Good morning everyone, and welcome to the second edition of BBVA Strategic Talks. Apologies, we got started with some delay due to the traffic. It has been particularly bad today in Madrid. In any case, it is a pleasure to have you all with us today here, both in Madrid and virtually. Thank you very much for joining us. As you can see on the screen, we have a great agenda for today. We will start with one of our key strategic priorities. It is artificial intelligence, data, and technology. For this session, I will be joined by Antonio Bravo, Global Head of AI Transformation, and by Carlos Casas, Global Head of Engineering. Then we will turn to Spain, one of our main markets, where Peio Belausteguigoitia, Country Head of BBVA Spain, will share with us how we are bringing this strategy to life in one of our core franchises.
The session will have two parts, first, a presentation from our speakers, and then a live Q&A. We very much encourage you to participate and make the most of this session. With that, it is my pleasure to hand over to our Chair, Carlos Torres Vila, for our initial remarks. Thank you very much. Carlos, the floor is yours.
Thank you. Thank you, Patricia, and welcome to our second edition of BBVA Strategic Talks. Welcome, and thank you very much for joining. Apologies again for the slight delay due to traffic. The sessions, as Patricia just said, are designed to give you a deeper view of BBVA's strategic priorities, which as way of reminder you have here on the screen, to embed into everything we do, a radical client perspective, to leverage sustainability for growth, scaling up the enterprise segment, promoting a value and capital creation mindset throughout the entire organization, unlocking the potential of AI and technology and data, and then finally, a team embedded with empathy to succeed. In the first edition of the BBVA Strategic Talks, we covered the enterprise segment. We also covered the Mexico business. Today, we will, as you know, talk about AI and technology as well as the Spanish business.
Let me start with a simple conviction, which is that AI gives us an extraordinary opportunity to create value for our clients, for our customers, and through that, for our shareholders. Capabilities, as we are all seeing, are advancing extremely fast at breakneck speed. AI agents can increasingly reason, understand context, execute complex tasks. With each improvement, we see how this expands what we can do. How we serve customers, how we operate, how we manage risks, how we build code. So across the bank, it expands what we can do because banking is particularly well-suited to this transformation. Financial decisions depend heavily on context, so your circumstances, your goals, your needs, the needs of your business, and these can be complex. Managing your finances often takes more time and effort than it should.
With AI, we can address all three, understand context better, make complex decisions easier, and help customers get things done with less time and less effort. Therefore, our ambition is a bank that understands each customer, anticipates their needs, and helps them act. More relevant advice, more personalized solutions, a simpler, more effortless experience for individuals and for businesses alike. For a business, that could mean anticipating cash flows, it could mean managing working capital better. It could mean navigating the complexity of international trade, for example, with advice tailored to that business and its circumstances. That's towards the client, but then inside the bank, AI multiplies our capacity. It is helping our bankers prepare better for conversations and to prepare better conversations, our developers to deliver solutions faster, our teams to complete processes with less administrative work, including fully automated workflows managed by AI agents.
This all means more capacity, more capacity to serve customers, to develop new services, and to grow with a more productive operating model. Of course, we should also be clear about the competitive implications that this will have. AI will make it easier, no doubt, for customers to compare alternatives. It will raise expectations. It will intensify competition. It will put pressure on margins. So part of the value of the increased productivity will go to customers through better service, through more competitive offers. Increasingly, the better players, like BBVA, will gain disproportionate share in economics. So we intend to lead that process, use AI to deliver greater customer value, deepen relationships, and win more business while improving our cost to serve. That is how we aim to turn this transformation into sustainable growth and attractive returns. Now, the critical question is execution.
There's already a substantial gap between what the technology can do, which grows ever faster, and what most organizations have deployed. So a successful pilot is one thing, but integrating AI into real processes, connecting it to data, to systems in a secure, reliable way, and operating all of it reliably at scale is much, much harder. This is where we believe BBVA is particularly well-positioned. First, we have strong foundations. We have lots of data, we have engineering talent, we have millions of digital customers who trust us and with whom we have developed deep customer relationships, strong foundations. Second, we have demonstrated that we can do this, that we can transform successfully, leading the industry. We moved early and decisively in digital, as you well know. We changed dramatically how we work internally.
We turned that transformation into a competitive advantage, which lasts, as we can see in our performance metrics. Third, we're making AI a priority across the whole organization with the same conviction that drove our digital transformation. That conviction is not just some theoretical abstract concept. It's something that translates into concrete choices, how we organize, where we invest, the talent we dedicate, the partnerships we build. It means being willing to change priorities and redesign how the bank works. We're obviously focusing on the areas with the greatest potential first, greatest potential impact, driving adoption across our teams and building the capabilities to scale. You will see some examples today, including early results from our priority initiatives.
Antonio will cover them, and he will also explain The Frame, which is the common foundation we are building to create, deploy, and manage AI agents across BBVA with security and control and accountability built in. This means defining what each agent can access, what each agent can do, when human approval is required, and how we monitor performance. Actually defining what performance is, what good is, and then monitoring each and every execution, not only to ensure that it is within the bounds we want, but to keep improving. This matters, this frame, this scaling, this common ground matters because our ambition extends across the whole bank. We need to rethink processes, priorities, ways of working, and to make successful solutions reusable across countries. Scaling is the name of the word. We have use cases, but scaling through this common platform is the critical point.
Our starting position is strong. We have now to earn the advantage through execution. After Antonio, Carlos will explain how our technology is evolving to support that ambition of delivering change faster with the resilience and security our customers expect. Finally, Peio will take you through Spain, which is well-connected. Spain illustrates really well how sustained transformation can strengthen the franchise. It also shows the opportunity ahead, deeper customer relationships, more effective bankers, and greater productivity, building on what we have already achieved. By the end of today, I hope you will have a clear view of the opportunity we see, the capabilities we are building, and how we intend to turn them into value. We have done this before. We understand what it takes, and we are determined to lead again. Thank you and welcome, and I turn it over to Antonio.
Thank you very much, Patricia. We will now start the first session focused on AI transformation and technology. Joining me on the stage are Antonio Bravo, Carlos Casas, and our CFO, Gonzalo Rodríguez. Without further delay, Antonio, the floor is yours.
Thank you very much, Patricia, and good morning, everyone. Today, I am going to walk you through three sections of content. I will start by setting the context of this very transformational wave that we are living, to then go deep into our strategy and the progress that we have made so far, and I will conclude with some final remarks. Going into the first section and talking about the opportunity that we see ahead of us, the first reflection is that if you look at what happens in an industry like ours, the fundamentals are very much reliant on data and analytical models. Across the value chain, in all customer journeys and different segments, everything has data and analytical models underneath, customer onboarding, cross-selling, credit underwriting.
The foundations of our business are very analytical driven, and that's why we believe that this new wave of transformation that comes with AI presents a huge opportunity for a business like ours because it can be very transformative in the way we manage and relate with clients. It can make our experiences more personalized, more tailored. It can also bring greater transparency for the clients. In terms of processes, it enables faster execution and processes, which will also result into a better experience of our clients. It will also have a dramatic way in the way our employees work and in their productivity. We believe that AI brings abundance to all these three dimensions. It makes easy what typically was complex. It makes fast what typically used to take a lot of time. It can parallelize efforts that used to be sequential.
Everything in banking can be rethink through AI for the better of our clients, for the better of our Shareholders, for the better of our employees. With this said, what is it that we are doing, and how is it that we are planning to win this transformation? Let me start with saying that we've already seen, we've already witnessed how technology can transform a business like ours. Through the digital transformation, BBVA has been able to combine a change in our great trajectory with an increase of our profitability, while also, most importantly, doing it for the better of our clients as we see customer experience improving across all our markets. As we step into this new transformation era of AI, we believe that our strengths and foundations are very solid.
First, we have data ready for all the countries in a global way in the cloud, which is one of the core foundations of every AI-related efforts. We've also been able to establish very deep partnerships with the main ecosystem players, which, in a context where technology evolves so fast, we believe is very relevant to make sure that BBVA always operates in the state-of-the-art of technology. Lastly, we created a data unit 10 years ago. Throughout that period of time, we've been building capabilities of core disciplines such as data scientists, data analysts, machine learning engineers across all our countries, and those capabilities and those teams are now at the core of the execution of our strategy. So we have the data ready for all the countries.
We have also core partnerships and resources from the ecosystem, and we have the teams and the organization ready to be pioneering in the execution of our strategy. As already said by Carlos, AI is one of our core strategic priorities of the strategic plan that we outlined last year. More than that, it's present across all the others because it's very transversal. It's going to help us be more radical about the way we relate and we serve clients. It will serve us, as we will see later on, to better advise clients also in the enterprise segments, in sustainability, and of course, to create value and transform the way our teams work.
Not only we have AI as one of our core strategic priorities touching all the others, but we've also recently rewired our organization on an operating model to make sure that we have our AI transformation unit well-equipped and self-contained, so as to execute on the strategy that we will now go deep into. What is it that we've been working on? We outlined in the strategic plan last year, around our AI strategy, which we call The Eight. The Eight is basically a top-down agenda that is bank-wide. It touches some of the main pieces of our value chain, and it has been the first strategic agenda on agents that we've been working on, as I was saying, for the last year. It's made of six robots. Each robot is a set of agents and two pillars. The robots are structured in three blocks.
One of them has the goal to transform the way we serve clients, both through a personal advisor on digital channels that is multimodal and will serve retail clients and enterprise clients in a multimodal way. It's what we call Blue. Another one that is geared towards helping our clients to spend more time with clients and in advisory roles. On the processes front, we have a couple of robots, one of them with full focus on our risk processes, in particular for the wholesale business, which again, is one of our core strategic priorities, and then also another robot focused in processes in the back-office operations.
Lastly, for our employees, we've been focusing specifically on software development, for which AI brings a huge opportunity to transform our productivity, as well as on providing AI for every other employee at BBVA, regardless of the role or the unit that they are part of. These six robots have been relying on two core pillars. One of them, which I've already referred, making sure that data and information, which is a core differentiation, is ready for agents to be consumed, and also that we have the technical capabilities not only to build, but to operate this set of agents. What I wanted to do now is to bring this to life to all of you.
In that sense, we have prepared some demos, not of all the robots, but of three of them, of the first three of them, to show and demonstrate how these experiences that are already either into production or will be into production in the next few weeks look like. With this, I will start with the demo of robot number one. Before we go into it, what you are going to see is our personalized assistant for our retail clients through a mobile experience, and you are going to see three cases that we've selected, one of them in which Blue advises clients and helps clients navigate their movements and enables them to talk to their data and also get some advice. In the second one, we'll see how Blue allows our clients to be advised in a sales process for a consumer loan.
Lastly, we will see a third example on how Blue can also support clients in the process of putting a claim of an insurance. With this said, let's go with the first demo, and later on, I'll introduce the two others.
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Blue is available in any language and comes back with an answer across accounts and cards and any other financial products.
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Client is having literally a conversation with the data.
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Blue is asking
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One of the questions. Groceries only, and it will provide a comparison of one month versus the other.
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You see here it's a-
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It's a very open question. Blue will go look into the spend patterns of this client and analyze some high amount duplicates-
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Or unusual merchants and will provide the three-bullet answer according to the client request.
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Second case on advising on consumer loans. Blue ask
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Blue provides a couple of options, pre-approved loan and also an EV loan.
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Blue confirms it will be a good option. The client asks to go ahead with the full amount, the 30,000. Blue provides the options and the pricing.
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Now the client wants to see a different term and its pricing. Blue offers that and also offers a comparison. Do you want to compare the eight years versus 10 years? Client said, "Let's go ahead with eight." With this, it drives you, basically to the page where the client can just confirm and get the loan. You've seen very conversational.
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Now we go with the third demo on insurance.
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So typical thing that could happen to one of our clients and, first Blue ask on what is it that happened? Is it break, cracked? What type of injure has happened?
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Blue recalls the answer of the previous question. And ask-
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Some questions about it and offers a couple of questions. We can repair it or either receive a compensation. Client can choose.
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With this, the claim already goes into processes and it's already managed for the client. You've seen, these are just some examples on how the new experiences that we will enable clients to be served with through our mobile app, our web, and eventually through any other device that might come to the market in the future, will enable our clients to have a conversation with their data, with the services that we provide in a very dynamic way, same way you use generative AI tools. That will apply to both information about your day-to-day banking, also advice to get products such as consumer loans, or to solve complex things like claims that typically also create a lot of burden in different cases.
This is a product that, by the way, we are going to be putting a new version of into production over the next few weeks for all our employees. Then progressively, through the remaining of the year and starting of the next year, we will roll it out to clients in Spain, Mexico, and also in countries in South America and in Latin America. That was the first demo on Blue. I will later on touch a little bit on the metrics. Let us go now with the second demo, which is the robot number two, AI Banker. We are going to be focusing in particular on AI Banker for Corporate & Investment Banking. Again, is one of our highest growing segments. But we are also developing such type of agents to support our commercial SMEs, bankers, and of course, our retail bankers.
However, for the benefit of time today, we decided to show you the demo of the AI Banker for our Corporate & Investment Banking business. Let us go with this second demo, please.
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That was an example on how we are enabling our bankers to talk also to the different information that we have about clients. It was an example of internal information. We're also working on a set of agents that will couple that internal information with external information. Also, we'll allow bankers to create pitches and generate ideas for those pitches. In essence, as you see, and as we will discuss, we have a roadmap to continue to bring these type of capabilities to make easier the day-to-day of our bankers, again, not only in Corporate & Investment Banking, as you've seen, but also across the rest of the segments. We've seen a demo of the robot number one, digital experiences with Blue in the robot number two for our AI Banker capabilities for CIB.
