Quarterly Report dec 13

Balance Sheet
REPORTED RECLASSIFICATION
(Amounts in euros thousand)

31.12.13 31.12.13 Var %
Assets
Cash and balances with central banks 2,835,041 2,826,838 -0.3%
Financial assets held for trading 1,510,517 1,510,725 0.0%
Other financial assets at fair value through profit or loss 363,680 363,528 0.0%
Investment Portfolio 16,229,930 16,175,139 -0.3%
Loans and receivables 108,855,521 108,044,027 -0.7%
Loans and advances to other debtors 102,047,217 101,132,436 -0.9%
Other loans and receivables 5,428,249 5,531,536 1.9%
Of which interbank deposits 301,249 356,242 18.3%
Fixed Income 1,380,055 1,380,055 0.0%
Adjustments to financial assets on macro-hedging 159,571 159,571 0.0%
Hedging derivatives 578,761 579,029 0.0%
Non-current assets held for sale 6,300,549 6,296,601 -0.1%
Investments 841,555 1,254,265 49.0%
Insurance contracts linked to pensions 142,948 141,048 -1.3%
Reinsurance assets 14,462 16,362 13.1%
Tangible assets 1,879,085 1,835,903 -2.3%
Intangible assets 2,980,653 2,457,550 -17.5%
Tax assets 3,597,122 3,516,827 -2.2%
Other assets 1,562,298 1,531,634 -2.0%

Total Assets 147,851,693 146,709,047 -0.8%
Liabilities
Financial liabilities held for trading 954,284 954,426 0.0%
Other financial liabilities at fair value through profit or loss 601,367 601,367 0.0%
Finacial liabilities at amortised cost: 131,320,889 130,213,814 -0.8%
Liabilities of credit institutions 21,903,405 21,693,222 -1.0%
Of which interbank deposits 2,020,691 2,020,691 0.0%
Customer deposits 89,988,300 89,162,479 -0.9%
Debt certificates including bonds 16,282,375 16,282,375 0.0%
Subordinated liabilities 2,324,019 2,324,019 0.0%
Other financial liabilities 822,790 751,719 -8.6%
Hedging derivatives 1,473,749 1,473,749 0.0%
Insurance contract liabilities 372,981 385,476 3.4%
Provisions 533,456 532,964 -0.1%
Tax liabilities 546,854 550,826 0.7%
Other liabilities 421,311 370,054 -12.2%

Total liabilities 136,224,891 135,082,676 -0.8%

Equity
Total Equity 11,925,494 11,925,494 0.0%
Capital, reserves and retained earnings 11,600,195 11,600,195 0.0%
Profit or loss for the period 325,299 325,299 0.0%
Dividends paid and declared - -
Valuation adjustments (350,069) (350,500) 0.1%
Minority interests 51,377 51,377 0.0%

Net Asset Value 11,626,802 11,626,371 0.0%

Total liabilities and equity 147,851,693 146,709,047 (0.01)
Quarterly Report dec 13
Funds managed
(Amounts in euros thousand) REPORTED RECLASSIFICATION
31.12.13 31.12.13 Var %

Customer deposit:
General government 10,740,792 10,732,015 -0.08%

Other private sectors 72,925,795 72,111,152 -1.12%

Residents 64,380,436 63,595,104 -1.22%
Non residents 8,545,359 8,516,048 -0.34%

Valuation adjustments (+/-) 184,380 181,979 -1.30%

Subtotal customer deposits and General Government 83,850,967 83,025,146 -0.98%

Deposits at central counterparty entities 6,137,333 6,137,333 0.00%

Total customer deposits 89,988,300 89,162,479 -0.92%


Unadjusted debt certificates including bonds: 15,917,942 15,917,942 0.00%

Bonds and other securities outstanding 14,922,018 14,922,018 0.00%
Commercial paper 995,924 995,924 0.00%

Valuation adjustments (+/-) 364,433 364,433 0.00%

Total debt certificates including bonds 16,282,375 16,282,375 0.00%

Subordinated liabilities 2,324,019 2,324,019 0.00%

Total on-balance sheet funds (a) 108,594,694 107,768,873 -0.76%

Mutual funds 8,507,023 8,341,528 -1.95%
Asset portfolio management 766,098 764,781 -0.17%
Pensions funds 5,208,637 5,038,528 -3.27%
Insurance premiums 1,890,966 1,808,398 -4.37%

