to increase capital within 1 year as of today. And under the second agenda item, we are requesting the EGM to grant the necessary powers to execute the resolutions adopted with respect to any qualifications put out by the Mercantile Registry or other authorities. The full text of the proposed resolutions and other documents that we've mentioned have been included and all the documentation made available to you since we published the quote of this meeting. Many thanks.

Ladies and gentlemen, shareholders, [Foreign Language]. Good day, and welcome to this Extraordinary Shareholders Meeting for BBVA. We thank you all for your attendance, not only those who are present here today in Euskalduna Palacio in Bilbao, but also those attending remotely. It is an honor for me to be here before you, once more. As you know, this is an extraordinary meeting to deal with one single item, the required capital enlargement for the share trade we have offered to Sabadell Bank shareholders. An enormously attractive transaction, a combination of two powerful banks that will create value for all our stakeholders, including, of course, all of you, our shareholders. But before we tackle this item, I would like to highlight BBVA's strength and our history of success, which makes this -- take this operation possible. A history of success, including 74 million clients, 121,000 employees across 25 countries across the world. We're a global scope bank, with leading franchises in attractive markets. And in each of those markets, we have interesting shares of participation, as you can read on the left side of the screen. And our profitability in each of those countries is leading the sector in comparison with local competitors always ranking either 1st or 2nd. Our leadership comes mostly from our pioneer strategy with which we have taken the lead in big trends like digitalization and sustainability. We were pioneers in digitalizations, enabling our clients access to BBVA to create new accounts, new operations or get products through simple, always readily accessible channels to operate whenever, however they feel most comfortable. And our clients are using these channels massively. As we can see by the percentage of clients relating to the bank through their mobile devices, which went from 25% in 2016 to 73% in 2023. At present, 53 million clients interact with BBVA over their smartphones. And the same as we've been leaders in digitalization, we also lead the way in sustainability. Certainly, the decarbonization of economy is one of the largest challenges that human kind has to face lately, as you have heard me say before. And in BBVA, we were one of the first institutions to understand that this is also a big business opportunity. Last year, we channeled over EUR 70 billion in sustainable business, twice as much as 2 years ago and more than 5x the investment of 2018. And last, I would highlight that as a result of all this, our clients are increasingly satisfied with our services. Our NPS, our Net Promoter Score, has gone up by 11 percentage points in the past 5 years. And in this indicator, we occupy leadership positions in every single geography of our footprint. The success of this strategy is reflected in our excellent financial performance. As we saw in this very place in March, we got the best profit in our story, attributable benefit of EUR 8.01 billion, 26% above 2022. We are way ahead of our competitors in Europe in terms of profit and value creation. Our ROTE, which measures the group profitability, continued to grow until it reached 17% compared to 12% in our European competitors. Our NAVPS, net asset value per share, which is the value for each of you, our dear shareholders, grew by over 20% throughout the year, which compares to approximately 14% in average of our European competitors. And the cost-to-income ratio, measuring the efficiency of the work we do in BBVA, continued to grow until 41.7%, significantly better than the 53.4% average, our competitors boast off. All-in-all, as you can see, a differentiating performance that has continued to improve during this first quarter of 2024 and will continue, driven by both our strategy and our strengths. But not only are we good performers and efficient, we also have greater growth. In this slide, you can see the profit of 2023 versus the growth of loans. As you can see, we combine one of the best profitability ratios with the highest growth in loans compared to all of our peers. We are in the ideal quadrant, the top left corner, with a unique profile for growth and profit that sets us apart from every other competitor in Europe. An additional key to this success is how disciplined we are in assigning and allocating capital, always guided by the creation of value for our shareholders. Throughout the past 10 years, we have disinvested EUR 16 billion in cases like Paraguay, because the market was not attractive enough; or in the case of maybe Chile or the United States, because we failed to gather enough scale. These two features, scale and market attractiveness, determine the possibility to achieve truly positive returns. Part of the capital obtained by those disinvestments was