We'll go now with the third demo on the processes front, in particular for the credit and the financial program generation on the risk front. Let's go with the demo. In this case, I'll be explaining what happens in this screen. Everything's integrated into the workflow. Analysts can select the client, the language that they want the financial program to be built in, and then they can select the sector in which the client operates, and the context information that the analysts want to be part of the financial program. With this, the agent starts putting together a financial program. It's a very long process, so it typically can take up to 30 minutes. Just to give you a reference, this typically will take a human 25 hours in different days.
Here, the agent takes some time and produces this output, in which first it provides a confidence score on each one of the fields based on the ground truth that we've defined so that the banker can review all the different sections of the financial program. It also enables the analyst, of course, to edit any of the fields that came out of the automatic AutoPF. Also, it enables the analyst to check the sources, as typically there's many sources that have been involved, public and private, and you can always root to the source of each one of the contents that were brought to the draft of the financial program, and again, do edits and adjustments accordingly. Again, confidence scores show up there. Also, we have the ability to establish alerts that might require a specific review by our analyst.
And in that sense, those are flagged into the system for the risk analyst to review and take some action on them. Again, they can be edited. With that, the financial program can be saved as a draft and be sent into the workflows where it will be feeding our approval systems and limits for the specific client, which in this case might have been developed for. So this was the third demo, again, in this case, showing how we can bring agents through our risk analyst to make their life easier and also shorten times, compress times in their workflows, which will also be improving our customer experience due to greater ability to execute faster. With this said, let me show you what are the first early results that we've gotten out of rolling out the products that you've seen.
Across the client front, we've seen already that some of the intents that we are prioritizing in countries like Peru and Mexico, and in this case into production, are able to absorb 90% of the calls that we get into the contact center end to end. We've also seen that the initial versions of Blue, not even the one that you've seen today, have been able to filter 50% of the chat conversations that used to be managed by our relationship managers, in this case, in Spain. On the processes front, we've been able to reduce 30% in total the time that we take to produce a financial program and also a rating of a client. We are going to go up to 80% in this case. Also on the processes front, we've been able to shorten 80% of the time in the way we manage claims.
Lastly, on the employees front, we have 75% of BBVA employees using AI recurrently with self-declared savings of 2.4 hours. But beyond that, we believe that this is a very strong foundation as we envision a future in which our employees will be working alongside AI agents. The fact that we are being able to push adoption to these limits clearly prepares us well for what the future looks like. Also on the employee front, as Carlos will discuss and will present later today, we are already seeing increases of productivity across certain pieces of the software development life cycle of close to 30%. So what you've seen is already real, is into production in some environments in different countries. We now also see that there's a huge opportunity to scale all these efforts that you've seen.
We have more than 50 million monthly calls in our contact centers. Almost 40,000 bankers at BBVA serving all segments that only, let's say, spend 50% of the time advising clients. We have more than 150 million operations managed annually at BBVA across all our businesses too, and an installed capacity of 12,000 software developers, for which we have a huge opportunity to do a step change in the productivity. So we believe that scaling what you've seen beyond the early impacts that we've already registered will allow us to tap into a very nice opportunity, as you see here. Precisely for that, we have a plan to continue to scale the agents that you've seen across countries and continue to give them also greater functionality. On the client front, as I have already mentioned, we have a roadmap to progressively roll out Blue to all the countries.
Not only for retail but also for enterprises. On the contact center, we are already into production in countries like Peru and will soon be in production in Mexico. AI Banker for retail is already in production in Spain, in Mexico, in Peru, in Colombia, and will soon be in the rest of the countries also with increased functionality for our bankers. In the case of wholesale, the demo that you've seen, we've already developed this into enterprises segment and Corporate & Investment Banking and will continue to enhance the experience, as I was mentioning before, to pitch building, sectoral notes, and visit presentations. On the processes front, our goal is to have 100% of our risk analysts in wholesale using tools such as financial program generation and also the rating by the end of the year.
From there, in 2027, we will expand an equivalent experience for our commercial banking bank analysts. On the processes front, we are working in some core areas such as I was mentioning, claim management, recoveries, insurance claims, for which you have also seen a demo in Blue, and also in some core processes in our finance function such as accounting, which we believe presents also a great opportunity. Lastly, on the employees front, Carlos will elaborate on this one later to everything related to software development. But we're already developing and deploying agents for some core pieces of our value chain, such as design and testing. For AI for all the employees, we are defining a set of agents that every other employee of BBVA, regardless of their role, will be able to use and that are already also into production.
Through the process of building this progress in which, again, we've been for the last year building agents under this framework that we call The Eight, putting them into production, registering and seeing some early signals of the impact that AI can have for our business across client, processes, and employees. As valuable as that has been the learning that came through the way in how to build an agent. Because it was something that we hadn't done before. In that sense, we have tackled the challenges of doing these first agents in a very artisanal way. We've been literally exploring uncharted territory for us.
Again, as valuable as the progress that we've made and that we've shown today has been the learnings that we've had in basically identifying that there are common primitives, that there are patterns, that every time you build an agent, there's a process that you can systematize, that you can industrialize. That's what has inspired the next wave of our transformation, which is what we call The Frame. Whose goal is to industrialize agent development so as to allow and enable BBVA to capture the abundance of agents beyond this initial framework that we've used and take it to the rest of the bank. This, again, is an effort that we've called The Frame, whose goal is industrializing agent development to bring agents to everywhere in the bank. With three goals. We want to build agents faster.
This is very relevant because, again, we believe that there's a huge competitive advantage for being first movers. We also want to build agents not only faster, but of course, in a controlled and governed way, and in a homogeneous way, and also preserving our sovereignty and optionality. We think that our sovereignty will rely on our data, our context, our connectors, our systems, and we will be leveraging on the best-of-breed capabilities out there in the market at any point in time. This is the next wave of our strategy, which will serve as a booster to bring the abundance of AI to all the organization well beyond the efforts that we've shown within The Eight.
To bring to life what is it that we want to industrialize so that you can also understand what it entails to build an agent, we've highlighted here some of the core technological components that we are in the process of industrializing. First one is the tech environment. In the same way that every time we onboard an employee, we provide that employee with a chair and a table, we have to provide agents with a technological environment to live in. Also, we have to provide them with access to data, and data has to be ready, as we've seen during the demos, with context and semantics so that agents can understand that data. Not only data we have to give them access to, but also tools and systems. If we want agents to execute on certain actions, they need to have access to those tools.
Of course, we need to provide agents with guardrails who are very relevant, be very clear and deterministic in things that we don't want to happen at any point in time during the execution of an action. Evaluation and monitoring, this is very relevant. Showing the agent what good looks like, what is the ground truth, what's the standard of quality that we want the agent to converge to in every other execution, and then observe how the execution converts or not to then adjust the agent. Governance and security, it's very relevant. We'll talk later about how we believe that trust is going to be increasingly relevant in the agentic world. Resilience also, especially for those agents that are going to be serving our clients live. Value management, which is also very relevant. I guess, we have all seen the news coming on token maxing and token consumption.
Here, we want to manage this agent by agent and making sure that token spend comes with value in every other development. These are some of the components that we are in the process of industrializing to build agents. Again, we discovered that these components are necessary and that there's a process that you can systematize during the process of building the first agents within the framework of The Eight. Now we are going to scale this in a very determined way across the entire organization. Wrapping it up, we started with the execution program of The Eight, produced some initial promising results that we are in the process of scaling, and also help us get some very relevant learnings about what it entails to build agents.
That has inspired the next piece of our strategy, which is The Frame, with this goal of industrializing agent development to bring it to all the processes in the bank. By doing that, being able to capture the abundance of AI for the better of our clients, our employees, our shareholders, and also the society. We are going to be operating in a context where we are also conscious of the risk that we are going to be managing. It's already been mentioned that we will face tougher competition from new competitors, that in the last few weeks, many of them came new into the market. Muse, Instinct, Dots by OpenAI are meant to be disintermediating client relationship, bringing different experiences to the market.
We believe, again, that in that sense, the trust that we've built over the years will continue to be increasingly relevant to retain the relationship with the clients. Asset quality. I've mentioned before that this is going to be a very deep transformation in the financial sector. But actually, we believe that all the productive sectors are going to be facing similar challenges and also opportunities. In that sense, we are going to carefully manage our portfolios, especially in wholesale, same way we've been observing and managing transition risk to other technologies such as decarbonization. Lastly, cybersecurity and resilience. It's also been very trendy topic over the past few months. Carlos will touch on this also later today. But we are preparing well to be able to respond to this new environment where AI and agents are clearly raising the bar.
With this, I'll go to the final remarks. Again, we believe that this AI transformation that we are now living in presents a huge opportunity for us to transform our business and our operating model. As we step into it, we believe that we have the trust that we've built over years of relationship with our clients that will continue to be very relevant in this context of agentic relationships. We also have the track record in having been successful in demonstrating that we are an execution machine of our priorities. That was true in data, and it's already been true today in our agentic transformation, as you've seen today. Also we have the strategy to go big, to capture the impact at scale through The Frame, and to make sure that we embrace the abundance of AI in a very structured and determined way.
With this said, Patricia, I'll pass the word to Carlos.
Yes, perfect. Thank you very much, Antonio.
Thank you, Antonio. After the presentation on AI, now we are going to be covering a broader perspective on how we are working with technology to ensure that we deliver on the strategic priorities that we have. The way we are going to be doing this is, first of all, we are going to be reflecting on where we are, what we've done, what are the sources of our core strategic assets that we have today, and how this is a base and a foundation for the future. Then we will reflect on what is coming next. As Antonio was saying, the world is entering a new era, a very different scenario, and therefore we need to get ready and to prepare our technology to tackle the challenges that we are going to be finding. Finally, we will close with some final insights and remarks and some conclusions.
Starting with what we are today. A very important foundation of BBVA is technology, and this is a core source of competitive advantage. We really believe that it is one of the engines that we need to deliver on our strategy, and I think that we have a very good track record of delivering on that. We have several recognitions as a well-prepared bank in this particular dimension, some of them very recent. I believe that the best way to show this is by looking to who we are today. You could argue that we are one of the largest fintechs you can find in the world. Our business is digital. As you see today, a vast majority of the millions of customers that we acquire every single year are coming through digital channels. It is not only client acquisition.
Most importantly is the way that we are developing a relationship with them. Most of our digital sales are going through digital channels today. As I said, today we are very digital, and obviously this is a consequence of everything that we have built in terms of our technology. Now the question is: what do we find behind this strategy? We believe that we have four very clear core assets, core technological assets that are behind our competitive advantage. First of all, we have the best channels and experiences in the industry, number one. Number two, this is based on a tech stack, on a platform that we have been evolving over time, and it is extremely modern, and that is helping us to deliver what we need to do.
Number three, we are a global bank, and that means that we have an advantage as we can create once and deliver in many parts of the world, and this is providing an advantage in terms of speed and in terms of efficiency. Finally, we put a lot of effort on resilience. As you can imagine, trust of our clients and customers is the most important asset that we have, and therefore technology has to be supporting that. Starting with the first and initial core asset that we have, which is our digital channels. We believe that at the end of the day, what technology has to do is to ensure that we have the capability to better serve our clients and customers. At the end of the day, technology for the sake of technology doesn't make any sense.
It has to be focused on anticipating the client needs and making sure that the experience that we deliver is the best. That is true in every single segment, in retail, in commercial, in large corporates. If we take the example of our retail segment, and we take the example of our mobile app, you could argue that it is one of the best that you can find in the industry. This is basically because we are trying to cover two dimensions. First of all, it has to be convenient. It has to make things easy for our clients and customers. There are several features, several characteristics that we have today that show that. For example, the capacity that we have to enable very fast payments with our mobile application. It's not only that, let us say, easier part.
It's also very important to make sure that we are able to offer very good advice. Meaning that with the usage of data, with the usage of our technological capabilities, we can offer the best financial advice, and we can make sure that the value added that we are providing to our customers is top-notch. That can be done very easily with our mobile application. Antonio was talking before about how we are evolving that with our capabilities such as Blue. As you can see on this page, there are some very strong numbers in terms of the rating that our mobile application has and also the strong client engagement that we are able to develop. Secondly, as I was mentioning before, it is not only our capability to serve our customer well, it is also the technology stack that we have behind.
As you know, we are a bank with 169 years of history. That means that our technology has been evolving over time, and obviously, we have had to modernize our technological stack, so we can offer a platform that is modern and that can serve the different needs that we have. In particular, when thinking about our tech stack, we have put a lot of effort in the last few years to build a technological stack that it is next-gen, that it is global, that it is modern, and that it is based on the core principles of modern technological architectures. For example, making sure that it is cloud-based, that it is layered and modular, therefore that it is composable, and that with that, we can offer very good and flexible experiences for our clients and customers.
We have clear facts about how the development of this particular technology has been helping us to transform our bank. As you can see, we have gone through a pattern of modernization of our technology. We have been migrating a very significant part of our transactionality, and today we see that two-thirds, meaning 66% approximately of our online transactionality, is going through this next-gen platform, which is very significant. A very significant majority of our transactionality has already been moved. That has a very clear impact. On the one hand, we see that the cost base that we have today when running our technology is EUR 200 million per year lower than what it would have been in the case we had not gone through this particular modernization. That has a contribution as well to our cost to income ratio.
It is one important component, not the only one of our efficiency, but we see that all these efforts is bringing us to a cost to income, which is best in class. Obviously, this is an effort that it is ongoing. In the next section, when we think about the future, I will further comment on how we are making sure that we are continuing modernizing and transforming our technological platform. As I said before, a third core asset that we have, first one being the channels, the digital channels that are top in class, our ability to offer the best solutions to clients and customers. Second, the next-gen tech stack. Number three is how we leverage globality
Because when you see this, the fact that we are a global bank and the fact that we operate in different countries in the world enables that we can have global technologies where we build once and we deploy everywhere. The tech stack I was referring to before, the next-gen tech stack is a tech stack that it is global by definition, by nature. There are elements that contribute to this. First of all, our global software development practice, our creation practices. We have global pipelines, we have global source code repositories. Therefore whatever we develop is accessible and available for the different parts of the world where we operate. So we have one single software development practice and single software development tools, which is a great advantage to make sure that what we develop is available for everybody.