Total other intermediated funds (b) 16,372,724 15,953,235 -2.56%

Total funds managed (a+b) 124,967,418 123,722,108 -1.00%
Retail funds
(Amounts in euros thousand) 31.12.13 31.12.13 Var %

Demand deposits 24,006,682 23,672,095 -1.39%
Time deposits 50,757,994 50,277,210 -0.95%
Asset repos 8,387,588 8,387,588 0.00%
Other accounts and valuation adjustments 698,703 688,253 -1.50%
Subtotal customer deposits 83,850,967 83,025,146 -0.98%
Retail commercial paper 653,741 436,259 -33.27%
ICO Mediation loans 6,737,934 6,666,768 -1.06%
Securitizationssold to third parties 534,312 534,312 0.00%
Marketable securities distributed through the branch network1 1,165,071 1,165,059 0.00%
Tax collection accounts 354,010 349,353 -1.32%
Asset repos -8,387,588 (8,387,588) 0.00%
Total Retail Funds 84,908,447 83,789,309 -1.32%
Quarterly Report dec 13
Lending to customers
(Amounts in euros thousand) REPORTED RECLASSIFICATION
31.12.13 31.12.13 Var %

Lending to general government 1,594,489 1,565,801 -1.80%

Lending to other private sectors 108,095,776 107,213,243 -0.82%

Residents 98,198,564 97,337,158 -0.88%
Non residents 9,897,212 9,876,085 -0.21%

Total lending to customers 109,690,265 108,779,044 -0.83%

Other loans 249,005 246,826.0 -0.88%

Total lending to customers and others 109,939,270 109,025,870 -0.83%

Valuation adjustments (+/-) (7,892,053) (7,893,434) 0.02%

Total 102,047,217 101,132,436 -1.80%
Lending to customers by type
(Amounts in euros thousand) 31.12.13 31.12.13 Var %

Trade loans and discounts 3,431,472 3,370,774 -1.77%
Secured loans 43,507,014 43,005,888 -1.15%
Mortgage 42,536,531 42,040,253 -1.17%
Other 970,483 965,635 -0.50%
Repos 7,102,146 7,102,146 0.00%
Term loans and other lending 32,777,653 32,487,641 -0.88%
Leasing 2,358,455 2,322,267 -1.53%
Doubtful assets 20,762,530 20,737,154 -0.12%

Total lending to customers 109,939,270 109,025,870 -0.83%
Quarterly Report dec 13
Risk Management Performance
REPORTED RECLASSIFICATION
(Amounts in euros thousand)
31.12.13 31.12.13
Non performing loans

Balance at 1 January 13,976,733 13,935,871
Additions 12,743,770 12,741,977
Recoveries 3,661,402 3,638,061
Other changes * - -
Net variation 9,082,368 9,103,916
% increase 65.0 65.3
Write-offs (1,833,660) (1,823,784)
Balance at the end of the period 21,225,441 21,216,003
* In 2012 basically Banco Pastor

31.12.13 31.12.13
Allowance for credit losses
Balance at 1 January 9,146,044 9,128,749
Annual provision
Gross 7,799,992 7,761,615
Recoveries (6,299,163) (6,281,448)
Net 1,500,829 1,480,167
Other variations * (291,731) (261,743)
Writte-offs (1,830,526) (1,821,174)
Balance at the end of the period 8,524,616 8,525,999
Of which sub-standard risk provisions 924,249 925,757
* In 2012 basically Banco Pastor

31.12.13 31.12.13
Risk quality measures (%):

Total risks 148,332,106 147,870,882.00

Nonperformance (Nonperforming loans/ Total risks) 14.31 14.35
Credit risk premium 1.12 1.11
Typical spread on lending to customers 1.90 1.88
Quarterly Report dec 13
Consolidated income and profitability
REPORTED RECLASSIFICATION REPORTED RECLASSIFICATION
31.12.13 31.12.13 Var % 31.12.13 31.12.13 Var.

