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Value creation

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VALUE CREATION IS REFLECTED IN THE WHOLE OF THE GROUP’S BUSINESS LINES, CENTRED ON RETAIL AND PRIVATE BANKING, COMPANIES, THE SELF-EMPLOYED AND SMES.

All Bankia’s areas of work are committed to creating value for the group, a commitment which in 2018 was supported mainly by two factors: the resumption of various business activities once the restrictions imposed by the European Union in exchange for the financial aid were lifted; and the merger with BMN.

These two factors, coupled with new business strategies, digitisation, the consolidation of ongoing initiatives, balance sheet clean-up and compliance with the regulators’ requirements, among other things, were the drivers of value creation during 2018.

The range of business activities carried out during the previous five years was extended in 2018 with a return to the financing of real estate developers and companies with access to the capital markets.

Value creation is reflected in the whole of the group’s business lines, a model combining full-service banking with specialisation by segment.

After the integration of BMN, services to the farming sector have become one of the bank’s key business lines.

Retail Banking

This segment works to attract new customers and boost loyalty, cross-selling and satisfaction among existing customers. To do that, it offers products targeted to each customer segment, such as the ‘Cuenta_ON Nómina’ account, with no fees, for all digital customers. The bank also launched ‘Bankia Fácil’, a range of services designed to meet specific everyday needs and in 2018 positioned itself as the market leader in digital payment services, being the only Spanish bank with functionalities in all platforms.

Private Banking

In 2018, after MiFID II came into effect and due to the integration of the BMN network, Bankia Banca Privada opened its services to customers with a smaller volume of assets. The cut-off point was lowered, allowing a larger number of customers to take advantage of its services. The advisory model includes a wide range of products and services, in which portfolio management predominates. After the merger with BMN, three new Bankia Banca Privada branches were opened in BMN’s areas of influence: Murcia, Granada and Palma de Mallorca.

Self-employed

The number of specialised account managers in the self-employed segment was increased in 2018, with customer service being delivered in the customer’s place of work. As a result, both service quality and customer loyalty have improved. The events of the year include the launch of the ‘Business Pack’, which includes the ‘Siifacil app’, designed to help self-employed business people manage their invoices.

Agricultural Sector

After the integration of BMN, the agricultural sector has become one of Bankia’s core business lines. The group expanded its agreements for the management of farm subsidies under the Common Agricultural Policy (CAP), adapted its product catalogue and streamlined credit approval processes. .

SMEs

One of the bank’s main lines of work in relation to small and medium-sized enterprises (SMEs) has been providing them with the funds they need in order to undertake investment projects, through pre-approved financing. In 2018 the bank also worked on developing its product catalogue.

Businesses

Bankia focuses its efforts on designing financing programmes tailored to its customers’ business plans, aiming to provide them with, among other things, security and personalised advice. The bank has simplified its products and projects, in order to become more responsive and reduce costs.

In 2018 this segment went a step further in its commitment to putting the customer and customer satisfaction first, with the Business Centre directors and account managers acquiring customer experience certification. In Corporate Banking, the bank succeeded in increasing both its stock of loans and its market share. The growth of green or sustainable lending deserves special mention.

Capital Markets

The services the bank offers to companies include syndicated lending and structured finance, assistance in raising finance other than purely banking finance (bond issues), interest and exchange rate hedging, and financial advice.

Bankia took part in more than 100 syndicated loans during 2018 and led the structuring and underwriting of 15 acquisition finance transactions.

Bancassurance

In 2018 Bankia reorganised the insurance business acquired in the BMN merger. Various steps were taken during the year to equip the branch network with new tools for selling insurance and to implement digital initiatives.

Asset Management

In what was a complicated year for most markets, the efforts in asset management were centred on reinforcing the advisory business. The highlight in mutual funds was the new Bankia Gestión Experta service, which has strengthened the group’s positioning as a provider of financial advice. The asset management business continues to play a crucial role in generating fee and commission income, as the transfer of funds out of deposits into mutual funds continued in 2018 and is expected to persist in 2019.

Real Estate Assets

Since it was incorporated in the Corporate Credit Risk Directorate, the Property Management Directorate has channelled its efforts into improving the quality of information available and has built closer relations with other areas of the group, with a view to speeding up sales of foreclosed assets, which currently are ahead of the Strategic Plan.

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