1 Half 2004 Results

Banco Bilbao Vizcaya Argentaria SA
26 July 2004


                           Results: January - June 2004

           Attributable net income at BBVA rises 16.1% to 1,355 million euros


  • Operating profit grew 7.7% to 2,670 million euros following improvements
    in all recurrent margins and in all business areas

  • Return on equity (ROE) increased to 19.8%, compared to 19.3% one year ago.

  • The first interim dividend is 11.1% higher and earnings per share (EPS)
    are up 10.6%

  • The cost/income ratio improved by 1.7 points to 44.9% with advances in all
    business areas

  • The non-performing loan ratio fell to 1.11%, compared to 1.59% a year
    earlier and coverage has risen to 223%

  • The Group's asset position remains solid; the BIS ratio is 12% and core
    capital is 5.9%

  • Domestic businesses benefited from appropriate price management. Customer
    spreads were maintained despite the strong rise in activity and operating
    profit is growing faster - now at 17.2%.

  • In Retail Banking, lending is growing at 18% and customer funds at 8.9%.
    Operating profit in this area is up by 11% and attributable net income by
    13.7%

  • Wholesale and Investment Banking increased operating profit by 16.8% and
    attributable net income by 26.7%

  • The Americas increased attributable net income 49.8% in current euros and
    68.3% in terms of local currencies

  • In Mexico, growth in lending accelerated, operating profit increased 10.9%
    and net income rose 35% in local currency terms


        By June BBVA's attributable net income for the year came to 1,355
        million euros. This was 16.1% higher than the same period last year
        thanks to sustained acceleration in profitable business activity in
        Spain, to favourable development of businesses in the Americas and to
        highly positive results in the wholesale area. All recurrent margins
        grew faster and operating profit rose 7.7% to 2,670 million euros.
        Attributable net income for the quarter - 688 million euros - is the
        best in three years.

        BBVA closed the first half of the year with a substantial and sustained
        improvement in the main ratios. Return on equity (ROE) increased to
        19.8% (19.3% a year earlier); the cost/income ratio improved from 46.6%
        to 44.9%; the non-performing loan ratio fell to 1.11% (1.59% in June
        2003) with higher coverage of 223%; and the BIS ratio was held at 12%.
        In summary, the Group is enters the second half in a strong position, at
        a fast but smooth pace in terms of activity and results. It is firmly
        focused on profitable growth.

        The positive trend of the Group's results allowed the first interim
        dividend for 2004 to be increased by 11.1% to 0.10 euros. This was paid
        on 12th July.

        At the end of the first half, BBVA has presented high quality results
        with accelerated growth and improvements in all business areas. Here are
        some of the main aspects:


 1. Growth in attributable net income was supported by the positive trend in
    operating profit and the neutral effect of intermediate items on the income
    statement.

 2. Faster year-on-year growth of the more recurrent earnings with higher
    quarterly increases in all margins (net interest income, core revenues,
    ordinary revenues and operating profit) - even at current exchange rates.

 3. In all the Group's business areas (Retail Banking, Wholesale and Investment
    Banking and the Americas) the growth in operating profit in the second
    quarter and in the first half was higher than previous comparable periods.

        These results have been achieved as expectations of recovery in the
        world's economy improved, with noticeable growth in the United States,
        Japan, China and other emerging economies, and moderate reactivation in
        the European Union. The main Latin-American economies also appear poised
        for greater growth this year.

        These trends together with the inflationary impact arising from higher
        oil prices have increased expectations of a gradual rise in interest
        rates. Currency markets were quiet during the quarter although the
        year-on-year figures still reflect an important depreciation in
        Latin-American currencies and the US dollar, against the euro.

        The most relevant aspects of the BBVA Group in the first half of 2004
        are as follows:

  • Attributable net income in the second quarter came to 688 million euros.
    This is the highest quarterly figure in the last three years. It brings the
    half-year earnings to 1,355 million euros, a year-on-year increase of 16.1%
    (20.2% at constant exchange rates).

  • Earnings per share increased by 10.6%, ROE rose to 19.8% (19.3% in the
    first half of 2003) and ROA was 1.04%.

  • Thus operating profit in the second quarter rose to 1,391 million euros
    with year-on-year growth (10.2% at current exchange rates and 16.4% at
    constant rates) that was higher than growth in the first quarter (5.2% and
    12.5%, respectively). As a result, the figure for the first half, 2,670
    million euros, was higher than the first half of 2003 by 7.7% at current
    exchange rates and by 14.5% at constant rates.

  • Net interest income in the second quarter was high, rising to 1,835
    million euros compared to 1,684 million euros in the first quarter. This was
    due to dividends received (a seasonal effect) and to an improvement in core
    revenues (interest revenue less interest expense). Solid growth in the level
    of business activity, particularly in lending to the Spanish resident sector
    and in transactional deposits at the Latin-American units, is being more
    directly transformed into net interest income in a context of spreads that
    are higher than previous quarters.