There is another very, very good example, and Antonio was mentioning that before, which is what we call ADA, which is our data platform, which at the end of the day is our analytical data and AI global backbone. Basically, this is where we manage information. We manage information globally from one single platform. This is very important. When you think about one global strategic asset and when we think about data, which is at the core of what we are doing today, and at the core of what is going to be needed in the future in the world of AI, the fact that we have such a platform is critical. It is available everywhere, with the only exception of those countries where we cannot use for regulatory reasons cloud technologies.
Most importantly, we were able, and I think it is a very good example of speed and the usage of globality to be able to deliver faster. We developed the entire platform and deployed in every single country in less than one year. I think this is a good sign on how our global practices are allowing us to be faster and more effective when developing our technology and our capabilities. The fourth core asset that we have is resilience. As I was mentioning in my introduction, when we think about what is the core strategic asset of a bank, without a doubt it is the customer and client base that we have, and therefore the trust that they have on us. It is something that we need to protect and we need to reinforce every single day.
At the core of our practices in technology is resilience by design, meaning that it is not something that basically we put at the end of a process to make sure that something is going to be stable or it is going to be available, or it is going to be protected. It is part of the initial design of everything that we do. This is something we have been reinforcing lately to make sure that this is something that we cover, no doubt. You have over there some of the very strong results and metrics that we have that clearly show that we are very resilient and getting better and better. When you see the number of incidents that take place in our technology, in our installation, you are seeing that it is half of what it used to be just a few years ago.
When we have an incident, we recover also in half of the time we used to do. This is the result of how we are implementing those resilience by design practices in the way that we operate technology. I would also highlight a clear fact. When you see the availability of service of our channels, take mobile retail channel, which probably is the most important one that we have and the more visible one, either in Spain, in Turkey, Mexico, we have availability levels that are top-notch in the ballpark of 99.9%, which is a very good number. Basically, with that, we have covered how we see technology. As you see, number one, how we offer the best experiences with the best channels.
Number two, how we run a technological stack that we need to modernize to be able to run our services in the best way and to develop new value propositions and enable the future. Number three, how we leverage globality to do things faster and to build once and in a very efficient way. Number four, resilience. But when we look to the future, we see that Antonio was mentioning that in his presentation, we are entering in a very different world, and there are things that are going to be different going forward. With regards to technology, you could argue that what we are seeing is a computing revolution. Just a few years ago, the only sort of productive computing that we had was the classical computing based on deterministic algorithms, bits, and logical operations as we know.
Now we have generative AI, which is a different way of computing. It is based not on numbers, but on language models. It is not based on complete certainty, but rather on patterns. It is a different way of understanding computing, and offering new possibilities, such as generating new content and replicating how a person, a human, would think. Then very soon, probably before the end of the decade, we are going to have productive quantum computing, which is a different sort of computing based on a different way of thinking about the problems. It is exponential variables, and it is going to enable computing alternatives and probabilities that today with classical computing, we cannot do. That is going to be a different paradigm. This is what we are going to be encountering, and we reflect on three topics.
First of all is that technology is going to be even more important, number one. Number two, that this is going to come faster. Number three, that this is going to be complex and that the context of risk where we are is going to be different. We are going to be encountering bigger risks and more complex risks. That is why in the four core assets that we have, we need to think how we are going to be evolving those. When you think about best-in-class channels and experiences, Antonio was showing that before, that way we are going to be relating to our clients and customers is going to be different. First of all, it is going to be agentic, meaning that we as a bank, our channels are going to become agents somehow.
That the sort of conversation that we are going to have with our clients and customers, you saw that in Blue in row number one, is going to be very different. Not only we are going to be interacting with people, we will interact with other systems, other agents of other clients and customers or even of some partners. Number two, we were talking about our tech platform. I was showing how we are modernizing that to enable for the future, but this is coming really fast. We will have to accelerate our modernization in different ways. One important point is that we are going to face a huge increase in transactionality, and that will imply that we will have to scale up our technology to be able to face the future that we have in front of us.
Number three, we were showing how our scale and our creation practices offer a competitive advantage in terms of speed and efficiency. But the world that it is coming is coming really fast, and we will have to be even faster compared to what we are today. That is going to mean that we will have to drastically change the way we do technology, the way we create solutions, the way we adapt our technology for the future, and that is going to be a significant shift. Finally, and I was mentioning that in the previous page, the context of risk is going to be very different. Therefore, we need to reinforce and secure our technology installation because we are going to be facing a different context. Let me briefly go one by one.
The first one, as I said, is that we will have to enable new ways of interacting with clients and customers. Antonio was showing how we want to be doing that in terms of how the experience will be in the future for our clients and customers. Hyper-personalized. It will be very event-driven, so it will happen in a much faster and convenient way compared to what it is today. We will need to enable a lot of context, a lot of information, so what we do and the solutions we offer for our clients and customers are more complete, more relevant, more proactive, and more conversational. Somehow more personalized. Antonio was also saying that because of that, we are building the infrastructure that we need, which is The Frame.
Let me just focus, not to repeat what Antonio said before, on the technical capabilities that are behind, and that will have to be part of the agentic technological architecture that we will have to embed in our tech stack. We will have to connect new channels, agentic. We will have to make data even more available with a unified data foundation that we will need, properly connected, properly contextualized, for example, with a context and semantic layer. Antonio was mentioning that in robot number two. In order to have that capacity to be able to contextualize well the information that we are going to be using to serve our clients and customers, we are going to have technical components, such as semantic layers, that are going to be helping us doing that.
We will have to develop different runtimes, obviously, so the environment in which we compute when thinking about AI. From the point of view of security and resilience, elements such as AIOps, evals, or the different security components that we will need. Basically, in order to be able to serve our clients and customers in a different way, our tech stack needs to be complemented, adapted, and we need to introduce new architectures, agentic architectures, to be able to do that. Let me move to the modernization of our platform. As I was saying, in this new context, the modernization of our technological platform is going to be even more important. As I said before, we have gone through an effort of modernizing our platform in the last few years.
This is why today, as I said before, we have two-thirds of our online transactionality already happening in cloud, already happening in next-gen architectures, but we want to accelerate that. One important message here is that the acceleration that we propose is not just accelerating for the sake of having a next-gen technology. It is basically practical and focused on ensuring that we develop the components that we need going forward in terms of what we want to build, and also that we can scale what we have in a world of more transactionality, that we can do this in an efficient way, because technology, as you know, is expensive. Finally, that this is resilient. With those principles is how we are evolving our technological stack, and we follow our modernization pattern.
As you can see, thanks to what we have done in the past, we have seen that with increases of transactionality in an annual basis, close to 30%, our transactionality or processing costs are growing only 5%. That means that with the use of the right technology and the right modernization, we can be pretty efficient in the way that we scale up. We pretend to continue doing that in the future. As a matter of fact, in the same fashion that I said before, that today we have two-thirds of our transactionality in next-gen. By the end of this strategic cycle, by the end of 2029, the very, very vast majority, 90% approximately, is going to be next-gen. We have a plan for that. We have a clear path for modernization.
This is going to leave us in a situation in which our business rules, business logic, are going to be in modern technologies. That is going to help us be much more flexible and adaptable. Therefore, that is going to mean that our legacy technologies, particularly the core banking that we have, is going to be reduced to a deterministic system of record, which is very transactional. An important part is that we can accelerate that transformation, basically, because AI is providing an advantage on this. This used to be multi-year, very complex projects or programs.
With the use of AI, and we are partnering with top vendors such as Anthropic on this particular point, we are going to be able to accelerate this very fast, because AI is very good, as you will see in a second, in coding, and this is basically about coding and making the right modernization, and transferring workloads from legacy to next-gen. Third element we were referring to had to do with speed, and had to do with how we make sure that in a world where things are moving very fast, we are able to create faster. Antonio was mentioning that before, if you remember, when he was talking about The Eight and the different mission-critical robots that we have. There is one about our creation model, robot number five, which is about software development.
I would argue that we name it software development, but actually it is broader because it is the entire creation process. Basically, we are drastically transforming the way we are creating software, creating solutions to make sure that this is fully agentic, number one, that it is very iterative, as opposed to previous processes that were much more sequential. We are able to create prototypes and to try things much earlier in the process, and we are able to do this in a fashion where the different people, the different roles that need to cooperate and work together can do it in a different way. They can do it all together from the very beginning, which means better quality, much faster, much more productive, better outcome.
The way we're thinking about this with some domains, big domains, that we are covering within our software development or creation process. The first one is obviously about thinking about what you need, which is the design part, where basically you take an idea and you finalize with the technical specifications that you really need. That part is very iterative with business representatives and technological representatives, and most importantly, with the agents behind that, as you will see in a second, are helping us do the process in a very different way. Then we have the construction itself. It used to be complex because there are many different architectural solutions, integration with our systems and so on. We are identifying that part as well so we can put that into production much faster. Then the final part is related to the operation of the solution itself.
With this, we are, as I was saying, changing drastically the way that we are creating software and creating solutions. This is already in production, so what it means is that we have several creation programs in the group where we are already implementing this, and we have a clear path of scaling this up to all domains by the end of this year, and to all projects by 2027. As you will see, we will have the capacity to deliver more things because we will make a better use of the resources that we have. We will go from projects that used to take months, if not years, to weeks, as we are seeing with the current outputs that we see from the projects that we are doing. What we are going to be doing next is to have a look at one particular demo.
It's a bit technical because it is based on, as I was saying before, on the real projects that we are doing right now using this new way of thinking. We are going to be focusing on the first part, which is about design, so meaning the idea generation and how we finalize with the use of agents in the entire process with technical specifications. So we can see the video.
[Presentation]
[Presentation]
As you have seen, this is a very different way of building solutions and our expectations, given the very positive impact that we are seeing already in the projects that we are conducting, is that we are going to be improving a lot in terms of speed, capacity to build more things faster, as I was saying, and therefore, this will continue to be a source of competitive advantage in a world where speed is going to be paramount. The fourth element that Corase that we were referring to in this presentation has to do with resilience. I was saying before that it is the most important thing that we have relating our clients' and customers' trust.
As we are entering a new world, a new era, we need to prepare for that because the context of risk is going to be quite different to what it used to be. There are many dimensions here. Let me mention three. The first one is that we are going to be running a new technology. We are going to be identifying our processes. That means that we are going to be complementing our current systems with new ones that behave in a different way. We need to rethink all the core principles of resilience that we have in our traditional technological stack, how that has to be or can be replicated in the new systems that we are going to have.
That is why building safe agentic systems, ensuring that we have the right components to manage reliability in terms of availability of service, in terms of recovery, in terms of data protection, and so on and so forth, is a core part. Again, Antonio was saying before, within our framework, The Frame of the structural pieces that we need to scale up our agentic creation, this is part of that, number one. Number three, in the same fashion that AI is bringing superpowers to us so we can better serve our clients and customers, unfortunately, those superpowers can be used by the wrong people against us. In that dimension, we can think about fraud, we can think about money laundering, and of course, cyber attacks, right? That's a core part of what we do.
As you know, this is a source of concern for the entire industry that we take extremely seriously. As you know, we have been working with the different banks, with the European Central Bank, to make sure that we have the right plans, and we do. We are fully committed to reinforce what we need to reinforce. We are well-prepared and well-equipped to defend ourselves if necessary. We have a plan, and we are putting all the resources that are needed to be able to do that in a short period of time. Talking about the following weeks, following months for some pieces. The third element is preparing for an explosion of transactionality, a growing volume. When we think about resilience and availability of service, one very relevant point is that our infrastructure is ready to be able to do that.
We can scale exponentially if needed to be able to run the compute that we need. That's a core part. Again, I'm referring back to our modernization plans of our technology. All our journey to cloud is obviously putting us in a very good position. That's going to be also part of our lines of work with regards to technology, and in particular, to our resilience efforts. To finalize, some of the points that we have been discussing or debating today. The first one is that technology is a core asset for us, is a core differentiating factor. Has been in the past, as you've seen. Thanks to the use of technology, we believe that we are in a very good position today. We're an extremely digital bank.
As I said before, you could argue it is one of the largest fintechs in the world as our business basically is digital today. A very big part of that. Second, this is the consequence of a very good track record on managing technology, as recognized in the industry. We have quite a practical approach in terms of not being dogmatic with technology, because at the end of the day, what we need to have is proactive technology, that it is able to serve what we need, but that implies, of course, a lot of modernization elements as needed. What we have today is a tech stack that it is ready for the future, although we need to continue obviously investing in that as the world continues changing.
As in the past, it has been very good and a core asset to be able to develop a competitive advantage. It will continue to be in the future. Number three, world is going to be different. The pace is accelerating. This is a very technological transformation, what we see with AI and some other sorts of computing that are coming, such as quantum computing. That is creating a lot of opportunities, but obviously we will have to face a more complex world and continue evolving what we have. We are very conscious of that, but we are extremely committed as we have a clear strategy, clear commitments, and we are ready to continue strengthening our technology to be able to support the growth and the success of the bank as needed in the future. With that, I finalize this presentation.
Thank you. Thank you very much, Antonio and Carlos, for your insightful views. We will move now to the Q&A session. We will start with the questions in the room and then move to the questions from our online audience. If you would like to make a question, please raise your hand and I will come to you. Please, when asking the question, state your name and the company you represent. Let's start with the first question. Alvaro, please.
