US Markets

BBVA net profit up 3% thanks to Mexico and Spain, Turkey weak

Credit: REUTERS/HENRY ROMERO

Spain's BBVA said on Wednesday its second-quarter net profit rose 2.6% thanks to a stable performance in Mexico and Spain.

By Jesús Aguado

MADRID, July 31 (Reuters) - Spain's BBVA BBVA.MC said on Wednesday its second-quarter net profit rose 2.6% thanks to a stable performance in Mexico and Spain.

BBVA, Spain's second-largest bank, reported net profit of 1.28 billion euros ($1.4 billion) in the three months through June, above analysts' average forecast of 1.21 billion euros in a Reuters poll.

Net interest income (NII), a measure of earnings on loans minus deposit costs, rose 6% to 4.56 billion euros and was up 3% against the previous quarter. Analysts polled by Reuters had forecast NII of 4.4 billion euros.

Like domestic rival Santander SAN.MC, BBVA makes most of its profit overseas, a model that helped it withstand two recessions at home in recent years.

In Mexico, where it makes more than 40% of its net profit, net profit rose 4%. Without the apreciation of the Mexican peso, profit fell 3%.

However, political instability and economic recession in Turkey, where it makes around 9% of its profits, have dented group profitability. Second-quarter net profit in Turkey fell 18 percent to 140 million euros, it said.

The lira tumbled nearly 30 percent in 2018 as a currency crisis tipped Turkey's economy into recession. It has fallen another 5% this year against the dollar and it was down 4% in the second quarter.

In Spain, where it makes a quarter of its profits, the bottom line rose almost 14%.

Executives from BBVA are expected to face questions during the conference with analysts and at a press conference about a legal probe into an alleged spying case involving the lender.

($1 = 0.8965 euros)

(Reporting by Jesús Aguado Editing by Jose Elías Rodríguez and David Holmes)

((jesus.aguado@thomsonreuters.com; +34 91 585 8339; Reuters Messaging: Reuters Messaging: jesus.aguado.reuters.com@reuters.net))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Latest Markets Videos

    Reuters

    Reuters, the news and media division of Thomson Reuters, is the world’s largest international multimedia news provider reaching more than one billion people every day. Reuters provides trusted business, financial, national, and international news to professionals via Thomson Reuters desktops, the world's media organizations, and directly to consumers at Reuters.com and via Reuters TV.

    Learn More