used to tackle opportunities with higher value generations like our franchises in Mexico, Turkey or Spain. And that's precisely the framework of capital allocation we have applied to our bid for Sabadell. Another important part of that capital was devoted to attractively remunerate our shareholders. On one side, where the cash dividend payout, which has continued growing in the past few years, as you can see,it has ramped up by 28%, and also a share buyback program at much lower prices than our value -- than our share price today. Since 2021, we have paid out over EUR 7.8 billion in cash dividends, added to EUR 5.4 billion in share buybacks, for a total of over EUR 13.2 billion paid out to our shareholders. Everything I have mentioned so far comes from rigorous management and has multiplied the value of BBVA shares in the past few years. Our shareholders have nearly tripled the value of their shares, including dividends since early 2019. As you can see, the exact data or point of data comes from multiplying value 2.75x. In comparison, European bank shareholders stand at a near 1.94x, whereas other Spanish banks stand at 1.59x. I believe this sums up our success story and the very favorable position we're at right now. So building from this impressive baseline, our combination with Bank Sabadell is the most attractive industrial project in European banking as you will now hear. A number of times before I have mentioned, we are leaders in digitalization and we are -- we anticipate the future. Our industry has veered towards digital, the preferred channel for clients to relate to banks. In Spain, for instance, the Spanish population using digital banking was approximately 30%. But according to the Bank of Spain, by 2022, this percentage reached already 70%. Digitalization increases the weight of software spending as well as IT equipment, communication systems and technological skills. In consequence, technology spending has become one of the big items in the industry's cost structure, which are mostly overheads. That is why scale is increasingly relevant to tackle the growing investments we need to make in technology. With the integration of Bank Sabadell to the BBVA Group, we gained scale and dilute overheads among a larger customer base and larger business volumes, therefore, offering clients from both entities, better products and services at a more competitive price. The growing importance of technology will do nothing but increase. We need to invest more and more in cybersecurity to protect not only our customers' money but also their data. Regulators are becoming increasingly stringent in this field. And we also need to guarantee service continuity and resilience in the event of catastrophes. And a good example of that is the EU DORA regulation, best known as DORA, being enforced in next January 1. But we can also add to all this new developments in AI, which requires huge technology investments not only in computing, but also in algorithms and in making the data required to feed these systems highly and readily available. The banks that invest the most, like BBVA, are the ones that get best returns and this tendency will do nothing but grow. This deal would increase our scale and reinforce our position in Spain, a very attractive market for investment. Spain has proven to be a resilient and dynamic economy that has grown well above the European mean in the past few years. We expect growth of 2.5% this year, 2.1% next year, some interesting figures that compare very well to other countries. Plus, after the deleveraging we've been doing in the past 15 years, Spain's private debt to GDP at present, both households and companies, are below the average of the European Union with a better perspective for credit performance. Returns for the banking sector are also looking up. In sum, Spain as a market fully covers our criteria for efficient capital allocation, as I mentioned at the beginning of my speech, and the integration with Bank of Sabadell is a great opportunity for all. Sabadell is the fourth bank in Spain with assets in the U.K. and Mexico. And it is a high-quality franchise with very positive performance in their financial metrics during the past few years. They grew their returns up to 11.5% ROTE in 2023, the capital ratio to 13.2% and their asset quality ratios have grown better and better. With the integration of both businesses, we will be gaining scale. After this deal, we would become the second bank in Spain in terms of loan share, and we reinforce our capability to compete in the domestic market. Plus, we're combining two highly complementary businesses, and we're doubling up on our commitment to SMEs to the highest share of BBVA, we would be adding the large SME business from Sabadell. Serving SMEs and self-employed is a top priority for BBVA. These businesses add more than 60% of the employment rate in the country and decisively contribute to Spain's economic and social development. As a matter of fact, we're the most supportive entity for the entrepreneurial fabric in Spain. During the first 4 months of this year, we grew our client base by more than 51,000 self-employed small and medium