Great. Good morning. Thanks for doing these sessions. Alvaro Serrano from Morgan Stanley. I had two questions, which I guess are for both of you. When we think about agentic AI, we immediately think about margins and lately, especially after Muse, about deposit sweeping technology and what can that do to the bank's business model. When you are deploying the tools today, can you maybe talk us through your thoughts on any obstacles from automatic sweeping beyond customer trust? How do you see that working out in the future? From a technology perspective, is there any regulatory sort of impediments to automatic sweeping? How do you see that affecting the broader deposit franchise of BBVA in the industry? Maybe the second question is, with that in mind, how can you defend against it?
Maybe on the cost leadership side, presumably these technologies will be available to everyone, and it is about bringing down the costs. Maybe you can give us some color. You mentioned that two-thirds of transactionality is now through the cloud. You are going to 90%. How does that change the cost income picture? Maybe not an exact number, but a flavor of the order of magnitude of some of these cost benefits while you change the cost platform. Thank you.
Antonio, perhaps you can take the first one and-
Yeah, I'll take the first one, and Carlos, you take the second one, okay?
Sure.
Thank you, Alvaro. I've alluded to it, the fact that we are operating in a new competitive context. Muse, which you've also referenced too.
Is a good example of how clients might be shifting their relationship channel to agents of third parties, such as Muse. I guess it's something quite new that has been rolled out in the U.S., not yet into Europe. What we clearly see is that to your question, we will continue to raise the bar for trust, which is going to be basically the competition is going to be a competition for trust. Who is the client going to trust? It's going to be a third-party agent or a BBVA agent. We believe that, yes, there will be competition, there will be margin pressure that will be coming through that new type of competition, and our plan is to continue to build trust and enhance our value proposition so that we not only retain the trust, but that we hopefully increase it down the road.
Clearly, the rise of a new type of competition in terms of agents for general purpose that will serve clients across many different things across industries is something that we'll need to tackle on that type of competition. Again, enhancing our efforts on trust, the client experience is going to be one of the core areas of focus.
Is there any regulatory hurdles today? For example, can an AI agent go with the passwords into BBVA accounts and shop around the deposits?
As of today, there hasn't been any regulation. Yet again, these products, in the case of Muse, have not come yet to Europe. We'll see down the road how regulation might evolve, and if eventually might be easier or not for agents to do such type of execution or money movement actions. Yet to be seen, as I said, early days still. In terms of the productivity and efficiency, you're right. When we look to the future, and when we see our modernization of our platforms, one of the reasons why, not the only one, but one of the reasons why we are doing that is because they are more scalable and they are more productive.
As I said before, with the two-thirds of online transactionality that we are already running in cloud, our cost base is really the ballpark of EUR 200 million lower than what it would have been if we had not gone through that transformation. When we look into the future, and when we see going from, as you said, from two-thirds to vast majority, the ballpark of 90%, that is going to have an impact. Again, our projected cost base in the future is going to be in the ballpark of additional EUR 100 million lowers than what it would be if we don't go through that particular path. Thing is that this is going to help us contain rising costs, basically because our expectation is that transactionality is going to be much higher in the future. Therefore, as we are seeing, computing is something that it is increasing.
By unit, if I may say, by transaction, cost is going to be lower. However, depending on how this explodes, and it's something that we will have to see in the future, we see that those costs are going to be rising as well. Having said all that, the fact that more and more we are more efficient and productive when running our technology, that is one of the factors that it is helping in the projected cost to income that we have in our strategic plan and that has been communicated to the market. Obviously, it is part of that as well.
Thank you. Sofie, please.
So yeah. Thank you for taking my question, Sofie from Goldman Sachs. You mentioned quite a few times that you're expecting quite a big increase in transactionality and volumes. Could you just walk us through what will drive that? Is it expansion into new markets, or do you expect the existing customers to do more transactions, or what's the kind of key driver? Thank you.
Well, I would say that it's mainly the customers increasing the transactionality with us as they will have a new way of interacting with the bank, with all these data, and also we will be more proactive in provided insights that will drive that increase in transactionality. It's not regarding expansion in our business outside our footprint currently.
Also, Patricia, growing organically. As you know, we are focused on customer acquisition, and this will drive obviously more transactions.
Absolutely.
Yeah. If I may complement, there are patterns that we have seen in the past, which is obviously every single year we have an increase in transactionality per client, basically because we are creating better experiences for them. Our digital channels are more useful, if I may say, and that is driving more usage. That is happening thanks to the fact that we have better things to offer and therefore more consumption from each individual client and customer. When you think about the future with AI, this is also true, right? At the end of the day, transactionality is not going to be only classical computing. It is going to be as well agentic transactionality. All the robots and all the agents that we are creating, of course, they are going to be generating technical transactionality as well in our infrastructure.
All of that compounded is what we see in the future that our transactionality is going to be higher, also from usage of our clients and the technical design that we have.
You have follow-up questions, Sofie?
Yeah, I was just wondering, do you see the pie growing, or you see BBVA getting a bigger share of the pie?
Both.
Both.
Both. We see the price growing.
Yeah.
As Carlos was saying, the price will grow because we will have more transactions, more agents making transactions. Our share will be larger because our commitment is to lead this transformation, so we will have increasing market share.
It is a bit about growing the customer base, it is about building deeper relationships and having more interactions with our customers. Luis, please.
Yes. Hi. This is Luis Peña from Bestinver Asset Management. Thank you very much. It is quite impressive what the bank is doing. I have two questions that are related. First one is, how much is the AI budget for the group? How that compares to the overall tech budget. The second one is related because there has been comments from U.S. banks, and also from European banks, saying that the cost of the AI is going to be significantly higher of what initially the institutions were budgeting. The question is, how are you budgeting the cost of AI going forward? It seems that the price of the token is going to come down somehow, but the models are going to consume a larger number of tokens.
In this regard, actually, the largest bank in the world is growing the cost base as we speak at more than double digits, and is trading at more than 3 x tangible book value. It seems that the market is paying for the institutions that they spend massively and wisely. Just want to sort of understand and take the view of the bank on how this AI cost is going to impact the bank in the short term. Because it seems that in the very short term, it is going to be an additional cost, so it is not going to bring an overall cost reduction for the group. How management, we have the Chair and the CEO here, see basically this cost going forward, if really the management is ready to make this a significant investment and spend more. Thank you.
I do not know if you want to start with the tokens and the-
Yeah.
AI costs as of today. Yeah.
Perfect, then I will pass it to you to the detail figures on cost and the weight. I think the first idea I want to mention is that every token consumption that we will have will come hand in hand with an assessment of the value that the corresponding agent will bring, which we believe is a very structural way to address our agentic transformation. Every time we put agents, such as the one that you have seen today, into production, it is true, they have a cost. Some processes, such as the risk agents that we saw, actually also required one of the best, or some of the best models that are more token heavy.
Every time we build agents, we are very conscious on the fact that they have a cost, and that we have to assess, and we assess it hand in hand with the value that they will bring. In that sense, the raise of token consumption that we are going to have, and that we are already having, comes hand in hand with the impact that we want each one of the agents that we are developing to bring. My point is that as we scale the spend in tokens, we are going to be doing that in a way that we ensure that we also bring the value alongside the spend.
Thank you very much, Antonio. Perhaps, Gonzalo, you can provide some insights on our views on investment and cost going forward?
Sure. Definitely we will continue investment on technology. If you look, our total IT cash out last year was EUR 4.2 billion, and this year it's going to be higher. If you look at also at the weight of IT cost of overall cost base, 2019 was 21%, 2025 was 27%. Definitely we're investing in IT and we are committed to continue investing. This, in a way, is what has really helped us to achieve a leading position in cost to income. Second quarter, we achieved 37.8% in cost to income ratio, and we are committed to a strategic meter plan of reaching 35%. We believe it's compatible to invest in technology as we're investing, and banking is becoming more and more a technology business. We will continue definitely investing in technology while keeping our cost to ratio at the levels that we are committed.
Gonzalo, within the figures that you've mentioned, the weight of AI is-
is obviously increasing.
Obviously increasing. Yeah.
Thank you.
Sorry. Do you have long-term contracts with your AI providers with a set price? The market right now basically is trying to understand how this cost is going to evolve, and I don't think that anyone really has a clear view on this. We just want to know really, how are you setting your contracts with your providers? If there's a certain cap above which you're not going to go in terms of total cost. How do you structure those contracts?
Yes, we definitely, and I was talking before about the partnerships that we've established with some key players in the ecosystem, and as you've already mentioned, we typically allocate some compute capacity. That's what typically comes as part of the agreements. It doesn't make sense to do the contract at the token cost because, as you were saying, it continues to drop every now and then. So we save the capacity, and with that capacity, then we're able to consume tokens or credits of different models depending on the pricing that, again, drops and continues to evolve over time. But yes, we're sourcing contracts, some of them for terms of two to three years with some of our partners, and typically we save compute for our agentic organization to run rather than cost per token, because that's fast evolving.
Yes. Alfredo, please.
Alfredo Alonso from Deutsche Bank. BBVA was the past. I have a follow-up on Luis' question. As long as the cost may change within time, and you want to have resilience on your processes. At some point, what do you want to keep human? I'm not going to ask how many people are you going to get rid of. But at some point, imagine that in five years time, whatever happens, energy costs are pretty high, token cost goes up by 2 x, and you've maybe substituted one person that at some point was kind of productive, but at that new token cost, it isn't. So how are you managing this process of taking this process out from people in order to make this resilience for the long term?
Then another thing that might be a big gig, sorry about that, is that on the cloud development model, you've taken quite a different approach than another rival bank.
You started before. We have to acknowledge that. But you rely more on partnerships instead of the in-house development. Which one really provides, in the long term, better cost, which have more resilience against these attacks? Because at the end of the day, if you have that built internally, probably you might be theoretically better protected, but probably you have a less ability to react to those threats. And what's the one that could adapt more rapidly to the changes that we have here? And one third, sorry about that. That's for Antonio, because coming from where he comes. It's about carbon neutrality of this process, because BBVA has been a leader in terms of becoming carbon neutral, but these are heavy, expensive in terms of energy. So how can this be managed in the future?
So perhaps the first one for you, Antonio.
I take one and three.
Yeah.
Carlos takes the second one. We love big questions, by the way, so thank you. So, going into the first one. Well, actually, reflecting about what you were saying, our growth and our plans are typically constrained by the capacity that we have to execute on them. Take any business in any country. We typically have plans that go beyond the capacity that we have. The view that we are taking on this, as I was explaining at the beginning, is to embrace the abundance of resource, to be able to clear the huge backlogs that we have in all the countries to do also that in a faster way. And we believe that's doing more with the teams and resources that we have. Yes, along the way, there might be roles that will be eventually changing. Like 10 years ago, we didn't have any designer at BBVA.
Now, that is one of the core disciplines or capabilities. Yes, there might be some jobs that eventually might change. We will onboard new profiles, or we will re-skill some of them. But also if we look backwards, throughout the digital transformation, which again, has yielded great results in terms of profitability and growth, we have not seen automatic drop in the number of employees at BBVA, and I think that can be used as a reference. Going to your third question related to carbon neutrality. Yes, we are seeing clearly how AI takes a lot of energy and also in some cases, water consumption, though that is still been more recently well managed by all the hyperscalers and players operating data centers. We are committed to our net zero targets, and we will factor in the token consumption that we do as an organization as part of them.
So same way we do with other carbon emissions related to our third parties, providers, or value chain. Carlos, you take the big one?
Yes, of course. Good question. Different dimensions to your question. Let me try to cover those. First of all, when compared to others, and obviously I cannot comment on the strategy of some others. But what you see in the market is that there are some places, particularly when you think about traditional banks that need to modernize tech stack. Some are taking a way that at the end of the day is basically becoming more efficient. So you see some technical optimization that what they look for is that they are going to be running in a cheaper infrastructure, which is good in itself. Our approach is much broader than that because we are not doing just a direct lift and shift. Basically, what we are doing is to rethink what our technology should be, rethink our logic, rethink our technological architecture so it is ready for the future.
That implies that our modernization process goes through a different pattern. That is why when I was mentioning in the initial part of my presentation that our modernization looks not only to cloud, of course, it looks to cloud, but it looks to modularity, a layered and composable architecture, data being available and exposed as needed, and so on and so forth. So that is part of the core modernization plan that we have, which is pretty much based on rethinking the technological architecture that we need going forward. Of course, we look for productivity and efficiency, and I was providing significant numbers in terms of cost avoidance in the past and what we expect for the future.
But we also believe that our core objective is to make sure that we offer the best solutions to our clients and services, the best experiences, that we do it quickly and fast time to market, and that this is resilient as well. So that is the approach that we have. You were having another comment regarding how we interact with our partners, and that may be different to others. It is true that we have very good strategic partnerships with those that can offer the best technology for us and therefore the best technology for our client and customers. And we are proud of doing that because we believe that this is the way to make sure that we offer to our clients and customers the best available. But we always keep control, and we keep ownership of the core strategic asset that we have.
Our tech stack is ours. Our technological architecture is ours. What we do basically is to make sure that that can work with best-in-breed solutions of some partners when needed. And then one final, you were having a comment also connected to what Antonio responded before regarding about resilience and in a world where agents are going to be doing things, how we keep control and so on. We like to think that at the end of the day, we are going to be improving a lot the way that we are running the bank with agents, but we are accountable for that. So the way that we think in terms of how we build resilience, human in the loop, and so on, it is the core principle that we, as BBVA people, we are accountable for everything that is done, and we are not going to be losing that.
Thank you. Borja, please.
