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ResponsibleBanking ReportUSA 2019
TA B L E O FExecutive SummaryThe TeamCONTENTSLetter from the CEO 3Talent Acquisition 26Letter from the Responsible Business Executive 4Professional Development 27Key Responsible Business Indicators 5Diversity & Inclusion 28Awards 6Compensation & Benefits 29StrategyAbout BBVA 7Values 8Strategic Plan Process 9Volunteerism & Social Engagement 30BBVA Charity 30BBVA Compassion 30Employee Data 31-32New Strategic Priorities 10Sustainable FinanceMateriality & Stakeholder Approach 11-13Five Year Commitment 33GovernanceOrganizational Structure & Board of Directors 14BBVA USA Management Team 15Internal Control Model 162019 Impact 34Support for Small Business Lending 34Home Mortgage Lending 34Community Development Services 35Compliance System & Compliance Training 17Community InvestmentStandards of Conduct 18Community Investments 36Liquidity Management 18Financial Education 37International Commitments & Corporate Policies 19BBVA Momentum 38Human Rights 20Supply Chain 20The EnvironmentEnvironmental Commitment 39The CustomerEnergy & Emissions 40Customer Experience 21Water 40Transparent, Clear & Responsible (TCR) Banking 22Materials 40BBVA Transformation 23Complaint & Claims Management 24Customer Protection 25AppendixSustainable Development Goals 41-42Additional Context 43-44About this Report 45GRI Standards Content Index 46-54Principles for Responsible Banking 55-56Assurance Letter 572
Executive SummaryStrategyGovernanceThe CustomerThe TeamSustainable FinanceCommunity InvestmentThe EnvironmentAppendixLetter from the President & CEODear Stakeholders,The five-year plan for continuedgrowth is underscored by the samesix pillars that are guiding BBVAglobally, including developingsolutions that help clientsimprove their financial healththrough advanced technologicalinnovation and a focus on afuture grounded in sustainability.Specifically, the pillars are:As BBVA USA wrapped up a busyand productive year in 2019, none ofus could have anticipated how wellthe work we did throughout the yearwould prepare us to successfullynavigate the complicated andunprecedented environment thatnow surrounds us in 2020. Improving the client’sfinancial health Helping our clients transitiontoward a sustainable future Reaching more clients Operational excellence The best and most engaged team Data and technologyThe many and varied crises thathave impacted all of us have shonea spotlight on the continued valueand the relevance of our new fiveyear strategic plan. As we have heardmany times from our ExecutiveChairman Carlos Torres Vila, thefuture of finance is financing thefuture. This means that we must alignour business efforts with the socialand environmental challenges inorder to achieve continued success.Going forward, we will continueto focus our efforts on these keyelements of success, along withtopics that are of specific importanceto our shareholders. In 2019, wesaw an increase in importance forboth the bank and its stakeholdersin three key categories: corporategovernance, environmental andclimate change impact, and diversityand conciliation. We further identifiedadditional topics as material: Easy,fast and do-it-yourself (accessibilityand simplicity); solvency andsustainable results; cybersecurityand responsible use of data; ethicalbehavior and consumer protection;and corporate governance.In addition, as the bank works towardits purpose of bringing the age ofopportunity to everyone, we continueour focus on a more sustainablefuture through lending, productsand services, building value forstakeholders and contributing in ameaningful way to a more sustainableworld. The bank’s previous 11billion community developmentprogram, fulfilled in 2019, along withour renewed commitment of nearly 15.4 billion in 2020, provide lending,investments and services to supportlow- to moderate-income individualsand neighborhoods in the U.S.The results we see from this ongoingcommitment are both good businessand responsible banking. Througha combination of communityinvestment, financial education andsmall business support, we are ableto deliver on the bank’s mission.Our commitment to these keyinitiatives will continue to be oneof the threads that bind us to ourpast achievements as we moveforward. Combined with our ongoingdigital transformation, BBVA iswell-positioned for continuedsuccess, despite the social, healthand financial challenges we allface. The partnership between ourextensive branch network and ouraward-winning digital channelshas proved prescient in a time ofsocial distancing, allowing us toprovide an omnichannel experiencethat serves our customersaccording to their needs.Francisco Javier Rodríguez SolerPresident & CEO3