enterprises. And together, we want to add the experience of both banks to jointly build the best possible partner for these businesses. As an initial sample of this endeavor, we will maintain SMEs circulating loans during at least 12 months. In sum, we want to build a stronger, more competitive and more profitable bank by reinforcing our presence in an attractive market by combining top quality franchises with highly complementary businesses. Plus, with this deal, we would get significant synergies with estimated cost savings of EUR 0.85 billion, including EUR 100 million in connection with lower financing costs. These savings will materialize during the first 3 years after integration and are coupled to restructuring costs of EUR 1.45 billion before taxes. Many of these synergies are related to the group's overheads and technology costs I was mentioning previously. This deal is positive for absolutely all of our stakeholders. Clients from both banks will be a unique value proposal since these franchises complement each other with the best and broadest product offering and the bank's global scope. Employees will be part of a larger team where they will have greater career and professional growth opportunities. One of our priorities in this process will be preserving and promoting the best talent and culture from both entities. The integration of the staff will be based on professional competence and merit as has happened in previous deals with BBVA. And the deal is almost positive for society as a whole. Since thanks to a bigger scale and profitability, we will have greater capacity to grant loans to households and companies that we estimate by EUR 5 billion further each year, which will also generate greater contributions via taxes. With this transaction, we also increase our commitment with the largest territories in our footprint. We will maintain the corporate center in Sant Cugat and will reinforce our support to a science entrepreneurship and culture in those territories. Particularly, we will use both brands in those areas where it can have relevant commercial interest. And of course, the deal is interesting and it involves an important amount of value creation for you as BBVA shareholders. First of all, it increases profit per share or earnings per share from day 1 once savings from integration begin to materialize. 3.5% of those plus TBV will grow by 1% approximately. All of this with a limited impact on capital, which would be only 30 basis points if the bid is accepted by 100% of shareholders and with a high yield on the investment. Plus, I would like to highlight, we will maintain our attractive payout policy by paying out between 40% and 50% of net attributable profit with the possibility to recombine dividends and cash and share buyback, plus the commitment of redistributing any excess capital above 12%, of course, subject to the required authorizations and approvals. For all these reasons, we bring a Bank of Sabadell shareholders, a public tender for a VTO over 1 share of BBVA for every 4.83 of their shares. So today, we bring to your approval a capital increase of up to 1.126 billion new ordinary shares for those Bank of Sabadell shareholders who will take up the bid. So there is no money -- monetary contribution or preemptive subscription rights for these shareholders. We have already requested the due authorization. So after CNMV's approval, the take-up period would be open for shareholders. We trust that the process will progress favorably. This is a tremendously attractive offer. It's a premium of 30% above values listed on April 29 when we filed the tender to the Board of Sabadell. And it gives Sabadell shareholders the possibility to capture higher value in the future and participating in 16% in the combined entity, if take-up reaches a 100%. We are convinced of the strategic rationale of this bid and the positive impact it will have for all stakeholders. For that reason, BBVA wants to offer Sabadell investors the power of choice, which you will be able to do once the take-up period is opened. We hope you can appreciate the strategic sense of this deal and walk with us into this huge project for the future. Our approach was friendly from the start and continues to be so. And by way of conclusion, I would like to insist on some things I've already said. First of all, we fully trust that this will be a successful transaction. The tender is extraordinarily attractive, meaning to create a stronger, more competitive bank. We are decidedly supporting Spain and its SMEs with positive financial effect in terms of tangible book value and yield on the invested capital with a limited impact on capital. And our experience in similar deals in the past is a guarantee to the success of this new integration, which definitely creates value for all stakeholders, shareholders, clients, employees and obviously, our society to continue to grow the impact we have had so far and coming through our purpose of making the opportunities of the new era available to all. And I wouldn't want to wrap this up without thanking you once more for your constant trust and support. [Foreign Language]. Thank you very much.