Hello, good morning. Thank you very much. Borja Ramirez from Citi. I have two questions, please. Firstly, you have highlighted the importance of scale and investing in AI in order to successfully deploy the AI. In your view, does the AI increase the importance of scale in banking? And also, if you could, I guess maybe the larger banks are maybe relatively in a more favorable position than the smaller banks in this regard. And then my second question would be, tech is evolving very fast. I know you provided some useful data points on 2029, but if I look towards the next five years, for example, how do you see the competitive landscape, and where is the biggest source of competitive advantage? Is it the customer's trust? Is it the data? Is it the scale or the AI capabilities?
I will take the two, and then you guys chip in.
Sure.
The first one is, of course, we think that scale matters in this transformation. I have alluded to the fact that most of the agentic efforts that we presented and demo today are being deployed globally in our franchise in Spain, and Peio will also comment later on Mexico, South America. Clearly, scale matters in AI big time, and we believe that is going to be also increasingly relevant. Then into the second question on competitive advantages. I think clearly we have been talking about trust in a context where there is going to be new competitors also claiming or competing to get the trust of the clients for general purpose things.
We believe that we have an existing strength, which is the trust of our clients to manage and serve them with financial services that we can step up with the tools and the agents that we are going to be deploying, both in our enterprise segments and our retail segments. That is going to be, we believe, very, very relevant, increasingly relevant in the agentic revolution, the trust and the retention of the trust. As we are today, we believe that one of the core competitive advantages will be, as we were saying, the ability of an organization to structurally change their operating model so that agents become a new workforce managed by our employees. That requires a structural change to onboard agents into the organization, as we have been putting some examples. It is very deep.
If done right, we believe will present a huge competitive advantage because it will allow us to transform our productive model, combine our existing workforce with agents that will allow us to raise our execution capabilities. To do that at scale, you need a very determined and structured approach, which is what we are going to be doing through The Frame to really rise to the challenge and capture the entire opportunity. I think trust and then the industrialization
Capacity and determination and execution to make it happen at scale will be differentiating factors. Because then with that, by the way, to your first question, you will be able to tap on the opportunity that size might bring to each one of us.
Just to add one comment, Antonio, on your comments. Definitely on the first one is scale. Scale matters both on AI and technology. Given that you have a larger customer base, you can dilute those costs among a larger customer base. This is why we think that we are in a more favorable position, given that we are in most of our franchises, we are either number one or number two in retail banking. This is obviously, to your second question, creating a complete advantage together with trust. The skill that we already have in our retail franchises provides us with a very good competitive advantage.
Miriam. Yes.
Miriam Fernandez from S&P Global. You have been talking a lot about this industrialization of agents, now the agentic economy, where we see agents transacting not only internally but also externally. I am curious to see, in terms of that governance of that infrastructure, whether do you think there is a business case for those agents to be running on-chain, to be underpinned by smart contracts and stable coins or other type of cryptocurrency to transact and to make that fully transparent and accountable on-chain? Or whether do you have another business case for that to function in the future?
No, thank you for the question, Miriam. These are very emerging trends on the agent disintermediation side with products that have been launched literally over the last few weeks. Yes, I agree with you that eventually these new general agent services could have an intersection, as you were saying, with ledgers, and eventually, that might be a new infrastructure underlying for agents to operate. Still hard to say how things are going to be evolving. Again, we are on the early days of the rise of these new product offerings.
Thank you. Miruna, please.
Thank you for taking my questions. Miruna Chirea, Jefferies. There is clearly a lot of opportunity from deploying AI into your day-to-day processes. But I also wanted to understand a bit better what are the risks and how you are striking a balance between deploying new opportunities but not deploying them too fast, as in to create risk in the business. I was wondering if you could share with us maybe some of the more negative experiences that you had in your early AI deployment process, the problems that arise, and how you address those. Then secondly, I was wondering to what extent you are already using AI into your credit decisions today and how you see the opportunity there. Thank you.
Thank you, Miruna. I would say we've learned a lot along the way. We've done a lot of mistakes in the developing of the agents. Of course, we make sure that before putting an agent into production for an employee or for a client, those mistakes are removed. But certainly, we've learned a lot, and we've been precisely encapsulating all that learning into some of the core components that are very relevant within our D frame effort. I was mentioning before security, guardrails, evaluation, turned out to be some of the most relevant assets for us to make sure that agent executions comply or converge to the quality standard, to the golden truth that we've defined for each one of them. Interestingly enough, another one of the learnings that came through the way is that our agentic organization has greater observability than we thought.
We can monitor and see how agents are executing and performing versus the standard that we've set for them. Based on that observation, we can adjust or fine-tune if there's any deviation on performance. To your point, we've had a lot of learnings. Throughout this year, we've learned a lot. We've made mistakes, and precisely those learnings are what we are going to encapsulate, and what we are encapsulating into The Frame to make sure that as we scale our agentic organization, we are also managing the risks in a very structured way. To go into the second part of your question related to risk, actually, risk underwriting for retail clients is one of the use cases of AI within the AI Act, defined as high risk alongside insurance and in recruiting. In that sense, we haven't done yet any efforts on that front.
What you've seen basically is AI supporting analysts, always with a human in the loop for our wholesale underwriting processes. That's a little bit what we are today, and we will continue to explore the boundaries of the AI Act to ensure that we make the most of technology while also complying with existing regulation frameworks.
Thank you.
If I may.
Sorry.
If I may comment quickly on that one. Something that is interesting also to highlight is that agents can be extremely resilient and secure, even more than what we had before. The reason being that by design, you can embed into the agent the security requirements that you need. In terms of resilience, for example, when we think about security requirements, we are moving from processes in which you would have add-ons to make sure that our systems are secure to something that by design, by definition, because it is part of the context, part of the instructions that you are giving to the agent, is part of it. I think it is important because although we need to continue learning and make sure that that is working absolutely well, I think that the promise of having a more secure environment is also there by design, because the way it is.
Thank you, Carlos. Alvaro.
Alvaro from UBS. It is kind of a follow-up question on Alvaro's first question. Do you think AI-driven pressure on margins might be higher in developed markets than in developing markets, and in this context, BBVA being a bit more protected than other entities? Thanks.
Well, I don't know if you want to add something.
No. I think the only thing I would add is, it goes back to the trust question. Trust is an issue, developed markets and emerging markets, and definitely the pace about this threat will evolve. It depends a lot on how customer trust about letting an agent moving or making transactions on your behalf. Accountability, what would happen if something happens to the customer or there is fraud or the agent contacts the wrong product. Also regulation. These both impact emerging and developed markets. What I would add also is the fact that, in any case, the most important thing, and this is part of our core strategy, both in Mexico, LatAm, South American, and Spain, is to become the primary bank for our customers. The best way to defend ourselves against this threat is when you are in the payment flow for our customer.
You have the payroll, you have direct debits, if you have debit card, credit card, the risk of intermediation is much lower. Whereas if you compete just on pricing or deposit pricing, this risk is much higher.
Thank you. Yes, Jorge, please.
Hi. Thank you for the presentation. Jorge from Cuadriga. So two very quick questions. The first one is you mentioned there is an advantage of being a first mover, but first movers sometimes do mistakes and competitors learn from that, right? How do you plan, or how is it possible to track actually what other competitors are doing right and better than you guys, and implement those things into your process? The second question would be, how easy is all the tools that you are developing, how easy is to implement those tools into potentially inorganic growth? So when you develop all these tools, do you also keep a focus on how easy is those tools to implement, or you just develop it just to focus on organic and forget about potential M&A and how easy is to implement those tools?
Or is it a case by case, so it will depend for some potential targets it would work, for some it won't. How do you think on this?
On the first-mover advantage?
Perfect. You're totally right. There was also a question before on the fact that when you're a pioneer and you move first, you can also make mistakes. We see it as a learning process, and we believe that being an organization that is able to learn fast enough in this very fast-paced changing environment is also a core competitive advantage. Yes, sometimes it requires flexibility because, again, the context is very dynamic. But the learning that we get through the process of being pioneer, we believe is a huge competitive advantage because it actually turns back into greater execution capability. On the second question-
Yes, on the second question, I don't know if you want Carlos to give some insights on how we build our IT stack, but I would say that it's primarily focused on our current operations.
Of course. Yeah. The tech stack that we are building, both next-gen, and as I mentioned before, but more in particular, the agentic architecture that we are building is fully global. That means that we are developing it once, and then it's being deployed in the different countries that we have. We are building those interfaces that are needed to properly work with the backend systems that we might have in the different countries. That means that when we think if eventually we'd have to take this to some other tech stack, it would apply because of the way it is being designed. It's a global one with that capability to be deployed in different parts of the world. Yeah.
Thank you. Yes, Hugo Cruz.
Hi, thank you. Hugo Cruz from KBW. I have quite a few questions, but I'll just go with two. First on costs, if you could give a bit more color. How do you guarantee? If you have this compute for three years, how do you guarantee that after three years, the cost is not going to go outside of your control? Also when you build agents in-house, how does that compare against building it with third parties? If you could give any numbers, that would be helpful. Second question, this approach to technology, which I think is the right one, but what does that mean for your M&A? Does that mean M&A more likely because you have a plug-and-play system, you can just bring a new bank into your systems?
Or actually, does it mean it's less likely because you have a culture and a strategy that's perhaps very different from other banks? Thank you.
Regarding the M&A strategy, I don't think that the IT strategy is linked to M&A at all. We have our IT strategy to manage our current operations, and it is not factored in. That is what I would say. I don't know if you want to add anything, Carlos.
No. Could you say it again? Sorry.
No, I don't think that M&A is factored in when we are thinking about our IT strategy at all.
No. It is not. At the end of the day, what we are trying to do with our tech strategy to make sure that, as I said before, it is scalable, proficient, best experiences, and that is the part that we are covering. At the end of the day, as long as it is becoming more and more global and more and more modular, obviously, it is easier to deploy in different paths. But as you said, it's not part of our core strategy today or one of the core elements.
So-
To the first part of the question, as of today, we are sourcing tokens through clouds with different partners and providers, with contracts that take some years, two to three years. We see tokens cost on the decreasing dramatically. In that sense, we believe that we will be able to continue to source those contracts later on down the road and even benefit from the economies of scale and also the reduction in prices. Though, also, in some countries, specifically Turkey, where because of regulation, we have to source and own our own AI infrastructure. We are also leveraging those learnings in what it entails to have your own AI data center in place to eventually factor those in as part of our compute strategy if at some point that was necessary.
Thank you. Cecilia, please.
Cecilia Romero from Barclays. I just had a question on fraud. As AI is lowering the cost and increases the sophistication of fraud, do you see an increase in structural charges in fraud losses for the industry?
Yeah. Good question, because as part of the big risks that we see is an increase, for example, in fraud or money laundering and so on and so forth. We have a very strong financial crime prevention unit that basically is working on that. What I would say is that attempts of fraud are increasing quite a lot because we see different patterns, and they can use technology, as you say, to do it, and that has an impact on the way that we are responding. If you take Spain business unit, we have actually materialized a very significant decrease, even with these new patterns in fraud this year, basically for two main reasons.
The first one is that we have to develop more intel in terms of understanding what the patterns are in the industry, and therefore fostering our ability to quickly respond to that, changing, if needed, some business rules in the way that we are doing things. Most importantly, we are incorporating very successfully. This is still something that needs to grow, but we have very promising results. We are incorporating AI itself to improve the way that we can detect and that we can prevent fraud from happening. In a nutshell, I think that, yes, we are in a context of risk, which is much higher. Yes, we are seeing more and more attempts and of different nature.
That requires a response from our side, which we are doing, and what we need to do is to use technology in our own defense as well as we are doing right now successfully. Yeah.
Thank you. Francisco Riquel, yeah?
Yes, good morning. Thank you for the presentation. Francisco Riquel from Alantra. You have given some examples of the efficiency gains that you can achieve with the use of AI, for example, with call centers and the number of calls that you receive and the time you save solving these questions. I wonder if you can share with us the number of outsourced FTEs that BBVA has across the group, and how do you see that number evolving in the next five years? Also more broadly for the in-house FTEs, the workforce, how big a reduction shall we expect in the next five to 10 years only because of AI? Thank you.
As a general answer, I would say that it is too early to know the precise impacts of this technology on the workforce. It is true that we have a relevant number of external sales force working for BBVA across the footprint, but it is a number that we do not disclose, and that is included in our cost base. We will see how things evolve, and we will try to manage that. As Antonio was mentioning before, the priority is to scale the business, to try to do more with the same resources, to have a better time to market, to try to be able to give a better response and more hyper-personalized to our customers. We think the opportunity is huge, and we will see how things evolve going forward. Okay. I think we have already covered all the questions in the room.
We can move now for the questions from our online audience. Operator, please.
Thank you. If you would like to ask a question, please press star one on your telephone keypad. We have a question from Carlos Peixoto of CaixaBank. Your line is open. Please go ahead.
Yes, hello. Good morning. Carlos Peixoto from CaixaBank here. Can you hear me well?
Yes. Thank you, Carlos. Go ahead, please.
Hi. Morning. Just a quick one on my side, or a bit of a different theme. Still attached to cyber, but basically attached to cybersecurity. I was just wondering if you could give some color on the type of budget that you have for cybersecurity and also touching on the size of potential litigation risks and threats. We have seen some discussions regarding agents' behavior going rogue in a way, and the way that these liabilities would fall on the different institutions. There is some press reporting as well on the insurance sector concerned with that. I was just trying to understand here if you have basically coverages in place for those type of threats, whether the liability for a rogue agent would fall within yourselves or whether it will be on the provider's side. Just a bit of context on that as well.
Sorry for the bit of philosophical question here. Thank you.
Yeah.
Okay. I can tackle the first one on cybersecurity. Basically, we are making sure that we are doing everything that is needed to have BBVA, and most importantly, our clients and customers well-protected in terms of cybersecurity. This is a top concern of the bank at every single level. That means that obviously we have already started heavily working on this, and in the following weeks or months, will continue doing so. We have a very specific plan on it that we can cover whatever it takes. We are, of course, having more resources than we used to have, even if this implies, in occasions, getting specialists from some other parts of the group to put them to work over here. This is dynamic, basically, as we will see new threats coming, but all the efforts as needed are being covered, obviously in accordance also with the ECB.