  • Net fee income also improved compared to the first half of last year,
    growing by 3.3% at current exchange rates and by 9.4% at constant rates.
    This improvement extended to all business areas.

  • Costs were contained and fell 1.8% at current exchange rates while they
    increased 3.5% at constant rates. Together with higher revenues this meant
    that the cost/income ratio improved to 44.9%, compared to 46.6% in the first
    half of 2003, with improvements in all business areas.

  • In line with the improvements in other margins on the income statement,
    operating profit from domestic businesses rose 17.2% supported by
    appropriate management of prices in both Retail and Wholesale Banking. This
    helped to maintain spreads in the second quarter without hindering the
    strong increase in activity - especially in Retail Banking.

  • Retail Banking in Spain and Portugal resulted in higher growth in all
    items on the income statement compared to the first quarter. Year-on-year
    growth in lending was 18.0% and customer funds grew by 8.9%, while customer
    spreads were held steady. Core revenues increased in the half year by 5.4%
    (3.8% in the first quarter) supported by faster growth in net interest
    income (2.6% compared to 2.1% in the first quarter) and by net fee income
    (up 12.0% compared to 7.8% to March). The increase in revenues combined with
    control of operating overheads has improved the cost/income ratio by 2.1
    points to 43.1% (45.2% in the first half of 2003). It has also led to
    year-on-year increases of 11.0% in operating profit and 13.7% in
    attributable net income.

  • Wholesale and Investment Banking closed the second quarter with
    outstanding levels of operating profit and net income. The growth in all
    margins was also higher than in the first quarter. As in Retail Banking,
    customer spreads were maintained. Operating profit in the first half came to
    409 million euros (up by 16.8%) and attributable net income was 277 million
    euros (up by 26.7%). The record earnings figure demonstrates the high
    profitability and power of the Group's approach in the wholesale business.

  • Lending in the Americas (excluding Bancomer's old mortgage portfolio and
    problem debts) increased 15.8% in local currency and traditional
    fund-gathering, including repos placed through the branch network and mutual
    funds, increased by an average of 11.7% for all the banks. This meant that
    net interest income increased by 15.5% at constant exchange rates (7.7% in
    the first quarter). Net fee income grew 11.8% and expenses grew by 5.7%
    (lower than the figure of 7.7% for the first quarter). Therefore, despite
    lower net trading income, operating profit increased by 11.2% (9.7% to
    March). The most recurrent part of earnings - operating income less net
    trading income - grew 26.1%, demonstrating the quality of the latest
    results. Lower provisioning requirements following an improvement in the
    non-performing loan ratio, helped profit after tax to rise by 28.7%.
    Finally, the lower minority interests after the acquisition of Bancomer
    caused attributable net income to grow by 49.8% in current euros and by
    68.3% at constant exchange rates.

  • Mexico continues to add customers at high speed and lending is growing
    faster. This is based on profitable transactions and has resulted in net
    interest income increasing 14.3% at constant exchange rates. This is
    considerably higher than the 7.9% recorded in the first quarter. Despite the
    decline in net trading income compared to last year, operating profit grew
    10.9% in year-on-year terms and net income by 35.0%. With the decrease in
    minority interests, attributable net income in the half year is more than
    double the same period in 2003.

  • Risk quality at the Group continues to improve. As problem debt levels
    declined in all business areas and lending activity increased,
    non-performing loans as a percentage of total exposure fell in all areas to
    1.11% at 30-Jun-04 (it was 1.23% at 31-Mar-04 and 1.59% at 30-Jun-03). The
    increase in provisioning together with the above decline in problem loans
    resulted in an increase in coverage which rose to 223.4% (209.8% at
    31-Mar-04 and 183.8% at 30-Jun-03).

  • At the end of June the Group maintained its solid capital base: core
    capital was 5.9% (compared to 5.7% at 31-Mar-04, and in line with the target
    of 6.0% established for year end), Tier I capital was 8.0% and the BIS ratio
    12.0%.


  BBVA Group Highlights (Consolidated figures)                                                                        
                                                      30-06-04                30-06-03                         % (YoY) 
  BALANCE SHEET (millions of euros)
  Total assets                                         316,396                 277,874                            13.9
  Total lending (gross)                                165,634                 147,620                            12.2
  On-balance-sheet                                     195,986                 182,771                             7.2
  customer funds                                                                                                      
  Other customer funds                                 119,872                 112,024                             7.0
  managed                                                                                                             
  Total customer funds                                 315,858                 294,795                             7.1
  managed                                                                                                             
  Shareholders' funds                                   15,349                  13,126                            16.9
  (including profit for                                                                                               
  the year) (1)                                                                                                       

  INCOME STATEMENT(millions of euros)                      
  Net interest income                                    3,519                   3,348                             5.1
  Core revenues                                          5,169                   4,946                             4.5
  Ordinary revenues                                      5,443                   5,349                             1.8
  Operating profit                                       2,670                   2,479                             7.7
  Pre-tax profit                                         2,118                   1,873                            13.1
  Attributable net income                                1,355                   1,167                            16.1