Many thanks. I'll hand over to the Secretary.

I will now -- I'll now report on the final quorum of this meeting having closed the attendance list. Having counted the proxies and the votes issued remotely before the beginning of the EGM and by the shareholders here in the room and voting remotely, we have the final quorum that here in the general meeting in this hall and attending remotely, we have 91,544 shareholders holding 770,655,580 shares representing EUR 377,621,234.20 of share capital, which is 13.37% of the share capital. Represented by proxy, we've got 61,703 shareholders holding 3,306,606,676 shares accounting for EUR 1, 620,266,671.24 of share capital, which is 57.37% of that share capital. Which means that between those present and represented, we have 153,247 shareholders with voting rights holding 4,077,322,256 shares, representing EUR 1,997,887,905.44 of share capital, which is 70.75% of that share capital. And now given that we have a notary minuting the proceedings, the notary will make the statement established in Article 101.3 of the Mercantile Registry regulations. Okay. I'll give the floor to the notary.

For all due effects, we now ask the meeting whether you have any reservations or challenges regarding the statements made on the number of shareholders attending and the capital present. Should any shareholder present in this room wish to lodge any reservation or challenge regarding the number of shareholders attending or the capital present, would they please come to my desk in order for me to incorporate their objection in the proceedings. Those shareholders who are attending remotely, you can communicate with me over the channel set up for this in the special portal established by the bank for this general meeting so that I can minute it to the proceedings.

Thank you very much, Mr. Notary. And now we open the floor to any shareholders who wish to speak and to exercise their right to information. The Secretary will now inform you of how to proceed.

I can inform you that the order of the inter ventures is established by the panel of this meeting, and we will be calling up all the shareholders who've already stated they wish to take the floor. I'd like to point out that for the smooth running of the meeting, it's important for you to keep your interventions focused on the business, on the agenda. And please do not bring in business which is not on the agenda. We also informed shareholders that to facilitate the smooth running of the meeting, there will be one single right to the floor for each person who wishes to speak regardless of how many shares they hold and how many proxies they've been given for this general meeting. And in order to allow all shareholders who wish to exercise their right to information, please make sure that you don't take up more time than is strictly necessary to deal with the questions you want to cover. And please don't ever overrun the 5-minute limit. Once the shareholders present in the Palacio Euskalduna have taken the floor, we will now take questions which have been duly lodged by shareholders attending remotely over the channels made available to them. After that, if possible, we will come back to you with the information or the clarification that you've requested. And those requests for information, which are valid but can't be dealt with during the meeting, we'll be getting back to within the 7 days following the end of the meeting, as established in the general meeting regulations and the Corporate Enterprises Act. Many thanks.

Okay. Now then we will let the shareholders take the floor. So who's the first shareholder?

I give the floor to Mr. [ Jorgea Ronda Vernal. ]