Interest and similar income 4,917,044 4,862,997 -1.10% 3.20 3.16 (0.04)
- Interest expense and similar charges 2,469,961 2,451,532 -0.75% 1.61 1.59 (0.02)
=Net interest income 2,447,083 2,411,465 -1.46% 1.59 1.57 (0.02)
+ Return on equity instruments 17,793 17,790 -0.02% 0.01 0.01 -
+Share of results of entities accounted for using -
the equity method 33,955 32,264 -4.98% 0.02 0.03 0.01
+Net fees and commissions 769,921 759,259 -1.38% 0.50 0.49 (0.01)
Gains or losses on financial assets and liabilities (net) 462,106 461,101 -0.22% 0.30 0.30 -
Exchange differences (net) 53,376 52,420 -1.79% 0.04 0.03 (0.01)
+Other operating profits (77,584) (77,681) 0.13% (0.05) (0.05) -
=Gross operating income 3,706,650 3,656,618 -1.35% 2.41 2.38 (0.03)
-Administrative expenses: 1,600,678 1,572,559 -1.76% 1.04 1.02 (0.02)
Personnel expenses 946,661 929,110 -1.85% 0.61 0.60 (0.01)
Other general administrative expenses 654,017 643,449 -1.62% 0.43 0.42 (0.01)
- Depreciation & amortisation 152,113 150,622 -0.98% 0.10 0.10 -
= Net Operating Income (Pre-provision Profit) 1,953,859 1,933,437 -1.05% 1.27 1.26 (0.01)
-Financial asset impairment losses (net) 1,274,760 1,254,232 -1.61% 0.83 0.82
-Impairment of other assets (net) 1,183,426 1,181,921 -0.13% 0.77 0.76
Gains/ (Losses) on assets held for sale (net) 963,798 962,020 -0.18% 0.63 0.62
=Profit before tax 459,471 459,304 -0.04% 0.30 0.30 -
- Income tax 131,322 131,155 -0.13% 0.09 0.09 -
+Profit/ Loss from discontinued operations (net) - - - - -
=Consolidated profit for the year 328,149 328,149 0.21 0.21 -
- Profit/ Loss attributed to minority interests 2,850 2,850 - - -
=Profit/ Loss attributed to the controlling company 325,299 325,299 0.21 0.21 -
(Amounts in euros thousand) (Annualized % of ATA)
Quarterly Report dec 13
Quarterly P&L
(Amounts in euros thousand)
I II III IV I II III IV

Interest and similar income 1,296,640 1,276,911 1,213,844 1,129,649 1,283,645 1,263,096 1,200,098 1,116,158
- Interest expense and similar charges 704,071 617,010 610,153 538,727 699,148 612,339 605,436 534,609
=Net interest income 592,569 659,901 603,691 590,922 584,497 650,757 594,662 581,549
+ Return on equity instruments 5,539 5,053 3,615 3,586 5,539 5,053 3,612 3,586
+Share of results of entities accounted for using
the equity method 4,922 6,731 10,074 12,228 5,500 8,563 6,474 11,727
+Net fees and commissions 190,285 197,767 194,771 187,098 187,889 195,088 191,642 184,640
Gains or losses on financial assets and liabilities (net) 41,821 134,658 157,461 128,166 41,777 134,153 157,194 127,977
Exchange differences (net) 12,490 13,641 14,530 12,715 12,344 13,462 14,192 12,422
+Other operating profits (20,192) (17,087) 6,910 (47,215) (20,366) (17,082) 6,929 (47,162)
=Gross operating income 827,434 1,000,664 991,052 887,500 817,180 989,994 974,705 874,739
-Administrative expenses: 386,018 393,434 392,336 428,890 379,534 386,598 385,031 421,396
Personnel expenses 230,707 236,248 234,711 244,995 226,440 231,748 230,398 240,524
Other general administrative expenses 155,311 157,186 157,625 183,895 153,094 154,850 154,633 180,872
- Depreciation & amortisation 36,479 39,528 38,628 37,478 36,103 39,150 38,270 37,099
= Net Operating Income (Pre-provision Profit) 404,937 567,702 560,088 421,132 401,543 564,246 551,404 416,244
-Financial asset impairment losses (net) 249,654 252,874 314,178 458,054 246,670 248,707 304,495 454,360
-Impairment of other assets (net) 198,887 278,455 180,447 525,637 198,896 278,376 180,152 524,497
Gains/ (Losses) on assets held for sale (net) 194,654 47,014 9,476 712,654 194,586 45,306 9,483 712,645
=Profit before tax 151,050 83,387 74,939 150,095 150,563 82,469 76,240 150,032
- Income tax 46,385 16,444 17,563 50,930 45,898 15,526 18,864 50,867
+Profit/ Loss from discontinued operations (net) - - - -
=Consolidated profit for the year 104,665 66,943 57,376 99,165 104,665 66,943 57,376 99,165
- Profit/ Loss attributed to minority interests 443 805 507 1,095 443 805 507 1,095
=Profit/ Loss attributed to the controlling company 104,222 66,138 56,869 98,070 104,222 66,138 56,869 98,070
2013 2013
REPORTED RECLASSIFICATION
Quarterly Report dec 13
Quarterly profitability
(Amounts in % ATA, rates annualized)
I II III IV I II III IV

