Banco Bilbao Vizcaya Argentaria

From Wikipedia, the free encyclopedia

Grupo BBVA

Type	Public
Founded	1999
Headquarters	Bilbao, Spain
Key people	Francisco González, Executive Chairman José Ignacio Goirigolzarri, COO
Industry	Finance and Insurance
Products	Financial Services
Revenue	€ 311.0 million (2004) [1]
Employees	91,000
Slogan	Adelante
Website	www.bbva.com

Banco Bilbao Vizcaya Argentaria (BBVA), (IBEX-35:BBVA) is a multinational Spaniard banking group. It was formed from a merger of Banco Bilbao Vizcaya and Argentaria in 1999, and is the smaller of Spain's two large banks. The bank has recently focused on overseas expansion, and now operates in 40 countries. Like many other Spanish companies, it enjoys a dominant position in Spanish-speaking Latin American countries. It also has a presence in many Mediterranean countries, especially Portugal and Italy, and has announced its intention to expand into the United States.

1 History
2 Expansion
- 2.1 Development in the 1980s
3 The creation of BBVA
4 External links

[edit] History

BBVA’s story began in 1857 when the Spanish Board of Trade sponsored the creation of Banco de Bilbao as a currency-issuing and discount bank. Until the 1890s it was practically the only bank in that part of Spain. In the second half of the 19th century Banco de Bilbao played a leading role in operations involving infrastructure projects and development of the steel industry. In 1878 it lost the right to issue currency and reorganised as lending and discount bank. Banco de Vizcaya was set up in 1901. It carried out its first operations in Bilbao and gradually extended throughout Spain. Apart from its activities as a commercial and general purpose bank, it intervened in the creation and development of a large part of Spanish industry. In 1902 Banco de Bilbao merged with Banco del Comercio although both continued to operate as separate entities. In 1909 Caja Postal was set up as a public entity and started operations in 1916, based on savings books. A consortium of bankers and manufacturers founded Banco de Crédito Industrial (BCI) in 1920 with the express aim of boosting the installation and consolidation of industry through long-term lending. Both Banco de Bilbao and Banco de Vizcaya formed part of this consortium. In 1923 the Servicio Nacional de Crédito Agrícola was created under the ministry of agriculture to provide loans to agricultural associations against the joint and several liability of their members. A combination of public and private interests set up Banco de Crédito Local (BCL) in 1925 in the form of a joint-stock company. Its purpose was to finance local authorities and other public institutions. Banco Exterior (BEX) was created in 1929 to encourage foreign trade, to seek new markets for Spanish products and to help local companies with importssand exports.

[edit] Expansion

Against a background of economic development in the 1960s, Banco de Bilbao grew further, absorbing other banks. At the same time Banco de Vizcaya also expanded and began to emerge as an important financial group. Greater flexibility by the authorities regarding new branches allowed it to extend its network. Caja Postal added current accounts, securities and specific credit lines to its existing services. The Banking Sector Reform Act 1962 nationalised BCI, BHE and BCL and converted the Servicio Nacional de Crédito Agrícola into Banco de Crédito Agrícola (BCA). All four thus became public entities. However in 1971 they were recast as joint stock companies and became official loan entities (under the Official Credit System Act).

[edit] Development in the 1980s

During the 1980s Banco de Bilbao’s strategy was to attain sufficient size in order to participate in financial operations generated by advances in technology, deregulation, securitisation and the interrelationship between domestic and international markets. Banco de Vizcaya contributed to the refloating of banks affected by the economic crisis and pursued a policy of strong growth through acquisitions. This turned it into a large banking group. The most important operation was the acquisition of Banca Catalana in 1984. In the meantime the official credit entities expanded their business through market operations. In 1982 BEX lost the exclusive right to provide export finance. It refocused its goals on becoming a universal bank and on building a financial group. During this process it acquired Banco de Alicante in 1983. In 1988 Banco de Bilbao and Banco de Vizcaya merged to form BBV.

Corporación Bancaria de España (CBE) was set up in 1991 as a government corporation and credit entity with bank status. Argentaria started out with a federated banking model. However in 1998 Corporación Bancaria de España (already privatised via IPOs), BEX (which had merged with BCI), BHE and Caja Postal were merged into a single bank: Argentaria.

[edit] The creation of BBVA

BBV and Argentaria announced their planned merger on October 19, 1999. The new group had the advantages of significant size, a strong capital base, a considerable financial structure and appropriate geographic diversification of its business and risks. As a result there was a greater profit potential.

Customers now had access to a larger network and a wider range of products. They also enjoyed easier access to new channels and a considerable international presence. Employees also had more opportunity for career advancement. The smooth integration of BBVA was attributed to the following:

the speed of strategic decisions
the immediate definition of the new organisation and a framework agreement with employees
the speed with which working groups were set up and plans were made for each area of activity
the successful achievement of ambitious timetables
the enthusiasm, commitment, effort and co-operative spirit

The integration process was given an important boost in January 2000 by the roll-out of the single BBVA brand. This helped the group generate an image that was strongly positioned in terms of identity and distinguishing characteristics.

The integration of the group's retail businesses in Spain (BBV, Argentaria, Banca Catalana, Banco del Comercio and Banco de Alicante) led to the creation of a significant branch network under the BBVA banner. The efficiency of the BBVA integration was recognised by top financial publications. In 2000 it was chosen World’s Best Bank (Forbes) and Best Bank in Spain (The Banker). In 2001, it was Best Bank in Latin America (Forbes) and Best European Bank (Lafferty).

In 2005, BBVA Group acquired Laredo, Texas based Laredo National Bank. In 2006 it acquired Texas Regional Bancshares and State National Bancshares to become the fourth biggest bank of Texas after Wells Fargo, Bank of America and JPMorganChase.

NYSE: BBV