Good morning, Mr. Chairman, CEO, members of the Board, ladies and gentlemen, shareholders, colleagues, et cetera. My name is [ Jorgea Ronda Vernal ]. I'm the President of SCB, which is trade unit setup in BBVA to defend the rights of the workers of both sectors regardless of the claims that might come up, we have high representation. I'm here in representation of more than 30% of the staff of BBVA in Spain and the shareholders who have given us their proxy. Mr. Chairman, in line with the information made known previously in the data presented today regarding the VTO over Banco Sabadell, should you successfully conclude the deal, given what a big deal it is. It would mean a change in the banking map of Spain and Europe. It's a corporate M&A, which is really important for the media, and we should expect the bank to be strengthened by it. And we will look to the future situation of our enterprise given this M&A. And in the current situation, the main concerns that we've heard from the staff have to do with the sales force, the endowment of branches and the control tools with too much control, which has gone up exponentially over the last 4 months, which also coincides with summer holiday times, which makes it very difficult for the staff to take up the extra work without having any impact on their pay. And we see that aggravated by not signing the collective agreement for our staff, which undermines the purchasing power of the staff. Although there are record earnings in the sector, the increase in wages hasn't been made very material. And we understand that it's necessary to increase the measures intended to improve the working conditions and the employment contracts of employees given the situation, which is going to take a long time before it's resolved, which is when we get the final outcome of this VTO. According to your statements, the union of both entities is going to generate value for everyone. The corporate social responsibility and your commitment to your staff are fundamental in all M&As, but especially when the joint profits of both entities are over EUR 9 billion in 2023, with an outlook for even more in 2024. And that's where we'd like to talk about the future. Should you successfully conclude the VTO with the merger, please, Mr. Chairman, will you make sure that this isn't done at the cost of the staff of both entities? In SCB, we will always firmly defend the rights of our workers. So any measures must be generous, non-traumatic and voluntary. And otherwise, it would be impossible for society to understand how you might treat your workers. In the previous AGM and others, we have already described the situations that need to be corrected, like the lack of staff in the branch offices and the loss of quality and service, the excessive work burden and the delocation of staff. So looking at this VTO. Well, if it's successful, it could be an excellent opportunity to resolve the situation that I just described. And therefore, Mr. Chairman, we do trust that you will take advantage of the great opportunity that you have before you to solve these problems without undermining the key assets of the enterprise, which is its staff to get a better bank for all people regardless of where they come from. And finally, as always, Mr. Chairman, we'd request, please, will you take into account our opinions and requests, because they are being put forward by all those that we represent. The people who are working for BBVA. [Foreign Language]. Many thanks.

Paola Torrico Portero has the floor.

Good morning, Mr. Chairman, CEO, shareholders, my name is Paola Torrico Portero and I speak on behalf of Comisiones Obreras, representing the shares to which we have proxy. Mr. Chair, we want to express our -- the concerns of our organization and workers after you announced your bid on Bank of Sabadell and possible merger of both entities. We referred to the labor consequences that the integration of such two large companies might entail. The headcount of both organizations are already beginning to suffer these consequences due to fear practices applied by certain middle managers that are putting even more pressure to their team members under the excuse that a possible merger is on the horizon. And the hidden threat that whoever does not shine will be let go. Plus an excessive and explicable ambition to reduce cost, considering summer months and summer holidays for the staff, which are already scarce, we're also worried about the budget for holidays or medical leaves. You look proud or you claim to be proud of your branch network, but that sounds like a macabre sense of humor. After the latest sector crisis and since 2021, BBVA workers have been dealing with untakable work burdens, which are undermining our health as we announced in the latest ordinary Annual Shareholders Meeting. But apparently, you refused to listen. The growth in your client base, technological progress, new digitalization endeavors and many other tasks cannot lead to an ongoing reduction of your staff. It should work the other way. Math is not that difficult. More work, more workers. It shouldn't be more complicated than that. BBVA need to support their workers with real tangible actions. In Comisiones Obreras, we're here to demand that if this merger with Bank of Sabadell should happen, there should be a labor agreement protecting employment on both sides, guarantee for employment, the feasibility of a future project and generational continuity should be conditions to be included in the possible or potential merger process. The protection of both sides of the staff should be an opportunity to reinforce teams. More hands on board for better results and a healthy labor environment that will certainly lead to better customer service. We also wanted to refer to the financial exclusion of these processes when it comes to bank and savings banks mergers that leaves citizens in dire conditions vis-a-vis the financial industry. During the world pandemic, the banking sector was considered a vital one. So we come to you once more to ask you to adopt your social co-responsibility and back it with facts, not words. I remind you that in your latest earnings call, you were boasting about your contribution to society and economic development and social areas of your footprint, you did fail to mention the abandonment of the population after branches are closed for clients who cannot have digitalized access to banking or access to actual physical branches offline. Of course, you keep claiming client comes first, but we need to support people, clients, workers, society, an inclusive one where no one is left behind, and some people working for people. Last, we're still -- we still have not signed the banking collective agreement. BBVA is one of the largest associated entities in the employer's agreement. You're obtaining extraordinary profit at the expense of your workers that have a loss of their purchasing power that only continues to grow. Only a good contract would help these workers overcome the situation. Some of your workers have had their salary frozen for 15 years. With the promise of a new and better future, this is no way to hold on to your talent and certainly does not generate pride or motivation. If you truly appreciate your staff, prove it by providing a contract and an agreement that reflects your profits and workers' compensation. Let's work ahead together with facts, not words. We believe that by hard work and responsibility and true will we can move ahead. Our intervention has been handed out to the notary public and also our intention for vote and the items of today's agenda. Thank you.