  DATA PER SHARE AND MARKET CAPITALISATION                                                 
  Share price                                            10.98                    9.15                            20.0
  Market capitalisation                                 37,232                  29,242                            27.3
  (million euros)                                                                                                     
  Net attributable profit                                 0.40                    0.37                            10.6
  Book value                                              4.53                    4.11                            10.2
  PER (Price/earnings                                     14.2                    13.1                                
  ratio; times) (1)                                                                                                   
  P / BV (Price / Book                                     2.4                     2.2                                
  value ratio; times)                                                                                                 

  RELEVANT RATIOS (%)                                                                                                 
  Operating income / ATA                                  1.79                    1.82                                
  ROE (Attributable net                                   19.8                    19.3                                
  income / Average equity)                                                                                            
  ROA (Net income /                                       1.04                    1.10                                
  Average total assets)                                                                                               
  RORWA (Net income / Risk                                1.80                    1.87                                
  weighted assets)                                                                                                    
  Cost / income ratio                                     44.9                    46.6                                
  NPL ratio (Nonperforming                                1.11                    1.59                                
  assets/Total risks)                                                                                                 
  NPL coverage ratio                                     223.4                   183.8                                

  CAPITAL ADEQUACY RATIOS (BIS rugulations) (%)                                                                         
  Total                                                   12.0                    12.0                                
  Core capital                                             5.9                     6.0                                
  TIER I                                                   8.0                     8.1                                
  
  OTHER INFORMATION                                                                                                   
  Number of shares                                       3,391                   3,196                                
  (million)                                                                                                           
  Number of shareholders                             1,132,490               1,183,969                                
  Number of employees                                   84,958                  86,791                                
  . Spain                                               30,784                  31,275                                
  . America (2)                                         52,198                  53,464                                
  . Rest of the world                                    1,976                   2,052                                
  Number of branches                                     6,927                   6,968                                
  . Spain                                                3,361                   3,384                                
  . America (2)                                          3,376                   3,384                                
  . Rest of the world                                      190                     200                                

  N.B.: Non-audited data. Consolidated statements follow generally accepted 
        accounting principles of Bank of Spain Circular 4/91 and later 
        Circulars.
                                                                                  
  (1) The 1H04 PER is calculated taking into consideration the median of the                                          
      analysts' estimates (July 2004).                       

  (2) Including those relating to the BBVA Group' s banking and pension fund 
      management activities in all Latin-American countries in which it is 
      present.                                                                    

  Consolidated income statement                                                                                       
  (Million euros)                                                                                                     
                                              1H04                 % (YoY)                   1H03   Memorandum item:  
                                                                                                     % at constant    
                                                                                                    exchange rates    

  Financial revenues                         6,043                   (7.9)                   6,565              (2.3) 
  Financial expenses                       (2,908)                  (16.4)                 (3,480)             (11.5) 
  Dividends                                    384                    46.1                     263               47.6 

  NET INTEREST INCOME                        3,519                     5.1                  3,348                11.4 
  Net fee income                             1,650                     3.3                   1,598                9.4 

  CORE REVENUES                              5,169                     4.5                  4,946                10.7 
  Net trading income                           274                  (32.0)                     403             (28.8) 

  ORDINARY REVENUES                          5,443                     1.8                  5,349                 7.7 
  Personnel costs                          (1,579)                   (3.1)                 (1,629)                1.4 
  General expenses                           (866)                     0.5                   (862)                7.5 

  GENERAL ADMINISTRATIVE EXPENSES          (2,445)                   (1.8)                (2,491)                 3.5 
  Depreciation and amortization              (225)                  (12.8)                   (258)              (8.5) 
  Other operating income and expenses        (103)                  (14.9)                   (121)              (6.8) 
  (net)                                                                                                               

  OPERATING PROFIT                           2,670                     7.7                  2,479                14.5 
  Net income from companies accounted          156                    35.6                     115               37.2 
  for by the equity method                                                                                            
  Memorandum item: correction for            (230)                    26.2                   (182)               28.0 
  payment of dividends                                                                                                
  Amortization of goodwill                   (313)                     4.0                   (301)                4.0 
  Net income from Group transactions           307                    10.4                     278               10.4 
  Net loan loss provisions                   (514)                  (39.3)                   (847)             (36.4) 
  Net securities writedowns                      -                       -                      -                   - 
  Net extraordinary income (loss)            (188)                    n.m.                     149               n.m. 

  PRE-TAX PROFIT                             2,118                    13.1                  1,873                18.9 
  Corporate income tax                       (569)                    52.6                   (373)               64.1 

  NET PROFIT                                 1,549                     3.3                  1,500                 8.0 
  Minority interests                         (194)                  (41.7)                   (333)             (36.5) 
  . Preferred shares                         (103)                  (14.1)                   (120)             (14.1) 
  . Minority interests                        (91)                  (57.1)                   (213)             (50.9) 

  NET ATTRIBUTABLE PROFIT                    1,355                    16.1                  1,167                20.1 
 


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