Executive SummaryStrategyGovernanceThe CustomerThe TeamSustainable FinanceCommunity InvestmentThe EnvironmentAppendixLetter from Executive Vice President, Director ofCommunications and Responsible BusinessDear Stakeholders,Looking back on the accomplishmentsof 2019 from the perspective of2020, it is heartening to see thesolid foundation we have been ableto establish for ourselves and thecommunities we serve. The myriadchallenges of the current year — socialand economic — bring into sharpfocus the value of our ongoing effortsto foster community development,support entrepreneurship and findways to deliver on our commitmentto diversity and inclusion both insideand outside the organization.Throughout 2019, BBVA USA hascontinued to demonstrate its strongcommitment to responsible bankingacross the footprint with renewedand improved programs, and thatis reflected in the fulfillment of ourfive-year, 11 billion commitment forlending, investments and servicessupporting low- and moderate-incomeindividuals and neighborhoods. Wemade this commitment in 2014,and before the end of 2019, weexceeded the expectations we setfor ourselves all those years ago.We expanded that commitmentwith a new commitment to carry usthrough 2025, pledging an additional 15.4 billion over the next six years.Within that time frame, the bankplans to originate 3 billion inmortgage loans to low- to moderateincome (LMI) homebuyers and inLMI neighborhoods, nearly 7.3billion in small business lending, 4billion in community developmentlending, and to make more than 1.1billion in community developmentinvestments. The plan was developedwith input from stakeholders on thebank’s 20-member advisory board,established in September 2015.In 2019, BBVA USA implementedprograms and enhanced processesin a number of key areas, including:Lending and Investments The bank worked in closepartnership with 31 CDFIs(Community Development FinancialInstitutions) across our footprintreaching 106 million in investmentsto increase CDFI lending capacity. The bank’s community developmentlending program supported 26affordable housing activities totaling 190.2 million. In 2019, the bank originated 21,729small business loans totaling 1.2billion.Community Giving During 2019, the Community GivingProgram invested 8.9 million inbank charitable sponsorships andgrants from the BBVA Foundation for722 community-based organizations. The Center for Financial Educationprogram continued to expand,working with 51 nonprofit partnersacross the bank’s seven statefootprint and investing nearly 850,000 to support thosepartners and the financial educationworkshops they hosted. BBVA nearly doubled the numberof people reached through theseprograms from just over 10,000in 2018 to 18,758 adults in 2019. BBVA Momentum hosted 19 socialenterprises that participated in thefive-month program, delivering morethan 1,200 hours of one-on-onetechnical assistance, mentorshipand strategic advice throughBBVA employee volunteers.Employee Involvement BBVA employees contributed120,959 volunteer hours incommunity service activities in 2019. BBVA employees furtherdonated a total of 886,655 to1,568 charities nationwide. .Equality Index, along with nationalrecognition as a DiversityInc 2019Top 50 Companies for Diversity.Going forward through 2020, wewill continue to identify and act onopportunities to engage employeesand the communities we serve inefforts to improve diversity andinclusion in the workplace.In the coming years, ResponsibleBusiness will continue to demonstrateour dedication to the globalorganization’s core values — thecustomer comes first, we thinkbig, and we are one team — byaggressively diving into the new 15.4 billion pledge and enhancingand building the capstone projectsthat further affirm our commitmentto the communities where weoperate. All these efforts combinefor one single purpose: bringing theage of opportunity to everyone.J. Reymundo OcañasCommunications and ResponsibleBusiness – EVP, Director, BBVA USAAdditionally, our work in buildingone team has earned BBVA a perfectscore in the HRC 2019 Corporate4
Executive SummaryStrategyGovernanceThe CustomerThe TeamSustainable FinanceCommunity InvestmentThe EnvironmentAppendixKey ResponsibleBusiness Indicators 3,742,977* 1,214,146* 1,181,934*RevenuesOperating CostsEmployee Wages and Benefits 676,178* 254,022*2,213,997Payments to Providers of CapitalPayments to GovernmentNumber of Customers10,4476411,505EmployeesBranchesNumber of Suppliers 8,948,146 886,665120,959Charitable ContributionsEmployee DonationsEmployee Volunteer Service Hours8,27328,633 2.696 billionNumber of MortgagesNumber of SME Loan CustomersValue of SME Loan Portfolio 1,215,914* 865,599* 458,004*Small Business LendingCommunity Development LendingLMI Home Mortgage Lending* In thousands5