Interest and similar income 3.33 3.25 3.16 3.04 3.30 3.21 3.13 3.01
- Interest expense and similar charges 1.81 1.57 1.59 1.45 1.80 1.55 1.59 1.43
=Net interest income 1.52 1.68 1.57 1.59 1.50 1.66 1.54 1.58
+ Return on equity instruments 0.01 0.01 0.01 0.01 0.01 0.01 0.01 0.01
+Share of results of entities accounted for using
the equity method 0.01 0.02 0.03 0.03 0.01 0.02 0.02 0.03
+Net fees and commissions 0.49 0.50 0.51 0.50 0.48 0.50 0.50 0.50
Gains or losses on financial assets and liabilities (net) 0.11 0.34 0.41 0.35 0.11 0.34 0.41 0.34
Exchange differences (net) 0.03 0.04 0.04 0.04 0.03 0.03 0.04 0.03
+Other operating profits (0.05) (0.04) 0.01 (0.13) (0.05) (0.04) 0.02 (0.13)
=Gross operating income 2.12 2.55 2.58 2.39 2.11 2.53 2.55 2.35
-Administrative expenses: 0.99 1.00 1.02 1.16 0.98 0.99 1.01 1.13
Personnel expenses 0.59 0.60 0.61 0.66 0.58 0.59 0.60 0.65
Other general administrative expenses 0.40 0.40 0.41 0.50 0.40 0.40 0.40 0.48
- Depreciation & amortisation 0.09 0.10 0.10 0.10 0.09 0.10 0.10 0.10
= Net Operating Income (Pre-provision Profit) 1.04 1.45 1.46 1.13 1.04 1.44 1.44 1.12
-Financial asset impairment losses (net) 0.64 0.65 0.82 1.23 0.64 0.64 0.80 1.22
-Impairment of other assets (net) 0.51 0.71 0.47 1.42 0.51 0.71 0.47 1.41
Gains/ (Losses) on assets held for sale (net) 0.50 0.12 0.02 1.92 0.50 0.12 0.02 1.92
=Profit before tax 0.39 0.21 0.19 0.40 0.39 0.21 0.20 0.40
- Income tax 0.12 0.04 0.04 0.13 0.12 0.04 0.05 0.13
+Profit/ Loss from discontinued operations (net) - - - - - - - -
=Consolidated profit for the year 0.27 0.17 0.15 0.27 0.27 0.17 0.15 0.27
- Profit/ Loss attributed to minority interests - - - - - - - -
=Profit/ Loss attributed to the controlling company 0.27 0.17 0.15 0.27 0.27 0.17 0.15 0.27
2013 2013
REPORTED RECLASSIFICATION
Quarterly Report dec 13
Yields and Costs
(Amounts in %, rates annualized)
31.12.13 31.12.13

