Acquisition

Banco Bilbao Vizcaya Argentaria SA
16 September 2004


BBVA, S.A. communicates that its subsidiary company in Mexico, BBVA BANCOMER,
has reached an agreement to buy the 100% of the mexican company HIPOTECARIA
NACIONAL, the biggest privately-owned financial institution in Mexico
specialised in the mortgage business. The total investment is USD 375 million.
The agreement will be effective once it has all the administrative permits
required.


A press release on the agreement reached is attached.



                                                    Madrid, September 16th, 2004

                                                                   Press release

                                                            September 16th, 2004


 BBVA Bancomer goes for the Mexican mortgage market, announcing its purchase of
                              Hipotecaria Nacional


  • Hipotecaria Nacional is the biggest privately-owned mortgage lender in
    Mexico, with a loan portfolio worth over 2.15 billion dollars

  • According to official estimates, approximately 20 million new homes will
    be built in Mexico over the next 25 years.

  • With this operation, BBVA Bancomer consolidates its leadership of the
    Mexican home-mortgage market.


    BBVA Bancomer has reached an initial agreement to buy 100% of Hipotecaria
    Nacional (HN), the biggest privately-owned financial institution in Mexico
    to specialise in the mortgage business. With this operation, BBVA Bancomer
    consolidates its leadership of the private Mexican mortgage market. The
    operation upholds two basic tenets of BBVA's strategy for profitable growth:
    creating shareholder value as of day one and making sense in terms of its
    overall strategy. The total investment is 375 million dollars (4.3 billion
    pesos), to be financed with BBVA Bancomer's own funds.

    HN is a Sofol, a non-banking financial institution (Sociedad Financiera de
    Objeto Limitado), with a loan-book worth 2.15 billion dollars (24.8 billion
    pesos). There are currently 17 Sofols operating in Mexico, managing a
    portfolio of over 7 billion dollars (80.5 billion pesos), such that HN's
    share of its market segment is above 29%.

    The organisation, which will be incorporated into the BBVA Bancomer
    business, has 950 employees and 79 branches reporting to 10 regional
    divisions. In 2003, HN reported a net attributable profit of 48 million
    dollars (552 million pesos), with a 34% return on equity, one of the highest
    ROEs in its sector, and a NPL ratio of scarcely 1.1%, half the industry's
    average.

    Recently, HN has opened branches in New York and San Diego (California) to
    handle the business of Mexican emigrants in the USA wishing to finance
    property purchases in their home country. It is planning to open similar
    offices in Los Angeles and Chicago.


    Sustained Growth and Excellent Prospects

    In 2003, 489,000 home purchases were financed in Mexico, while it is
    estimated that some 575,000 units will be financed in 2004, 95% of them
    newly built.

    In fact, looking at housing trends world-wide for the next 25 years, Mexico
    seems set to be one of the fastest growers. Official Mexican-government
    estimates forecast that over 20 million new homes will be built over that
    period.

    The future growth of the Mexican housing market is predicated on the current
    shortage of homes; a rapidly growing population and government plans to
    support building projects.

    Moreover, low short- and long-term interest rates and an increasingly
    regulated mortgage market will enable financial institutions to further
    increase their presence in mortgage lending.


    Leadership in the Mortgage Market

    With this operation, BBVA Bancomer will consolidate its leadership in the
    private mortgage market in Mexico.

    HN will provide BBVA Bancomer with a broad portfolio of business and
    customers -more than 90,000-and a specialist team of professionals, vital to
    the growth of the leading Mexican financial institution in this business
    area. Furthermore, once HN is incorporated into BBVA Bancomer, it will be
    able to give its customers access to better and broader-ranging services
    with various and new lending lines.

    'We are very satisfied with the purchase, as it ratifies our leadership in
    the mortgage business, which in coming years is definitely going to be one
    of the most dynamic components in the Mexican economy,' declared Jaime
    Guardiola, deputy chairman and general manager of BBVA Bancomer.

    'It is a great chance to integrate our professional team within the
    structure of BBVA Bancomer, because its financial power will allow us to
    grow faster as a mortgage lender and because it will help us to offer even
    better services to our customers ,' said Victor Manuel Requejo, HN general
    manager.

    BBVA Bancomer's purchase of HN is due to be completed before the first
    quarter of 2005, pending due diligence proceedings and regulatory permits.





                              Hipotecaria Nacional

                                   Highlights


  • 950 employees

  • 79 branches

  • 29% market share among Mexican non-banking financial institutions
    (Sofoles)

  • Loan-book of 2.15 billion dollars

  • Over 90,000 customers

  • 2003 net profit: US$48 million
  • ROE: 34%

  • ROA: 2.5%

  • NPL Ratio: 1.1%





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