Executive SummaryStrategyGovernanceThe CustomerThe TeamSustainable FinanceOur Purpose:To bring the age of opportunity to everyone.Community InvestmentThe EnvironmentAppendixBBVA USA was recognized by Kiplinger as itsrunner-up in the Best Banks for High-Net-WorthFamilies category for 2019.Awards Javelin Strategy & Research 2019 Mobile Banking Scorecard: Ease of UseJavelin Strategy & Research 2019 Mobile Banking Scorecard: Customer ServiceForbes: World’s Best Banks ListGOBanking Rates: Best Second Chance Checking Accounts ListGOBanking Rates: 10 Best National Banks of 2019Human Rights Campaign: 100% on the 2019 Corporate Equality IndexGlobal Finance Management: Innovator in Cash ManagementDiversityInc: Top 50 Companies for DiversityKiplinger: 2019 Best Banks for High-Net-Worth Families in the US2019 Best in Bank Customer Experience Awards: Best Mobile ExperienceBusiness Insider Intelligence: 2019 Mobile Banking Competitive Edge LeaderGreenwich Associates: 2019 Customer Service Leader: US Commercial Middle Market BankingAVA Digital Awards: Integrated Marketing: PlatinumAmerican Heart Association: 2019 Workplace Health Achievement Index: Gold Status2019 Bloomberg Gender-Equality Index6
Executive SummaryStrategyGovernanceThe CustomerThe TeamSustainable FinanceStrategyChicagoSacromentoClevelandSan FransicoWashington D.C.FresnoDenverRaleighLos San DiegoThe EnvironmentAppendixAbout BBVANew YorkSan JoseCommunity InvestmentPhoenixLubbockTucsonLas CrusesFt. WorthBirminghamDallasMontgomeryEl PasoBeaumontAustinBranchesSan AntonioCommercial lleOrlandoSarasotaLaredoWest PalmBeachCommercial/Private Client OfficeMiamiMcAllen 93,603,347Total Assets (In Thousands)13States641Branches10,447BBVA USA Bancshares Inc., is awholly owned subsidiary of BBVA(NYSE: BBVA) (MAD: BBVA).BBVA is a customer-centric globalfinancial services group founded in1857. Headquartered in Houston,Texas, BBVA USA Bancshares is aSunbelt-based holding companywhose principal subsidiary, BBVAUSA, operates branches in Texas,Alabama, Arizona, California, Florida,Colorado and New Mexico. BBVA USAranks among the top 25 largest U.S.commercial banks based on depositmarket share. BBVA is used as a tradename for the US bank.BBVA provides financial solutions thatfit with the lives of our customers.We offer traditional credit anddeposit products, Small BusinessAdministration (SBA) loans, treasurymanagement, leasing, accountsreceivable purchasing, asset basedlending, international services,insurance, interest-rate protectionand investment products, specializedinvestment portfolio management,traditional trust and estate services,investment advisory services andfinancial counseling.Employees7
Executive SummaryStrategyBBVA ValuesGovernanceThe CustomerThe TeamBBVA values define our identity andthey serve as the pillars for makingour purpose a reality: Customers come first: the bankaspires to take a holistic customervision, beyond finances. Thismeans working in a way thatis empathetic, agile and withintegrity, among other things. We think big: we aim to havea significant impact on thelives of people, enhancing theiropportunities. We are ambitious,ViVa AwardBBVA recognized VeronicaDelgado, BBVA USA’s Directorof Talent Management &Learning, with the global ViVaAward. Delgado’s colleaguesreport that she is, “a trusted andvalued partner;” “always thefirst to jump in;” and that “shehas a great can-do attitude.”These observations are among thereasons that Delgado earned theaward and had the opportunity tojoin her fellow award winnersfrom across the globe inSpain for Values Day.Sustainable FinanceCommunity Investmentconstantly seeking to improve,seeking excellence as a standard. We are one team: People arewhat matters most. We teardown silos and trust in ourpartners as we do ourselves.BBVA’s values are reflected inthe daily life of each employee,influencing every decision. In2019, the values and behaviorswere included in all professionaldevelopment model processesand the Talent & Culture policies.“The ViVa Awards celebratepeople who are living the bank’sValues every day, in everyinteraction with peers andcustomers,” said Director of TalentAcquisition and DevelopmentSonia Storer, who nominatedDelgado for the award.The EnvironmentAppendixBBVA highlighted and celebratedour Values during our second globalValues Day in 2019. The ValuesChallenge, a new component ofthe celebration, was launched in2019 in response to employeefeedback. This program encouragesimpactful employee participationin shaping the bank’s future. Globalteams collaborate on projects overa period of two months so thattheir ideas can be implementedat the Group. The first edition ofthe program was attended by 500employees from around the world.“There are so many people herein the U.S. and in the bank’sfootprint around the globe whoinspire and motivate me, andit’s an honor to be includedand to have the opportunityto learn from my respectedcolleagues,” said Delgado.Chief Talent & Culture ExecutiveRosilyn Houston said, “Veronica ispassionate about her role in theorganization, and she takes greatpride in how our developmentopportunities positively impactteam members throughoutthe bank and create additionalopportunities for them.”8
