BBVA says profit falls on higher debt provisions
BBVA, Spain's second-biggest bank, reported on Wednesday a 17.6-percent drop in second quarter net profit due to higher provisions for bad loans.
Net profit in the April-June period reached 1.29 billion euros (1.67 billion dollars), down from 1.56 billion euros in the year-earlier period, it said in a regulatory filing.
Analysts polled by Dow Jones Newswires expected second quarter net profit of 1.2 billion euros.
BBVA, which last week passed a stress test of European banks, booked provisions during the period of 250 million euros.
The bank's non-performing loan ratio fell to 4.2 percent from 4.3 percent in the previous quarter, its first decline since 2006, but was up from 3.2 percent in second quarter 2009.
During the first half of the year, BBVA posted a net profit of 2.53 billion euros, a 9.7 percent drop over the same time last year.
After stripping out one-off gains from asset sales last year, the decline was 4.4 percent, the bank said
In the first half, net profit generated in Spain and Portugal fell 2.2 percent to 1.19 billion euros but this was offset by a 12.9 percent jump in net earnings in South America to 453 million euros.
BBVA credited the positive performance in South America to a "faster rate of growth in the volume of business, the defense of spreads despite competitive pressure amd containment of costs at under the level of regional inflation."
© 2010 AFP