Bank of Spain Ups Minimum Requirement for Bonds and CoC: BBVA Now Required to Maintain Higher Ratios

An upgrade has emerged on the financial landscape as one of Spain’s leading banks, the Banco Bilbao Vizcaya Argentaria, S.A. or more commonly known as BBVA, has been served a revised MREL by the Bank of Spain. This key directive, which governs the bank’s own capital and eligible liabilities, is applicable from the day of receipt and takes into account financial and supervisory information as of end-December 2023.

In a sharp contrast to the previous notification delivered in 2024, BBVA’s updated mandate dictates an increased volume representing at least 23.13% of the total risk-weighted assets of its resolution group. Furthermore, 13.50% of the risk-weighted assets should be composed of subordinated instruments, fortifying the bank’s financial health.

But the pressure is far from unbearable. In fact, BBVA appears to have stepped up to the challenge, already complying with the enhanced MREL on both fronts: risk-weighted assets and leverage ratio. The formidable resolution group, comprising BBVA and its European subsidiaries, forms a well-built structure of its own funds and eligible liabilities, fully complying with this revised mandate as of the end of 2023.

The ceramic bull is evidently in solid financial health, demonstrating an impressive ability to adapt and prosper under evolving regulations. This calls for accolades in a financial world constantly skewed by unexpected turns and terrifying dead-ends.