This is what we can comment on that.
Yes, very good.
To the second one related with liabilities, I guess that as we develop our own agents, we've also been very conscious on the relevance of having both for client-facing and employee-facing employees, a human in the loop, certifying the actions that are going to be taken by the agent. When that goes beyond BBVA with other agents, Gonzalo was also referring to the fact that accountability is going to be a key issue to be managed on who is accountable and liable for what agents might execute when there's a multi-agent interaction. That's in the shaping.
Thank you very much. I don't think we have any further questions, so we will take now a coffee break. We will be back at 12:00 P.M. for our second session focused on BBVA Spain. Thank you, Antonio, Gonzalo, Carlos. Thank you very much.
Thank you, Patricia, and thanks, everyone.
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Welcome back. Let's now turn to Spain. BBVA Spain was pioneer in digital transformation and that leadership has delivered tangible results, more customers, deeper relationships, and leading profitability and efficiency. To explain how BBVA is facing this new strategic cycle, we have Peio Belausteguigoitia, Country Head of BBVA Spain with us. Peio will present in Spanish and the Q&A will be open both in English and in Spanish. Headsets are available for simultaneous translation. Peio, the floor is yours. [Non-English content]
[Non-English content]
Hello, I'm here to tell you about the history of Spain and the story of Spain in the past few years, and the targets we have set for ourselves into the future. My presentation is divided into three blocks. The first one, a couple of slides to begin with, to share with you the macro context in Spain, so that by comparison with other countries in Europe, you will see that all the macro data are tremendously positive, providing for a very positive environment for growth in our industry.
In the central block of my presentation, you will see how BBVA Spain has led or taken the lead of the transformation model in recent years, particularly a transformation that has taken foothold on the customer experience, understanding that such experience would bring in further clients, further growth, further cross-selling to clients who are satisfied with BBVA, which would be translated into very specific outcomes that we're here to share with you in terms of financial return, efficiency, and profitability. During the third block, I will show you how we intend to work in the next few years under the same strategy. A strategy where clients and customers sit at the core of our day-to-day work, and where customer experience is the vital element to generate further growth ahead. We're starting with the first block. I just wanted to share some data with you.
The economy in Spain is growing well above those around us. Also in terms of GDP in 2025 and 2026 follows the same trend, as well as the forecasts for 2027 point to a positive gap between Spain and surrounding countries in Europe. Private consumption boasts very strong data. Employment numbers are looking up, in terms of growth and sustainability. The economy in Spain is giving very clear flags in terms of how competitive Spanish companies are when they go out into the world to compete in exports, not only related to tourism, but also in connection with services. In this positive environment, in terms of the banking industry in Spain, I bring some data highlights. A very positive number that keeps us optimistic in terms of demand for the next few years. We have household leveraging and business leveraging during the past few years.
Today, compared to the rest of Europe, we stand below the household and business leverage average in Europe. As for interest rates, well, they're growing but still remain moderate. 2.5 for credit facilities remains a moderate rate, and we're positive in terms of the impact of such rate in terms of credit demand. The data we get every month from the Bank of Spain in terms of credit growth, and year-on-year terms are positive for growth in consumer credit and mortgages. In this environment of moderate interest rates, debt return quality data and NPL data remain very positive when compared to our peers, and sloping down. The environment involving credit demand, credit quality, and NPL look very positive for our industry.
As for what we've been doing in BBVA Spain recently, I have a set of slides to share the tangible results of the strategy we've been applying in the past few years. I would say that we have very clearly focused on the customer experience, and at all times, we have understood that the value proposition was key in this aspect. It's not just about being the best, it's about being the best in all possible channels to offer the best way to interact with the bank. This has played a fundamental role in terms of relationship models and distribution. Focusing so keenly on annual, monthly, and daily follow-up of our connections with clients has placed it at the top of a customer's choice.
As clients get to know us better, they deepen their relationship with us, which generates a serious return for the strategy we applied. It has always been centered around the client and client experience. This slide generates a very good idea in numbers of how we have entirely turned our transformation model around, and these are some of the results or outcomes we got. Let's take a look at the middle block, improving customer satisfaction, the Net Promoter Score among all our clients and customers. We're talking about individuals, SMEs, and businesses. On-screen, you have the numbers of how NPA data have improved. Actually, both in retail, SMEs, and commercial, we have outdone our own NPS levels as you can show. This comes from a radical change into the relationship model of the past, which largely pivoted around the face-to-face model.
We opened different and new channels, different ways to contact clients, and we have decidedly supported the digital channel, but at the same time, we've also supported the online model, and still face-to-face in terms of capillarity and specialization. Why not? But to the reduction of our face-to-face presence, you can add a significant growth in our teams specializing on face-to-face customer services, both for SME and for private banking. In terms of online banking, and this would deserve its own meeting, today we have the best possible remote system, absolutely differentiating a model which has been welcomed and adopted from square one, generating a much higher acceptance level. Right now, our sales force exceeds 4,700 units, either hybrid or remote, with all the possibilities to do servicing and creating new accounts, a model that clients value so positively that our NPS for the remote model is 72%.
This model is present in all our sections or banking sections, particularly in retail. But we're also supporting the remote model in commercial banking. We have transactional managers that remotely interact with clients to get their trust and their transactions. They're present in their payments and collections, and 26% of our sales forces are precisely on the commercial online side. We have decidedly supported and invested on each of these channels until we have become number one in each of them. As you know, our app has been awarded best banking app in the world, the best by far in Spain, and going way beyond our initial objective, which was making the bank available to clients in their own mobile phone or a smartphone. This goes beyond servicing and new accounts.
Our app covers that and so many other experiences that our clients value positively, which are related to their financial health and very specific aspects of their needs and opportunities during each of their life milestones. I was saying that we were obsessed with growing and getting new clients, obviously taking support on the digital channel, but at the same time, taking support on how our own clients promote us, our promoter score. New entries have nearly doubled this year. In retail, we're almost doubling the number of new customers and clients. On the SME side, you can read the numbers. Nearly 70,000- 75,000 companies will start dealing with BBVA throughout 2026. Our share of new clients in the SME sector has gone from 20% - 25% new client share.
One of every four or five new banking relationships opened in the SME world go to BBVA. This obsession for reeling in new clients has led us to achieving the best online channel for onboarding and welcoming new clients. Then we also have the new onboarded client onboarding, where we explain, not just describe, explain all the new features at their fingertips and the different channels through which they can contact us. That is something we do because we seek to be in the heart of our clients' and customers' activity. Not only transactionality, it's also about turning that client into a preferential client. We want to be their bank of choice. So that they can run all their transactions through our bank, and that entails a certain profitability. When we're someone's main bank, it does make a difference.
In terms of transactionality, our numbers are out there for anyone to see. We hold 17.4% market share in payrolls, then back in 2019, our payroll share was 4.0%. We have now gone 340 basis points above that. In terms of every other aspect, we have been doing better. The trust concept, as others have mentioned before me today, is built by delivering. It is about providing increasingly better experiences to the clients via innovation. We are a clear example of how BBVA Spain and BBVA Corporate Group hold innovation in our DNA. We hold 19% business share in P2P payments. Not just Bizum. We have several other solutions. In e-commerce, for instance, we have a Bizum payment share of 58% because we were first adopters. We were the first to offer Bizum to e-commerce, and e-commerce now stands for 20% of payments made in Spain.
Out of every EUR 100 sold, EUR 20 are sold on e-commerce. E-commerce has a growing presence there, and Bizum is a clear example of this trust we have generated by building, innovating, and evolving, while keeping our focus on the client. So transactionality and being our clients and customers' first bank or bank of choice, generates trust. Here you have the data on our sound deposit base, on the share between time deposits and demand deposits. Granularity of those liabilities are vital. Those accounts from retails and SMEs, and even corporate, are vital to us. In this competitive environment of today, neobanks stand out. There are two things I want to say. We have been competing in this arena for years. For a long time, we have witnessed different value propositions that were purely digital and highly niche-centered.
Some of them came in as early as the turn of the century, and we stand at 2026 now. In the past couple of years, we have seen a strong impact of these newcomers in terms of opening new accounts or new accounts opened in neobanks in Spain. We also do see that they tend to cannibalize one another in time. These new entrants cannibalize one another. I would say that at BBVA, we constantly monitor all the clients we share with competitors, clearly also with neobanks. We have all the data on how those clients interact with our competitors and with neobanks.
In terms of users, we can monitor whether they interact with other banks once a year, twice a year, once a month, and we can see how our clients evolve into the products they hold with us three months, six months after them opening a new account with a neobank or another competitor. So we can take a perfect picture of the product where those new entrants and competitors are present. Ultimately, the big challenge is being someone's main bank. That is the Holy Grail. What we see is that remaining number one is a very difficult task when you have a model like the model we have in BBVA Spain, encompassing customer experience and offering the best channels, and therefore evolving those clients, you have the winning ticket.
We have customers that have other banks, but when it comes to core products, we are still many customers' main bank. Clearly, with our value proposition, we offer our customers the best possible scenarios and the best of all worlds in terms of multi-channeling and customer experience. Ultimately, that trust, it goes beyond a mere concept and becomes a deliverable in many experiences we've been offering our customers in different channels. The digital channel is but a clear example of that. Also, the online channel Remote all of our departments, and it would be very difficult or complicated for our competitors to clone that option. Then we have the live face-to-face channel.
One bank, one single channel with a niche value proposition and a very good experience, as long as you remain within the happy path, will have to compete with a multi-channel, omni-channel, placing the customer at the core of every decision made. That's a harsh comparison. As you can see on this slide, our These small businesses, big corporates, and consumer lending. We have grown more than the system. The system has grown by 1.5% since December 2020, whereas we grew our balance sheet by 2.6%, particularly under corporates, we have grown 260 basis points during the same period. In consumer loans, according to our data and including pre-approved and one-click loans, we have grown by 261 basis points. Thanks to this growth, our balance sheet mix is very different from the one we had in 2022.
Now, these numbers are a lot more significant in our mix. In the enterprise world, you can see our data from the past few years. If we take December 2020 as 100 base, in aggregated terms, the system has grown by 1%, whereas our balance sheet grew by 33% in the same period. That's what I meant by 260 basis points market share growth. We're offering or we're contemplating all sorts of businesses, small businesses, SMEs, corporate, and I have some data for you. When we were determined to be our customers' main bank, we decided to focus on a model that would help those clients with their payments and collections and growth and debt. Our commitment to each of them is divided into short-term and long-term share. In aggregate, we have grown over 400 basis points and over 500 basis points in short term.
In other words, in payment financing. In specialization in SMEs, we have grown our sales force by 53% going from 930 to over 1,400 individuals. Our transactional managers today, which have an impact and have an interaction with customers over the phone to be there for them, are up to 26% of the total sales force in enterprise segments. Just as we invested in digital capabilities in individuals or retail, we've also invested in the digital features of the enterprise segment, both for our account managers with the best CRM out there in terms of the use of data and opportunities, and the digital channel we offer through our app and our website for everyone in the enterprise segment.
Another aspect on which we have worked very hard is trying to get all those products and experiences that were mostly reserved for larger corporate clients, we have cascaded down to smaller businesses and SMEs. The options or our outlook for SMEs is turning their smartphone into a first face-to-face interaction for servicing and new account opening. 40% of our SMEs have pre-granted limit loans for their business in the digital channel. This is a model that was successful in retail via pre-granted loans, and we have just cloned it into the world of smaller businesses. This whole transformation endeavor in terms of customer experience and new clients and growth, translates into our balance sheet.
In 2025, we had a profit of EUR 4.14 with an RORC of 20.2% and an efficiency of 33.3, an efficiency ratio which are the best numbers in Spain as long as we don't compare apples and oranges. Because some competitors include their CIB when they talk about Spain, or they include enterprise banking branches in Europe that we do not include in our earnings call because we call it Spain versus rest of businesses. If we compare Spain business to Spain business in terms of efficiency and profitability, we remain number one. That comes from following the path I just described, that we envisaged years ago, highly focused on the customer experience. As you can see, if we benchmark ourselves to our peers, we get 24% of the total results, considering that other competitors have a comparative scope that does not exactly match ours.
Usually during earning calls, I add business volumes for each entity and what they call their Spanish business and assets and liabilities, and then benchmark them to other entities and to their business volume. We still stand at the top. We are number one by far in terms of efficiency and profitability versus business volume. That's how far we've come. Both Carlos and Antonio talked about a differentiating factor BBVA has, and that is our clear strategy. We have stuck to that strategy, and in terms of execution, our outcomes are our best billboard. We have been successful managers, and there is a very similar challenge ahead of us. We want to give our clients and customers the best value proposition, whether they be a company or an individual or a corporation. Ultimately, all customers want their banking institution to be relevant and useful to them.
What we see, as you've heard enough times today, is that based on the new technology, we now have the opportunity to build a brand-new bank that in terms of customer experience and trust, can build on its own experience to earn our customers' trust in a new competitive environment. From now on, we have two sub-blocks of the last block, opportunities or businesses where we have or continue to have room for growth and further profitability. At the same time, on the side of big new ideas, things that we need to do as part of a new technology to have a real impact on technology growth and return. Acquiring more and more customers, that's our obsession and has been for years.
In 2026, as I was saying, based on the data we monitor every day in this highly competitive environment filled with new players and different value propositions, we aim to continue to grow just as we grew or maybe slightly more than we did last year. As I said with a specific example of Bizum, trust comes from our innovative DNA, always in search of new solutions to make the whole customer journey a lot simpler for them, seeking new value pockets that translate into specific projects, like the data transfer from public institutions that you can get during onboarding, not only from Spain, but also from the rest of Europe, so that we can engage new clients from other countries in Europe. Or making use of our existing footprint and the related business ecosystem to extend our value proposition to more potential clients.