Thank you very much, Ms. Portero. The word goes to Luis Maria Urrecha Benguria.

[Foreign Language], Mr. Chairman, CEO, members of the Board of Directors, shareholders, and all the people here in this room and all of those who are following us over remote media. Quite honestly, it's great to be here at home. And I've met up with lots of people, that I've been happy to work with in the past, all colleagues of the place, I'm -- Luis Maria Benguria, and I belong to the third biggest trade union in BBVA with almost 20% representation. And here, I'm representing the people who work for you and the shareholders who have granted their proxy to us with nearly 1 million shares in proxy. We'd like to thank all of the people who have been involved for giving us the opportunity to put across the concerns of the staff in BBVA and also Sabadell. Firstly, it's clear that we should congratulate you for the positive trends we're seeing in the bank. They're reflected in the earnings, you've been referring to. In the last quarter, you've got spectacular returns. I would imagine by the end of the month, you'll repeat with further good news. Without a doubt, that's been thanks to the people who work for the enterprise and, of course, the decisions made by the management team. You should take into account the hard work done by your staff. The staff of this bank is the alma mater of the business, which make it possible to get these outstanding returns that you've announced. So what we'd like to say is that in CGT, we are mainly concerned about the consequences on employment of this VTO over Sabadell. We're not going to talk about the financial issues which have to do more with the legal teams and the finance department nor any loss for societies had turned the ECB preferred intra-community mergers rather than in-country mergers. It's true that the merger of two entities, regardless of the legal form in which it's done, always leads to excess staff. With the understaffing of the branch offices here in BBVA, and that's the real situation that we have right now, we are worried. And that's why our concern is focused here on the recent history of our country, which shows that mergers between financial institutions have always led to layoffs, forced relocations with devastating impact on the morale and the well-being of the workers and customer service. You already have to look at what's happening in our branch offices. In CGT, we're committed to fighting for decent labor conditions for our employees. And we have to request that you should not only avoid dramatic measures, but actually commit to taking decisions that will protect and benefit workers in both entities. What we're proposing, for example, is a measure that the staff would like a lot, adopting early retirement possibilities rather than just laying off staff. Any de -- relocation should be totally voluntary. We propose that you should actively find acquisitions in the European market, not just in Spain, to have a truly international bank. Likewise, we'd request that during the process, you should inform the trade union reps at all times so that we can contribute our ideas about how to make things run as smoothly as possible, maintaining a high level of transparency with regular reports to the union reps on the impact of the VTO unemployment and what measures you're going to adopt. We take advantage of being here today to remind the Board of Directors of their corporate, social responsibility with a fair treatment of all employees. That's not just an ethical imperative, it also has positive repercussions on the reputation of the bank, and therefore, is long-term sustainability as a business with a big impact on all those communities in which BBVA operates. I'd like to wrap up here saying that we are currently in collective bargaining stage, and thanks to the contributions of the more than 6,000 signatures we've got from the staff requesting the non-application of Article 5 of the agreement, which has to do with the compensation in the case of absorption and merger, at the moment, the bargaining table was previously saying no. But now the doors have been opened and we are currently negotiating percentages, which would have to do with the kind of compensation that will be given with the absorption. And we'd like to thank you for listening to us. And we do hope that our contributions and proposal will be taken into account. [Foreign Language] Many thanks.

Thank you very much, Luis Maria. I now hand over to Francisco Javier Aguirre.