Executive SummaryStrategyGovernanceStrategic PlanProcessBBVA Group establishes strategicpriorities to provide focus forfunctions across the bank as theywork on projects and programs.The strategic initiatives establishedas part of BBVA USA’s responsiblebusiness department were alignedwith the 2019 strategic prioritiesas outlined in the chart below.The CustomerThe TeamBased on these priorities, launchedin 2015, BBVA has driven growthin digital and mobile customers,digital sales and has improveduser experience and impactcustomer growth and satisfaction.BBVA Group began the process ofupdating the company’s strategicpriorities in 2019. These new prioritieswill be reflected in the strategicinitiatives beginning in 2020.Sustainable FinanceCommunity InvestmentThe EnvironmentAppendix“We want to repeat this success. We haveselected six more priorities to amplifythe impact of our digital transformationon our customers and society, with a keyrole for the team, technology and data,to make our purpose a reality and reachmore clients.” –– Onur Genc, BBVA’s GroupExecutive ChairmanResponsible Business InitiativesStrategic ienceCustomer Experience Digital Sales ReputationManagement StrategyAdvocacy New Business Models Optimize Capital Allocation Unrivaled EfficiencyA First Class Workforce 9
Executive SummaryStrategyGovernanceThe Customer“Based on a solid understanding ofthe macro environment in the regionof the country where we operate,our market position and some of theopportunities we see to transformcertain areas of the bank, we createda thorough and collaborativeplan that we believe is ambitious,achievable and fully aligned withBBVA Group global objectives.”–– Francisco Javier Rodríguez Soler,President & CEO BBVA USAThe TeamSustainable FinanceCommunity InvestmentThe EnvironmentAppendixWe are evolving our Strategic Prioritiesto strengthen our purposeNew Global Strategic PrioritiesBBVA’s new strategic priorities,launched in 2019, will drive activitiesof the strategic plan for 2020-2024.1.Improving our clients’ financialhealth — Help our clients,through personalized advice,make better decisions andmanage their finances to achievetheir life and business goals.2. Helping our clients transitiontowards a sustainablefuture — Progressively alignour activity with the ParisAgreement and use our roleto help our clients transitiontoward a more sustainablefuture inspired by selectedSustainable Development Goals.3. Reaching more clients tohave profitable growth —Accelerate profitable growthby being where clients are,leveraging our digital channelsand those of third parties.4. Driving operational excellence —Work efficiently with automated,simple processes that use newtechnologies and data analyticswhile effectively manage risks,both financial and non-financial.5. The best, most engaged team —A diverse and empowered teamguided by our Purpose, Values,and Behaviors, propelled by atalent development model thatcreates growth opportunitiesfor all team members.In line with the global strategy,BBVA USA is focused on developingsolutions that help clientsimprove their financial healththrough advanced technologicalinnovation and a focus on a futuregrounded in sustainability.6. Data and technology —Advanced data analyticscoupled with secure and reliabletechnologies to build distinctivehigh-quality solutions and deliveron our strategy.10
Executive SummaryStrategyGovernanceMateriality ProcessBBVA listens carefully and considersthe interests of our stakeholdersthroughout the year. Stakeholderfeedback is thoroughly andsystematically collected and assessedthrough the materiality process.Our stakeholders are based onBBVA Group’s stakeholders,historical experience and input fromDatamaran (automated processes forbenchmarking, materiality analysisand ESG risk management).The 2019 materiality analysisprioritizes the most relevant issuesfor both our key stakeholders andour business. The materialitymatrix helps guide our strategicplanning and determines the priorityissues included in our reporting.The materiality analysis consistedof three phases:1. Review and validation of theissues list from prior years basedon information from the usuallistening and dialog tools.The Customer2. Prioritization of issuesaccording to their importancefor stakeholders includinginterviews and surveys ofcustomers, employees andinvestors, along with a robustdata analysis of other availableinputs. Sources included: RepTrak ExternalReputation Survey Investor relations surveysfor investors and analysts Regulatory documents Industry trend reports News feeds Social media listening Benchmarking NGO documentationThe TeamSustainable FinanceCommunity InvestmentAccording to the GlobalReporting Initiative (GRI),material topics are thosethat reflect an organization’ssignificant economic,environmental and socialimpacts; or that substantivelyinfluence the assessments anddecisions of stakeholders.The exp
Business – EVP, Director, BBVA USA Letter from Executive Vice President, Director of Communications and Responsible Business Dear Stakeholders, Executive Summary Strategy Governance The Customer The Team Sustainable Finance Community Investment The Environment Appendix. 5 . Best Second Chance Checking Accounts List