In terms of business where we have a greater possibility of growing, we'll talk about insurance. Insurance and capital, there's a lot of competitiveness in this sector. We're a very important player. We have Vida, life and household insurance is in-house. Outside this kind of agreements, we have Ikerra, which is a separate reference, and in Sanitas for health insurance. The rest, we have different areas in non-home and non-health with cyber risk and a very wide coverage beyond the Sanitas, the healthcare company. Here we can see the growth, 18% comparing the rest of the sector, only 7%. The balance sheet contribution are 17% higher in commissions. It's a pre-tax profit and fees CAGR from 2025 to 2025. We have a great opportunity in insurance, where we have 21% of our customers that have subscribed an insurance policy with us.
It's 79% of the clients that we can reach out to them and convince them of our proposal, okay? So that they start holding policies with us. We are conscious that our proposition must be based on confidence. We think that in the sector, they sell and sell with the dropouts and non-renewal rates that they take into account, as there is always in any branch of the insurance world. But we're working on that. We're improving the client's experience so that we can drastically reduce the dropout rate and therefore increase significantly the rates of renewal. In the case of claims, you can do everything through the application. You will have a single claim manager, and you have a follow-up claim for a home accident, for example. You will have the full management and follow-up through the app in the very short term.
The agent in the app will play an increasingly relevant role in the customer's experience through the app. Concerning private banking now, I can share some data on our situation. We have a very solid starting point. Very solid indeed. We have more than 200,000 customers, 201K. As of August 2026, we've increased by 46% our sales force in the world of private banking. By the end of the year, we'll go on increasing it because it's a very strong and decided bet from our side, and we have an NPS, which is excellent, 84%. We talked about neobanks and the challenges we face in the future before, right? The need to update ourselves and to gain and acquire customers, but happy customers. This is a challenge for our competitors. They fight against this barrier, which is 84% of NPS that we have amongst our clients.
We believe may grow even more in terms of value propositions, in some very specific issues that have to do with the concept of differentiating ourselves with the private banking customers that may have, he, she, and/or their family, some advantages because of their being best preferential clients of the bank concerning different options and in value propositions that we wish to improve upon. Our own bankers, as Antonio Bravo was saying before, will be obtaining upgrades in terms of advisory capabilities, leverage on a better knowledge of both the market and the clients, as I said, driven by the AI. The enterprise world. We have two slides here. It's been an absolute focus on the entrepreneurial world growth. We've grown in 260 basis points.
We've increased sales force in terms of specialization, the building and deployment of CRM in our sales force for enterprises with a continued investment, significantly so, in digital and remote channels, in terms of providing a better experience to our customers. We are going to continue with this effort. We really measure absolutely all our customers' transactionality, payments, finance, non-finance, national, and internationally. We know about the inflation rates that each of the clients are exposed to. We have very clearly set goals in terms of growing and growing and keep on growing. That data that I shared before about that growth of more than 500 basis points is a very specific example on how we've been able to land and settle our strategy, and we're going to go investing.
We're going to go on investing in channels, in the payments and collections of funds, nationally, internationally, in the remote channel for the specialization of our transactionality teams in order to help our clients better in the foreign trade. AI is also going to help us. As I said before, we're digitalizing our commercial proposition and pre-granted loans. It's going to help us, AI, with a better process of knowledge about the client and creation and building a risk framework that is appropriate to that specific client and the translation to the digital channel for the convenience of the client so that they can hire the different products, with their own risk assessment. It's a product. We talked about democratizing these products. We launched a product for bigger companies, there was multi-financing capabilities.
We collected all the different lines that they have as cash flow in the company's credit line, confirming with factory, whatever, and to include everything, integrating it into a comprehensive frame of risk assessment. Then the client can decide, "I have EUR 100 million, and it's with me up to me pay to assignate that EUR 100 million into each of the standard products." It's wonderful, this product, in terms of clients' experience. They needn't be contacting the manager continually and re-offset between confirming and factoring and rebalance the different charges. You don't have to do that anymore. We have it for the entrepreneurs world, and we launched it a couple of months ago for SMEs, and 2,000 SMEs have now chosen this product of BBVA.
It is an example of how BBVA's innovation is reaching out to all clients, all segments, and all clients of all sizes, which is our obsession, and this is what we work for. Also, for the enterprise segment in every size, of course, there are different value niches where growth may be expected. For SMEs, we have specific examples of the middle market, middle-sized enterprises, and the big corporate clients. We want to improve their experience. The AI agents will be very important, orchestrating the traffic of many of the interventions that the clients undertake with us, and it is a big bet so that the experience is the best.
Orchestrating with AI, we will be able to use commercial opportunities from any kind of interaction, even though the first interaction that the client might have had is a servicing interaction, but it will be the same we obtained with the remote model. I talked about the remote model before. There were similar figures of the remote segment in the physical persons with something similar in the face-to-face world. Now for remote world, we have an average of 38 sales a month. The same for a live interaction means 26 sales. In remote, we have a resolution of about 85%. We convert the servicing into a commercial opportunity. Why? Because the client is so happy with our resolution capabilities that it promotes it. It is a multi-channel world that only us offer, and we are taking the same opportunity to enterprise segment. In middle-size companies, we have grown.
We have grown in terms of our presential distribution. We have now specialized managers in that middle-size companies, EUR 15 million -EUR 50 million in business turnover. We have already shown the results. It has contributed to the balance sheet for 2026, and we are growing 115 basis points more than the average in that sector. Of course, as I shared before, the enterprise segment has experienced a very, very significant growth. Lastly, I would like to share with all of you what our position is in terms of the customers' experience towards the future. As I was saying that in the past few years, the client has always been at the center of our strategy. The client-centered strategy meant we were going to be the first for all kinds of banks in terms of NPS, the Net Promoter Score, the NPS. That is why we can explain our situation.
We are in the top tier. It is a whole different playing field. We are first rate because the technology allows us to listen to the customers many more times. So now we have the open market NPS and the same question, specifically question, physical SMEs and corporations, we ask the same questions. As soon as they access our app, at 12 months, we have answers of about 1.5 million customers. 1.5 million. 25% of them, of the customers that we do ask questions, they will answer back and give you feedback on where you have to improve, and that very active listening effort that we undertake in the enterprise segment takes to action. Action and action.
They are actionable because we build new functionalities, and we improve many of those that we already had and that the clients are demanding, asking, or telling us about that have room for improvement. The culture in BBVA, the culture of BBVA promotes active listening of clients, notwithstanding their size or segment, and therefore reacts to that active listening endeavor. We've gone beyond the absolute values on NPS that gives us a larger dimension of the clients' opinions. Now we've gone towards a detailed information on each of the type of segment and do measure the emotional moment EBA and their perception of the relationship with BBVA. It's not only 12 months, but to know at any time what the relationship is. We have millions and millions of sources of information. Obviously, NPS, the two kinds, and also in terms of granularity, we have the transactional NPS.
The real-time and all the different conversations that we process through AI, the conversations the customers have with us, voice conversations or text conversations, and we can measure and value and assess the feedback in each of their conversations. Starting from that, and I insist, starting from that, we build upon that, and also we measure other issues or feedback that the customers provide as to processes, for example, that may be entertained as a possibility of a fraud, or a card being blocked, or requesting a mortgage at any given time. All that leads to active listening, and then actions, and actions, corresponding actions. More than 50,000 clients a month have had some kind of reaction or negative feedback to the last relationship that we've had with us in specific cases.
The evidence tells us that listening to them, calling them, and listening and understanding, we change their perception of the bank and improve upon the NPS. EBA goes beyond the acronym. It's an attitude, a listening attitude, a reacting attitude to what we've heard, which means that the client's experience is our strategy because it is the center of all our decisions. Now, by way of conclusion, I've given you some specific examples where we can see that AI will have a clear impact in everything. Everything that we do and how we do it. We want to build a bank that is more convenient, easier to use, more comfortable, faster, more contextual, as Carlos said in the beginning, and therefore, much more personalized. Personalization understood as answering the needs that each of our clients present at any given time.
Of course, a robust bank, a safe bank, and a scalable bank. When I talk about scalability, I talk about growth, which is our main objective. We shall be able to offer all these functionalities and all these positive experiences to an increasing number of clients in a much simpler and faster fashion. In conclusions, some final remarks following the different blocks we've seen in the presentation. In Spain, we are in a macroeconomic positive environment. We're quite optimistic as to the credit demand growth and economic growth in general. BBVA has proven its strategy. We are boasting the way we implement and execute the strategy, the focus on the customer, the excellence delivery in each of the channels. We're moving forwards.
We have a clear goal to the future, to growth and growth and growth in the future based on the client's experience and looking for those hubs or niches where we think we have a possibility of growth and improvement. We're moving towards the future. Of course, we're moving forward, as Carlos has said. We're building a new bank. Carlos Casas has mentioned this. We're going to build on the way we work, our relationship model, and distribution model.
It will have a very strong impact on the customer's experience, since we clearly are leaders in clients' experience. We have been leaders in customers' experience in the past few years. We have the credibility of having been successful in the past in terms of executing all the strategy that I have described in the other slides. As it couldn't be otherwise, of course, placing the customer at the center of all our decisions.
Well, thank you. Thank you very much for your presentation, Peio. We'll start with the Q&A, firstly answering questions from the room, and then afterwards, those online. Please.
[Non-English content ] Thank you very much for the presentation. I had two questions. First, many of your competitors have been trying to grow in private banking in Spain. The competitors. What is BBVA doing differently?
How big do you think the opportunity for private banking in the next five years will be? Second question, a few months ago, I remember that we saw the data on the percentage of customers' revenue that is remaining at BBVA 12 months after identifying that it was sharing with neobank in Mexico. I was curious, do you follow the same statistics in Spain, the same metrics?
Thank you, Miruna, for the two questions. In terms of private banking and the opportunity, well, it's a very competitive segment. Instead of traditional players, we have some niche players, boutique banking, and so on. The big opportunity that we have at BBVA is to compete and acquire external customers. It also has to do with our own clients that are segmented in personal banking or not even properly segmented.
Now, thanks to our own study with the commercial intelligence and through their behavior and transactionality, we have come to realize that these are clients do work with BBVA and are probably clients of private banking. For other competitors, and in-house, we have a brutal growth capability of already existing customers who are already working with other financial institutions. Then we capture them, we acquire them internally as an upgrade in order to engage with private banking with us. Other competitors don't have that asset. Those niche or boutique competitors don't have that advantage. This is a very, very relevant growth opportunity. Also the configuration, the nature of the bank's configuration in different areas and business units is also a very important growth opportunity.
Internal synergism is very important in terms of private banking, and transactionality is one of the greatest tools that we can leverage upon. We are working on that. We have many investment and incentives, and many of the payrolls transactions are acquired through different commercial propositions that the different companies that we work with will facilitate. We have become the primary bank for many of their employees, and that is a very important segment and a great opportunity for growth with this cross-selling between the different areas of the bank. The same goes for private banking. It usually comes from different Corporates, Executives, SMEs, the Chairs that are working with BBVA in some of the areas, and that somehow we capture them and persuade them to work with the bank in a more comprehensive fashion. That is a very relevant opportunity for growth.
I am very optimistic as to the future and the next years. We have great capabilities for growth. Our data says that we have almost doubled the assets we manage in private banking in the past five years. For you to have an idea, two-thirds of that growth are explained because of invoicing on third parties, because of the market effect. Two-thirds of that growth has been a duplication of the growth of factoring and what I mentioned of the internal synergism and the in-house management of clients. The second point, I wanted to add something on the first point on private banking. It is important to understand what Peio has mentioned on the digital transformation, and the remote model has allowed us to be more efficient and to release capacity that was devoted to particulars and grow in enterprise, private banking, SMEs, and that is why we have grown.
We have 90% of private banking managers than we had six years ago as a result of digitalization and the consolidation of the managers to high-value segments. As to the second question, we do measure what each customer does as we share them with other banks. We measure the behavior and transaction with each and all the products. Still, our preferable customers go with the primary bank, and after a few months, we have seen how many clients we have shared with Revolut or the others are still having primary banking with BBVA, which is more or less the same percentage. As we lose the stock or the primary banking clients is more or less the same rates. We see a few niche effects, but the primary banking with the clients, it is preserved, and the transactional liquidity still managed with us as well.
We could also insist that the companies that pay through BBVA, the payroll, where those payments end up. We know perfectly how many payrolls are paid from BBVA to neobanks. The amount is zero. It is not significant at all.
Thank you for the presentation. My question probably for the two of you. As Gonzalo, you played a former role, you will be comfortable with the question. You have given us the market share rates for the enterprise, 68 growth in basic points in the past few years, I think I remember correctly. Can you tell us in which credit segments and what type of tools, or maybe by sector or type of credit tool that you have gained a market share? Towards the future, do you see a greater possibility in gaining further market share?
Do you have any objective that you can share, or it would be just the natural growth in market share that you can provide that you think is a reasonable forecast for the future? Second, a more qualitative question. You mentioned credit, and if you had to rank the two or three segments where you expect the greater growth in the next four years, which one would it be?
On growth, well, it's been quite cross-sectional across all sectors. We have all the data, of course, on the evolution of the risk cost. You could ask, this was paid at the expense of paying and an increase in NPL or worsening in indebtedness of the quality. We have broken it down by SMEs, corporations, middle size, and we have very good data.
In the aggregate, we can see how we compare with our peers, but you'll analyze the breakdown into each of the product segments. The results are very good as well. It has nothing to do with quality of our credits. In terms of profitability, we have a granularity in the follow-up of detail of operations in each customer, which is a brutal level of delay. We have a very insightful understanding, and it's been cross-sectional across all sectors. After all, we just reflect the mosaic of our economy, and we take up of the environment.