Average
balance
Weight (%)
Income or
expense
Average
balance
Weight (%)
Income or
expense
Average
rate (%)
Financial system 6,024,590 3.92 31,376 0.52 6,144,923 4.00 31,228 0.51
Loans and discounts (a) 102,819,684 66.84 4,197,631 4.08 102,571,610 66.74 4,144,523 4.04
Securities portfolio 24,747,742 16.09 680,494 2.75 24,727,793 16.09 679,716 2.75
Other assets 20,238,218 13.15 7,543 0.04 20,242,716 13.17 7,530 0.04
Total earning assets (b) 153,830,234 100.00 4,917,044 3.20 153,687,042 100.00 4,862,997 3.16
Financial system 27,529,487 17.90 367,210 1.33 27,471,058 17.87 364,225 1.33
Customer funds (c) 90,741,778 58.99 1,558,415 1.72 89,752,897 58.40 1,543,155 1.72
Demand accounts 15,946,000 10.37 72,616 0.47 15,734,639 10.24 71,752 0.46
Savings and time deposits 67,495,030 43.87 1,387,692 2.06 66,717,510 43.41 1,373,296 2.06
Deposits at central counterparty entities 5,289,585 3.44 18,408 0.35 5,289,585 3.44 18,408 0.35
Retail commercial paper 2,011,163 1.31 79,699 3.96 2,011,163 1.31 79,699 3.96
Marketable debt securities & other 19,101,041 12.41 531,390 2.78 19,105,219 12.43 531,390 2.78
Other interest-bearing liabilities 367,608 0.24 12,946 3.52 367,572 0.24 12,762 3.47
Other funds 5,156,571 3.35 - - 6,057,568 3.94 - -
Equity 10,933,749 7.11 - - 10,932,727 7.11 - -

Total liabilities and equity (d) 153,830,234 100.00 2,469,961 1.61 153,687,042 100.00 2,451,532 1.60

Customer spread (a-c) 2.36 2.32
Net Interest Margin (b-d) 1.59 1.57
REPORTED RECLASSIFICATION
Average rate
(%)
Quarterly Report dec 13
Quarterly Yields and Costs
(Amounts in %, rates annualized)
Weight Yield Weight Yield Weight Yield Weight Yield Weight Yield Weight Yield Weight Yield Weight Yield

Financial system 3.61 0.45 3.99 0.43 4.07 0.44 4.00 0.77 3.64 0.44 4.03 0.43 4.18 0.42 4.14 0.75
Loans and discounts (a) 67.08 4.23 66.13 4.15 66.87 4.04 67.32 3.90 66.99 4.19 66.05 4.11 66.82 3.99 66.92 3.87
Securities portfolio 16.69 2.81 17.15 2.81 15.79 2.75 14.64 2.61 16.70 2.81 17.16 2.80 15.79 2.75 14.58 2.61
Other assets 12.62 0.04 12.73 0.04 13.27 0.04 14.04 0.04 12.67 0.04 12.77 0.04 13.21 0.04 14.37 0.04
Total earning assets (b) 100.00 3.33 100.00 3.25 100.00 3.16 100.00 3.04 100.00 3.30 100.00 3.21 100.00 3.13 100.00 3.01

Financial system 19.11 1.37 18.76 1.27 17.70 1.27 15.92 1.44 19.09 1.36 18.73 1.27 17.68 1.26 15.84 1.43
Customer funds (c) 56.66 1.99 58.42 1.74 59.67 1.69 61.31 1.45 56.25 1.99 57.92 1.74 59.20 1.69 60.13 1.46
Demand accounts 9.75 0.45 10.05 0.45 10.40 0.45 11.30 0.54 9.65 0.45 9.92 0.45 10.27 0.45 11.13 0.47
Savings and time deposits 40.66 2.35 43.46 2.10 45.36 2.04 46.16 1.74 40.35 2.35 43.09 2.10 45.02 2.04 45.16 1.77
Deposits at central counterparty entities 3.29 0.29 3.74 0.39 3.28 0.40 3.44 0.32 3.29 0.29 3.74 0.39 3.29 0.40 3.43 0.32
Retail commercial paper 2.96 4.03 1.17 3.97 0.63 3.76 0.41 3.35 2.96 4.03 1.17 3.97 0.63 3.76 0.41 3.35
Marketable debt securities & other 12.85 3.16 12.37 2.46 12.43 2.77 12.01 2.73 12.86 3.16 12.38 2.46 12.44 2.77 12.00 2.73
Other interest-bearing liabilities 0.25 3.90 0.24 3.34 0.23 3.27 0.23 3.55 0.25 3.87 0.24 3.31 0.23 3.33 0.23 3.34
Other funds 4.25 - 3.34 - 2.90 - 3.00 - 4.67 - 3.86 - 3.37 - 4.28 -
Equity 6.88 - 6.87 - 7.07 - 7.53 - 6.88 - 6.87 - 7.08 - 7.52 -