There's been a few sectors, such as the tourism sector, which in Spain has been leading, okay, ahead of the others, but maybe which is a characteristic of the growth of Spain in the last few years, which is not usually reflected in our sector, is that more or less, all sectors have been doing well. Geographically speaking, they're all been experiencing positive results, some better than others, but they've been doing reasonably well. We've been growing in all sectors and in all segments, which is very important. Middle size, SMEs. SMEs, when you ask about service and the first, second provider payrolls, we have grown significantly in the past four years. We went up to 14% in SMEs. We're fourth or fifth, and we are third in the SME segments.
We've grown in corporate, middle size, in CIB, in the contribution on the margin of benefits in Spain. It's now 56%, but in 2023 and 2025, the contribution to the business has contributed by BBVA because we're more relevant with the current clients. We're involved in the most significant operations and transactions, so we grow more in terms of results. I would think it's been across all sectors and all segments and all sizes. That's been our obsession to grow, through the client, centered on the client, any kind of segment, any size of client, has been our acquisition obsession to offer and provide the best client experience, no matter the size and no matter the challenge. We insisted on democratizing all the different products that seem to be a niche for the big corporate clients and now are being brought down to earth to middle size and SMEs.
The same kind of services and value propositions that were successfully in private banking with remote or digital servicing or contracting or risk assessment has moved from private banking to SMEs and enterprise world and enterprise segments. We've worked across all segments, and it has borne its fruit, of course. And your second question, I don't think about ranking with members of our team. We don't want to be confusing who's in the second or the third position. You just see a possibility for growth in everything we've been summarizing. In the enterprise world, we come from spectacular results. Whatever way you look at it, whatever piece of data you study from the Bank of Spain, NPS, rates, first provider, penetration in payrolls, all the data, absolutely all the data have improved acquisition of first new clients.
We're first in class for all sizes of the enterprises, and we pursue with this ambition because we have seen in the past few years that we have been able to offer the best clients experience, and if we go on providing the best experience, help them be relevant, we're going to keep on growing, which will be our objective. Now to be specific, going beyond the enterprise world to the insurance, private banking, that were other two worlds, right, that you mentioned. I was talking as the country head manager and as Peio Belausteguigoitia. I think we have a great opportunity in the area of the insurance world because up to now, we have not profited so much from our strategies in terms of experience for the client. We haven't translated this into actual results.
If we are consistent with our strategy, we'll provide results, and we have to admit that we have room for improvement in the client's experience in the insurance world. As we have seen, as soon as we focus on the clients, the results come. There's a big gap in the insurance world, and we're going to work with clients there, and we expect a great growth in that area.
Yes, I have two questions. First, we see many entities providing better offerings in remunerated digital accounts, payroll accounts. Have you noticed an increase of competition in liability products, and what influence could this have on the cost of deposits? The second one, a follow-up on insurance. Since you already have financial conglomerate status, do you see an organic growth in insurance in your future?
You take the second one, I'll take the first one. It's a very competitive world. All you need to do is watch TV and the ads on TV. There are different propositions out there. Ours is a proposition for individuals and SMEs, and it's very powerful. It's a vivid contrast to the ideas out there among our competitors. And data state that.
The client rules sovereign, and when you remain above 20% in new clients in SMEs for four years in a row, it means what you are offering is really good. In retail, we have a very solid, dynamic proposition in terms of the benefits we offer to customers seeking a new bank. We are doing very well competing in that field. Also, as I have said before, we have an entire journey to make ourselves known to customers through an entire journey, so that in a very short time, since they open an account with us, we help them know us and get the best possible experience so that they will want to continue to work with BBVA. Yes, there is media pressure about remunerated accounts, et cetera. We have our own value proposition with a different approach and different products.
We can offer investment funds, personal banking, private banking, where you can find savings products, some of them insurance-related. We also have structured products. So we have a wide variety of products, and customers choose us. As for media pressure on remunerated account, I think we are focused on transactionality. Clients will pour in in the world of SMEs, enterprise, and retail, and that is where we have experience and granular in Spain. About the second part of your question, as you know, yes, we have a financial conglomerate certification, and before the end of the year, we will also get the certification. It will not have an impact on CET1 release because we are below the threshold for immediate release, but it will provide the chance to grow in insurance with no capital penalties, so further for growth and insurance. Also, to run stress tests, we get an extra buffer.
So when it comes to calculating the P2R, we will have an advantage as well.
Yes. Go ahead, Borja, please.
Hello. Good day. Borja Ramirez from Citi. I have two questions for you. The first one is about AI. Considering new clients, you reported 1 million new clients last year, and I believe you expect to capture an extra 1 million this year. Where do you think the AI has the largest impact: accelerating client acquisition or increasing cross-sales on existing clients? That is my first question. The second one is about being a customer's main bank or principality, as you call it. What are the most effective products to get a customer to have you for their main client? Is it payroll, savings, loans?
Your question on AI, that is a very good question about the impact of AI in accelerating the acquisition of new clients.
Perhaps I would round up that impact under guaranteeing a completely different customer experience. That goes back to something Antonio said a while ago. In the next few weeks and before the end of the year, we will launch a conversational assistant, like the robot you saw a while ago, and that is a customer experience leap ahead. It shows how you can use natural language to interact with this assistant that will provide suggestions and support until the customer decides to get a loan. That is one step ahead and above the customer experience we know so far. So, our strategy in recent years, at least in Spain, will generate more cross-sales, higher tickets, a thicker balance sheet, and a customer experience that is a quantum leap ahead of the digitalization process.
As for the rest, I would say being the main bank for individuals is about a payroll account, right? Which is how they and we articulate payments and collections. So, depending on who you are, the way you get your money and pay your things makes all the difference. Cards, including non-banking players, we have a share of 2.6%, and counting them, we have over 16.6% versus 18%. As I said, 20% of transactions in Spain are on e-commerce, and we have a share in that market of 29%. Bizum specifically, we have a 58% market share in Bizum as a form of payment, or as a payment method. So, that's only for businesses.
If I had to consider the size of the business world, well, if you are a corporation and pay your employees through BBVA, and then to that you add taxes, factoring, confirming, well, you are their top supplier for banking services, and that is our obsession. That we have made so much investment on the digital channel and on playing remote. 26% of our sales force is remote and devote 100% of their time to transactionality with corporate or companies. Yes, one more thing. The relevance of transactionality involves not only deposits, it also involves individuals' assets. If we have the customers' transactions, it's easier to cross-sell. Most of our consumer loans and market share comes from cross-sales and providing a super simple digital experience. You can tell which position it comes from, right?
Go ahead, Jorge.
Good afternoon, Jorge from Cuadriga.
My question is about the race for liabilities. Yeah, the race for deposits. So, how do you envisage young customers? Because I don't see that big risk in neobanks right now, but 15 years from now, when the generational gap closes. Because right now, the banking business is a trust business. Those who already have the money today also have a certain age. So, how do you track? Do you have any indicator to track the way average age evolves amongst your clients? Do you have any initiatives to reel in those young clients? There's no trust because they haven't had a bank yet. So, do you think that trust can be built 15 years, 20 years down the road with the likes of Revolut that might lead to a loss of the ensuing transactionality?
Well, thank you for that, Jorge, and that's a very appropriate question.
Some data for you. Nearly 50% of the individuals we brought in 2025 in Spain are actually young, aged under 30. These are hard data. You are right, Jorge, that there is this perception, there is this narrative about the entrance of neobanks and their impact on younger population, but 50% of our new clients are young. That is because we were actually the first to do digital onboarding based on a selfie, for instance. I believe that has kept us 2-3 steps ahead of our competitors. When they made it to where we were, we were already six months beyond, and our value proposition kept evolving. We have addressed value propositions to younger populations, 3 - 4 years before the flooding of neobanks into Spain. That is a target we never lost sight of, and we wanted to be the first bank.
We wanted to be our clients' first bank. Like first bank ever, not just preferred bank, and we have value propositions for the young, and we have had them for years. About the entrance of neobanks, when we monitor the sequencing of different products and interactions with our clients since they start working with banks and neobanks, we have clearly segmented those clients that start working with neobanks by age range. If you look at the data, there is this neobank that started advertising their services using travel services. You go to the airport, you see 18-year-olds, 35-year-olds, and 80-year-olds traveling, and they work with us. The perception of clients we share with neobanks does not depend so much on age groups. We do a follow-up based on age group, international numbers, and you see plenty of banking interactions that happen, say, once a year.
Say, they use a neobank for traveling to a specific place and then never use it again, and we are still their preferred bank. Competition does not come so much from age group. You see all sorts of age groups at an airport. As BBVA, like I said, we have always been several steps ahead in terms of bringing in new clients and digital channels. We have been focusing on the young segment for years. Yes. Beyond what Peio is saying, not only do we measure each client individually, when we compete with neobanks, we also measure the features they offer. We compare their features to ours. If it is a joint proposition, well, it is a package, and then we look to what they offer and we do not. It goes to our development backup that allows us to catch up with the experience amongst the youth or not.
Any feature our neobank will offer is in our pipeline, and it helps us enhance our value proposition to our existing clients. Well, since you mentioned private banking and made a couple of comments about it, if I recall correctly, did you launch an initiative for a multi-family office in Spain? If so, how is that working and can it be replicated to other countries, or is it very locally specific?
Well, yes, we launched an initiative right before the summit, and it is part of our private banking proposition, but it is too soon to tell because we just launched that initiative a month ago. As for the potential to export that to other countries, well, we are considering other countries like Mexico, and we are analyzing the numbers.
Yes. Next question. Alfredo from Deutsche Bank.
About your comment on profitability versus stock, and when you said that you are the most profitable bank in Spain, I wanted to see that from a different perspective. Optimum time, minimum cost of risk, plus the advantage of the change in structure and increased efficiency. How much further room to grow do you have in profitability per stock unit, and how much of future profit should come from growth? Back to something you mentioned a while ago, this monitoring of customer-by-customer cross-selling. Basically the star of your cross-selling model used to be mortgages, but the world is evolving. How do mortgages stand today in terms of value? How valuable are they for you, and how big a foothold do you have in the market without including mortgages? Just to provide some context on increased profitability.
As you know, we continue to strive for a better profitability in Spain based on the growth of credit in a favorable interest rate environment. At some point, we had stability. Right now, interest rates are slightly higher sooner than we expected. We expected EURIBOR at 2.5 in 2027, and we have already hit that mark of 2.5. But we are still positive about the growth of the credit dynamics in the industry, as Peio explained. We also maintain our strategy to profitably capture that growth in the highest value segments. Those would be the main drivers, and obviously, we maintain our efficiency pledge.
Yes, good question about cross-sales, Alfredo. Yes. We are aware that mortgages were our star product, but that has changed, as so many other things have. I believe that you must have seen that in today's presentation.
The bank has changed, and our value proposition has changed. Actually Gonzalo said something about that before. The key is transactionality, transactionality. It is a key element to better understand customers. New inference and propension models help us understand customers and offer different alternatives at different times. Hence, cross-selling is no longer anchored to a single specific product, but rather it takes root on better understanding and knowing our customer, better using the customer data we have to provide a better experience for them at their life milestones to cover their milestone needs. Yes, I am aware, and I agree that the star product used to be mortgages, but not anymore. Depending on the year, we can have 60,000 - 90,000 mortgages, but we are capturing 1 million new clients. More than 60% of those bring in their own income.
The mortgages are no longer the big pearly gates for clients to walk in through. They are still a relevant product for us, but the difference between mortgages and other products are a whole order of magnitude.
Two questions. First, if you could talk a bit what you're doing special on consumer lending and embedded finance in the Spanish market. Then on a different topic, given the reelections, what can the banking sector do or what it's missing for the sector to be able to support a stronger housing supply in Spain?
Thank you, Hugo. Well, in terms of consumer lending, our growth has been highly leveraged on the one key loan product. It's pre-granted loans that stand for approximately 80% of our monthly revenues. We have nearly 4 million in limits, and we closely monitor all the sub-segments within those 4 million clients in terms of risk quality to measure the cost of risk for this product, consumer lending, and therefore its efficiency. I would say that it is probably the most successful product we have created in this bank in years. As I said, it's constantly monitored, and we modify those products every month based on name, last name, and amount. On the side of embedded finance, we're looking ahead into the future, and we want to enhance our value proposition in ecosystems that are not from inside the bank.
Your question about housing, well, BBVA as a bank and as part of an industry, has always supported free new construction for housing, involving both ownership and rentals. We support our clients, and our share in the industry is definitely relevant. Both BBVA and the banking industry have always supported and continue to support the housing industry as far as we can go, which is basically financing real estate and housing projects at different levels and of different nature with different purposes. The real problem in housing is the mismatch between supply and demand. More homes need to be built. That's it.
I don't think we have any further questions.
Sofie.
Yes, Sofie, sorry.
I was just wondering, where do you see the banking in Spain in 10 - 15 years from now? Do you think we are going to have the same banks that currently are the leading banks in Spain, or do you think that the banking environment will look very different compared to what we have today?
Well, I would say that 10 years, 15 years into the future, it is very difficult to predict the future. But as Carlos and Antonio presented, scale matters, and it will be increasingly relevant. Investment in technology will continue to grow, as will investment in AI, which will be a relevant part of banking costs. And if we can dilute those costs among a larger customer base, scale becomes vital. So certainly, 10 years, 15 years down the road, you will see banks that can compete in an environment that is highly technology-driven.
To an end, so thank you very much for joining us today, for all your questions. I hope the event has been useful for you. Thank you, Peio, for your presentation. And for those here with us, I would like to invite you to join us for a cocktail just outside. Thank you so much.