Total liabilities and equity (d) 100.00 1.81 100.00 1.57 100.00 1.59 100.00 1.45 100.00 1.80 100.00 1.55 100.00 1.59 100.00 1.43
Customer spread (a-c) 2.24 2.41 2.35 2.45 2.20 2.36 2.30 2.41
Net Interest Margin (b-d) 1.52 1.68 1.57 1.59 1.50 1.66 1.54 1.58
REPORTED RECLASSIFICATION
III
2013 2013
IV IV I I II III II
Quarterly Report dec 13
Net fees and commision income
(Amounts in euros thousand)
REPORTED RECLASSIFICATION
31.12.13 31.12.13 Var % 31.12.13 31.12.13
Banking services 735,130 724,468 -1.45% 95.5 95.4
Portfolio administration 95,198 94,868 -0.35% 12.4 12.5
Securities portfolios 28,169 28,101 -0.24% 3.7 3.7
Asset portfolio management 3,714 3,714 0.00% 0.5 0.5
Mutual funds 45,836 45,758 -0.17% 5.9 5.9
Pension plans 17,479 17,295 -1.05% 2.3 2.3
Other banking services 537,687 529,686 -1.49% 69.8 69.8
Securities and foreign currency purchase and sale 11,756 11,644 -0.95% 1.5 1.5
Demand account administration 114,550 112,703 -1.61% 14.9 14.8
Provision of collateral and other guarantees 148,368 146,413 -1.32% 19.3 19.3
Asset transaction services 40,373 39,089 -3.18% 5.2 5.1
Collection and payment handling 81,610 80,340 -1.56% 10.6 10.6
Other 141,030 139,497 -1.09% 18.3 18.4
Means of payment 102,245 99,914 -2.28% 13.3 13.2
Defaults 34,791 34,791 0.00% 4.5 4.6

Total 769,921 759,259 -1.38% 100.0 100.0
Weights %
Quarterly Report dec 13
Personnel and general expenses
(Amounts in euros thousand)
REPORTED RECLASSIFICATION
31.12.13 31.12.13 Var% 31.12.13 31.12.13
Personnel expenses: 946,661 929,110 -1.85% 59.1 59.1
Wages and salaries 707,801 694,632 -1.86% 44.2 44.2
Social security charges 179,002 175,707 -1.84% 11.2 11.2
Other personnel expenses 29,393 28,873 -1.77% 1.8 1.8
Pensions 30,465 29,898 -1.86% 1.9 1.9
General expenses 654,017 643,449 -1.62% 40.9 40.9
Rents and commons services 147,550 145,122 -1.65% 9.2 9.2
Communications 33,106 32,598 -1.53% 2.1 2.1
Maintenance of premises equipment 51,303 50,810 -0.96% 3.2 3.2
IT and other technical expenses 153,660 151,541 -1.38% 9.6 9.6
Stationery and office supplies 8,135 7,912 -2.74% 0.5 0.5
Technical reports and legal expenses 41,418 41,125 -0.71% 2.6 2.6
Advertising and publicity 32,879 31,711 -3.55% 2.1 2.0
Insurance 8,101 7,743 -4.42% 0.5 0.5
Security and fund transport services 23,035 22,754 -1.22% 1.4 1.4
Travel 9,210 8,902 -3.34% 0.6 0.6
VAT and others 121,590 119,587 -1.65% 7.6 7.6
Other general expenses 24,030 23,644 -1.61% 1.5 1.5
Total 1,600,678 1,572,559 -1.76% 100.0 100.0
Weights %